Analyzing CarGo’s Contract

In January, the Rockies accomplished a feat thought to be impossible: they locked up Carlos Gonzalez, who is represented by Scott Boras.  Despite Boras providing CarGo with "actuary tables that would show Gonzalez's earning power if he would stay healthy and productive," the Rockies were able to buy out three free agent seasons at less than $18MM per year.

Gonzalez's seven-year, $80MM deal set a record for the largest deal signed by a player with between two and three years service time.  The contract topped Hanley Ramirez's six-year, $70MM contract, signed nearly three years ago.  Other recent deals for two-plus players include Justin Upton's six-year, $51.25MM contract and Jay Bruce's six-year, $51MM pact.  A few details on the four contracts:

  • Gonzalez is paid $23MM for his three arbitration years plus $53MM over the course of three free agent seasons ($17.67MM per).  There are no option years, so CarGo could reach free agency at age 32 and score one more huge deal.
  • Ramirez gets $23.5MM for his three arbitration years and plus $46.5MM over three free agent seasons ($15.5MM per).  His deal also has no options, and he can reach free agency at age 30.
  • Upton will earn $20.75MM for his three arbitration years plus $28.75MM over two free agent seasons ($14.375MM per).  The deal has no options, and he can be a free agent at age 28.
  • Bruce will make $25.25MM over four arbitration years plus $25.5MM guaranteed over two free agent seasons ($12.75MM per).  In the likely event Bruce's 2017 club option is exercised, that's $37.5MM over three free agent seasons or $12.5MM per.  If the option is exercised he'll reach free agency at age 30.

CarGo essentially matches Ramirez's arbitration earnings and tops his free agent take by a total of $6.5MM.  In one sense Boras deserves credit for brokering the largest deal ever for a two-plus player, but in another Hanley's agents at WMG win since their deal came almost three years earlier.

Though the Rockies paid top dollar to do Gonzalez's extension now, the savings could still be significant.  Further along in their careers, Ryan Howard and Joey Votto required $44MM and $38MM for their three arbitration years, respectively.  Howard later gave up five free agent seasons at $25MM each, so paying CarGo $16MM in 2015 could be a downright bargain if he remains an elite player.

For my take on the Rockies' other huge extension, the Troy Tulowitzki contract, click here.



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