As the Phillies have ramped up their spending in recent years, the question has become inevitable: will they cross the luxury tax line for the first time, and if so when? GM Matt Klentak and president Andy MacPhail discussed the subject in camp, as Scott Lauber and Matt Breen of the Philadelphia Inquirer report.
Even as Klentak downplayed the importance of the $208MM line in the team’s decisionmaking, he also seemed to acknowledge it as a rather prominent factor in the internal decisionmaking process. Klentak labeled the Competitive Balance Tax line a “guide” rather than a “barrier.”
The rubber meets the road when a stated principle is put to a real-world test. Klentak says that hasn’t quite happened just yet, explaining that the team “never got to the point of really asking ownership about [any moves] because we never lined up a baseball trade that we thought was right.” If and when an opportunity arises that would force the Phils to foot a luxury bill, Klentak says he “would expect to have a good, productive dialogue with our owners about” the matter.
MacPhail suggested a clearer desire to push into the luxury realm if circumstances warrant. “It’s my hope and frankly my expectation that we’re going to exceed it this year,” he said. Read one way, that’s a strong indication that the club intends to spend. Read another, it’s an acknowledgement that the organization will plunk down more cash if the team finds itself in a competitive enough position. That’ll mean waiting to find out how the already assembled roster can perform.
In comments of more general interest — to the MLBPA, if not the casual fan — MacPhail laid out rather clearly how teams — even those with revenues as great as the Phillies — view the function of the tax. “Nobody can live over it,” MacPhail says of the luxury line. “The penalties are too severe — not just economically, but it grabs you every different way.”
It probably won’t take much to force a decision on the luxury tax matter. The Phils are right up on it already. Cot’s on Contracts has the club sitting at $203MM in CBT payroll, which is also Lauber’s estimate. Roster Resource has that number over $2MM higher, which would mean even less breathing room.
Calculating payroll for CBT purposes is an evolving process, of course. Decisions taken during the season can move it up or down. And it isn’t as if there is any drastic penalty for going over (just 20% on the amount over the line). The actual financial hit only ramps up when you go into higher tax penalty levels and do so over multiple seasons.
So, what does this all mean from a practical perspective? Perhaps Klentak should be taken at his word when he says the team is pleased with the talent it has assembled, which includes a long list of notable veterans on non-roster deals. There’s obviously room to improve and deepen the pitching staff and/or to add an established performer at third base or center field. But that’ll require a higher level of ownership involvement to complete, unless Klentak can work something out that’s mostly cost-neutral.
Odds are, any movement past the line — should it occur — will happen during the season. MacPhail says the club intends to “evaluate what we have and make a determination in-season as if we are going to go over or not.” The front office has seemingly already committed most of the money it has been allocated, even if its spending is viewed as a guide rather than a “hard barrier.”
Pay the tax
They will if they’re close at the deadline. They also need to extend Realmuto.
With extending Realmuto, they’ll definitely go over, unless they have the arbitration meeting first, and then they extend him. The Neris and Realmuto arbitration meetings will have a big impact on the tax too.
Love my Phils. But can’t stand these goof balls in front office. We will never win with Klentak and Macphail no matter how much we spend.
MacFAIL…as a Cubs fan I could never stand the guy. He takes way too long to make decisions and is very conservative.
I never really though about it before, but I think you hit the nail on the head.
I am okay with this. There’s a lot of talent on this club, but even Gerrit Cole would not have guaranteed them the division, or even third place. Braves are a better team than them. Nats, Mets and Phils are all close, but the Phils have the worst starting pitching of the bunch. So before making yet another splurge, let’s see where the Phillies are before the trade deadline. Also, 2021 sees a lot of money coming off the books. It also has a pretty nice FA class in terms of pitching. So that’s the time to really spend.
The problem is that by pushing back the highest hopes to 2021, they’ll be doing it without JT, who is “outta here” at season’s end. Bank on in Boston red for ‘21.
That’s a cute dream.
