News from the wire about this coming offseason’s qualifying offer:
Teams have been told that at the qualifying offer to free agents this offseason will be in the $18 million range, maybe $18.1 million.
— Buster Olney (@Buster_ESPN) July 20, 2017
This is about a million dollars more than last year’s qualifying offer, and remember that the rules have changed. Here are the parts relating directly to the Chicago Cubs:
For signing a player who rejected a qualifying offer:
A team that neither exceeded the luxury tax in the preceding season nor receives revenue sharing will lose its second-highest selection after the first round in the following year’s Draft as well as $500,000 from its international bonus pool. If it signs two such players, it will also forfeit its third-highest remaining pick.
Based on the Cots salary tracker, I do not believe the Cubs are in any danger of exceeding the luxury tax even after absorbing Jose Quintana’s contract. This does have some sting if the Cubs were to go after a potentially QO’d free agent like Yu Darvish, but at least they would keep their first round pick. And there’s also no guarantee that the Cubs will go this route, although they are perfectly fine to do so given their financial flexibility.
For losing a QO’d free agent:
If a team neither exceeded the luxury tax in the preceding season nor receives revenue sharing, its compensatory pick will come after Competitive Balance Round B. The value of the free agent’s new contract has no impact on the compensation pick in both of these cases.
As in previous drafts, Comp Balance Round B is between the second and third rounds. As for who can snag the Cubs a compensation pick, the list of free agents-to-be include:
- John Lackey
- Jake Arrieta
- Brian Duensing
- Jon Jay
- Brett Anderson
- Wade Davis
Let’s just say that the most likely players to be extended the qualifying offer are Jake Arrieta and Wade Davis. The incentives that were restructured in the new CBA mean that the Cubs and other MLB clubs can spend without losing first round picks, but their compensation is far less than before unless they are a revenue-sharing club, which is not the Cubs. The Cubs again are not currently in danger of exceeding the luxury tax threshold, so I could see a couple of post Comp Round B picks going their way this offseason if they choose not to re-sign Arrieta or Davis.
At $18.1MM, I can also see a situation where Arrieta takes the QO as a pillow contract to regain some value for his next contract, since it is a lot of money even for one year. At the same time, the Cubs will have to consider this since if Arrieta does well, then he would leave next offseason with no compensation as teams cannot extend a QO to a player who has received a QO offer previously in his career. If Arrieta sucks, then the Cubs are on the hook for all that money and a lame duck trade chip with diminishing value. Ditto with Wade Davis, but I imagine that the Cubs are at least thinking about extending Davis as an elite reliever.
Theo Epstein and Jed Hoyer have been very transparent about their efforts to balance both the current competitive window and the replenishment of the minor league talent pool to drive the next competitive window. This will be a delicate balancing act between acquiring the best (hopefully non-QO) free agents available while also maximizing the draft positions and pool money to get amateur talent. Now that we know the approximate value of the QO, the team will be hard at work on those two fronts to keep this engine running.