Cashman's Cano Contract Conundrum

[RedOctober3829]

Robinson Cano asked theYankees for $300 million in a negotiations within the past couple weeks, and with the Yankees not ffering in that ballpark, the sides understand he will test the free-agent market.

Cano's request is said to cover 10 years, meaning he's seeking baseball's first $30-million-a-year deal player.

Cano was believed all along to be seeking a deal in the range of Alex Rodriguez's record $275-million deal, so it isn't a major surprise he'd seek that figure. Rodriguez was looking for something in that range before signing the record deal with the Yankees after the 2007 season.

Cano is in good position as the top free agent on the market, in a market flush with cash. However, it isn't known whether any team would pay in that range.

The Dodgers, the top candidate to spend, would like to lock up star pitcher Clayton Kershaw. The Cubs like Cano very much but see themselves as a year away from contention.

http://www.cbssports.com/mlb/writer/jon-heyman/23855076/cano-asks-for-300million-contract-froom-yankees

 

[TomRicardo]

Why does being a year away from contention stop you from giving a franchise player a long term contract?  You build around him.

 

[Trlicek's Whip]

Why does being a year away from contention stop you from giving a franchise player a long term contract?  You build around him.

 
Yeah - when you have no leverage, you manufacture a posture such as this. At least with Cano's first salvo that reduces the number of potential suitors and probably any "mystery teams." 

 

[jon abbey]

Oh man, $300M, including around $210M of dead money. That is insane, this should be interesting. 

 

[bankshot1]

Just the inflated sticker price.
 
But it kills the idea that Cano was going to give the Ys a hometown discount just to hang his # in Monument Park.

 

[Orel Miraculous]

Man, I'm torn on this one.  The right baseball move, I think, is to let him walk, as the Yankees aren't going to contend next year and it's almost a foregone conclusion that this will turn into an albatross contract (probably sooner rather than later, too)  So on one hand, I'm giddy about the possibility of them signing him for the next 10 years.  On the other hand, the apoplectic reaction from the NY media and fans that would ensue if they failed to sign him after this abortion of a season would be so much fun...

 

[jon abbey]

But it kills the idea that Cano was going to give the Ys a hometown discount just to hang his # in Monument Park.

 
Well, it's written by Boras' mouthpiece, not exactly a reliable source on contract negotiations. Just because Boras isn't Cano's agent anymore doesn't mean he doesn't have an agenda here. 

 

[EvilEmpire]

On the other hand, the apoplectic reaction from the NY media and fans that would ensue if they failed to sign him after this abortion of a season would be so much fun...

They won't get a peep from me if they let him walk instead of offering a 10 year contract.

 

[bankshot1]

I think the interesting variable is the Yankees reported desire to avoid the luxury tax, and reset the payout. With the team in dire need of a makeover, with the hopes and dreams of the franchise hinging on a slowly healing ankle, a hoped for poster boy strung-out on drugs, lawyers and image consultants, and no help on the farm, is saving the luxury tax and $75 million (my estimate) that critical, to walk away from the ultra-high end of the FA market? Do the Yankees re-think their short--term financial goal in face of obvious on-field needs?  

 

[Smiling Joe Hesketh]

 
Well, it's written by Boras' mouthpiece, not exactly a reliable source on contract negotiations. Just because Boras isn't Cano's agent anymore doesn't mean he doesn't have an agenda here. 

 
Well, why give the richest organization in all of baseball a hometown discount? If Cano wants $300 million, the Yankees are pretty much the only team capable of giving it to him. The Dodgers are pretty much tapped out at this point, and the Angels spent all their money on Pujols and Hamilton.

 

[Yaz4Ever]

I think the lure of a $200MM contract and naming a bathroom the Cano Commode would lure him there.
 
Or a $200MM contract and a slap to the face.
 
Or even just the $200MM contract on its own.
 
Gammo is prescient.

I would've thought so, too.  I guess we were wrong.

