International Slot Money Baseball

16-08-2021

International Slot Money Baseball

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International Slot Money Baseball

The new Collective Bargaining Agreement includes significant changes to the international signing rules.

There is no international draft, as Major League Baseball had initially proposed, but teams will now have bonus pools with hard caps. Gone are the days of teams being allowed to blow past their bonus pools, pay an overage tax and be limited to signings for no more than $300,000 the following two signing periods.

Bonus Pools

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Under the new system, beginning for the 2017-18 signing period that starts on July 2, most teams will have a bonus pool of $4.75 million. The clubs that receive a “Competitive Balance Pick” in Round A of the June draft get a $5.25 million bonus pool. The clubs that get a “Competitive Balance Pick” in Round B get a $5.75 million pool. So, essentially, some of the smaller market teams will get extra money in their pools. Signing bonuses of $10,000 or less will continue to be exempt from the bonus pools. Every team's 2017-18 bonus pool is available here.

Teams can also trade pool space once the signing period opens on July 2. They can acquire up to 75 percent of their original pool allocation in 2017-18 and 2018-19, then after that they can trade for up to 60 percent of their original pool. Teams are allowed to trade away as much of their pool as they want. So a team that starts with a $4.75 million pool could trade up to around $8.3 million, while a team with $5.75 million could trade up to get a little more than $10 million. One difference in the new CBA is that teams will now be allowed to trade for additional pool space even if they have already spent their full pool allotment. Under the previous system, a team's bonus pool consisted of four individual slot values, and trading pool space required trading those slot values. The new system is just a straight bonus pool with no individual slot values, so that should make things simpler with regards to trades.

The size of a team’s bonus pool could also shrink if the club signs a qualifying offer free agent. A team over the major league luxury tax that signs a qualifying offer player loses $1 million from its international pool the next signing period. All other clubs who sign a qualifying offer player will lose $500,000 from their pool the next signing period. All forfeited international bonus pool money will be distributed equally among the other clubs.

Penalties

Teams that went over their bonus pools in previous signing periods to incur penalties will have those penalties carry over into the new CBA. So teams like the Padres, Astros and Braves that are over their current 2016-17 signing pool will be unable to sign a player for more than $300,000 in the 2017-18 and 2018-19 signing period, though they are still able to spend their full pool allotment or trade it away.

Pool Exemptions

The rules also raise the signing age for players to be exempt from the bonus pools. The rules had been that international players were exempt from the bonus pools if they were at least 23 with five or more seasons of experience in a foreign professional league, like Serie Nacional in Cuba. Now players must be at least 25 with six seasons in a foreign professional league to be exempt. While those rules most commonly come in to play for Cuban players, the rules encompass all international players, including foreign professionals in Japan and Korea.

Just like under the previous system, signings from Mexican League clubs will continue to only have the amount of money that goes to the player count against a team's bonus pool. The majority of Mexican players are signed directly from Mexican League teams, some of which keep as much as 75 percent of the payment, though it varies by team and player.

A joint announcement from the commissioner’s office and the players’ association also notes that the bonus pools will grow in subsequent years along with industry revenues. The growth rate of the international bonus pools and the draft bonus pools will be equal. The announcement also noted that MLB “may impose strict penalties on any club that attempts to circumvent the system.”

A group of new athletes will join the Major League Baseball family this week as the MLB holds its annual draft.

The Pittsburgh Pirates selected Louisville catcher Henry Davis with the first overall pick and the Texas Rangers grabbed Vanderbilt pitcher Jack Leiter — son of retired big league All-Star Al Leiter — with the second overall pick.

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SETTINGS

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For players, the team that drafts them can have a major impact on how they develop as baseball players, but it also can have a huge impact on how much money they earn.

Each draft slot in the first 10 rounds of the MLB draft is assigned a certain amount of guaranteed bonus money it can offer that player, referred to as the “slot value.” The slot value is guaranteed in the form of a signing bonus.

