The Extension For Felix

The Mariners have reportedly agreed to a 5 year, $78 million contract extension for Felix Hernandez. Mariner fans (including this one) are obviously thrilled with the deal from an emotional standpoint. We’ve been attached to King Felix since he was 17, and after watching the likes of Randy Johnson, Ken Griffey Jr, and Alex Rodriguez depart, it is refreshing to see the team finally lock up a superstar to a long term deal.

But, I’ll keep my celebrating to a minimum over here. Let’s take a look at this deal from the perspective of what Hernandez surrendered by signing this deal.

As a second year arbitration eligible player, Felix was in line for a significant paycheck with or without this contract. Based on his 2009 salary of $3.8 million, his performance last season, and what comparable (yet still inferior) pitchers got in their second arbitration year, he would have been expected to come in around $9 or $10 million in salary for 2010.

So, in reality, his 5 year, $78 million deal is more like 4 years and $68 million, because he was already getting the first 10 million. Or something really close to it. How does $68 million over the next four years, or about $16.5 million per season, compare to what we think he would have gotten had he not signed this deal?

Given a realistic projection for his performance, you’re looking at something like a $15 million payout in arbitration next year if he stays healthy. Even if he gets hurt (non-labrum tear category), he’s likely looking at another $10M-ish payout, as we’ve seen teams offer arbitration to players like Brandon Webb and Erik Bedard even coming off lost seasons, because the upside is high enough to justify a one year contract.

Alternately, a healthy Felix could have opted to sign long term next year, following in the steps of Johan Santana in buying out his free agent years at the end of his fifth full season. Johan got 6 years, $137 million. Felix doesn’t have Santana’s track record, but he’s younger and has better raw stuff, so you’d have to think an extension after next season would have been in that neighborhood.

To buy his long term security a year earlier in an attempt to avoid what happened to players like Bedard, Webb, and Ben Sheets, Felix signed at a pretty significant discount. He turned ~$20 to $25 million in payouts plus free agency at age 25 (or $10 million in payouts plus a ~$20M/year AAV extension in a year) in exchange for about $53 million over his first three free agent years.

$17 to $18 million a year for three free agent years is a really large discount over what his expected payouts for those years would have been in in the future. He sold the risk of injury in 2010 for probably something between $5 and $10 million per season from 2012 to 2014.

Given the risks inherent with pitching, it’s understandable. Felix’s family is now set for life. But he left a pretty decent amount of money on the table by signing now. Not that I’m complaining.



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Dave is the Managing Editor of FanGraphs.


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Levi
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Levi
6 years 7 months ago

A great deal for both sides.
Plus, when he does eventually hit the open market, he’ll be able to cash in massively if goes on to have a Santan-esque career.

That being said, Jack Z has got to be the early front runner for AL MVP, right?

Obligatory Sox Fan
Guest
Obligatory Sox Fan
6 years 7 months ago

I’m becoming such a fan of Jack Z. The Mariners are quickly becoming my favorite non-bosox team.

I wish the Phillies hadn’t given away Cliff Lee, because the Mariners have got a NASTY post season team. I don’t want to have face them come October.

johng
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johng
6 years 7 months ago

You won’t.

Peavy, Buerhle, Danks and Floyd will be there waiting for you.

Kevin S.
Member
Kevin S.
6 years 7 months ago

Peavy knows that ~40% FB% ain’t gettin’ the job done in the Cell, right?

Realist
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Realist
6 years 7 months ago

Don’t forget Freddy Garcia, Andruw Jones and Juan Pierre! It is going to be brutal.

CircleChange11
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CircleChange11
6 years 7 months ago

I love that you said that at a Mariners “ball washin” site/forum.

Somebody had to say it. Have the mariners even left ahead of the Rangers yet?

Note: I really like what SEA has done this off-season, but let’s not get crazy about it.

Nothing brings out a little negative votes like a suggestion that the Mariners or jack Z isn’t “IT”.