 

[rembrat]

Man, I'm torn on this one.  The right baseball move, I think, is to let him walk, as the Yankees aren't going to contend next year and it's almost a foregone conclusion that this will turn into an albatross contract (probably sooner rather than later, too)  So on one hand, I'm giddy about the possibility of them signing him for the next 10 years.  On the other hand, the apoplectic reaction from the NY media and fans that would ensue if they failed to sign him after this abortion of a season would be so much fun...

 
Cano is a victim of coming after Sabathia and Rodriguez' contracts. He's like Tony Soprano missing out on the golden age. I would be shocked if the Yankee public were anything but relieved at the prospects of avoiding another albatross contract. 

 

[bankshot1]

When the asking price is 10/300, is negotiating down to 8/200 that unthinkable? Hell it almost sounds reasonable.

 

[rembrat]

I don't think Cashman was born yesterday.

 

[jon abbey]

I'd be stunned if NY gives him $200M, my guess is they would top out around 7/140 or 8/160. If he can beat that elsewhere (a fairly big if), I think NY will let him walk. The Soriano acquisition hurts Cano's leverage a bit here, as I've said before. NY fans know and love Soriano from his first stint here, and he can be a solid middle of the order hitter for at least one more season. 

 

[bankshot1]

The Heyman article stated the Yankees offered Cano 7/140 in ST and they recently upped the offer (unspecified). And given that Cano did nothing to hurt his value since ST, and that almost everything else in Yankee-world turned to shit this year, I can't see them offering him less than what they gave Teixeira. (8/176).  

 

[jon abbey]

Peter Gammons ‏@pgammo49m
NL GM:"I think anyone who's been in the industry knows 10 year contracts don't work. Yankees haven't even talked to his agent for a month."

 

[jon abbey]

I can't see them offering him less than what they gave Teixeira. (8/176).  

 
Those were different times for NY for many reasons, also that specific contract has hamstrung them ever since (although it helped put them over the top in 2009). 

 

[bankshot1]

There is no question that was a different times, but the Yankees still have a stadium to fill and advertising to sell, and right now the cupboard of Yankee poster boys is a little low. And apparently the FO is ok with at least a 7 year contract, and ok with at least $20 million a year, so the question is how much leverage does Cano have, and does an extra year (8) and about $40-60 million over those 8 year, really that critical?   

 

[Orel Miraculous]

 
 I would be shocked if the Yankee public were anything but relieved at the prospects of avoiding another albatross contract. 

 
Well, maybe the fanbase wouldn't quite react with rage if they failed to resign him (the savvier faction of the fanbase anyway.), but can you imagine the resignation and apathy heading into next season?  Average attendance at the toilet has fallen from 46,000 in 2010, to 43,000 last season, and 40,000 this year.  They're going to drop again next year no matter what, but if they fail to resign Cano and essentially admit that they're punting 2014, they'll won't draw more than the mid-20s.

 

[DJnVa]

Olney today:

People familiar with Cano's thinking have a sense that he will take the biggest offer he receives this winter, regardless of whether it comes from the Yankees or another team.
 

 
So, no discount.

 

[Meff Nelton]

I'd cut it in half, and offer him 5/$150M. He's one of the top five players in the game, and figures to still be in that range for the next two or three seasons. He deserves something in the $25M range, and the overpay on the AAV is to cover the Yankees' ass on the back end, with the contract ending at 35. If he's set on getting a 7-10 year deal at an elite AAV, I let him walk with little complaint. The Yankees really wrung out his value like a washcloth over his last deal.

 

[NYCSox]

 
Well, maybe the fanbase wouldn't quite react with rage if they failed to resign him (the savvier faction of the fanbase anyway.), but can you imagine the resignation and apathy heading into next season?  Average attendance at the toilet has fallen from 46,000 in 2010, to 43,000 last season, and 40,000 this year.  They're going to drop again next year no matter what, but if they fail to resign Cano and essentially admit that they're punting 2014, they'll won't draw more than the mid-20s.

 
God I had so much fun going there in the late 80s/early 90s. A Sox game at the Toilet was like going to one in Tampa - we'd overrrun the damn place.

