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An updated estimate of the Cubs’ 2022 payroll and luxury tax

The lockout ends — let the chaos begin!

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Thursday, baseball went from the proverbial zero to 60 in about three seconds after MLB owners and the MLB Players Association came to a tentative agreement on a new collective bargaining agreement.

I’ll have more to say about some of the changes coming to the game later today, but first, I thought you’d all like to be brought up to speed on the Cubs’ payroll as it stands right now and how much is left over for any possible moves the team could make before Opening Day, which is now just 27 days away.

One thing that’s changed for the team is the minimum salary, which will start in the new agreement at $700,000. That’s a significant increase from the 2021 figure of $573,000. Here are all the numbers for the guys who — as of this writing — figure to be on the team’s Opening Day roster. Now, remember that there have been no transactions (other than minor league signings) for the last 100 days! It seems likely the Cubs will add some players, or make some trades, before they open the season against the Brewers April 7 at Wrigley Field.

Cubs estimated salaries and tax hits for 2022

Player Salary Tax hit
Player Salary Tax hit
Marcus Stroman $23,666,667 $23,666,667
Jason Heyward $22,000,000 $23,000,000
Kyle Hendricks $13,875,000 $13,875,000
Wade Miley $10,000,000 $10,000,000
Willson Contreras $8,700,000 $8,700,000
Ian Happ $6,500,000 $6,500,000
Yan Gomes $6,500,000 $6,500,000
David Bote $3,000,000 $3,000,000
Harold Ramirez $1,600,000 $1,600,000
Clint Frazier $1,500,000 $1,500,000
Alec Mills $750,000 $750,000
Rowan Wick $730,000 $730,000
Adbert Alzolay $720,000 $720,000
Nick Madrigal $720,000 $720,000
Rafael Ortega $720,000 $720,000
Frank Schwindel $720,000 $720,000
Justin Steele $720,000 $720,000
Patrick Wisdom $720,000 $720,000
Codi Heuer $715,000 $715,000
Nico Hoerner $715,000 $715,000
Keegan Thompson $710,000 $710,000
Brad Wieck $710,000 $710,000
Sergio Alcántara $705,000 $705,000
Scott Effross $705,000 $705,000
Manuel Rodriguez $705,000 $705,000
Tommy Nance $705,000 $705,000
Michael Hermosillo $700,000 $700,000
40-man minor leaguers (estimate) $2,250,000
Player benefits & misc (estimate) $16,000,000
Cubs share of IFA bonus pool $1,666,667
(Reserve for trades) $10,000,000
TOTAL $109,511,667 $140,428,334
2022 LUXURY TAX THRESHOLD $230,000,000
CUBS UNDER TAX BY $89,571,666

As always for these posts, I turn the rest of this post over to BCB’s The Deputy Mayor of Rush Street, who always does excellent, detailed work on payroll matters. The rest of this article is his.


The 2022 Cubs Roster - Lockout Ends: Let the Chaos Begin!

Top Line: The tentative agreement has the CBT/luxury tax threshold for this coming season increasing $20 million over the 2021 season. The bad news for Cub fans, I don’t anticipate this will have a major effect (if any) on the projected baseball budget this year, which for purposes of this series is still estimated at $170 million.

Still, committing nearly $80M before the lockout and landing two of the better free agents available* is a sign that (at the least) Jed Hoyer is making more of an effort than his old boss did in paying attention to both sides of his version of ‘parallel tracks’. It also opens the question of will ownership and the front office go further to set up a plausible playoff spot contender this year - now with three wild cards - by adding one more key free agent?

To try and answer that, we’ll first take a look at where things stand, and then I’m afraid we’ll end the discussion with a big question. I still don’t see clarity at this point.

* - As catchers go, while not necessarily a ‘major’ free agent, Yan Gomes was probably the best available option in the market.

