Random Payroll Thoughts

Just trying to work through some ideas

Back in October, Bill DeWitt III sat down with St. Louis Business Journal and said that the front office planned to “climb the rankings” when it came to payroll. Around the same time, he said that the club was going to be “aggressive” and even though revenue might go down, payroll should go up.

In November, before the Thanksgiving-tide rush of activity, John Mozeliak reiterated that payroll would be in line with what the club would have finished with had they not traded off significant amounts of payroll at the end of 2023. That would put the club around the $190-$200 million range, according to Katie Woo’s article.

The Cardinals shaved $17.5 million with Adam Wainwright retiring, $3 million with Drew VerHagen’s contract finishing up, just short of $5 million with the trade of Tyler O’Neill (who likely would have eaten up more of ‘24 money), around $3.75 million non-tendering Dakota Hudson and Andrew Knizner (again, they likely would have cost more if they’d stayed). That’s closing in on $30 million that isn’t there anymore. There seemed to be a lot of room for additions after a terrible, terrible season.

This week, Bill DeWitt III told John Denton that the club was basically tapped out and there would be no more significant additions. Roster Resource has the Cardinals about a million shy of where they finished 2023 after all the trades, not before them. So what happened?

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We know the Cardinals weren’t completely silent this winter, of course. They added Lance Lynn, Kyle Gibson, and Sonny Gray, though with Gray’s backloaded contract that was basically the $30 million the club had already cleared out. The next biggest addition was this week, when they took on Andrew Kittredge who will probably get around $2.3 million in arbitration.

There’s some contract escalators as well. Willson Contreras is paid $8 million more. Steven Matz gets a couple more million. Tommy Edman and Ryan Helsley should get raises in arbitration. (On the other side of things, Miles Mikolas sees his salary drop by almost $3 million).

Still, this offseason doesn’t seem to mesh with the talk that was coming out of the front office this winter. Why is that?

Some will say that you just can’t believe anything the front office says. I’m not in that camp, however. We have seen that when the Cardinals talk vaguely about “being opportunistic” or “looking for ways to improve the team” that they tend to not do anything. When they lay out specific goals, they usually wind up fulfilling them in one way or another.

For instance, last winter they said that payroll would go up and they needed a catcher. They went out and got Willson Contreras and, while it may have only been a couple of million, payroll technically did go up. Granted, when a conservative front office makes a point of saying that, you don’t expect the increase to be a rounding error, you expect a significant bump. However, that’s the fans reading into things somewhat.

This winter, the focus was getting “three starting pitchers” and there was talk of two relievers as well. As we know, the three starters were quickly grabbed up and the Cards did get bullpen arms from Seattle (Riley O’Brien), Boston (Nick Robertson, Ryan Fernandez), and Tampa Bay (Kittredge). So they’ve done what they said they would do.

So in some sense the front office could say, “Look, we’ve accomplished what we wanted to accomplish and there’s no reason to just spend to spend. We’re in a good position for future opportunities.” Which would be fine if they’d built a team that was clearly an October contender. Instead, it’s a team that could win the NL Central but only because nobody else may want to (though don’t count out the Reds).

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We’ve also seen the Cards move the goalposts a bit, I think. We’re hearing more about the expanded coaching staff costing money and the money that they are investing in the team (and perhaps people like Chaim Bloom, though we don’t know his contract terms) seems to be getting lumped in with player salaries.

BDW3 said to Denton, “With payroll, it has to be thought of in the context of the whole business with all the investments we’re making in other aspects of the product on the field.” Which doesn’t really jibe with “climbing the payroll rankings” from October, since coaching staffs are never included in those totals. We’re talking about the 26-man roster, maybe the 40-man, but not the fact that they’re paying Yadier Molina again after a year hiatus.

What’s intriguing to me is that we’re hearing a lot more about the Bally issue being a challenge, even though as noted just a couple of months ago that wasn’t a drawback. The Cardinals should have been guaranteed their full share for 2024. It would be understandable if they didn’t go long-term on a lot of folks because of the insecurity of what’s going on with Diamond Sports, but 2024 should have been a 100% go and finances shouldn’t have been a huge concern (save for their reliance on attendance, but that would have been better addressed by a splashy new signing that increased excitement).

I’m thinking something has changed.

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I was wondering about something behind the scenes even before there was this little nugget in the NY Post article discussing MLB’s rejection of Amazon helping out Diamond Sports:

“At the upcoming bankruptcy hearing in Houston, MLB will offer Diamond a deal that reduces the media rights fees it pays for three of the 11 teams in exchange for MLB gaining the digital rights for all Diamond teams in 2025, sources said.”

What do you think the odds are the Cardinals are one of those three teams?

The Cardinals are one of the best draws in baseball. Even last year, they were in the top three in ratings. While their fee may not be the largest, it’s probably one of the bigger ones in the group that still relies on Diamond Sports/Bally’s to broadcast their games. The deal the club signed in 2018 was to be worth over a billion over the 15 years. Especially if that was a backloaded deal as you would expect, it’s not chump change.

If the Cardinals went into the winter thinking they were getting 100% in 2024 and now think they might get 70%, that could definitely change their approach to spending. There’s an argument that it doesn’t need to—Joe Sheehan pointed out this morning St. Louis might be the best team outside of NY, LA, or Chicago to do well with direct-to-consumer work—but it’s understandable that it would.

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If this is the case, there are a couple of questions that come along with it. The first is, of course, why the Cardinals would be asked to do this, assuming it wasn’t their idea. The second, which is somewhat related, is what do they get out of it.

We all remember that Bill DeWitt Jr. is the major reason that Rob Manfred is commissioner of baseball. Their relationship appears to be very solid. I could easily see Manfred sitting down with DeWitt and asking for his help in this matter, putting the good of MLB (getting more and more of the streaming rights in their hands) over a short-term hit to the bottom line.

The Cardinals are going to need more than altruism, though, to go along with this. It could be that they want the blackouts to end and they think this is the quickest way for it to happen. After all, they could sell a lot of streams to Iowa, Texas, Arkansas, and Illinois that they can’t now because of the blackouts. If they have plans for their own network—and they definitely should—being able to get into those plans sooner rather than later could be a carrot.

I also wonder if there wouldn’t be a handshake agreement that the next big foreign trip that comes up that the Cards are interested in they get. They did London last year, of course, and they have the “Field of Dreams” game this year in Alabama. You know, though, that they want to be at the top of the list for the next Puerto Rico game. Perhaps they’d like a shot at a Japan game. Something like that could be a sweetener as well.

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Maybe they aren’t a team that’s in line for a fees cut. Maybe it’s just that they hit their targets with a lot left over and now they don’t have to worry about it, though again their moves this winter don’t really scream “wake up call” like BDW3 said in his interview with Denton. Maybe they’ll have a lot of dry powder for the trading deadline, though it’s hard to imagine who would be on the market that would cost so much for two months.

The Cardinals improved their team this winter in the most Cardinal way possible. If it works, nobody will care. If holes start showing, though, the lack of winter spending is going to be the first thing everyone points at.