Votto, Lozano Make Smart Deal

Joey Votto has nothing to lose. He and agent Dan Lozano avoided arbitration and worked out a deal with the Reds that's worth $38MM in guaranteed money. And Votto doesn't hit free agency a minute later than he was originally scheduled to. Cincinnati gets cost certainty, but no free agent years and no visible discount. One agent says the Reds took on all the risk.

"The team paid him as if he was going to be a .350-40-120 player the next two years" the agent said.  "Had the team gone year to year to protect against diminished productivity or injury, would they have ever had to pay him more money than $38MM over three years?"

Recent history says the answer is no. Votto will earn more over the course of his first three arbitration years than Miguel Cabrera ($33.7MM), Albert Pujols ($32MM), Mark Teixeira ($27.9MM) or Justin Morneau ($22.5MM) did. Votto's money is now guaranteed, so the 2010 NL MVP will be cashing his checks even if he has an off-year or gets injured.

Ryan Howard ($44MM) is the one first baseman who earned more than $38MM for his first three arbitration seasons. The Phillies slugger pocketed $44MM for that chunk of his career, but one MLB insider says Howard set himself up for a bigger payday than Votto by posting better power numbers in his pre-arbitration seasons.

"Where Howard beats him is in terms of home runs," MLBTR's source said. "He had 129 to Votto’s 90. And Howard had 353 RBI to Votto’s 298. Qualitatively in terms of their rates with batting average and on-base plus slugging, they’re very, very close. The difference really is the home runs and the RBI."

The gap in power numbers would likely have been enough to keep Votto's 2011 salary in the $7-8MM range on a one-year deal. In other words, Pujols, Cabrera and Teixeira were attainable targets for Votto, but he wasn't going to approach Ryan Howard money in his three arbitration years.

This isn't to say that Reds GM Walt Jocketty was wrong to lock up his first baseman. The 2010 Sporting News Executive of the Year could look back on this deal as one that saved him money. His eight-year extension with Pujols and Lozano worked tremendously well, but that deal bought out five of Pujols' free agent seasons. 

This time the Reds guaranteed Votto more than fellow-MVPs Pujols and Morneau without obtaining the rights to any of his free agent seasons. The team gets cost certainty, but they are not getting a discount. Lozano and Votto secured a massive win that guarantees the first baseman more than most of his peers and allows him to hit free agency as a 30-year-old.


39 Responses to Votto, Lozano Make Smart Deal Leave a Reply

  1. Lunchbox45 5 years ago

    yup

  2. Ethanator99 5 years ago

    I hate this deal. This is the 3rd stupid deal the Reds have given out this offseason along with Arroyo and that 2 year deal to Cairo.

    I really don’t think that “cost certianty” should be that big of a deal for the Reds

    • $1529282 5 years ago

      It doesn’t really screw them over much either, unless there’s an injury to Votto or something. Coming off an MVP season, Votto would’ve submitted at least a $10M arb fee, if not more, and he’d have won too, if you go by Ryan Howard’s case. A $13M and $15M or $12M and $16M combo for his last two seasons is perfectly reasonable to assume.

      Unless you think Votto is due to collapse or suffer a serious injury, the Reds basically agreed to pay him what was coming to him anyway, and probably saved a few million in the event that he wins a second NL MVP, which Reds fans probably all agree is possible.

      • Lunchbox45 5 years ago

        no… even if he has 2 more identical seasons like last year. He wouldn’t have gotten more money then they gave.. They essentially paid him as if he was going to put up identical numbers to his 2010 season. Reds save no money with this deal.

      • Why would you go by Ryan Howard’s case for Joey Votto? Their career numbers leading up to arb 1 are not the same.

        • Threat_Level_RedSox 5 years ago

          True, but is anyone else wondering why the Reds didnt buy out any of his free agent years like most extentions for arb eligible players?

          • He said or insinuated multiple times this offseason he wasn’t going to go down that route, that he has “no idea where he wants to be in three years.”

            Buying out arb years was never on the table. This is just treating the MVP like the MVP.

          • Lunchbox45 5 years ago

            My guess is that Votto and/or his agent were unwilling to push back his free agency

        • YanksFanSince78 5 years ago

          Especially when you consider that HRS and RBI are given more weight than things like OBP and OPS. You know the saying “Chicks and arbitors love the long ball” and when you compare the two Howard’s first 3 year average of 51 hrs and 144 RBI makes Votto look sort of pedestrian @ 30 hrs and 100 RBI.

      • YanksFanSince78 5 years ago

        You are missing the point.

        “Unless you think Votto is due to collapse or suffer a serious injury, the Reds basically agreed to pay him what was coming to him anyway”

        The fact that those liabilities exist then why guarantee him anything when you can go year to year and protect yourself? You can’t assumethat he will have 3 more MVP type seasons, although I think Votto is a great player.

        Also, the poster just went to great lentghs to show that Votto was more likely to get around $7-$8 mil his first arb year. If that happens then gradual increases of $13 the 2nd year and $18 the 3rd stillput him @ a grand total of $39 mil. I don’t see too many scenarios where the Reds would end up paying more going year to year with Votto.