Transactions Since Our (Next to) Last Update

11/19 - RHP Ethan Roberts and OF Nelson Velasquez were selected (added to the 40-man) in advance of a Rule 5 Draft that hasn’t happened, at least not yet.
11/22 - Cubs acquired OF Harold Ramirez from Cleveland for cash - basically an enhanced waiver claim.
11/30 - RHPs Trevor Megill and Jason Adam were waived off the 40-man roster
12/1 - C Yan Gomes signed as a free agent - 2 years, $13M ($6.5M AAV)
12/1 - RHP Marcus Stroman signed as a free agent - 3 years, $71M ($23.3M AAV)
12/1 - OF Clint Frazier signed as a free agent - 1 year, $1.5M (plus up to $1M in incentives)
12/1 - OF Michael Hermosillo signed as a free agent - 1 year, $600k

Since then, there have been a handful of minor league, non-roster signings

Bring. Those. Lights. Back. Up.

A reminder that any ‘announced’ CBA deal still may require typing up, checking over and then formal ratification, and information is limited to a degree until the MLBPA puts up a copy of the actual terms on their website. We go with the best we can obtain for now.

Which means the next date we need to keep in mind is... unnecessary! It’s now an all-out sprint to Spring Training. Signings to finish locking in a team for the coming season will commence, MLB’s answer to “March Madness”.

That said, there has been plenty of coverage of the labor negotiations elsewhere on the site. Here, we’re concerned with Jed Hoyer completing his roster for 2022.

So where DO we stand with the roster at this point?

(Note, these figures are for each player’s ‘cap hit’, the charge against the Cubs’ luxury tax spending level. The base luxury tax threshold has been reported to increase to $230,000,000 for 2022 in the new CBA.)

Players with guaranteed contracts

Stroman $23,666,667
Heyward $23,000,000
Hendricks $13,875,000
Miley $10,000,000
Gomes $6,500,000
Bote $3,000,000 (2 options - expected to start the season on the IL)
Frazier $1,500,000 (1 option)
Hermosillo $700,000
===================
TOTAL $82,241,667
===================

Arbitration-eligible players (based on MLBTR Estimates)

Contreras $8,700,000
Happ $6,500,000 (2 options)
Ramirez $1,600,000
====================
TOTAL $16,800,000
====================

Note: The MLB minimum salary for 2022 rises from $573,000 to $700,000 as reported in the details of the new CBA agreement.

Pre-Arb Players more likely to make the 26-man roster as things stand

Alcantara $705,000 (OUT OF OPTIONS)
Alzolay $720,000 (OUT OF OPTIONS)
Effross $705,000 (3 options)
Heuer $715,000 (3 options, out for the season with TJS)
Hoerner $715,000 (2 options)
Madrigal $720,000 (3 options)
Mills $750,000 (OUT OF OPTIONS)
Nance $705,000 (2 options)
Ortega $720,000 (OUT OF OPTIONS)
Rodriguez $705,000 (1 or 2 options)
Schwindel $720,000 (2 options)
Steele $720,000 (1 option)
Thompson $710,000 (2 or 3 options)
Wisdom $720,000 (1 option)
Wick $730,000 (1 option)
Wieck $710,000 (OUT OF OPTIONS)
===================
TOTAL $11,470,000
===================

Pre-Arb 40-man players more likely to start in the minors

Abbott $700,000 (2 options)
Amaya $700,000 (1 or 2 options)
Canario $700,000 (2 or 3 options)
Deichmann $700,000 (2 or 3 options)
Espinoza $700,000 (1 or 2 options)
Marquez $700,000 (2 or 3 options)
Morel $700,000 (2 or 3 options)
Rivas $700,000 (3 options)
Roberts $700,000 (3 options)
Rucker $700,000 (3 options)
Velazquez $700,000 (3 options)
Vizcaino $700,000 (2 or 3 options)

Other expenses

40-man Roster Players in Minors $2,250,000
Pension Payments & Sundry Expenses $16,000,000
Cubs’ Share of IFA Bonus Pool $1,666,667 (based on $50 million total pool reported)(Reserve Withheld for Trades/Buffer)¹ $10,000,000
===================
TOTAL $29,916,667
===================

GRAND TOTAL FOR CAP PURPOSES $140,428,334

LUXURY TAX THRESHOLD $230,000,000

CUBS CURRENTLY UNDER THE TAX BY $89,571,666

¹- Optional Expense, but some amount figures to be held back from whatever Tom Ricketts sets the baseball budget at.

