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Jays Avoid Arbitration With All But Stroman and Osuna — Could Extensions For Those Two Be Next?

Cue pointless consternation, the Jays are going to arbitration with Marcus Stroman and Roberto Osuna!

For the second year in a row, the club will be going to arbitration with Marcus Stroman, and for the first time (in his first year of eligibility) they will be doing so with Roberto Osuna. As I mentioned in my piece earlier today about Josh Donaldson settling (which also included some thoughts on extending him and why that hasn’t happened, FYI), the arbitration process has had a tough time shaking its old reputation. Feelings did used to get hurt, especially in the era before the strike, around the time of collusion, when the players were still clawing to get proper compensation out of their clubs. Nowadays? It’s not that feelings can’t get hurt, but the players understand very well that this is a business, and some of the really contentious stuff that would be brought up in the past simply doesn’t exist anymore (perhaps because players these days are just so much more professional in their approach to their craft that teams can’t really use that stuff as ammunition).

So… it will be fine. Like, Josh Donaldson lost in arbitration to the Jays in the winter after he came over from Oakland, then was so hurt by it that he went out and won the goddamn MVP.

More than just fine, it could be a good thing. Stroman and Osuna are certainly candidates for long-term extensions, and though the Jays are a “file and trial” team (still, per Shi Davidi), with a policy of not negotiating one-year deals beyond today’s deadline, the policy allows them to still work on extension in the meantime, rather than necessarily going to a hearing. Is it possible that Stroman and Osuna might have simply allowed the Jays take care of all of today’s business first, not worrying about the hearing because extensions are in the offing? Doubtful! That wouldn’t exactly be great negotiating practice if they were. But that doesn’t mean that there might not still be something to be worked out. Those are valuable guys, still early enough into their arbitration years for a team-friendly long-term deal to be advantageous for the players as well, and people you’d like to see be Blue Jays for a long time. That, of course, doesn’t mean anything is happening in this regard, but it’d be cool if it did.

Stroman and Osuna, along with Sanchez, Travis, and Pillar, will be free agents following the 2020 season. Right now all that the 2021 Blue Jays have on their books right now is $3.929 million for Lourdes Gurriel, and a $4 million buyout of Troy Tulowitzki’s last contract option. Adding a little to that to buy out some of Stroman and Osuna’s early free agent years could certainly could be done, and extending their time here deeper into the coming Vlad and Bo era has a lot of appeal as well.

I wouldn’t hold my breath on that stuff, because there’s a lot of reasons the club would want to keep on going year to year with these guys — Osuna’s health, perhaps, or the fact that Stroman, as a Super Two, will require quite a bit to buy him out of arb years three and four, which already stand to be quite expensive). But there’s certainly a chance, assuming the Blue Jays themselves see those players as long-term pieces to be locked down.

If the club does go to arbitration with these two, it will be over a $400K difference in Stroman’s case, as he’s filed at $6.9 million, as compared to the Jays’ offer of $6.4 million (his projection was $7.2 million), whereas Osuna will be fighting for $500K, as he’s filed at $5.8 million, and the Jays have come in at $5.3 million (projection was $5.6 million).

Otherwise, the important-ish things from todays news are the actual settlements. Last night Cam informed us that “outfielder and Playoff Legend Zeke ‘Zeke’s Thunder’ Carrera agreed to a one-year deal worth $1.9 million and lefty reliever Aaron Loup agreed to a one-year deal worth $1,812,500.”

This morning it was Josh Donaldson settling for $23 million.

Then in the early afternoon, in the first two of what I expected would be a flurry of announcements (hence not writing about it until now — GAH!), we learned that Aaron Sanchez had settled for $2.7 million, and that Devon Travis had settled at $1.45 million.

Finally, just after 5 PM ET, the club officially announced deals with five players, Donaldson, Sanchez, and Travis, plus Kevin Pillar ($3.25 million) and Dominic Leone ($1.085 million).

As it stands, this means the Jays have committed $35.1975 million to these five players, after having been projected by MLBTR to only need to pay out $33,.2. Adjust your estimates of how much the club has left to spend accordingly!

Just where were the discrepancies? WHY THEY’RE RIGHT HERE IN THIS TABLE!

Player Projected Salary Actual Salary Difference
Josh Donaldson $20.7M $23M $2.3M
Kevin Pillar $4.0M $3.25M -$750K
Ezequiel Carrera $1.9M $1.9M 0
Aaron Sanchez $1.9M $2.7M $800K
Aaron Loup $1.8M $1.8125 Same diff
Devon Travis $1.7M $1.45M -$250K
Dominic Leone $1.2M $1.085M $115K

Of note here is that MLBTR, though excellent as always, was off pretty good on Donaldson and Sanchez in one direction, and on Pillar in the other. I have no idea how to account for that for two of them, but one can’t help but wonder if Sanchez (and his agent Scott Boras) getting such a higher number here than expected has something to do with the way Boras bristled about the low pay assigned Sanchez by the Jays last year, after his client had put together a magnificent season, leading the American League in ERA and being a huge reason for the Jays’ second straight run to the postseason.

