With free agency more or less in the books and all arbitration cases having been decided, the projected payrolls for Major League Baseball teams are becoming more clear. A few moves could occur before the start of the season — maybe some contract extensions, maybe some trades — but given the information we have, we can come pretty close to projecting Opening Day payrolls for all 30 teams.
Overall, spending has increased moderately since last season. A year ago, the average Opening Day payroll was right around $128 million, which itself represented a very small increase over 2015 despite big spending in free agency. This year, the average payroll is up to $133 million, a 4% increase despite uncertainty with the new Collective Bargaining Agreement and a weak free-agent class.
In what follows, I’ll consider the league’s payrolls in a few different ways. Salary information has been collected from Cot’s Contracts, while the equivalent of the MLB-minimum salary has been attached to open roster spots, bringing each team to 25 players. Money for players not on a club’s roster roster — as in the case of the Reds, for example, who are paying $13 million for Brandon Phillips to play in the Atlanta suburbs — is included in the payroll for the team actually paying the money.
To nobody’s surprise, the Los Angeles Dodgers have the highest payroll in baseball.

The Dodgers come in at around $235 million, which is roughly $40 million clear of the second-place Detroit Tigers. Even after accounting for the competitive-balance tax, it appears as though the Dodgers are still looking at a reduction of more than $30 million from last season. Even if they need to cut payroll more, the result should hardly be debilitating for the health of the team.
The tax amount for this season is $195 million. When you account for the $15 million or so that gets added for benefits and the rest of the 40-man roster, it would appear that the Tigers and Yankees will pay between $5 million and $10 million, the Giants will be right on the borderline, and the Red Sox might actually be under, as Allen Craig and Rusney Castillo don’t count for tax purposes.
Read the rest of this entry »