I also agree that the ChiSox have a very good chance at the ALC. But many here seem to have the blinders on in regards to Scherzer and think the Twins non-Mauer and Morneau players are going to have 3 WAR seasons again.

quincy0191
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quincy0191
6 years 7 months ago

If there’s anyone who thinks Zdruaisaj;ldnkg hasn’t launched himself into the conversation for best ML GM they’re probably working for ESPN. As a Giants fan, I would be willing to trade Brian Sabean for Zdru;aksdhghaosh;i straight up. Sabean is easier to spell, after all. And he’s the longest-tenured GM! And he’s got a goatee! And his first name is an anagram of “brain” (that has to mean something, right?)!

joser
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joser
6 years 7 months ago

The M’s had their Bavasi era — and that ended just 15 months ago or so. The right GM can turn a team around in a remarkably short amount of time as long as he has something to work with. That’s the ray of hope Giants fans can cling to in this long gray gloom of their discontent. Meanwhile, at least you get Lincecum every five days (speaking of which…).

(Heck, even the Royals have Greinke, Houston has a budget, and even the Marlins have a new stadium deal coming. I’m not sure what hope Pirates fans can cling to.)

obsessivegiantscompulsive
Member
6 years 7 months ago

And Sabean’s the guy who has put together one of the best, if not the best, rotations in the majors, so good that they still won 88 games while fielding one of the worse offenses in the majors, even though most people, both fans and non-fans, were hesitant to predict even a .500 record for the 2009 Giants. With Sanchez’ maturation and Bumgarner’s eventually taking a spot, our rotation could be even better.

Likewise, the bullpen is stellar and with the addition of Runzler and hopefully a healthy Romo all season, it could be even better too.

Finally, the lineup should be better as well. Molina did not really hit that well in 2009, and now we have Huff in the cleanup spot. Posey should be able to match Molina’s OPS if he starts. Sanchez is a much better hitter at 2B and Sandoval didn’t start hitting homers until June, so he has all of 2010 this time to hit for HR power. And DeRosa should be an improvement over LF and Schierholtz couldn’t/shouldn’t do any worse than what Winn did in 2009.

And, really, nobody is going to mention that King Felix is not even 24 years old yet, which most consider still in the injury nexus zone, but has been given $78M. Will you still be wanting Zdruaiorjkadjgto over Sabean if Felix suddenly go the way of Noah Lowry and have all sorts of physical problems?

Ivdown
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Ivdown
6 years 7 months ago

The risk is definitely worth the contract for the Ms.

Also, I wouldn’t expect the Giants to put up the same pitching stats (Cain is due to regress, and I wouldn’t expect Zito to be as ‘good’ as 09 Zito in 2010), so the ‘upgraded’ offense will have to pick up that slack. The Giants are a pretty good team, but until their offense becomes middle of the pack, they won’t be able to contend really.

alskor
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alskor
6 years 7 months ago

Wait, what? Who considers 24 in the “injury nexus zone?”

No.

Also, Aubrey Huff isnt very good.

DavidCEisen
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DavidCEisen
6 years 7 months ago

If Felix’s arm falls off tomorrow, it was still a better signing than Zito.

alskor
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alskor
6 years 7 months ago

You’d be willing to trade one of the worst GMs in the game (Sabean) for one of the best GM’s (Jack Z) straight up?

Shocking.

Whartonite
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Whartonite
6 years 7 months ago

I think Sabean would take this deal. Jack knows better.

DWrek
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DWrek
6 years 7 months ago

From what I can tell, KLaw and Neyer have agreed with a lot of what ZZ has done so far. Dont understand the ESPN knock.

vivaelpujols
Guest
6 years 7 months ago

Of course Z is one of the best GM’s. It doesn’t take much of a sample size to be able to tell that. Of course there is nothing special about this move. Long term deals to pitchers are always risky – no matter how good the pitcher is.

joser
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joser
6 years 7 months ago

Of course you write of course a lot.

JH
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JH
6 years 7 months ago

I can’t analyze this deal in any way whatsoever.

FELIX!!!!!!!!!!!!!!!!!

Joe
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Joe
6 years 7 months ago

To be fair Dave, the Mariners did lock up Ichiro to a favorable contract a few years back.