 

[hbk72777]

Let him walk. Besides, the Dodgers realize you can only field 9 players at a time, right? They already overdid it with 4 expensive outfielders (Crawford, Puig, Kemp Ethier) with 3 spots and no DH. In 2 years, they'll probably have a 400 million dollar payroll.

 

[jon abbey]

I'd cut it in half, and offer him 5/$150M. He's one of the top five players in the game, and figures to still be in that range for the next two or three seasons. He deserves something in the $25M range, and the overpay on the AAV is to cover the Yankees' ass on the back end, with the contract ending at 35. If he's set on getting a 7-10 year deal at an elite AAV, I let him walk with little complaint. The Yankees really wrung out his value like a washcloth over his last deal.

 
Meff, the voice of reason as always (ok, almost always). 

 

[bankshot1]

I'm not sure offering the most highly sought after FA available, 50% of what he wants, is a reasonable strategy, if the goal is signing the guy. Why would he rent his most valuable years at a modest premium to recent elite FA signings, (his teammates) while taking on the entire risk of an injury or declining performance in his late 30s, particularly when he holds most of the leverage. 

 

[Meff Nelton]

I'm not sure offering the most highly sought after FA available, 50% of what he wants, is a reasonable strategy, if the goal is signing the guy. Why would he rent his most valuable years at a modest premium to recent elite FA signings, (his teammates) while taking on the entire risk of an injury or declining performance in his late 30s, particularly when he holds most of the leverage. 

 
10/300 is a fantasy. Nobody is giving it to him, 8/216 is in my view the absolute upper limit of the market for him ($27M AAV.) $66M wouldn't be an insane amount to money to make up over five years at the end of his career, especially considering inflation in the sport. And that's assuming anybody would give him that number in the first place.

 

[terrynever]

Cano's price will come down over the winter. What interests me is whether he wants to play for a rebuilding Yankee team going forward. If he has to choose between a team with a bright future and the Yankees, what would he do? Take the money and run, I guess.
 
If he does leave, IMO he goes down as the greatest Yankee 2B in franchise history, and a totally durable player who rarely sat down with nagging injuries. Since 2007, his lowest games appeared total is 159 in the regular season. He played hurt a lot of times and still put up great numbers. And this season, with no protection until Soriano arrived, he became a more patient hitter, recording his most walks ever and highest OBP. He has finished third, fourth and sixth in the last three MVP races and should be among the top five this season, too. Probably top three because where would this shitbox of a team have been without him?
 
In keeping with recent budget decisions at other positions, I believe the Yankees will let him walk.

 

[JimD]

One factor in favor of a Cubs offer is no fear of losing their first-round draft pick.

 

[bankshot1]

 
10/300 is a fantasy. Nobody is giving it to him, 8/216 is in my view the absolute upper limit of the market for him ($27M AAV.) $66M wouldn't be an insane amount to money to make up over five years at the end of his career, especially considering inflation in the sport. And that's assuming anybody would give him that number in the first place.

No shit 10/300 is Cano's wet dream #, and is his opening ask. Its a negotiation. I assume the floor for him is slightly more than Teixeira contract.  

 

[Meff Nelton]

No shit 10/300 is Cano's wet dream #, and is his opening ask. Its a negotiation. I assume the floor for him is slightly more than Teixeira contract.  

 
And all I'm saying is that there is an AAV premium that would give him the opportunity to make even more money than a long term deal over shorter years if he remains healthy and productive going into FA again. The number is out there, maybe it won't be worth it for the Yankees or Cano in the end, but that is the target I shoot for.

 

[bankshot1]

I assume Cano doesn't have to take on risk of re-signing after a 5 year contract, so he won't. Further if the Heyman article is accurate the Yankees offered/are comfortable with 7 years. I'm not sure an 8th year will foul up a deal. But a 10th year might.

 

[CoRP]

 
10/300 is a fantasy. Nobody is giving it to him, 8/216 is in my view the absolute upper  lower limit of the market for him ($27M AAV.) $66M wouldn't be an insane amount to money to make up over five years at the end of his career, especially considering inflation in the sport. And that's assuming anybody would give him that number in the first place.