Almost no chance he goes to the RS. We have Vazquez through the end of 2022.
Is there really a nice FA pitching class next year? Had not thought so.
Decent mid-range starters – Bauer, Ray, Stroman, Tanaka. No aces.
Obviously, Betts will be the big attention better.
The Phillies have spent $100 million+ in free agency for three straight offseasons. They have been a .500 team for the last two years.
Make the move to get Kris Bryant already!
With Bryant it’s less about money and more about the Cubs asking price. Phils should not give up a ton for Bryant if they believe in Bohm.
I don’t believe there is as much interest in Bryant as the Cubs believe.
I dont know that the CUBS believe the Phillies have much interest in Bryant.
I would love to have Bryant on our team, but only if he signs an extension which is not likely to happen.
I am not ready to trade Bohm, Howard, or Kingery for a two year rental of Bryant.
You cannot trade Kingerey or Howard for Bryant. If you want to package Bohm and maybe OF talent, I’d do that, but the Cubs likely wouldn’t.
Every team is saying this either through the surrogates as with the Phillies or the owner directly.
It’s owners union propaganda.
It may be purely for the purpose of negotiating the next CBA or their lawyers may have concluded that using the tax as a CAP is collusion. The next time the owners are convicted of collusion they will be lucky to get a 50/50 split of ownership. They’ve used up everything.
Pssst, the owners are handing out huge contracts like were a Pez dispenser. If you want to prove collusion, it is difficult to do so with record-setting contracts.
For Tony Clark it would be. For a real thousand dollar per hour attorney it wouldn’t be hard at all.
It ain’t happening. The league breaks down into a few different categories:
1-Teams that are tanking.
2-Teams that are at the cap.
3-All other teams, and all other teams are spending.
Find me a single team that is not at the cap, or not rebuilding, that hasn’t spent any money.
I’m not sure whether to go with
Stupid money or you can’t handle the luxury tax. Decisions decisions
The Phillies spent years re-building and have no young talent to show for it besides Nola. Meanwhile, the Yankees, Dodgers, and Rays, teams that didn’t re-build, have so much young talent they have to trade some of it away.
Phils have young talent — and had more before the trades. The problem is the pitching that they didn’t surround their talent with.
Great math, great analysis.
Klentak and MacFail made too many “intermediate” moves and are not able to jump on the big one when it becomes time.
Yup. IMO, it started with Arrieta and continued with Robertson, but mostly Arrieta. They are paying him $25M this year. There are at least a few teams out there that Arrieta wouldn’t even be starting for.
Odubel’s 7.3M contract bones them. Robertson’s 11.5M too. 14M for a 4th OF isn’t good either. Whole lot of waste right there equals Nolan Arenado’s AAV.
The Phillies aren’t paying Bruce that much. I believe the Mariners are paying $12.625 MM of his salary next season.
It looks like it still counts against the luxury tax? 3 sites, 3 different luxury tax figures. Baseball Reference, Cots, Roster Resource.
You forgot Arrieta’s $25 mil hoping he can be a serviceable #3.
Since Odubel is in AAA I thought his salary didn’t count against luxury tax, like Rusney Castillo with Boston.
After Castillo, MLB eliminated the loophole.
Agree with Fred.
Remember a few years ago, they were bragging they didn’t have to sign many minor league free agents because they had prospects filling multiple slots at AAA?
If more of them had panned out , might not in as deep as they are now. With the exception of Nola,Hoskins and Kingery, the key pieces for the team are FA or were traded for . Hoskins is the only home grown player even close to being worthy of extending, and verdict is still out on him ….
This is why we need to hold onto Bohm and Howard and see how well they do with the great coaching staff we have in place.
Yeah, they definitely need to hold onto their top guys. That’s the case, especially since two of their top 5-7 guys had really subpar seasons in Medina and Garcia..