Whatever the case… uh… there are some 2018 Blue Jays salary numbers. Happy Friday, everyone!

  • AD

    Dont think its makes sense to extend osuna. He has more value as a trade chip to the jays. Stroman, sure. Hes developed into a solid 2/3 starter that doesnt miss a lot of bats but gets a shit ton of ground balls. Cant have enough of those in your rotation.

  • stevevd

    Didn’t Donaldson lose in arbitration BEFORE he won the MVP and not AFTER as the article suggests?

    He just came off a 2 year deal which covered 2016 and 2017. Wasn’t 2015 the year he lost in arbitration and won the MVP?

  • jays17

    Please trade Stroman now. He’s an arrogant headcase and his value is very high right now. I’d take Sanchez over Stroman any day of the week. Who else will Stroman stop speaking with because they won’t endorse his personal HDMH crap?

  • vic

    Extending Stroman would make sense, but Osuna? Too much risk, both with his arm and his position. Relievers can fall off pretty suddenly. Go year to year with him.

    • Steve-O

      (Presumably Stroman, Sanchez and Osuna would be making quite a bit more by then, but if you forecast Bo and Vlad, and possibly others young guys are contributing on rookie deals, you have to think there will be room in the budget.)

    • Nice Guy Eddie

      The problem with that is that Donaldson will be 35 in 2021. You are right though, that Toronto has 40 million a year tied up in Tulo and Martin through 2019, then half that for Tulo in 2020. Neither one is moveable. I can’t see a long term deal for Josh here. Obviously he’d charge a premium, not give a discount, to play in a high-tax jurisdiction but most importantly he’ll want to sell as many season post-age 35 now as he can.

      • The Humungus

        Do guys ask for a premium to play for the Yankees? Or the Dodgers?

        I think that tax stuff is bullshit made up by the media. California, New York and Massachusettes all have tax rates comparable to Ontario (I’m talking combined, not just state vs provincial). Illinois is close as well.

        Add in to the fact that mlb players (and all athletes, for that matter) pay their tax based on where it was earned. So, not just in home game location, but road as well.

        It’s really not as big a deal as you’d think. Sure, Texas and Florida are at an advantage with no state tax, but the biggest market teams are all about the same as we are here.

        • Oakville Jays

          I think that Donaldson is a resident of Florida. There is no state income tax in Florida. Donaldson would pay NY city & possibly state tax for games played in NY. Similar rules if he goes to California.

          • The Humungus

            Residency is only the determinant for Canadian provincial tax. I worked a temporary contract in Saskatchewan while a resident of Ontario, but paid all my taxes to Ontario.

            In the US, they tax based on place earned, not residency.

            But, because his employment is based in Canada, he would pay Canadian taxes based on income earned in Canada. It’s the way the tax treaty with the US works.

        • Nice Guy Eddie

          Humungus, baseball players generally do not want to play in Canada. That has been made clear over and over again. Ricciardi has said it,
          Anthopoulos said it (he complained that even when he offered a higher AAV and more years players went elsewhere), David Wells said it, Stroman and Pillar both said how they felt disappointed when they were drafted by Toronto. Even the manager left in 2013 to go play for a divisional rival in the US in the middle of his contract. If I can sum up the feeling of American players to playing in Canada, it’s “But that’s not even in the US.” No one likes to say that to Canadians, but that’s how Americans generally feel. They don’t want to play in Canada, they don’t want to play in Mexico, they want to play baseball in the US.

          The tax situation makes it worse. The marginal rate in Ontario is 54%. Nowhere in the US is there a marginal tax rate that high. If the government took more than half of one’s earnings in the US, they would be gone. But that is only HALF the equation.

          The other half is what is taxed. In Canada, every type of personal income is taxed. In the US, there are numerous deductions not available in Canada. The most commonly known is mortgages, where Canadians pay mortgages out of post-tax dollars whereas Americans can deduct mortgages prior to taxation. But that is only one of numerous differences, all of which lead to a big tax difference.

          But taxes aren’t the only thing. Americans don’t want to come here anyway. Taxes just make it worse.

          I’m not dissing Canada or Toronto, but if you think Americans look at Canada as an equal destination to somewhere in the US, you are mistaken.

          Lastly, if you think “that tax stuff is bullshit made up by the media” ask yourself ‘why’. Why would the media ‘make up’ this ‘bullshit’ as you put it? Seems odd, doesn’t it.