ADJUSTED FOR ACTUAL PAYROLL EXPENDITURES IN 2022

GRAND TOTAL IN CASH OUTLAY $129,896,334

(This figure includes deducting $532,000 in adjustments between contract payouts and cap valuations, and less the optional $10,000,000 trade buffer.)

Projected Opening Day Roster

OF - Hermosillo, Ortega, Happ, Heyward, Ramirez, Frazier
IF - Wisdom, Hoerner, Madrigal, Schwindel, Alcantara (David Bote is expected to start the season on the IL)
C - Contreras, Gomes

SP - Hendricks, Stroman, Miley, Mills, [Alzolay/Steele]
RP - Wick, Thompson, [Alzolay/Steele], Wieck, Effross, Nance, Rodriguez (Codi Heuer is out for the season after Tommy John surgery)

[with Rucker, Roberts, and likely some non-roster options contending for the last bullpen spot]

Minors - Cory Abbott, Miguel Amaya, Alexander Canario, Greg Deichmann, Anderson Espinoza, Braylin Marquez, Christopher Morel, Alfonso Rivas, Ethan Roberts, Michael Rucker, Nelson Velazquez, Alexander Vizcaino.

(The 40-man Roster currently stands at 39.)

Now, the roster here is a bit unrealistic. I don’t see how they can go with six outfielders and just one backup middle infielder to Hoerner and Madrigal, but that’s the way the guaranteed deals have worked out to this point. Six outfielders, none of whom can be sent to the minors without a chance to become free agents. For the seventh bullpen spot I’ve chosen Manuel Rodriguez’s big arm as a default, but there should be a competition for the last couple of spots, or even room to add a veteran arm now that we’re on the other end of the lockout.

And along with this new CBA, the heavily rumored universal DH has come to pass, so another thought is adding a bat somewhere. At this time, I’d say you can only count on Wisdom, Schwindel, Happ and Contreras for “thump” in the lineup. That doesn’t leave all that much opportunity to swap out hitters, unless perhaps David Ross is thinking of letting Willson’s bat get 60 games or so in the DH spot. An opening can be made if the team wants to sign an extra hitter.

But the larger question is: Did the signing of Marcus Stroman open the door for another big move, perhaps a move for a “franchise” player? And does an extra $20 million added to the tax threshold create even more space to allow Hoyer to grab a “tentpole” for the Marquee Network (and foundational player for the next Cubs’ playoff run)?

Last time, I mentioned that it matters if the ‘baseball budget’ is closer to $140 million vs. closer to $180 million. Well, it stands around $140.5 million right now. Of the $70 million or so that I thought Jed Hoyer had to spend at the start of this off-season, Stroman, Gomes, Ramirez, Frazier and Hermosillo combine for just short of $34 million of it. If a top-level hitter/franchise player like Carlos Correa strikes your fancy, that could take a 10+ year, $300M+ commitment. That might not be in the budget unless you’re happy with the rest of the team as is, or if Tom Ricketts is willing to boost the payroll up toward $190 million to land what would be a foundational building block for the next Cubs’ championship contender. Again, does the (quasi) salary cap going up create spending space for Hoyer?

Bottom Line: You can still make a case for another bullpen arm, at least one more BOR/depth starting pitcher, and a bat/DH type - but a middle infielder, particularly a shortstop seems an obvious add. Considering the track record I don’t see how you can count on Hoerner and Madrigal to play a combined 280 games. Of course, there are still a few options on the free agent shortstop market (age in parentheses):

Carlos Correa (27)
Jose Iglesias (32)
Andrelton Simmons (32)
Trevor Story (29)

Also, but more as utility options:

Mike Freeman (34)
Erik Gonzalez (30)

So I leave you with the still salient, last question I asked here: What’s your baseball budget number this year, and are you willing to plan for a step beyond any free agent deal we’ve seen from the Cubs before?

We’ll be back at some point to assess what (if anything) Jed Hoyer does with this mad scramble of player signings to finish off the ballclub the team will begin the season with.

Now Let’s Play Ball!

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