Happy Friday, and welcome to Top of the Order, FanGraphs’ new triweekly column! Every Monday, Wednesday, and Friday, I’ll be starting your baseball day with some news, notes, and thoughts about the game we love.

To those who aren’t familiar with my work, a little background: I’ve been at FanGraphs since the beginning of the 2021 season. My work here has been largely behind the scenes, with my main responsibility being updating the RosterResource payroll pages (which are pretty great, if I do say so myself). I’ve worked with Jason Martinez and RosterResource as far back as 2012, when it was MLB Depth Charts, before it was in FanGraphs’ awesome interface and even before it was stored in Google Sheets (it was just text on a page!).

That transaction and payroll lens has dominated how I think about baseball over the last decade or so; it’s informed how I watch baseball, and it will certainly influence the topics I choose to discuss in these columns. I’m not watching for the long view of players’ Hall of Fame careers like Jay Jaffe does; I don’t have an incredible projection system like Dan Szymborski; I don’t have an innate feel for the game’s aesthetics and trends like Ben Clemens. I’m watching and following for information. Read the rest of this entry »

By now, you’ve probably heard that Shohei Ohtani’s $700 million contract will pay him through 2043, with Ohtani deferring an unprecedented $680 million (over 97% of his contract). The structure calls for Ohtani to earn just $2 million each year of the contract, and then $68 million a year for the 10 years following the deal.

Ohtani will inarguably be taking home $700 million via this deal, and I disagree with the notion that the contract should be described as anything other than that big number from a bottom-line perspective. But what matters, especially with regards to the Competitive Balance Tax (CBT), is the present value of the contract.

Article XXIII of the CBA concerns the CBT, and the key component for determining payrolls for CBT purposes is the average annual value (AAV) of contracts. If Ohtani’s contract didn’t contain any deferrals, his AAV would be $70 million, calculated by simply dividing $700 million by the 10 years of his contract. Where things get complicated is with deferrals. When money is deferred in a contract, the value of that money depreciates over time, and it is the depreciated value of the contract that is used as the numerator, or replacement for the $700 million, in the AAV calculation. Ohtani’s deferrals will be paid without interest, which is key for depreciating the value of the payment; interest would have increased the present value of the contract, and as such, the AAV and corresponding CBT hit. Read the rest of this entry »

The confetti has fallen, the Texas Rangers are World Series champions, and the offseason is upon us. Unlike the other major sports, the baseball offseason is usually a slow drip, which means there are a lot of transaction and roster deadlines between now and when pitchers and catchers report in the spring. Here are some key dates and events to keep in mind as you navigate the coming winter.

November 2

All XX(B) players officially become free agents

XX(B) free agents include all players with six or more years of service on an expiring contract who ended the season on the major league roster or injured list, excluding those with contract options or opt outs, as their decision doesn’t have to occur until later. There are a few exceptions to the rule, as due to clauses in their contracts, players with NPB or KBO experience like Shintaro Fujinami need not be at six years of service to reach free agency, as Fujinami will. Read the rest of this entry »

By now, you’ve probably seen that the Angels put what we in the business call “Darn Near a Whole Roster Of Players” on waivers. Per ESPN’s Jeff Passan, Lucas Giolito, Matt Moore, Reynaldo López, Hunter Renfroe and Randal Grichuk are all free for the salary relief taking; USA Today’s Bob Nightengale reports that Dominic Leone is on waivers as well. Meanwhile, Ken Rosenthal of The Athletic reports that Harrison Bader, Carlos Carrasco, Mike Clevinger and José Cisnero have also been placed on waivers by their respective clubs. What does this mean for those players? What about the teams waiving or claiming them? What about you, the reader? Let’s dive in to some of the common questions I’ve seen since the news broke.

Q: What does “being placed on waivers” even mean anyway?

In the context of post-trade deadline transactions, being placed on waivers is similar to the waiver action that occurs when a player is designated for assignment. However, since the trade deadline has passed, the option to trade a player who has been placed on waivers is gone. The only option for a claiming team is to claim the player straight-up, paying all of his remaining salary for the rest of the season. Read the rest of this entry »