LeeTro
Member
Member
LeeTro
6 years 7 months ago

Also, Griffey was in Seattle his first 11 years and Randy was there for almost 10 years.

obsessivegiantscompulsive
Member
6 years 7 months ago

Aw, you’re just ruining their buzz now…

diderot
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diderot
6 years 7 months ago

I want to think that finishing this deal is also what allows other Mariner dominoes to fall. Z now knows exactly how much he’s got left to spend. One more starter would be nice.

Steve
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Steve
6 years 7 months ago

Good article.

one comment, I’m not sure that Santana is the best comp for KF b/c Johan had already gotten his first big payday a few years before he signed with the Mets.

the Twins has already guaranteed Johan $40M, which I believe bought out his first 2 FA years. his contract with the Mets was really a true FA contract (they even tore up the final year of his Twins’ contract). it didn’t cover any of his arb years. it’s the first contract with the Twins that is actually a closer comp to KF’s contract.

another good comp would be the deal the Sox gave Lester.

don’t get me wrong, this is still a good deal for the Mariners b/c KF is a special, special talent. but it’s a great deal for KF. he ensured his family’s financial security for life should he never throw another pitch.

Steve
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Steve
6 years 7 months ago

Let me add that I can’t see Cot’s from my work network, so I am open to being corrected on Johan’s service time. I am going from memory.

sean
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sean
6 years 7 months ago

Correct. Santana’s four year deal with the Twins is a better comparable. He lost his first arbitration and then signed the deal that bought out two arb years and two FA years. And he signed it after winning a CYA and getting shafted out of the 2005 award.

arsenal
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arsenal
6 years 7 months ago

i’m a little drowsy but i found this article really hard to follow even though it’s obviously very simple.

nice deal by the M’s, j-z strikes again! any word on a cliff lee deal?

johng
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johng
6 years 7 months ago

I think one thing that often goes unsaid is that the 5-10 mil a year he left on the table is a good to great closer, or some other player. One of the problems with A-Rod’s 1st huge contract with Texas was that he handcuffed them, and disallowed them from taking on any other serious contracts.

Erik E
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Erik E
6 years 7 months ago

Smart executives like Jack Z don’t spend 5-10m on closers.

Steve
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Steve
6 years 7 months ago

really? $5M? methinks you’re taking the whole “closers are overrated” idea to an unsupportable extreme.

johng
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johng
6 years 7 months ago

That’s got to be the funniest statement I’ve read in a long time. If only Jack Z was the GM of the Red Sox. Fangraphs readers would be so smitten, they couldn’t even type smarmy posts.

HD
Member
HD
6 years 7 months ago

Who is thumbs-down-ing level-headed responses like Steve’s?

If you watched the Yankees in the ALCS and World Series, then you should have no doubt Mariano Rivera was worth $10 million.

CircleChange11
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CircleChange11
6 years 7 months ago

Who is thumbs-down-ing level-headed responses like Steve’s?

The same m’s fans that think a decent season by Aardsma in a non-competitive year is going to project to a very good season as closer in a competitive year.

Me? I’m willing to wait and see how the whole plays out on, you know, the actual field.

If they want to put it all in the hands of David Aardsma, then fine. I’ve seen the prequel to that movie … starring Ryan Franklin.

I’m guessing mariner fans don’t think Aardsma will “regress to the mean”, but rather “came into his own” and “found his role”, and now he’ll dominate with a 1/2.75M contract.

Aardsma basically set career bests in everything in 09. If he matches (even similarly) that performance in ’10, I’ll be impressed. If he starts blowing games that the M’s need, I’ll remember this thread when the M’s go overspend on a reliable closer.

It’ll be like that thread where Cub Fans were getting all snarky about how the Cubs were going to dominate in 2009, and were the best team in the NL.

The Mariners should be an enjoyable team to watch in 2009, there’s no need for their fans to ruin by assuming a “smarter than everyone else” position. Of course, everyone has that right in the off-season, but I’d take a sip of humble juice and take a peak through history at all the teams that have erroneously assumed a great deal of improvement.

