How changes to the luxury-tax threshold will affect the Phillies’ 2022 roster construction
With a farm system that lacks top-level talent, money is the Phillies' biggest asset. It's a good thing the luxury-tax threshold is $20 million higher.
So, where were we?
After a 99-day lockout of the players and six weeks of negotiators from Major League Baseball and the Players Association slinging proposals across the bargaining table, transactions were unfrozen Thursday night and 30 front offices braced for the bull rush of free-agent signings, trade talk, and salary arbitration filings that were stored up for three months.
The Phillies, in case you forgot, have a lengthy roster-building to-do list. Before the lockout, they signed free-agent reliever Corey Knebel and utility infielder Johan Camargo, and made a host of smaller moves, including trades for backup catchers Garrett Stubbs and Donny Sands and reliever Nick Nelson.
» READ MORE: Baseball is back: Players and MLB agree to new CBA; frenzy of transactions is next
But they still have a boatload of needs — a left fielder, a center fielder, late-inning relief (at least one pitcher), and starting-rotation depth — that will thrust president of baseball operations Dave Dombrowski back in the spotlight.
And the rules of engagement have changed. For one thing, this new collective bargaining agreement, ratified by the owners Thursday night, brings a higher luxury-tax threshold — $230 million, to be specific, in 2022, a 9.5% increase over last year.
The threshold rises in future years, too, but not by nearly as much. By 2026, the last year of the agreement, the luxury-tax bar will be $244 million, only 6% higher than at the beginning.
Pay attention to those numbers. In each of the past two seasons, the Phillies pushed the payroll to within about $600,000 of the luxury-tax threshold but didn’t surpass it. They have never surpassed it. Managing partner John Middleton indicated that he isn’t opposed to it, but only if the Phillies are one player away from being a serious World Series contender. They aren’t there yet.
But even if ownership, led by Middleton, continues to treat the threshold like a limbo stick (some would say like a salary cap), Dombrowski could still have as much as $20 million more than last year to build a roster.
Could that mean trying to bowl over free agent Kris Bryant with a high-dollar, shorter-term deal to fill the left-field/middle-of-the-order void? Or scooping up two relievers instead of one? Or taking on salary in a trade? Or splurging to re-sign popular Brad Miller for the bench?
» READ MORE: Phillies’ power-bat search: Kris Bryant brings versatility, production — and a steep price tag
It all has to be on the table, especially because the Phillies are dealing with the dual concerns of a 10-year playoff drought and a farm system that generally lacks top-level talent. Money is their biggest asset, which isn’t a bad position in a year when the luxury tax is being pushed upward.
Going into the lockout, the Phillies had committed approximately $183 million against the luxury tax. Nobody knew what the thresholds would be. But Dombrowski didn’t seem to be sweating it. He said in November that he received a budget from Middleton, although he predictably declined to share it.
“I don’t find it restrictive,” Dombrowski said. “Put it that way.”
It’s seemingly less restrictive now. Accounting for the $1.7 million that each team must now kick in for a new merit-based bonus pool for pre-arbitration (entry-level) players but not for the minimum-salary increase to $700,000, the Phillies are roughly $45 million below the $230 million mark, which should enable them to fill several holes.
Before the lockout, the Phillies were deep in talks with lefty-hitting free-agent outfielder Kyle Schwarber. They had also spoken with the Tampa Bay Rays about a potential trade for Gold Glove center fielder Kevin Kiermaier.
Other slugging left-field types are available, including Bryant, Nick Castellanos, and former New York Mets outfielder Michael Conforto. There are plenty of free-agent relievers, too, such as Andrew Chafin, Ryan Tepera, Mychal Givens, and longtime closer Kenley Jansen.
“There’s still a lot of players out there,” Dombrowski said 99 days ago. “I’m not sure how long the timeframe is going to be. None of us know. But we still have time to address the things that we need to do.”
Just not as much time as he hoped.
Spring training begins Sunday.
Tick tock.
» READ MORE: Phillies’ power-hitter search: Kyle Schwarber has pop, right price but questionable defense