The Phillies really have to start developing more talent if they want to continue to field a sustainable winner. They’re going to have to develop and graduate their highly talented guys like Bohm, Garcia, Howard, Stott, Medina, Morales, and quite clearly Moniak..Odds are that not all of those prospects will hit, but regardless, they’re going to need for at least Bohm, Moniak, and two of their top pitching prospects to become successful ML regulars.
The Phillies just simply cannot afford to continue filling major holes with high priced free agents, or even above average priced guys. There has to be more of a balance moving forward, and if they can further achieve that balance, then the Phillies can continue being a contender moving forward…Otherwise, you end up like the Giants or repeating your previous history..
Just in terms of this season, the Phillies are definitely being overlooked. They very well could surprise some fans/analysts giving the Braves, Mets, and Nats all they can handle..It is going to be one of the best division races this season, and all of us fans should be rewarded with one heck of a showdown!!
Phils had a whole decade of awful drafting. Luckily, those prospects got them Lee, Halladay, Oswalt & Pence, and most besides Carrasco, Villar and maybe Domingo Santana have not panned out. Considering how badly some of those guys turned out (Kyle Drabek, Michael Taylor as 2 examples), thank goodness they were other team’s busts.
4 years, all sub .500, payroll butting close to the tax, “meh” farm system….and this is a franchise with a LOT of money……..
Not real impressed with Klentak.
Some of the guys they drafted could have been good trade chips, now they are wasting away in the Minors blocked and getting worse.
No disrespect to PHI fans but I think Philly finishes 3rd in this division ahead of ATL & MIA.
If their pitching doesn’t pull off a miracle, I can foresee another 81-81.
The only disrespect I see here is to ATL. I can see the Phils finishing 2nd to 4th. I don’t think anyone in the NL East is as good as the Braves.
Don’t overlook Washington. Even without Rendon, they have a terrific trio atop their rotation and a roster full of players who have a championship pedigree.
Somebody on one of the Phils blogs did an analysis on the WAR they’ve gotten from the draft and international FAs. I believe they were 29th between 2005-14, and they’re dead last in international FA WAR.
This regime doesn’t have much going for it yet besides Nola, Kingery and hopefully Hoskins. Couple that with having the #1 pick in a bad draft year, and you have the Phillies situation. As a fan, it hurts that they wouldn’t sign 1-2 more SPs, just as options when the 3-5 spots fall apart. You have $41 mil falling off next year so very little chance of going into repeat violator territory. It’s like buying a luxury car with all the bells & whistles, then scoffing at one additional add on at the end.
You know that thing everyone’s been saying about the Ricketts family all winter? That, but for John Middleton.
When you go over the luxury tax on a long-term deal you find you’re over next year too. Then you have to go even further over to add a player. You can end up like the Red Sox. They wouldn’t have been a favorite to make the playoffs this year but had the highest payroll in the game. So they had to trade Betts to get a team to take half of Price’s deal and now they’re even less likely to make the playoffs.
If the Phillies go over, it should be adding pitching, not to block Bohm, a guy who has enormous upside.
This exactly. The Phillies had an average offense last season.
“It’s the pitching, Stupid!”
But just don’t go to Acme and find quality pitching on the end of the aisle. That section was picked clean weeks ago when Coke, Bumgarner, Ryu and Porcello were snapped up.
You will not be blocking Bohm with Bryant because Bohm would certainly be part of the deal for Bryant.
And for all the pitching talk, the Phils certainly need help on offense as well. I’m not saying I want to trade for Bryant, but another solid bat would be a tremendous help. Maybe that will come from Bohm, but I still see him as a first baseman at best.
It’s not going to hurt much to go over the cap. The penalties are relatively low for first-time offenders. And their 2021 payroll is $118M plus maybe another $54M to replace Realmuto, Didi, and a closer. That’s more than enough room for another quality SP.
Phillies 3,4 and 5 starters need to be .500 if they are to challenge for anything and need a dependable bullpen. I’m honestly surprised they haven’t tried the Rays’ idea of an opener.
Trade for Bryant.