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How the valid offer affects the off-season

One of the topics to consider for the reason why the free agency in 2019 is slow is the impact of the qualifying offer (QO). Both off-season and 2018 and 2019 have been very slow and this article will see how QO could be a factor.

background

First of all, what is the valid offer? It is part of the free agency for players who have 6 or more years of service and have carried out their contract. As part of free agency players who have not been offered a QO in previous years a free agency can be offered a QO from the team that played in previous seasons (players acquired in the middle of the season are not eligible) . The player has 10 days to accept or reject the QO.

The qualification offer negotiated in the collective bargaining agreement covering the period 2012-2016 has had an impact after the 2012 season. It has evolved after the new CBA for 2017-2021. Below are details of how the qualification offer and its impact on the teams involved with the free agent.

  • Free agents can be offered an qualifying offer ($ 17.9M after 2018) from the original team
  • If a player accepts the QO, then they are no longer free agents and will play next season at the QO speed
  • If another team signs a free QO agent, the signing team may lose draft in the next year's draft
    • Before 2017, the teams lost a first or second round (the first 10 choices were protected)
    • Choices lost in the second and fifth highest selection, if they exceeded the luxury tax in the previous season
      • You also lose $ 1 million from the international bonus pool for the next signing period
    • You lose the third highest selection for a team that receives money for revenue sharing
    • Other teams will lose the second highest selection
      • In addition, he loses $ 500,000 in international bonuses

The Dodgers adapt to this low season. The compensation that the team losing the player can be anywhere from the end of the first, until after the fourth round. However, this aspect of the qualifying offer has no impact on the slow market.

For some excellent details see this article on Matt Kelly's MLB.com

Digging further into what a team loses

When teams lose a draft card, they also lose the bonus money that they would be able to pay their withdrawal charges. During the draft some players are enrolled higher up than they may have been carved out because they are willing to sign up for what is known as "under the slot". Each withdrawal in the first 10 rounds has a dollar amount. If a player signs under the slot, more money is available to sign the others.

When the draft starts all the teams have a certain amount of bonus money to try and sign their choices with. That amount is the total of all the draft slots of a team. See this breakdown of the 2018 draft for how the money is allocated. For example, if the Dodgers were to sign Bryce Harper as a free agent, they would lose their second to choose. Using the 2018 draft as an example, this would mean that the Dodgers would lose $ 917,000 of their total bonus of $ 5,288,200. Also, if the Dodgers signed Harper, they would have lost $ 500,000 of their $ 4.75 million to the international signature.

Impact on some players

Looking at the complete list of QO players over the years, it is obvious that the QO has a varied impact. For large free agents such as Zack Greinke or Bryce Harper, there is a zero impact as it is more worthwhile to lose a levy or international money. However, there are clearly some players who have been hit in a negative way. Teams are now smart enough to quantify the penalties for signing a free agent connected to a QO. We will see some examples of the last few years of players who received less than QO money and had a negative impact.

Howie Kendrick

After Howie Kendrick played the 2015 season with the Dodgers he was offered the QO, with the Dodgers wishing to get the draft compensation. They did a similar QO with Brett Anderson, but accepted the offer. Howie ended up not accepting the QO and spent a good two months looking for a job. The offers never came and ended up signing a 2 year / $ 20 contract with the Dodgers. Without the QO connected to him, I think he would have done much better in free agency. He was a strong player with the Angels before being traded with the Dodgers, but the teams felt they had not lost the draft choices.

Mike Moustakas

After the 2017 season Mike Moustakas was a free agent and ended up signing for only $ 6.5 million with incentives. Another good player who was entering his 28-year season and has definitely got a disappointing contract. Since this year is not tied to a QO, it will be interesting to see what the market will be for him.

Hyun-Jin Ryu

After an excellent season, but full of injuries, the Dodgers offered Hyun-Jin Ryu a qualifying bid. With a week to evaluate other offers, Ryu decided to accept the QO from the Dodgers. Like Kendrick and Moustakas, Ryu is a solid player, but is it really worth renouncing draft picks and losing international money? For many teams, it's probably not worth it.

Impacts on the off season

There are many reasons for the low seasons, with teams that do not sign free agents in a timely manner being a big part of the problem. Qualifying offers on some players can not help, but this year there are only 6 players with QO. I think only A.J. Pollock of unsigned players (Harper, Keuchel and Kimbrel are the others) is negatively affected. Yasmani Grandal also had an attached QO, but there were many factors that kept his contract low.

What is really happening is that most teams are becoming very good at giving the right values ​​to the players and not spending a cent for that value. Include penalties related to the signing of free agents in those calculations. Teams now also have metrics that can objectively show that many players begin to slow down in the early 1930s. In most cases, players who have a free agency at the age of 30 will not have 4 or more annual contracts.

Final thoughts

In order not to penalize QO players, I hope the next Collective Contract Agreement will remove the penalties for signing a QO player. Let the losing team the player still get the compensation choices and in this way the losing team gets something while the player's market does not have a negative impact. At a minimum, this creates a fairer market for all free agents.

The former GM Jim Bowden says the Dodgers are a "team that goes back"

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