MLB: Yanks Expected to Slash Payroll
ESPN’s Buster Olney reports that after this week’s meetings in Florida the Yankees have decided to cut this year’s payroll of $208 million to somewhere in the neighborhood of $185 million. With roughly $170 million already committed to 12 veteran players they have under contract for next year this means the Yankees are not likely to be major players in the free agent market this winter.
One wonders that if the Yanks are intent on getting to that number how they are going to manage to re-sign any of their free agents and still have money left over to sign anyone else. I honestly never understood where all of the chatter about the Yankees being favorites to sign guys like Jason Bay or Matt Holliday and John Lackey came from. It is funny to me how the Yankees are always considered the favorites to sign the big name players without any real thought put into it.
The reality of it is even the mighty Yankees have been affected by the lagging economy. They sold roughly 8,000 fewer tickets per home game this past season, most of which were the high priced luxury seats. Attendance was down to the tune of 579,297 for the Yankees this season. Lower ticket sales lead to lower concession revenue and less swag being sold at the stadium. It seems unrealistic that when the number of tickets sold drops that a team could afford to significantly boost its payroll.
The primary reason the Yankees were never going to be major players this off season is what lies ahead for them after next season. The Yanks already have $136 million in salaries committed to the 2011 payroll and that does not include the contracts of Derek Jeter or Mariano Rivera whose contracts expire after next season.
Now, if Rivera has another strong season next year he is likely to get in the neighborhood of $15 million if the Yankees decide to retain him. There is already speculation that Jeter is going to get a deal in the neighborhood of $30 million. If that comes to fruition the Yanks are already back up $170 million.
That number does not even factor in what Joba Chamberlain and Phillip Hughes potentially receive form arbitration next winter. If both guys have strong years next season it could add another 8 to 10 million to their payroll in 2011. If the Yankees truly are committed to tempering their payroll we may not see them make any significant acquisitions for a couple of years, though I doubt that to be the case.
What their proposed fiscal responsibility does mean is they are not likely to land any of this winter’s big name free agents or Roy Halladay unless they manage to dump a significant contract or two. Thus far the only player they have been rumored to be shopping is Nick Swisher which would essentially allow them to re-sign Johnny Damon or Hideki Matsui and Andy Pettite and still stay within their targeted salary structure.
Another impact this has on the market is it likely suppresses the amount of money the tier one free agents receive. In the past the Yankees have typically been ones to set the market by paying above market for name talent. Without them being major players other teams will not be compelled to bid as much on the elite talent because they will not have to worry about out-bidding the Yankees or giving someone a contract commiserate with what the Yanks paid someone.
If the Yankees stick to their financial plan it should make for a very interesting winter and may even balance the playing field out a bit with other teams landing an impact player that normally would not due to not being able to keep up with the Yankees.