          • Oakville Jays

            I remember that Dirk Hayhurst complained about very expensive roaming charges on his cellphone. Rogers refused to give him a cheap cellphone plan. He also said players complained about the lack of ESPN in the clubhouse.

          • The Humungus

            The marginal rate in California in 2017 was 52.3%.

            They also pay 7.62% combined for FICA, versus Canada’s 6.58% for CPP/EI.

            the rate in Ontario was 53.53%.

            I’m no mathemagician, but it would appear to me those numbers are nearly identical. Like less than .15% difference.

            Add in that they can still deduct their mortgage against US earnings. It’s not as significant difference as you may think.

            Especially since you never hear a player say they don’t want to play for the Dodgers, Angels or Giants because of “the taxes” .

            I’ll correct myself. I’ll say it’s bullshit from player agents that the media disseminates. Is that better? Because the tax situation is insignifcant in terms of major markets.

          • Nice Guy Eddie

            On the same day that Hummungus was writing on the internet that players don’t care about taxes, and have no problem with CA and NY, MLBTR reported the exact opposite about Ian Kinsler. Next time you read about how Toronto was once again on a player’s no-trade list (but according to Hummungus the player doesn’t want to charge a premium to come here) remember this.

            “When the Angels agreed to acquire Ian Kinsler from the Tigers in December, the second baseman had the Halos on his 10-team no-trade list. Kinsler explained to Katie Strang of The Athletic (subscription required/highly recommended) that it was “because of tax reasons.” He also pointed out that taxes led him to put the other California teams and both New York clubs on his no-trade list. Kinsler still waived his NTC for the Angels, though, thanks in part to the presence of good friend and teammate Justin Upton (whom he played with in Detroit). Kinsler revealed that the Halos were the only one of the 10 clubs for which he’d have waived his limited no-trade rights. “

          • Nice Guy Eddie

            Humungus, it’s not one guy.

            But more important, you shouldn’t just make bullshit up on the internet, like California has a 53% marginal rate. Nowhere in the US has, or would tolerate, a 53% marginal rate. It is clear to me that what you have done is add together the state and federal tax, like it is done in Canada. This is exactly the problem with people who think they know something after a minute on GOOGLE.

            In the US, state taxes and property taxes are DEDUCTED from federal taxes not ADDED. This is part of what I tried to explain to you above, when I said that the tax systems are very different. There is no 54 or 54% marginal tax rate in the US, nor will there ever be.

            Instead of drifting around on GOOGLE looking for unsubstantiated arguments, you should look at this as a learning experience. You are not going to find a substitute for knowledge in a few minutes with GOOGLE.

          • The Humungus

            So, I’m using Turbo Tax, because I haven’t needed to, as of yet, work on US Taxation. You use a term like “marginal rate”, that’s what I go looking for. Using “effective rate” would have amounted to a much better discussion here. I calculate effective rates on a wide range of incomes on the regular when it comes to doing economic loss.

            However, you’ve ignored the changes to the SALT deductions that were made in the Republican tax bill.

            That deduction for state, sales and property taxes is now capped at $10,000 total, where it used to be unlimited. Which is going to disproportionately going to affect those living in high-tax jurisdictions.

            Also, before, taxpayers had to make a choice between state & local income and sales taxes, rather than straight up deducting state & local income taxes.

            Regardless, one would assume that a state like Illinois would have been at a disadvantage previous, as their state sales tax was extremely high compared to some other states. But you never heard about players who didn’t want to play for the Cubs or White Sox because of “tax concerns”.

            And you rarely hear about free agents clamoring to go to Miami or Arlington because of “tax concerns”

      • Steve-O

        A few things:
        1. Reyes and Wells were both traded, so while I acknowledge it’s unlikely and certainly tricky, we should know by now that no contract is immovable
        2. I don’t follow your last point, back-loading his potential contract would simply be shifting some of the cost burden to his later years when (presumably) the Jays would have other starters on cheaper deals, but the AAV would be whatever they can agree on
        3. I really doubt the tax thing is as big a deal as it’s sometimes made out to be – a marginal advantage, maybe, all things being equal, but nothing I’m worried about

        • Kris

          On the tax issue it is more a myth than fact. The Blue Jays, Raptors and the Canadian NHL teams are signing free agents and re-signing their own players all the time.

          Here a quote from Crowe Soberman (Tax Expert)
          “Ignoring contract restructuring and using all the variables described above, we computed that the tax bill for a player who is a resident of Florida and moves from the Marlins to the Blue Jays with $100 million left on his contract is only an additional $2.7 million, over the life of the entire contract. It is a significant number”

          40-45% of the players time is in Canada (After you account for ST). And I read another article another way to get around the tax issue is a signing bonus.

          The difference between New York or CAL base teams for taxes compared to Canada is small and those teams have no issues signing players when MLB free agents have options in Texas or Florida.