In my first post about Evan Longoria’s long-term contract, I completely ignored the three option years (2014 through 2016). The six-year base contract was already a no-brainer for the Rays and team-options can never be a bad thing. But after figuring out exactly what those options included, this is an even a bigger steal for Tampa Bay than I first thought. If Longoria could have signed the six-year contract without the option years, he should have.
Part of the base salary of $17.5MM that everyone’s quoting is a $3-4MM* buyout of the first option year. So the additional cost of the listed $7.5MM 2014 option is really only $3.5-4.5MM. That’s peanuts, especially considering the Rays only have to pay it if they want to. Actually, the cost of the option is $1MM more than that because it triggers a buyout on the 2015-2016 combined option.
And how about that second option? It’s for $11MM in 2015 and $11.5MM in 2016 for a total of $20.5MM (removing the $1MM buyout charged to 2014). That much money would buy a slightly above-average player on the free agent market — Longoria could be much better than that. There’s also an MVP-clause (I can’t find the details) that could bump the 2016 salary up by $2.5MM. Hmm, $2.5MM more if Longoria’s one of the best players in the league? I think the Rays would be ok with that.
So let’s break down the contract year by year given worst-case and best-case scenarios. If Longoria’s a complete bust but sits around in the Tampa system and earns the arbitration bonuses, the Rays will owe him:
Year Salary 2008 $500,000 2009 $550,000 2010 $950,000** 2011 $2.5MM 2012 $4.5MM 2013 $10MM ($6MM plus 2014 buyout) 2014 nada 2015 nada 2016 nada TOT $19MM
If Longoria turns into a star, never goes back to the minors, and earns his MVP bonus, he’ll be paid:
Year Salary 2008 $500,000 2009 $550,000 2010 $950,000 2011 $2MM 2012 $4.5MM 2013 $6MM 2014 $7.5MM 2015 $11MM 2016 $14MM TOT $47MM
Yowzers. Worst case, the Rays are out $19MM. Yeah, that’s a lot of money, but it’s not like we’re talking Barry Zito at $19MM per season here. Best case, the Rays have a superstar signed for three years of arbitration and three years of free agency for an average of $7.5MM per season. Just counting his free agent years, he’d average about $11MM per season. For an MVP candidate. That will cost you $20-25MM in today’s market. And again, the Rays only have to pick up those option years if Longoria lives up to the hype. If not, no worries.
Update: Here are some answers to common questions about Longoria’s contract.
Footnotes
* $4MM if Longoria was eligible for arbitration in 2011, which would only happen if he’s sent down to the minors for an extended period of time.
** It’s interesting to note that the Rays have already guaranteed Longoria more money in his third season than Pujols made, which is the record.
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Sky is a baseball fan and racket sport afficianado living in upstate NY. His favorite color is orange and is just about ready to give up on his life-long dream to become the next Magnus ver Magnuson (World's Strongest Man). His favorite baseball teams are the Yankees and Red Sox, proving that there's hope in the Middle East.
April 20th, 2008 at 3:04 pm
[…] strange supporting this one outright. But make no mistake, this is a tremendous deal for Tampa Bay. Sky has the math on it, but it’s really very simple: if Longoria turns into Abraham Nunez, the Rays will be out […]
July 2nd, 2008 at 11:22 pm
Great analysis! The Rays look like huge winners if Longoria averages what he has for half of a season. Even though I believe that the success of any deal cannot be determined until at least half of the contract is fulfilled, I suspect that Longoria will be a bargain at $14MM in 2014 with inflating salaries and the huge projection of this Major League talent. The Rays GM deserves the executive of the year award for every year that Longoria is in the top 10 of MVP voting, which will not be rare, I predict, over the next decade. The Rays are built to sustain *and* succeed in a small market.