Steve
Guest
Steve
6 years 7 months ago

A-Rod was a free agent. KF is not. apples and oranges.

KF had a legitimate economic reason to “leave some money on the table”. A-Rod had none.

obsessivegiantscompulsive
Member
6 years 7 months ago

I would note here that the author said that he left $5-10M annually on the table for 2012-2014, not 2010.

NBarnes
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NBarnes
6 years 7 months ago

A-Rod didn’t handcuff the rangers. Any analysis says that the Rangers got fine value from A-Rod versus his contract. If the Rangers had payroll problems in the early 2000s, feel free to look at Chan Ho Park, Juan Gonzales, and Carl Everett; now there’s some money flushed down the drain.

joser
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joser
6 years 7 months ago

Yeah, those were the boat anchor contracts. Though if the Rangers weren’t also on the hook for ARod (or just had pockets as deep as Texa-er, the Yankees) they would’ve been better able to cut bait on those and recover. But either way, Texas paid ARod like he was the best player in baseball and he pretty much delivered.

JH
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JH
6 years 7 months ago

The 2001-2003 Rangers were some of the worst-filled-out rosters in recent baseball history. The ’03 team had a league average offense despite having Rodriguez (.420 wOBA), Blalock (.370) Palmeiro (.369), Teixiera (.345), and half-seasons from Carl Everett (.380) and Juan Gonzalez (.379). The failure of that team wasn’t A-Rod’s fault. It was the fact that between Einar Diaz, Shane Spencer, Todd Greene, Doug Glanville, Laynce Nix, Ryan Christiansen, Donnie Sadler, Ruben Sierra, Jason Jones, Ramon Nivar, Marcus Thames, Jermaine Clarke, Mike Lamb, and Ryan Ludwick, they got a .277 wOBA over more than 2000 plate appearances. That’s almost 1/3 of the team’s total plate appearances, and the guys they used in those spots were a combined ~30 runs below replacement level.

No one player can make up for the fact that 1/3 of the lineup he bats in is worse than random players floating around the AAA scrapheap.

maqman
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maqman
6 years 7 months ago

It will interesting to see if there is a no-trade clause or a Cy Young bonus.

Nik Aitken
Guest
Nik Aitken
6 years 7 months ago

Word is there is Cy Young bonuses involved.

suicide squeeze
Member
Member
suicide squeeze
6 years 7 months ago

I thought the Cy Young bonuses were being phased out by 2013.

joser
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joser
6 years 7 months ago

Well then I guess he’ll have to win a couple before that.

Jimbo
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Jimbo
6 years 7 months ago

Smart GMs are realizing that taking a bit more risk on younger studs avoids the situation where you just can’t afford them a year or two later.

Ivdown
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Ivdown
6 years 7 months ago

Yeah, that and GMs are starting to rely less on free agents and more on their farm systems and trading. I love this trend of locking up young stud players (Greinke, Longoria, Lester, Josh Johnson, now Felix, and more I know I’m forgetting), and I really hope Colletti and McCourt look hard at this and realize that Kemp needs to be locked up for the next 6 years at the least, same with Billinsley and Kershaw (but Kershaw could wait another year).

Drew
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Drew
6 years 7 months ago

Love the deal for the M’s. Like it a lot for Felix.

He gives up some dollars on the back end to set himself up and to stay in the place he likes. Nothing wrong with that tradeoff, especially when he will hit the open market again at age 28. How quickly we forget the doomsayers who predicted Felix would not stay healthy because of his violent delivery. I think he had to take this deal, and I’m glad for both sides that they got it done.

CCW
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CCW
6 years 7 months ago

He still may not stay healthy. That’s the risk Felix just hedged against by taking this deal, and the fact he took the deal means he’s not all that confident. I don’t actually think he thinks he’s going to get hurt, but everyone knows it’s a very real possibility.

One thing I haven’t seen discussed much is how a long-term deal changes the player/team relationship. The team now has more invested in the long-term health of the player. That’s good for Felix, physically and emotionally.

