A low-budget success story, the Pittsburgh Pirates are at it again. Despite ranking in the bottom-third in payroll around baseball for several years, the Pirates have leaned heavily on pre-arbitration extensions to prevent turnover of its top-end talent before free agency.
Once again, the Buccos maade their move, signing 24-year-old outfielder Gregory Polanco to a 5-year/$35 million deal Sunday, with two club options. In total the deal is approximately $58 million with escalators pushing it up to $60 million.
Looking at contract comparisons for Polanco's new deal, we need to only look a few spots across the diamond, to teammate and left fielder Starling Marte. In March 2014, Marte signed a 6-year/$31 million deal with two club extensions, and like Polanco, the deal followed his first full season in Pittsburgh while he was still arb-eligible.
The general annual cost before options — about $7 million per season — is higher than Marte's annual at the time. The Pirates locked Marte in at a mega-discount at a little more than $5 million per season, especially considering he was a 4.4 fWAR player in 2013 and combined for 8.0 fWAR in 2014 and 2015. Marte's option years combine to total $24 million.
Polanco isn't there yet. He plays adequate defense and hasn't shown the same pop or base stealing capability as his teammate. He came to Pittsburgh with superstar capabilities, but hasn't met the expectation. We can immediately say he left too much on the table, but the Pirates offered a 7-year/$25 million deal that Polanco rejected in June 2014, so the right fielder may be assuring he gets a steady payday without the guarantee of success.
In 2015, teams spent about $6 million per WAR. Polanco, a 2.3 fWAR player, would be set up for about double this contract's rate on the open market. The two option years take care of Polanco's first two free agency seasons, valued at about $23 million total, or $11.5 million per season, which will still be a discount for Pittsburgh if he reaches anything near his full potential.
For comparison's sake, I looked at Baseball Reference (1.3 WAR) and Baseball Prospectus (2.8 WARP) and can argue the Pirates are close to a fair deal per Baseball Reference's measurement.
The Pirates cannot afford to take big financial risks on potential. That's where low-budget teams can get rolled over on one bad contract. The Pirates knew they could get an underwhelming Polanco for cheap or close to value while buying out some potential upside years.
The Pirates front office brass also knows that from 2014 to 2015, Polanco's average jumped 20 points, and he saw significant jumps in his ISO and hard hit rate. He experienced an unusual drop in his home runs per fly ball considering his hard hit rate, suggesting he's due for an upward correction toward the mean. The batting average jump comes from a rebound in BABIP, all of which is recorded in the chart below.
What all this says is, if the Pirates see what we see, all signs are pointing to everything coming together for Polanco very soon. He still not necessarily looking like a 30-30 superstar, though he has room to grow and there's enough reason to suggest with better home run luck and more consistency defensively, he will join Marte in the 3.5-4 fWAR class this year or next, maximizing the value of his contract for the team.
Another interesting wrinkle to Polanco's deal is how it will coincide with potential changes to baseball's collective bargaining agreement with the players' union, which expires in December and will be negotiated prior to 2017. By all indications, the union will seek to gain a bigger revenue share, while also targeting the pre-arbitration process, which pays young players pennies on the dollar in some cases (then again, the union is dominated by veterans who often sell-out young players' bargaining chips, so who really knows what will transpire). Overall however, the union can't be very thrilled with the deal, and the Pirates certainly capitalized an opportunity to sure up its future outfield before Andrew McCutchen potentially leaves the fold after 2018. What the union and owners do in regard to pre-arb players in the next CBA will notable to watch, and could affect the the low-budget Pirates — who thrive on deals like this — when it comes to dealing with upcoming prospects Tyler Glasnow, Josh Bell and Austin Meadows.
The chart below (data via Hardball Times) breaks down salaries around baseball to distinguished age groups. It shows the disparity for players on the youngest and older end of the spectrum. It offers us some insight in the union's bargaining point, and possibly why extensions to pre-arb players like Mookie Betts and Xander Bogaerts have been rare to this point of the season. And also why the Pirates and ace Gerrit Cole had a silent squabble over his $10,000 raise for 2016.
|Year||25 & under||26 to 30||31 to 35||36 & up|
The lack of extensions is speculation on my end, but if I can be somewhat bold and suggest Polanco levels out as a 2-win player, then the Pirates essentially eat his arbitration and two years of free agency at a super cheap rate.
From a comparison to other recent extensions around the one-year service time mark, Polanco's deal seems fairly aligned, even if cheap on the grander scale of things.
Jerry Burnes is a contributor Beyond the Box Score. You can follow him on Twitter at @jerryburnes.