 
He is easily twice the player that Pedroia is and his ability to softly underhand the double play ball to Jeter is worth another $100 million on it's own.

 

[bankshot1]

Just saw this in today's on-line NY Times
 
http://www.nytimes.com/2013/09/27/sports/baseball/wide-gap-between-yankees-and-cano-in-contract-negotiations.html?ref=sports&_r=0
 
 

According to a person in baseball who was told of the figures that were exchanged months ago but asked not to be identified because he was not permitted to speak publicly on the matter, Cano has asked for a 10-year, $310 million contract, essentially confirming an earlier report by ESPN.The Yankees, the person said, responded with a contract offer similar to David Wright’s eight-year, $138 million deal with the Mets, but with no deferred money, making it worth more than Wright’s deal and well more than Dustin Pedroia’s eight-year, $110 million extension with the Boston Red Sox.
The Yankees then updated their offer to Cano to something in the neighborhood of seven years at roughly $23 million per year, or about $161 million base salary. There have been no discussions since then, the person said.
 

 

[Average Reds]

I have a hard time believing that Cano tops a 7 year, $161 million offer when he tests the market.  If I'm the Yankees, I pull that offer and wait for him to come crawling back.  No point in competing against yourself.
 
Of course, competing against themselves is what the Yankees (used to) do, so perhaps it will all work out for Cano.  But I tend to doubt it.

 

[bankshot1]

I have a hard time believing that Cano tops a 7 year, $161 million offer when he tests the market.  If I'm the Yankees, I pull that offer and wait for him to come crawling back.  No point in competing against yourself.

If the reports of the 7/161 million offer is accurate, adding in the $15MM he made this year, the Yankees basically offered Cano Teixeira's 8/176.

 
 

 

[Sampo Gida]

Thing is the Yankees can not afford to wait for Cano to construct the 2014 team. Cano has already said he is not going to make a quick decision and will likely take a Boras type approach to these deals and sign in January with the best offer.  Offer him the best deal you can, give him a Nov 30 deadline after which the offer is off the table
 
You can get a lot of free agents for 200 million. Guys like Choo, Drew, Peralta, Napoli, Salty, McCann, Cruz, Redmond, Garza, Colon, etc
 
Cano is the 13th best offensive player based on RAA per Fan Graph this year and 17th best wRC+.  You pay a premium for offense at 2B, better focus on positions where offense is relatively discounted.  WAR is inflated for some position due to positional adjustments and defense.  You don't pay that kind of money for defense when you can get defense cheap from guys like Ryan for almost nothing even if you lose some offense.  So long as you are getting the offense you need from your typical offense positions and you have pitching, you can sacrifice offense at 2B.  

 

[Brickowski]

Cano's price will come down over the winter. What interests me is whether he wants to play for a rebuilding Yankee team going forward. If he has to choose between a team with a bright future and the Yankees, what would he do? Take the money and run, I guess.
 
If he does leave, IMO he goes down as the greatest Yankee 2B in franchise history, and a totally durable player who rarely sat down with nagging injuries. Since 2007, his lowest games appeared total is 159 in the regular season. He played hurt a lot of times and still put up great numbers. And this season, with no protection until Soriano arrived, he became a more patient hitter, recording his most walks ever and highest OBP. He has finished third, fourth and sixth in the last three MVP races and should be among the top five this season, too. Probably top three because where would this shitbox of a team have been without him?
 
In keeping with recent budget decisions at other positions, I believe the Yankees will let him walk.

But what team is going to pay him anything close to $300M... or even $200M?  It would have to be a contender; a rebuilding team or a small market team will never pay him that.  Maybe Texas?   I just don't see a market out there.