        Extensions to players under team control are all about risk/reward. The team will RISK giving a young player guaranteed money with the REWARD being that they have him for under market value for at least 2 or more of his FA years. Reds accomplished none of that.

        The only positve they obtained is good will, and we’ll see if that has any value in 3 years when he’s up for free agency. Will he keep in mind the team loyalty shown or will he chase the biggest pay check?

        • studio179 5 years ago

          “The only positve they obtained is good will, and we’ll see if that has any value in 3 years when he’s up for free agency. Will he keep in mind the team loyalty shown or will he chase the biggest pay check?”

          Exactly. That is the only point to this deal.

    • redsreignbegins 5 years ago

      You are one negative little man. I wouldn’t call any those deals “stupid.” Arroyo and Votto will be a big part of the Reds success over the next three years. Votto’s not cheap but Votto has a history of being one of the hardest workers in the game. He’s a dedicated and emotional player. I have no problem trying to keep our MVP happy, especially given the fact he missed parts of 2010 with depression. Arroyo is rock solid and most of that money is deferred (all of the way to 2020 no less) making it less money that it appears on the surface given inflation. I could guarantee contention with Arroyo and Votto and all of the other solid players wearing red.

  3. Joey Votto OPS+ in first 3 years: 152
    Ryan Howard OPS+ in first 3 years: 152

    And I still think this at least buys the team some goodwill w/ Votto when FA does come up, in that in the past they have taken care of him. I know that everyone is waiting to rip on this thought, so go at it.

    • Lunchbox45 5 years ago

      I don’t think arbitrators look at new age stats.. they look at HR’s, RBI’s and Howard had him beat in both. ..

      as for the good will aspect, I have to disagree.. If Votto was going to give something up for this the reds being so “nice” don’t you think he would have given them at least 1 year of his free agency in exchange for this generous deal?

      • That’s the point…at this time he’s not willing to give up FA years. He keeps on saying things like “I have no idea where I want to be in 3 years”.

        It’s going to be hard as #$%#$ to re-sign Joey Votto in 3 years. I have no problem w/ the team giving some goodwill now in order to maybe make it easier.

        I’d really put his chances of being a Red in 2014 at less than 50%.

    • alxn 5 years ago

      good luck finding an arbitrator who will put any value into OPS+

      • Hey, I’m just saying their first three seasons may not be that much different when factoring in time period and park factors, as this post seems to indicate.
        Not saying an arbitrator would have any idea what OPS+ is or would pay any attention. But I’m sure he could have it neatly explained to him.

        • YanksFanSince78 5 years ago

          I am not attacking you so don’t take this personally. In school they taught us never to make a statement or a comparative w/o knowing all the information.

          Ryan Howard doesn’t have any wacky career home/away splts.

          Home= 1,824 PA, 124 HRS, .279/.377/.575 @ 1hr per 14.7 PA
          Away= 1,941 PA, 129 HRS, .279/.367/.569 @ 1hr per 14.4 PA

          Your arbitor would throw your arguement that Howard is only as good as he is because of the ballpark he plays in.

          • That’s why I added time period, I realized it may not have been all park factors. Plus, not trying to be a *****, but the time period you’d want to look at for Howard would be his 3 pre arb years. And at the same time I’ll add that even if you only look at those 3 years, he’s still basically the same on at home and on the road.

            So big differnece then is just time period. There has been a regression league wide in power #s since 2007, and that is what accounts for the difference.

          • YanksFanSince78 5 years ago

            Hmmmmm……I don’t know if you can make that arguement for Howard. He had an “off” year in 2010 but is only 1 year removed from a 45 hr and 140 rbi year. And despite having an off year, his worst full season, his power numbers were still comparable to Votto’s (HR/PA; 1:20 for Howard and 1:18 for Votto). So Howard has the benefit of 45 hrs during a lge wide regression in 2009 and in his worst season, he posted power numbers simlilar to Votto’s best season. Bat avg, OBP, OPS and defensive metrics show that Votto is a better all around player but will that fall on deaf ear’s of the arbitrator?

  4. You are all forgetting that a lot of this money is a signing bonus, which comes out of a different budget than straight up team payroll (correct me if I’m wrong, Tim et al). Also, this deal is paying Votto as a relatively 4 WAR player (he was worth 7.4 fWAR last year), when, barring injury, he’ll likely be around a 5 WAR player for these years. I’m a Reds fan, and was very very unhappy with this deal at first, but the more analysis I’ve seen and the more details that are coming out about it, coupled with quotes from Votto about it, make me feel much better.

    • Bringing up WAR here is apples to oranges. Year to year they’d be paying him as a 4 WAR player when he’s a 5, too.

