TBT Companion: Low Payroll Teams

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TBT Companion: Low Payroll Teams

Post by RonCo » Mon Apr 13, 2020 6:01 pm

Editor’s Note: This feature is an addendum to the conversation featured in episode #7 of The BBA Today, wherein Matt Rectenwald and Stephen Lane break down the causes and ramifications of the data presented here.

# # #
There have, at times, been conversations about raising the salary cap. You know what I mean, right? Release the pressure? Open things up a bit? Maybe soak up the excess cash out there in a different way?

This article isn’t about that.

I mean, to be honest, I’m not sure how moving the cap would make things better or worse, but I admit I find more compelling arguments for staying the course. So, no, I’m not going to talk about any movement. Nor am I going to dwell on folks at the top of the cap—which a lot of people say is where you’ll find the movers and shakers—this, of course, despite the fact that last year’s Landis winner’s payroll was “only” $102M (defeating YS9’s $111.5M) and the year before Las Vegas won on a payroll of only $90.7M (beating an even more austere Louisville at $74.8M). In 2039, Jacksonville at $103.7M beat Calgary’s $94M in the Landis. A year before that, Edmonton’s $94M payroll beat Vegas’s behemoth $111M staff.

(Aside: All of these values are “after bonuses” numbers, hence can be over the $110M salary cap)

The bottom line is that the correlation between a team’s use of payroll, while interesting, does not seem to be particularly compelling as a reason to pick a winner when it comes to the Landis.

Add to this, the cases of Montreal, Twin Cities, and Wichita this year.

Which, of course, is the purpose of this feature.

Here is the required chart: I created it by tabulating each team’s variance from average payroll (which is $87.8M) as I write this—pre-bonuses, of course. I then listed those values by standings rank—in other words, Division Leader at the top.

2042-Payroll-Divisions.PNG

So, yes, look at Montreal (whose payroll is really $51M under the average). Look at Twin Cities. At Wichita.

Admittedly, it’s only mid-May, so the rankings could well be suffering from sample size, but recent conversation around the league suggests a sense that Montreal and Twin Cities’s starts are possibly an indicator of something real, while the jury is still out for Wichita. Take that for whatever it’s worth. Regardless, all three of these teams are running massively sub-average payrolls, and all three are playing winning baseball. (To give an idea of the magnitude of the payroll deficit these guys are running, if you take them out of the league, the BBA average payroll would jump $5M/team, from $87M to $92M.)

If one of these teams will keep the Anti-Payroll pedal to the metal for the whole season and walks into the post season, well … folks might just think that GM was really sick and they won’t follow him. But if two of them do it, well, maybe they’ll think those two were just an interesting pair, and still just let ‘m pass on by. But if all three of them do it…well…can you imagine, three teams walking into the post season singing a tune with this kind of Anti-Payroll sentiment, and ten walking out? Well, friends, if three teams manage the trick, then they may think it's a movement. And that's what it would be, the Montreal, Twin Cities, Aviators Anti-Payroll Movement!

Hmm…okay…sorry about that.

For just a moment I felt the need to sing along.

Kinda.

With feeling.

Anyway, where was I? I dunno what this will mean in the end. You can make up your own damned mind, though a few questions hit me:
  • How much of this is fueled but these guys drafting in that but 2037-2039 time period? If a lot, is this approach sustainable over the seasons?
  • Are these three teams true candidates for long runs?
  • Assuming their payrolls rise in 2043 and beyond, how much will be in Free Agents and how much will be to keep their kids in the organization?
  • What will three teams with this kind of cash to throw around do in the draft and International Free Agent markets?
The questions are endless, right? I ponder, too, for example, how historical this situation is? Which Landis winner had the lowest payroll?

Of further note, Charm City is also running a fairly large deficit relative to the league, and while they have struggled to start the season, they were a bit of a media darling in some corners to be a team that, led by the sublime Wilson Andrade, might make big waves in the Atlantic.

So, what does that mean?

If Wichita fades like the pundits think they might, and Charm City rises into its place, does that change the conversation?

