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The Indians have signed left fielder Michael Brantley to a four-year deal worth $24 million, with an $11M team option (or $1M buyout) for 2018. The contract covers all three of his arbitration-eligible years, along with his first year or two of free agency, and keeps Brantley under team control through his age-31 season.
Guaranteeing a player $25 million when his contract could have been handled on a year-to-year basis is a risk, no doubt, but I think it's the sort of risk the Indians should be taking. In fact, I hope there's a bigger risk in their near future, in the form of an even longer, more expensive extension for Jason Kipnis.
In order to assess an extension like this, it's important to consider what Brantley's cost would have been if the Indians had gone year-to-year with him.
The starting point for that would have been his 2014 salary. The two sides were scheduled for an arbitration hearing next Monday. Brantley's side had submitted a bid of $3.8 million, while the Indians were offering $2.7 million. I've already said I think Brantley would have won if they'd reached the hearing, so I'm using $3.8 million for 2014.
From there, it gets more difficult, because production and health create a wide range of possibilities for years two and three, but let's start by examining what his salary would have been if he'd remained the same sort of player he's been the last couple years.
What sort of player has Brantley been?
Over the last two years Brantley has a batting line of .286/.340/.399, good for an OPS+ of 110. The most significant changes in his offense from 2012 to 2013 were a moderate decline in his walk rate (from 8.7% to 6.5%) and a moderate improvement in his stolen base success (from 12 for 21 to 17 for 21). The general consensus on his defense is that he's a bit better than average in left field, with solid range and sure hands. All told, Brantley has been worth something like 2.5 wins a year, making him a bit better than an average player.
What do arbitration raises look like for players like Brantley?
Maury Brown has kept careful arbitration numbers, and in a post at Baseball Prospectus a couple years ago, he studied that offseason's arbitration-eligible players, and found that outfielders received an average raise of 66% in their second year, and of 53% in their third year.
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For specific comps, there's Hunter Pence, who (coming off a season with an OPS+ of 112) received a 97% raise in his second year of arbitration, and Adam Jones, who (coming off an OPS+ of 111) received an 89% raise in his second year. Those guys both had more power than Brantley, so I think their figures are high, but the average second-year raise of 66% might be a little low (especially since the BP article says overall raises that year were at their lowest level since 1996).
A 66% raise from his hypothetical $3.8 million salary in 2014 would boost his pay to $6.3 million for 2015. A 53% raise from $6.3 million would bring his salary to $9.7 million for 2016. Add those three years together, and you get a total of $19.8 million for the next three years.
At $19.8 million for the next three years, the fourth year of this extension, when Brantley would otherwise be a free agent, instead keeps him under team control for just an additional $5.2 million, far below what a 2.5-win player would receive on the open market. The $11M option will likely be well below average for a 2.5-win player by 2018 as well.
If Brantley maintains the kind of production he's put up over the last couple years, the Indians are going to get something like $10-15 million in surplus value. If you think Brantley will improve any further (or if based on other outfielders' raises, you think the figures I used for Brantley are low), the surplus value is even greater than that.
If the Indians are to be consistent contenders in the next 4 or 5 years, it's likely to require the team's top prospects developing to the high-end of their possible outcomes, and their current young players making further strides (or at least maintain their 2013 production). Right now the team has a fairly solid core of relatively young players. If guys like Kipnis, Brantley, Carlos Santana, Yan Gomes, Danny Salazar, and Corey Kluber don't improve/maintain, the Tribe is probably sunk no matter how much they're paying those guys, because the team doesn't have the means to to fill that many important roles through free agency.
I wanted the Indians to extend Kipnis last offseason, when he would have been $10-15 million cheaper through 2018 or so than he would be now. If they wait another year and he puts up the same kind of numbers he did in 2013, he'll become another $10-15 million more expensive. Brantley wouldn't have become that much more expensive, but the same principle applies. He's been very consistent over the last two-and-a-half years, and is still only 26, making him as good a bet for maintaining his production as anyone.
If you role the dice on a young core and they succeed, you've locked good players into below-market contracts. The money you've saved can be used to bring in the missing piece or two that's needed in a given year.
That's how a team like the Indians succeeds.
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