TCN Blog 2016 Top Story #3: International Shopping Spree

Because of their 2015 regular season success (100 wins), the St. Louis Cardinals received the smallest international bonus pool allocation of all Major League Baseball clubs for the 2016-2017 signing season, at just over $2 million.

However, due to favorable external conditions, the Cardinals decided to blow that budget out of the water, signing more players and spending at least eight times more money – including the associated MLB penalties.

Contributing factors to making this decision included a number of deep pocketed clubs held back from high spending on individual players due to prior year over-spending, a widening Cuban pipeline and unknowns prior to the new Collective Bargaining Agreement that went into place at the start of this month.

arozarena-machado-200_7939To date in the current period which began on July 2, the Cardinals have signed 25 international players, with more potentially under consideration. Sources including Baseball America and have disclosed signing bonuses for just 10 of the 25.

Of those 10, four have received more than $1 million, three of whom are Cubans. The other six picked up between $100,000 and $600,000 each in signing bonuses. The list is topped by outfielder Jonatan Machado, the highest-bonused international signee in team history at $2.35 million.

To help put that into perspective, Machado alone received more than the Cardinals’ entire international signing budget for the year. (In the photo, he is smiling in the foreground with another new millionaire outfielder and fellow Cuban, Randy Arozarena, in the cage in the background.)

Five of the 25 were signed to 2016 contracts and began play in the Dominican Summer League. The playing contracts of the other 20 will go into effect in 2017.

Here they are:

Signed – bonus reported (10) Pos Ctry Age Bonus Year
Jonatan Machado OF Cuba 17 $2,350,000 2016
Johan Oviedo RHP Cuba 18 $1,900,000 2016
Victor Garcia OF Ven 16 $1,500,000
Randy Arozarena OF Cuba 21 $1,250,000
Carlos Soler OF DR 16 $600,000
Franklin Soto IF DR 16 $550,000
Carlos Soto C Mex 17 $400,000 2016
Roy Garcia RHP DR 15 $200,000
Luis Montano OF DR 16 $200,000
Alexander Samuel OF DR 16 $100,000
Signed – bonus not reported (15) Pos Ctry Age Bonus Year
Rodard Avelino RHP DR 17
Allinson Benitez RHP Ven 16
Diomedes Del Rio OF Ven 18 2016
Joyser Garcia C Ven 16
Ivan Herrera C Pan 16
Erik Pena SS Ven 16
Yowelty Rosario SS DR 16
Enmanuel Solano RHP DR 17 2016
Larimel Soriano RHP DR 16
Cristoffer Zapata LHP DR 17
Leonardo Taveras RHP DR 17
Freddy De Jesus 1B DR 16
Pablo Gomez SS DR 17
Nelson Prada LHP Ven 16
Hector Soto RHP Mex 17

The first table is ordered by signing bonus amounts. The second is roughly sequenced by signing date, with the most recent, Mexican right-handed pitcher Hector Soto, announced just one week ago.

Now, let’s roll up the numbers – for those players whose bonuses have been disclosed. As a result of the exclusion of 15 players, remember that these numbers are low, not high, when considering the team’s total spend on international players this period.

Signed players (known bonuses) $9,050,000
Pool allocation $2,027,300
Pct over pool
Overage signed players (known) $7,022,700 246.4%
$ penalty Signing penalty
Penalty for signed (> 15% above pool) $7,022,700 100% tax No player over $300K in 2017-18 and 2018-19
Pct pool Signing penalty
Total cost signed players (known) $16,072,700 792.8% No player over $300K in 2017-18 and 2018-19

As noted, the Cardinals have committed over $9 million of player signing bonuses against their budget allocation of just over $2 million.

The reason for this is that the system was set up with low bars. The highest penalty rate possible under the then-current rules is incurred at 15 percent overspend.

As the table above indicates, the Cardinals have exceeded their allocation by more than $7 million. The club will owe that same amount to MLB, a 100 percent financial tax. In addition, St. Louis will be prohibited to sign any individual players for more than $300,000 each over both of the next two 12-month signing periods.

This is very important to understand. While the Cardinals have been fattening up their minor league system during this signing period, they will face an international famine in the 2017-2018 and 2018-2019 July 2nd classes. So it is especially crucial they get the right players this time around.

When all is considered, to secure the services of just 10 of these 25 young men, the Cardinals have spent over $16 million, or about 800 percent of their pool allocation.

To put that total into perspective, it is over 50 percent more than the organization spent on this June’s entire First-Year Player Draft. It is more than double what the Cardinals are paying for four years of Aledmys Diaz’ services.

Plus, the signing year is far from over. The Cards could decide to keep spending.

But even if not, this is an unprecedented player haul for the Cardinals organization, the likes of which we will not see again under the far more restrictive set of terms enacted in the new CBA, which explicitly prohibit over spending.

Link to The Cardinal Nation Blog’s top 10 stories of the year countdown

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