I don’t have the answers to any of these questions, but I’m looking at the situation, and I’m intrigued.
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Re: TBT Companion: Low Payroll Teams

Post by Fat Nige » Mon Apr 13, 2020 6:36 pm

Wichita aren't running such a low payroll through any sort of choice, WE HAVE NO MONEY. I inherited a team that had been running at a loss for so long that there was no cash, no ballpark funds and no wiggle room anywhere. The budget was down to around $80m, thankfully I had a ton of PPt's to fix that a bit but I'm running the best I can. Even on my $53m payroll I'm scheduled to make less than a million profit. If I go to the FA pool who do you think I can improve for $1m??? I'm smart but how do improve without sorting my finances first?
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Re: TBT Companion: Low Payroll Teams

Post by Lane » Mon Apr 13, 2020 6:41 pm

that's why i included budget in my comment. i know that not all teams are able to spend to the cap at any given time
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Re: TBT Companion: Low Payroll Teams

Post by GoldenOne » Mon Apr 13, 2020 6:53 pm

I see those teams as heading towards a cyclical event as opposed to sustainable. In 2-3 seasons, those teams are going to start hitting some big ARB numbers and having some bigger holes to fill on their teams. I think those bigger drafts from 38-39 or so are coming together for some teams now but in a couple of seasons we will start to see the movement that we used to see as some teams start to looking at filling some big holes while also battling an increasing payroll.
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Re: TBT Companion: Low Payroll Teams

Post by RonCo » Mon Apr 13, 2020 7:30 pm

GoldenOne wrote:
Mon Apr 13, 2020 6:53 pm
I see those teams as heading towards a cyclical event as opposed to sustainable. In 2-3 seasons, those teams are going to start hitting some big ARB numbers and having some bigger holes to fill on their teams. I think those bigger drafts from 38-39 or so are coming together for some teams now but in a couple of seasons we will start to see the movement that we used to see as some teams start to looking at filling some big holes while also battling an increasing payroll.
The closed-loop nature of this league (salary caps set where they are, revenue streams where they are, and players moving on even more readily) means that the kinds of decisions teams need to make to stay on top will change. I think you're right the the arb window will drive GMs to make some tough decisions if they are going to be able to stay on top.

I haven't seen Jeffrey work yet, so he's going to be fun to watch. Nigel has been around for a long time--but he's got less resources to deal with. Brandon is on build #2, and Scott, too, has learned some lessons about how the world works when you try to extend everyone at once.

It's going to be fun to watch these guys come up the curve and deal with the problem sets related to guiding this kind of team through the mine field.
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Re: TBT Companion: Low Payroll Teams

Post by GoldenOne » Mon Apr 13, 2020 10:46 pm

There are also a few other teams out there that may be heading in the other direction too so it will be interesting to see if those voids get filled, how they get filled, who fills them, and if the fulfillment can be maintained for a while.
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Re: TBT Companion: Low Payroll Teams

Post by johnd2442 » Tue Apr 14, 2020 2:12 pm

Anti payroll pedal to the metal! I liked reading this even though I've got no horse in the game. Just like I liked the podcast with Matt and Stephen talking about this. It challenges me to think about my own team's budget and what may happen for the future.
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Re: TBT Companion: Low Payroll Teams

Post by Fat Nige » Tue Apr 14, 2020 2:18 pm

johnd2442 wrote:
Tue Apr 14, 2020 2:12 pm
Anti payroll pedal to the metal! I liked reading this even though I've got no horse in the game. Just like I liked the podcast with Matt and Stephen talking about this. It challenges me to think about my own team's budget and what may happen for the future.
All the podcasts in this league are worth listening to, they are filled with great analysis, information about the league and indeed just general info on the workings (or not workings) of OOTP.
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Re: TBT Companion: Low Payroll Teams

Post by bcslouck » Tue Apr 14, 2020 6:04 pm

I like pushing payroll but free agency hasn't really had pieces that made sense for me to spend on. It'll be going up soon anyway with some of these guys starting to hit arbitration.
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