Fergie348
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Fergie348
6 years 7 months ago

I’m happy for M’s fans, as they get to keep their star (finally..) for awhile. As a Giants fan, I’m wondering what it’s gonna take to keep Lincecum in orange and black for a comparable time period. The service time is a bit behind KF I think, so the G’s have some more leverage but it’s fading fast what with all the Cy’s and the fact that he may be the most valuable pitcher in baseball right now. I’m thinking that he’s going to get somewhere in the neighborhood of $12MM in arbitration this year (maybe just a little less) and for a 5 year extension we might be looking at $90-100MM, probably backloaded. Thoughts?

Joncarlos
Member
Joncarlos
6 years 7 months ago

Like the others have said, a good deal for both sides. Assuming good health, Felix will still be young enough to get a Sabathia-esque deal when this contract expires. (And depending on who’s bidding on him at the time, he’ll certainly benefit from having had Safeco and the M’s defense on his side for his extended audition).

The M’s get an awful lot of cost certainty and save a few million in the process. Now they just need to backfill with some cheap starters to benefit from their park/defense setup in the long run.

Xeifrank
Guest
6 years 7 months ago

He may have left $20M on the table, but that is a “worst” case scenario for him. I think to do a proper study of this you need to weigh all the possible outcomes, which include catastrophic injuries each year. I think when you do that, it will come out to a much closer figure to what he ended up signing for.
vr, Xei

chino
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chino
6 years 7 months ago

Just a quick note: 68/4=17. Thus, he would be getting 17 million annually.

crix
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crix
6 years 7 months ago

First I must say that no closer is worth $5-$10 million as someone earlier commented. You can find closers for next to nothing such as David Aardsma for example, (less than $1 million) while some GM’s can afford to sign closers for over $9 million like Cashman with Rivera or Epstein with Papelbon. I’m not saying Aardsma is better but, for the money he was in ’09.

Anyway, as an M’s fan I’m happy that Felix is locked for a bit, who knows it may even persuade Cliff Lee to sign long-term, hopefully for around the same. By the way, incentives look to be $1 million for a Cy Young and $500 K per all-star appearence. Nobody got a bad deal in this, the M’s didn’t have to pay $20+ million per, and “The King” has a much bigger crown now. Maybe Felix isn’t as greedy as others or maybe he’s happy and doesn’t want to worry about free agency right now. He’s only 23 years old, he will have another big contract in a few years. All I know is it’s gotta suck being an Angels fan right about now.

Nik Aitken
Guest
Nik Aitken
6 years 7 months ago

Well said. Rivera has eclipsed $10 million in value twice in his career, and the same with Papelbon.

Paying a closer $10 million and expecting plus value is a little silly.

HD
Member
HD
6 years 7 months ago

Just curious- does the post-season factor into these valuations?

vivaelpujols
Guest
6 years 7 months ago

“Rivera has eclipsed $10 million in value twice in his career,”

…according to FanGraph’s estimates of WAR.

And HD makes a good point. Postseason does not factor into WAR valuations on FanGraphs. Rivera has been amazing in the postseason virtually every year, which raises his real life value tremendously.

Brendan Scolari
Guest
Brendan Scolari
6 years 7 months ago

Are you factoring situational leverage into that? That would raise the value of any late-inning reliver and it’s not accounted for in WAR IIRC.

CircleChange11
Guest
CircleChange11
6 years 7 months ago

Just curious- does the post-season factor into these valuations?

No, the post-season and world series championships are meaningless due to their small sample size and increased randomness.

Yes, I’m being sarcastic. But, many at FG are not when they imply similar statements.

I am willing to wait and see what happens when the rubber meets the road, and see how Aardsma fares down the stretch when the division is on the line.

I’m not wishing any ill will on Aardsma, I’m just saying he hasn’t pitched in situations as important as the closers he’s being compared to, nor has he had more than one good season.

I just find it weird that someone would point to Aardsma as an example, when most are talking about established closers that have pitched in seriously important games.

