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February 4, 2016 Outta Left FieldThe Case for Ripping Up Sal Perez's ContractYou can almost see why Salvador Perez signed his contract extension back in 2012. Almost. Perez, a 16-year-old way back in 2006, initially signed with the Royals out of Venezuela for just $65,000. He quietly worked his way through Kansas City's farm system without much fanfare, and on a minor-league salary to boot. When, just 39 games into his major-league career, the Royals offered him a life-changing seven million dollars guaranteed, it's not hard to see why he signed the dotted line. Then again, Perez had posted a .295 True Average through those first 39 games, and he'd already earned a reputation as a defensive stalwart and model teammate. He signed a buy-low deal when his value should have trending toward a high point, and worse yet he allowed the Royals to snag two of his free agent years for a combined $11 million (pending salary escalators). That latter bit must be particularly frustrating for Perez now, considering the current and ever-growing state of the free agent market. Even though Perez hasn’t necessarily developed as well as hoped—his TAv dipped to .251 in both 2014 and '15 and his pitch framing rates below average—he's remained a contractual steal. It's not surprising, then, that after helping lead Kansas City to back-to-back World Series appearances, he'd like more money. Should the Royals, who Jon Heyman notes are working with Perez to re-do his contract, give it to him? In a strict business of baseball sense, no—heck no. If teams had to play take-backsies on each team-friendly deal that worked out in their favor, the whole concept wouldn't fly. As it stands, the Royals have Perez under wraps for 2016 at $2 million followed by three (more than) reasonable club option years, all of which will almost certainly be picked up. That's a perfect deal from the Royals’ perspective, as it allows them to keep their franchise catcher in town through his age-29 season at a severe discount, freeing up resources to lock down the rest of the core. By 2019, Kansas City might decide it doesn't want to pay for Perez into his 30s—he is, after all, a 6-foot-3, 240-pound catcher with 3,556 1/3 innings banked since 2013 and signs of decline already surfacing. By then, they'll have gotten the best of Perez for cheap, moved on, and provided another chapter for the inevitable Moneyball-style best-seller about the team. That's the conventional route, anyway, and it doesn't prohibit Kansas City from negotiating a second extension with Perez before he hits free agency. But to give him more money now . . . well, that's just bad business. Or is it? *** The Case for Paying Perez Consider, first, the amount of time Kansas City's core position players have spent playing together:
Of course, we know how quickly a team's chemistry can change, and we still don't know how, exactly, to measure it in the first place. But giving Perez more money—money he's theoretically earned through his performance—probably can't hurt, both by improving his relationship with the franchise and avoiding any behind-the-scenes contempt that might grow when he looks at some of his teammates' salaries. 2) The Fans This one's maybe the most obvious, but like all of these, difficult to measure. The idea here is that by giving Perez more money when they don't have to, the Royals would be showing further commitment toward keeping their core together and, maybe more importantly, winning—at any cost. "Play well and we'll reward you, because we want to win," is a front office message fans can rally behind. From Kansas City's perspective, winning is the key ingredient that will keep the turnstiles spinning—note the near one million attendance increase from 2013 to 2015—but a generous attempt to keep a fan favorite content can't hurt public relations. 3) Future Discounts Reworking Perez's contract would not only send a message to Kansas City's fans, but also to its players. Particularly the young ones. Raul Mondesi, who debuted in last year's World Series, is currently Kansas City's no. 1 prospect. Just 20 years old, Mondesi's a speed-and-defense shortstop who figures to take over for Alcides Escobar at some point. He's also someone the Royals probably hope to sign to a Perez-like extension over the next few years. If the Royals take a hardline stance against giving Perez what he wants, perhaps Mondesi and his agent are less likely to sign an extension—or, at least, a super team-friendly extension. If, on the other hand, Mondesi knows he can sign an early-career deal that's subject to later negotiation if he turns into a franchise cornerstone, he's more likely to agree to it. That way he, like Perez, would lock down financial security for himself while leaving a door open for a bigger payday down the road. If Mondesi turns into, say, Angel Berroa rather than a franchise cornerstone, the Royals wouldn't have to worry about ripping up his team-friendly deal, but they'd also have saved millions of dollars from getting him to sign a modest extension (over a more pricey one) in the first place. Repeat that same process with multiple young players and the Royals would likely recoup the extra money they handed Perez, if not more. It's a potentially dangerous precedent to set—the Royals can't be expected to rework every deal—but it'd further reinforce Kansas City as one of baseball's most player-friendly destinations. 4) Saving the Royals From Themselves The Royals have famously relied on Perez to carry a heavy workload. The following table shows players with the most games caught in each of the past three seasons:
Why have the Royals played him so often? Well, for one, they haven't had a legitimate backup since Perez took the starting job. There was Drew Butera last season, and he's accumulated -4.2 WARP over his six-year career. In 2014 it was Brett Hayes, and he's accumulated –2.2 WARP over his seven-year career. In 2013 it was George Kottaras, and he's, well . . . you get the point. Maybe there's another reason. Since the Royals have Perez signed so reasonably, it's possible they've run him out there so frequently because they don't have much to lose. If Perez breaks down in a year or two, they can simply decline one of his options and go in a different direction—or keep him around as a moderately expensive backup. If the Royals were paying Perez more, and if they had more incentive to keep him healthy and productive through the length of his contract, maybe they'd invest in a better backup catcher. A better backup catcher would mean better production from the backup role and, presumably, better production from Perez, who has posted a second-half OPS of .638 over the past two seasons. *** What would a re-done Perez contract look like? Wild speculation:
We often think about team spending on how it's used to either acquire new talent from outside the organization or lock up rostered talent further into the future. We don't usually think about a team paying a current player more money because he's outperforming his contract. Maybe that's because that's just simply not how the baseball world works. The Royals have an opportunity to turn that mindset on its head, and in the end, it might help both their bottom line and their ring count. And even if it doesn't work out, the Royals come out of it benevolent trendsetters with a smiling (and slightly richer) catcher. References and Resources Ben and Sam recently discussed the potential Perez extension (and team chemistry) on Effectively Wild.
Dustin Palmateer is an author of Baseball Prospectus. Follow @sacbuntdustin
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One solution that occurs to me where the Royals don't have to literally rip up the contract, but where Perez gets a benefit, would be to guarantee the remaining option years in exchange for, say a $16m option for 2020 with, say an $8m buyout. That's 23m in new guarantees for Perez which is good for him, while so long as he stays healthy, continued cost control at the levels they originally agreed to for the Royals.
They could do this. It's probably more likely than what I proposed, but I'm just not sure how much it'd satisfy Perez. He's probably not happy with the figures on those three options years in the first place.