  5. RMR 5 years ago

    Pujols, 2004-06: 7.0/11.0/14.0 (32.0)
    Teixiera, 2006-08: 6.4/9.0/12.5 (27.9)
    Morneau, 2007-09: 4.5/7.4/10.6 (22.5)
    Cabrera, 2007-09: 7.4/11.3/15.0 (33.7)
    Howard, 2008-10: 10.0/15.0/19.0 (44.0)

    The latest of these was 3 years ago, others were earlier. This completely ignores the reality of salary inflation. Let’s adjust those figures to 2011 dollars those using a 7% inflation rate. Here are the totals:

    Morneau: 27.1
    Votto: 35.1
    Teixiera: 36.1
    Cabrera: 40.1
    Pujols: 47.4
    Howard: 49.8

    You can certainly debate the merits of cost certainty if you want to. But let’s not pretend like it was some great overreach. The value of money changes over time and in the proper context, Votto’s deal looks much more reasonable.

    As for resigning, Votto has very clearly expressed that he enjoys playing in Cincinnati and does not have his sights set anywhere else, save possibly for Toronto. He’s just not ready to commit to playing anywhere yet.

    • Lunchbox45 5 years ago

      I’m a terrible at this kind of stuff so sorry if this is a stupid question..

      but with the economy in the stinker, has the inflation rate really still climbed at a 7% rate?

      • RMR 5 years ago

        The baseball economy is certainly correlated with the larger economy, but it generally has experienced much greater inflation as a result of the massive revenue boom. I checked out a few recent studies and 7% seems to be an accepted average annual figure. It was higher pre-08 and less more recently, though that likely only exacerbates the Pujols and Teix contracts.

        The general point still stands. Whichever figure(s) you use, an analysis such as the one presented here is simply misleading without inflation-adjusted figures.

        • YanksFanSince78 5 years ago

          Your still missing the point. No one is advocating that Votto would not eventually earn $38 mil. In fact, that is exactly the point. If you’re not buying out any FA years, then why not go year to year and in the worst case scenario you protect yourself against fall off or injuries and in the best case you end up paying him $38 mil over 3 years anyway? It’s all risk on the side of the Reds with no benefit of below market value FA year buyouts.

          • Brad426 5 years ago

            You are wise. Well, for a Yankees fan, I mean.

        • RMR 5 years ago

          For reference, using 5% produces:

          Morneau: 25.7
          Teixiera: 33.6
          Votto: 35.9
          Cabrera: 38.6
          Pujols: 42.5
          Howard: 48.1

          Same conclusion. That said, prior to the great recession, mlb had been experiencing rates closer to 10%.

  6. BigRedOne 5 years ago

    The theme of this article is, “it’s smart for players not to want to play in small markets.” MLBTR is becoming another Fox Sports and ESPN as yet another mouthpiece for the large markets. Keep going down this road and there will be another work stoppage to ensure an even playing field for all teams. When baseball fans talk in the offseason the topics are not about plays or players but are now about “market size” and “signability”. And people wonder how baseball has fallen behind football and basketball in popularity?

  7. “The difference (between Howard & Votto) really is the home runs and the RBI”

    This agent strangely ignores 2 VERY important factors.

    1) Votto has 3.027 years of service time. Howard had 2 months less at only 2.145.
    2) It’s been 3 full seasons since Howard signed that contract.

    I really can’t see how he wouldn’t make at least Howard’s 10m, provided he didn’t submit a 14m figure with the Reds submitting 8.75 or something. The MLB CBA is clear –
    “This shall not limit the ability of a Player or his representative, because of special accomplishment, to argue the equal relevance of salaries of Players without regard to service, and the arbitration panel shall give whatever weight to such argument as
    is deemed appropriate.”

    If Prince Fielder just got 15.5m in arbitration there is no way Votto was going to make 7-8m after taking his team to the playoffs.

    • YanksFanSince78 5 years ago

      1st year players are thrown a bone. 2nd year bigger bone….so on and so on. 1st year arb players seldom get anywhere near their worth. It’s like paying dues.

      • Strange that you chose to ignore the clause from the CBA that says because of special accomplishment service time can be ignored considering that it’s the crux of my post.

  8. Awwwwww, RBI. Cute.

  9. bucs_lose_again 5 years ago

    True story. You nailed it, bub.

  10. YanksFanSince78 5 years ago

    No, I think my post came out before yours. :)

  11. Well, I keep on saying what the possible reward is, but you apparently don’t think it is a possible reward. Just keep an open mind, bud.

    You think these Pujols negotiations would be a little easier had the Cardinals been paying him close to market value the last 7 years?

  12. East Coast Bias 5 years ago

    I am very tempted to write a response…

  13. YanksFanSince78 5 years ago

    I can’t pass. Maybe the thought behind this post is that while you are a small market team it’s WISE to use extreme caution and to play things as close to the vest as possible. A perfect example would be the extension given to Jay Bruce. $52 mil is a lot to give a kid who hasn’t proven himself and has only hit over .260/.330/.470 once. If he blossoms into a star GREAT. If he doesn’t then he can be a liability on the payroll. Small market teams need to be smarter and need to see a larger body of work before making multi year deals when they don’t have to.

  14. @Chuck: Um, no, in my opinion, the Pujols negotiations would not be any easier if the Cardinals had “been paying him close the market value the last 7 years”. Why would they? Would Albert and his agent not want a $300 million/10-yr deal right now?

Leave a Reply