Not surprisingly, given the membership of FG, but the fans project Aardsma having MUCH better 2010 than do the published projectors. Evidently, David Aardsma will soon be the Joe Nathan of the ALWest. If he does, wonder what the odds are he makes more than 2.75M in 2011?

Matt Zakrowski
Member
6 years 7 months ago

You don’t always get it right when you try guys like Aardsma. 5 Mil for a worthwhile closer isn’t always a terrible move.

vivaelpujols
Guest
6 years 7 months ago

You can find closers for next to nothing such as David Aardsma for example

Aardsma is a product of very good luck and very good scouting on the Mariner’s end. Before 2009, he was projected for a 3.88 ERA.

http://www.baseballprojection.com/SEA2009p.htm

That’s not a very good closer – actually below replacement level. Aardsma worked for the M’s last year, but assuming you can consistently pick up guys off of the scrap heap and turn them into stud closers is a fallacy perpetuated by the F.A.T. culture of many Sabermetric oriented analyses.

Only certain types of players are F.A.T.’s, and they are freely available for a reason – most of the time due to injury risk or coming off of down years. You could get lucky like with Aardsma, or it could bite you in the ass like with Izringhausen.

Paul Thomas
Guest
Paul Thomas
6 years 7 months ago

Eh…

The A’s right now have the following pitchers who look like their top bullpen options:

Joey Devine (1.97 FIP in 2008, injured in 2009, cost one somewhat-discounted season of Mark Kotsay)
Brad Ziegler (3.15 FIP in 2009, cost nothing)
Mike Wuertz (2.37 FIP in 2009, cost two organizational players, Justin Sellers and Richie Robnett)
Andrew Bailey (2.56 FIP in 2009, cost a 6th round pick)
Brad Kilby (3.03 AAA FIP in 2009, 2.21 MLB FIP, cost a 29th round pick)
Jerry Blevins (3.01 FIP in 2009, cost half a season, slightly discounted, of Jason Kendall)
Craig Breslow (3.77 FIP in 2009, cost nothing)

Combined 2010 estimated cost: $5M

They also moved a decent relief pitcher, Jeff Gray as the primary value in a package to acquire Jake Fox. He cost another very late draft pick.

OK relievers are easy to acquire on the open market, but what people tend to miss is that GOOD relievers are easy to acquire late in the draft, with picks that otherwise would hardly ever pan out into any kind of MLB value. Most 29th round picks are strictly to fill out minor league rosters with decent, if overage, talent so that the legit prospects don’t feel pressure to overperform.

Matt
Guest
Matt
6 years 7 months ago

When someone offers you $78 million to play a game for five years, TAKE IT!

Jim
Guest
Jim
6 years 7 months ago

Two recent discussions, one about Felix offering an apparent discount of ~$20m and another about what Cliff Lee’s upcoming demands will be, give divergent examples of the same negotiating logic.

For Felix, a moderately likely outcome is that he will negotiate another lucrative long-term deal after the current one expires. Pitching at Safeco Field for an excellent organization for the next five years will tend to increase the value of that potential second contract. It’s easy to imagine that effect being $20m or greater, so the “discount” may actually be a speculative investment by Felix and his agent.

Cliff Lee, on the other hand, is eight years older and will (almost certainly) be negotiating his final long-term deal. His upcoming contract will be the overwhelming factor in determining whether his lifetime earnings reach milestones like $60m, $80m or $100m. Given only one high-leverage shot at big guaranteed money, there isn’t much justification to be choosy about teams. Any “discount” a team gets from Lee will probably be for personal reasons.

As a long-time Mariner fan it feels strange that players actually want to come to/stay in Seattle. It was normal and customary to pay an additional premium for quality free agents, comb the entire league for players with a connection to the Puget Sound area, and be ignored by many free agents each year. Now for the first time, the organization is credible enough to compete as an equal in the market for talent. The Mariners are still stuck in the upper left far away from what most players consider “home”, in a national media shadow with a brutal travel schedule. But they’ve also joined an exclusive club, that of well-run large-budget teams in cities where the fans and media aren’t jerks, and many players value that highly.

wpDiscuz