 

[E5 Yaz]

I know he's shied away from doing big money deals in recent seasons, but given how much he and his manager hate the Yankees, and how it could potentially cripple a division rival, Peter Angelos might be tempted

 

[TheYaz67]

Agreed that $300M (and 10 years) is nuts - he ain't getting that b/c of what the A-Rod, Pujols, Wells and Hamilton contracts are looking like right now.  However, if the Yankees will not go north of $170-$180 million, I think someone (Dodgers, Cubs, mystery team) will go as high as $200M and 7/8 years (since he looks a good bet to be very productive for the first 4/5 years of a contract) and if so he will walk....

 

[mauf]

Cano's fWAR the past three seasons
 
2011: 5.3
2012: 7.7
2013: 6.1
 
A 3-2-1 weighted average of those numbers yields 6.5 WAR. Let's assume a little age-related decline, and that Cano's extreme durability has at least a little luck component, and project him for 5.0 WAR in 2014.
 
Now, let's apply a back-of-the-napkin version of Tango's method for estimating the value of these deals. I'm assuming $6mm/WAR is the going rate on the 2013-14 free agent market (which is a bit low, if anything), and 10% annual increases in free-agent salaries (from Tango's method -- seems a bit high, but the market is expected to remain robust in the mid-term). Also, consistent with Tango's method, let's assume that Cano's projected WAR declines by 0.5 per year.
 
This yields:
 
2014 -- 5.0 WAR @ $6mm/WAR = $30mm
2015 -- 4.5 WAR @ $6.6mm/WAR = $30mm
2016 -- 4.0 WAR @ $7.26mm/WAR = $29mm
2017 -- 3.5 WAR @ $8mm/WAR = $28mm
2018 -- 3.0 WAR @ $8.8mm/WAR = $26mm
2019 -- 2.5 WAR @ $9.68mm/WAR = $24mm
2020 -- 2.0 WAR @ $10.65mm/WAR = $21mm
2021 -- 1.5 WAR @ $11.7mm/WAR = $18mm
 
Total for 8 years = $206mm
 
I assume that no team will be willing to pay much to lock up Cano's age 39 and 40 seasons -- he might get a 10-year deal, but it won't be for materially more than $206mm.
 
I think assuming 10% growth in salaries is flawed, as some of the $$/WAR figures in the later years look insane. Tango's model used that as a flat assumption, but that was a different time in the history of the sport.
 
Cano is going to get more than many people are expecting, but $300mm? That's crazy talk.

 

[soxfan121]

You can get a lot of free agents for 200 million. Guys like Choo, Drew, Peralta, Napoli, Salty, McCann, Cruz, Redmond, Garza, Colon, etc

 
As a non-Yankee fan, I will be overjoyed to see them spend $200M on free agents. First, because that probably means their total payroll is going over the luxury tax limit, making this year's castoff adventure even sweeter. Also, most (if not all) of those guys are over 30, will require multiple year offers and will only plug holes in the dyke, not build a new foundation.
 
It will be interesting to see if the Yankees can again reload with free agents now that their core has aged out of effectiveness. All due respect to Mr. Robertson but this group isn't the same quality of homegrown winners. 

 

[Sampo Gida]

 
As a non-Yankee fan, I will be overjoyed to see them spend $200M on free agents. First, because that probably means their total payroll is going over the luxury tax limit, making this year's castoff adventure even sweeter. Also, most (if not all) of those guys are over 30, will require multiple year offers and will only plug holes in the dyke, not build a new foundation.
 
It will be interesting to see if the Yankees can again reload with free agents now that their core has aged out of effectiveness. All due respect to Mr. Robertson but this group isn't the same quality of homegrown winners. 

 
 
The Red Sox just signed a bunch of over 30+ FA with to deals up to 3/39 and it worked out well.  Most of the players I listed should be available for 3 years or less except Garza, Salty, McCann, and most of them will be available at 15 million or less per year.
 
Yankees have lived with the luxury tax forever.  Revenue sharing rebates are probably the main motivation to cut payroll.  Their post revenue sharing revenues are double the average MLB team plus they have YES revenues which are not counted or shared, so they can afford it.

 

[smastroyin]

But they have stated a goal to be under the tax, so the question is whether they do or not.

If they get out from under ARod and can go over the tax, they can do a lot of things.

