The 2012 MLB Rule IV draft will most likely be seen as a failure. Prior to the draft, we discussed on multiple occasions how the new rules put in place to limit spending on signing bonuses were supposedly a means of ensure the most talented players were drafted first. Instead, it’s opened the door for organizations to take advantage of a lack of leverage given to college seniors, while attempting to allocate the majority of their spending limits to their first few draft picks.
For the uninitiated, here is a summary of the new rules:
MLB has set a predetermined value for every pick, from $7.2 million for the number one choice to $100,000 for any pick after the 300th. These are the resulting slot allowances for every team, also with the amounts of money that each team spent in the first ten rounds of last year’s draft, as well as the overall amount they spent:
|Team||Picks||Bonus Pool||2011/Top 10||2011/Total|
Information from Baseball America.
If a team fails to sign a player drafted in the first ten rounds, that draft pick’s allotment comes out of the team’s total budget. Teams that go over the total budget up to 5% in signing bonuses will face a 75% tax. Teams that go over slot by 5-10% face a 75% tax and the loss of a first rounder. Teams that go over slot by 10-15% face a 100% tax and the loss of a first and second rounder. Teams that exceed slot by 15% or more face a 100% tax and the loss of two first rounders. Teams that don’t exceed their draft spending limit will have a chance to obtain picks from teams that over-spent.
After the first day of the draft, with the Toronto Blue Jays selecting Matthew Smoral in the supplemental round, a player who promised to be a tough sign considering the amount it would take to sign the team’s two first round picks, I wondered if the organization, perhaps like the Pittsburgh Pirates, was prepared to embrace the penalty set out for going over allotment.
It might make sense. A team could punt it’s first two rounds of picks in order to sign all of the expensive players that other teams concerned with their allotments had bypassed. It would certainly be risky, but there’s never a shortage of high school prospects who scare off teams because of their bonus demands and commitments to college programs. Even with the 100% tax, the draft often proves to be a remarkably better area in which to invest than free agency.
However, on the second day of the draft, it’s become a lot more clear, what the Blue Jays are actually up to.
I’ll let J.J. Cooper of Baseball America explain:
The draft rules set up in the new Collective Bargaining Agreement were designed to hold down signing bonuses and get teams to line up their draft boards based more on talent and less on a player’s signability.
On Monday night, that ideal held true. Players were largely picked based on where teams saw them on their draft boards. And while Stanford righthander Mark Appel’s slide added drama, the draft didn’t see a Jacob Turner, Josh Bell or Nick Castellanos-like slide, where a premium talent fell a long way to a team willing to meet his significant asking price. The draft board largely lined up based on talent.
That wasn’t true on Tuesday as the draft wore on, however. It became clear that for many teams, the second half of the top 10 rounds was less about best player available and much more about the best player willing to accept a small bonus.
Cooper points out that while teams might have appeared to be aggressive in the first rounds of the draft, they were incredibly conservative in the later rounds.
The Blue Jays were as aggressive as anyone in the first three rounds of the draft, selecting premium high school talents in Matt Smoral (supplemental first round) and Anthony Alford (third round). Both could have asking prices well beyond their draft slots. But after taking Alford in the third round, Toronto selected seven straight college seniors.
College seniors have little bargaining leverage. If the Blue Jays work out well-below market deals for some or all of those college seniors, they could use the extra money to sign Smoral or Alford. The Blue Jays’ total bonus pool is $8,830,800. The seven Blue Jays’ picks from the fourth through 10th round carry an allotment of $1.244 million. If the Blue Jays hypothetically signed those seven players for $200,000 total, that would be $1 million that could be used to sign Smoral or Alford.
If we look at the past, this strategy makes an incredible amount of sense. The team is ultimately dealing with likelihoods. It’s more likely that a player selected earlier than later will be better. In fact, the importance of this chart can’t be overstated in this case:
What selection would you prefer to compromise in this case? An earlier pick or a later pick? The choice is rather obvious. Depth isn’t nearly as important as talent for the Toronto Blue Jays. And nor should it be, given the history of the development of baseball players. Put simply, the Blue Jays are selecting top heavy in their picks as opposed to going for an all around good draft. And it’s a strategy that’s pretty hard to argue against.
In the National Post, John Lott delves into some of the specifics, going over the Jays picks in the fourth to tenth rounds.