A team could opt to spend more than the slot value but could incur a penalty from MLB if they do — a team could also spend less than the slot value, but risk the drafted player not accepting the offer. Unlike the NBA and NFL drafts, athletes selected into MLB can opt to go back to college if they are drafted out of high school, thus forfeiting any bonus money from the MLB team.

In baseball, all drafted players begin their careers in the minor league system, where salaries are low, so the signing bonus they receive on draft day makes up most of the money they will earn until they reach the majors. Once in the majors, they can begin to negotiate a new contract — only about 10% of minor leaguers make the big leagues, according to data from MotherJones.

A more detailed look at the MLB’s slot value system can be found here.

See also: How the NFL keeps its players from going broke

Because of this system, dropping a few spots during the draft can actually cost players hundreds of thousands and dropping 10 or more spots can cost a young athlete over a million of dollars.

Here are the estimated signing bonuses for the first round selections of the 2021 MLB draft, according to contract monitoring site Spotrac.

Pick No. 1 Henry Davis, Pittsburgh Pirates

Slotted bonus: $8,415,300

Pick No. 2 Jack Leiter, Texas Rangers

Slotted bonus:$7,789,900

Pick No. 3 Jackson Jobe, Detroit Tigers

Slotted bonus:$7,221,200

Pick No. 4 Marcelo Mayer, Boston Red Sox

Slotted bonus: $6.664,000

Pick No. 5 Colton Cowser, Baltimore Orioles

Slotted bonus: $6.180,700

Pick No. 6 Jordan Lawlar, Arizona Diamondbacks

Slotted bonus: $5,742,900

Pick No. 7 Frank Mozzicato, Kansas City Royals

Slotted bonus: $5,432,400

Pick No. 8 Benny Montgomery, Colorado Rockies

Slotted bonus: $5,175,900

Pick No. 9 Sam Buchman, Los Angeles Angels

Slotted bonus: $4,949,100

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Pick No. 10 Kumar Rocker, New York Mets

Slotted bonus: $4,739,900

Pick No. 11 Brady House, Washington Nationals

Slotted bonus: $4,547,500

Pick No. 12 Harry Ford, Seattle Mariners

Slotted bonus: $4,366,400

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Pick No. 13 Andrew Painter, Philadelphia Phillies

Slotted bonus: $4,197,300

Pick No. 14 Will Bednar, San Francisco Giants

Slotted bonus: $4,036800

Pick No. 15 Sal Frelick, Milwaukee Brewers

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Slotted bonus: $3,885,800

Pick No. 16 Khalil Watson, Miami Marlins

Slotted bonus: $3,745,500

Pick No. 17 Matt McLain, Cincinnati Reds

Slotted bonus: $3,609,700

Pick No. 18 Michael McGreevy, St. Louis Cardinals

Slotted bonus: $3,481,300

Pick No. 19 Gunnar Hoglund, Toronto Blue Jays

Slotted bonus: $3,359,000

Pick No. 20 Trey Sweeney, New York Yankees

Slotted bonus: $3,242,900

Pick No. 21 Jordan Wicks, Chicago Cubs

Slotted bonus: $3,132,300

Pick No. 22 Colson Montomery, Chicago White Sox

Slotted bonus: $3,027,000

Pick No. 23 Gavin Williams, Cleveland Indians

Slotted bonus: $2,926,800

Pick No. 24 Ryan Cusick, Atlanta Braves

Slotted bonus: $2,831,300

Pick No. 25 Max Muncy, Oakland Athletics

Slotted bonus: $2,740,300

Pick No. 26 Chase Petty, Minnesota Twins

Slotted bonus: $2,653,400

Pick No. 27 Jackson Merill, San Diego Padres

Slotted bonus: $2,570,100

Pick No. 28 Carson Williams, Tampa Bay Rays

Slotted bonus: $2,493,900

Pick No. 29 Maddux Bruns, Los Angeles Dodgers