 

[Sampo Gida]

But they have stated a goal to be under the tax, so the question is whether they do or not.

If they get out from under ARod and can go over the tax, they can do a lot of things.

 
I believe they said they would go over if needed to be competitive
 
http://www.upi.com/Sports_News/2013/01/11/Steinbrenner-not-worried-about-payroll-cut/UPI-45261357927070/
 
 
 

All I can continue to tell everyone is our commitment to the fans is never going to change. We will always field a championship-caliber team," Steinbrenner said Thursday during the meetings at the Sactuary resort in Paradise Valley. "Is our goal [a $189 million payroll] next year? Yes. But [we'll go that low] only if I'm convinced if the team I see, that we've put together, is a championship-caliber team."

 
If he sees a competitive championship caliber team in 2014 without going over 189 million then I want to smoke or drink what he is smoking or drinking
 
Arods suspension provides relief only for 1 year, and any significant free agents would likely want a commitment beyond 2014.  Of course, the tax would be reset to 17% in 2015 if they go under in 2014, so they would save about 15 million on tax in 2015 at 2013 salary levels, on top of the 75 million they save in 2014 on tax and salary for a total of 90 million .  But if they lose 100 million or more in revenue (Yankees and Yes) due to fielding a dog of a team in 2014, that does not seem wise, which is why I would be surprised if they do this.

 

[mauf]

 
If he sees a competitive championship caliber team in 2014 without going over 189 million then I want to smoke or drink what he is smoking or drinking
 
Arods suspension provides relief only for 1 year, and any significant free agents would likely want a commitment beyond 2014.  Of course, the tax would be reset to 17% in 2015 if they go under in 2014, so they would save about 15 million on tax in 2015 at 2013 salary levels, on top of the 75 million they save in 2014 on tax and salary for a total of 90 million .  But if they lose 100 million or more in revenue (Yankees and Yes) due to fielding a dog of a team in 2014, that does not seem wise, which is why I would be surprised if they do this.

 
Being under the tax threshold perpetually isn't on the table. The idea is to get under in 2014, then go over again in 2015. If they get out of most of their 2014 commitment to A*Rod and give Cano a 10-year deal to lower the AAV, I see no reason they can't be competitive in 2014 with a $189mm payroll. If A*Rod's suspension is trimmed to 50 games, that's a different story.

 

[Average Reds]

Maybe I've missed this, but has it been determined that the Yankees would get a dollar for dollar reduction in their cap hit if A-Rod is suspended?
 
I was under the impression that the cap relief for the Yankees would be the reduction in AAV, which would go down by approx. $3 million.  In that scenario, they would receive significant relief from a cash flow standpoint, but not in terms of their total payroll calculation.
 
Obviously I could be complete wrong, but I had not seen that answered and I didn't think that a suspension like that just gets wiped from the payroll.

 

[LeoCarrillo]

Reds, everything I've read says they get full relief. A-Rod is due $25m with an AAV of $27.5m. Either way, if he's banned for the season , they can use that money.

Estimates were that the Yankees had 16 under contract for about $100m and needed to get 9 guys for about another $90m to stay under the 189.

Bemoan it all day long, but the A -Rod rebate now probably means they can sign Cano and still stay under.

 

[Average Reds]

Reds, everything I've read says they get full relief. A-Rod is due $25m with an AAV of $27.5m. Either way, if he's banned for the season , they can use that money.

Estimates were that the Yankees had 16 under contract for about $100m and needed to get 9 guys for about another $90m to stay under the 189.

Bemoan it all day long, but the A -Rod rebate now probably means they can sign Cano and still stay under.

 
 
That kind of sicks, but it is what it is, I guess.
 
Thanks for the info.

 

[LeoCarrillo]

That kind of sicks, but it is what it is, I guess.

Thanks for the info.


It does suck, but it's not like it will likely make them competitive next year. And the plan was probably just to get under once and start spending again.

So ultimately they'll get a revenue- sharing rebate once and their luxury- tax hit will take a few years to get back up to 50%.

It's just money for the Steinbrenners, who were gonna start spending anyway.