New CBA affects Red Sox in mixed ways

New CBA affects Red Sox in mixed ways
November 22, 2011, 11:45 pm
Share This Post

The new five-year collective bargaining agreement agreed to jointly by the Major League Baseball and the Major League Baseball Players Association Tuesday guarantees labor peace through 2016 -- bringing baseball's streak of uninterrupted play to 21 years -- and can be seen as a positive for the game.

While the NFL had a dark summer before agreeing to a new labor deal, the NBA anticipates a nuclear winter and storm clouds gather for the NHL when its deal expires next fall, baseball is trouble-free when it comes to labor -- and who could have anticipated that 20 years ago?

Such tranquility, of course, is an unqualified positive for the game. But some of the details that were collectively bargained aren't necessarily good for the Red Sox -- or other big-market clubs, for that matter.

A look at some of the fine print and how it impacts the Red Sox.

1) A signing bonus cap for first-year amateur draft picks.

This is the point that probably impacts the Red Sox most going forward.

In the past, the Red Sox have routinely ignored the "slot" or recommended signing bonuses for draft picks. That has earned them the rebuke of the commissioner's office, but little else.

But starting next year, there will be real consequences for doing so.

The Sox have exploited the system to draft players with signability issues in later rounds and have routinely paid over "slot" signing bonuses. At times, in fact, they have gone significantly over slot to take players who were identified as first-round talent, but weren't chosen until later.

For years, small-market teams complained that the purpose of the draft was being perverted by teams like the Red Sox (and Yankees, Phillies and other large-market brethren), and that some of the best amateur players weren't going to the teams which, by virtue of their poor won-loss record, need them most. Instead, charged small-market teams, big-market teams were flexing their economic might and signing the best amateur players.

That, of course, gave big-market teams a two-fold advantage: not only were they signing the best (established) free agents, but they were also stockpiling many of the best high school and college players, with which they could regularly replenish their pipeline of homegrown talent.

Starting with next year's draft, however, there will be, for the first time, a huge disincentive to overspending on draft picks.

While owners failed to attach specific, hard slots to each pick, they did a signing bonus pool limit. Teams will be given figures for all of their picks in the first 10 rounds, based on where they pick and accounting for supplemental picks. Teams which go over that amount by 0-5 percent will be taxed 75 percent on the overage. Teams which go over by 5-10 percent will be taxed 75 percent on the overage and forfeit their next first-round selection.

The more teams go over the signing bonus pool, the higher the penalties.

In the recent past, the Red Sox routinely went over the recommended slot amount for players such as Anthony Rizzo, Will Middlebrooks, Ryan Lavarnway and Ryan Kalish.

In the future, it will be virtually impossible for the Sox to draft those same players in the same (later) rounds. Going forward, the Sox can take them in higher rounds -- or, more likely, not take them at all.

2) A signing bonus cap on international free agents.

As is the case in the draft, the Red Sox have been big players for international free agents who aren't subject to the draft (think: Jose Iglesias, Daisuke Matsuzaka, Che-Hsuan Lin, Junichi Tazawa, Hanley Ramirez).

Now, the same restrictions that govern the amateur draft will also govern international free agents. A total cap system will be in place and going over that prescribed numbers will result in similar taxes on the overage as well as more stringent limits on future bonuses.

There is one way to dodge this cap: signing international players to major-league deals, the way the Sox did with Iglesias. But such a practice usually retards player development since it uses up player options much quicker and virtually guarantees that a player will be rushed to the big leagues before he's ready.

3) The same revenue sharing that existed in the last CBA will, with minor changes, be continued in the new one.

The Red Sox were, at one time, vocal about their opposition to the system. Then, commissioner Bud Selig began to sock the Red Sox (and other large-market teams with vocal concerns) with enormous fines -- some as high as 500,000 -- and the Sox' grumbling grew quieter.

Every one of the 30 major-league teams pays 34 percent of their local revenue into a central fund. That revenue is then paid back in equal measure.

(Put another way: The Red Sox and, say, the Pittsburgh Pirates, both pay the exact same rate on their revenues. But in the Red Sox' case, because their total revenues are far greater, they get back far less than they paid into central fund.)

The Red Sox have campaigned for a reduction in the amount of money they pay into the central fund, arguing that the rate is a disincentive for investment and on-field success.

The only concession the Red Sox -- and other big-market teams -- got is that, toward the end of the deal, teams in big markets who typically don't generate revenue in accordance with their market size will have to "rebate" some of the money back to big-market clubs like Boston.

The likely fallout is, Sox ownership will continue to examine ways to generate revenue from other outside sources, as it does now with Roush Racing and Liverpool soccer.

4) The introduction of a second wild-card team in each league no later than 2013 and perhaps in time for the 2012 season.

Of all the changes in the new CBA, this is one which most obviously impacts the Red Sox in a positive way.

With two wild-card teams in the American League, it will now (or soon) be possible for three teams in the A.L. East to qualify for the postseason. Previously, if the Yankees won the division -- as they have for 11 of the last 14 seasons -- the Sox would have to worry about finishing in front of, say, Tampa Bay.

How would this have changed the Red Sox fortunes in recent seasons? Consider that that the Sox have finished out of the postseason four times since 2002.

Under the new set-up, they would have made the playoffs in three of those seasons: in 2002 (when 93 wins would have made them the second wild card team); 2010 (when 89 wins would have qualified); and, this past season, when the Sox were eliminated on the final night of the season, triggering a series of after-shocks throughout the offseason.

Only in 2006, when the Sox won 86, would the Sox have remained on the outside of the playoff picture looking in.