Should Dan Uggla Have Taken the Money?

According to Ken Rosenthal, Marlins 2B Dan Uggla was offered a 4 year, 48 million dollar contract, buying out his final year of arbitration and his first three free agent seasons yesterday. The second baseman declined the deal, preferring to head to arbitration this season and enter the free agent market after the 2011 season.

Uggla made $5.35M and and $7.8M in his first two arbitration years. Given his great 2010, particularly at the plate – .381 wOBA and 140 wRC+ along with the more arbitrator-friendly numbers of a .287 average, 33 HR, 100 R, and 105 RBI – Uggla can probably look to make over $10 million dollars on a one year deal for 2011 from Florida. By taking his arbitration reward in 2011 and then his first free agent contract in 2012, there’s good reason to believe that Uggla could pick up more money, a longer contract, or both.

First of all, Uggla’s play has been worth at least $12 million every year since 2008. In 2008 and 2010, Uggla compiled 4.5 and 5.1 WAR, each year worthy of $20 million. Even his down 2009 (.274 BABIP) was good for 2.8 WAR and just over $12 million of value. His bat is consistently among the best at the second baseman position. Even with poor defense (around -10 runs against average according to both the fans and the metrics), Uggla is fully capable of All-Star type seasons and a mortal lock to be above average overall.

Uggla also could be betting on an uptick in the economy. The dollar per win value that we use here has been rather stagnant from 2008-2010, and given the current state of the economy, I don’t expect much growth out of baseball salaries in 2011. But as the U.S. economy moves further away from the near-depression levels it reached in 2008, the willingness of baseball owners to open up the pocketbooks should increase. Perhaps the winter of 2011-2012 could be that time. It’s rather unlikely that salaries would dip over this time, making this a low-risk strategy for the Uggla camp.

Going forward, I like Uggla’s odds of beating the contract offered to him by Florida. He’s topped four wins in two of the last three years, and even if his BABIP sits closer to .300 than the .330 of 2010, Uggla will still be near the top of any offensive 2B leaderboard. His defense may be a concern toward the back end of any deal he signs, but he has a bat that should play at any position on the easier end of the defensive spectrum. The only problem is that he will be 31 at this time next year, which may make some suitors shy away. Despite his age, though, his offense will likely be too much for a few teams to resist, and he could even see a Jason Bay (comparison) type of contract in a few scenarios.

It’s always risky to turn down $48 million, but Dan Uggla could be able to bring down even more if he’s patient. Apparently, his risk premium is such that he’s willing to risk collapse in 2011 to bring down more money from 2012-2014 (and possibly beyond). It would’t be hard to understand if Uggla chose to take the guaranteed money, but barring a catastrophe, Uggla should win out in the long run.