Talking major league budgets is always a sticky subject. How much should the players get? What counts as money spent on players?
Using major league payroll a percentage of revenue the Rays look really bad. According to a tweet from Camden Depot the Rays were among the most thrifty teams in baseball, claiming the Rays are spending only 35% of their revenue on major league payroll. These numbers have since been used to show that the player’s cut is going down across the league.
However, in a press conference held at Tropicana Field, MLB commissioner Rob Manfred made the claim that MLB payrolls are increasing in line with revenue.
“We have been at a very stable — approximately 50 percent of revenue going to player salaries — for five, six, seven years,” Manfred said. “The math of that means that salaries are growing in line with revenues.”
Ben Lindbergh fact checked Manfred’s statement at The Ringer, and found that if you added up major league payroll, player benefits (insurance, pension, etc.), and postseason share payments the players cut of revenues have hovered around 50% since 2010.
The lowest percentage the players received was 48.5% in 2012 after receiving the high water mark of 51.1% in 2011. In 2016 and 2017 the player’s cut stayed steady at 50.1%.
Player benefits plays a big role in the discrepancy from the first list. In 2018 the teams will pay $421.3MM. This is split evenly between all teams. The Rays will contribute $14,044,600 this year.
Last year the Rays ended up paying $80,392,738* on their major league payroll after the mid-season additions of Sergio Romo, Adeiny Hechavarria, and Lucas Duda.
The Rays also paid for replacements for players on the disabled list accumulating 1,629 days. That’s just shy of $5MM in pay for call ups, and some was expected with Nathan Eovaldi spending the whole season recovering from Tommy John Surgery and Wilson Ramos spending 83 days on the disabled list recovering from a torn ACL. At the major league level, then, the Rays spent just shy of $94.5MM on MLB payroll and benefits in 2018.
Using the $205MM revenue number at Forbes, that would be 46.1% of revenue spent. This is below the league average 50.1%, but is much closer than it looks just by comparing MLB payroll to revenue, and we’re not done.
To get Lindbergh’s final player compensation total he adds amateur talent acquisition signing bonuses (draft and international free agent) and minor league salary and benefits. As a result, Lindbergh found that in 2017 the players took home 56.3% of total revenue.
What happens when you do the same for the Rays?
Last year Tampa Bay had a signing bonus pool of $12,528,100 and after trading for some additional money had $6,000,000 to spend in the international free agent market. This adds $18.5MM towards player acquisition costs.
Finding numbers on minor league pay, meanwhile, is tough. Minor leaguers don’t get paid much at all. In rookie ball it starts at $1,100 a month for about three months. This increases up to $2,300 per month in AAA for a five month season.
The 15 players on the 40 man roster get a minimum of $41,200 a year for their first year on the 40 man roster and increases to $82,700 in their second season. Players get a $20 per diem for days on the road. This adds up to a sizable amount to the guys in the low minors. Even though the guys not on the 40 man don’t get paid it adds up to a minimum of $2.25MM total. This doesn’t count any MiLB free agent depth signings.
Including the same figures, the Rays spent at least $115,250,000 on players in 2017. It should be noted that not all of this goes towards MLBPA members, but even though the Rays didn’t spend a lot on opening day payroll relative to their revenue, when you add all the compensation for all players it was right in line with the MLB average.
As a percentage, the Rays spent 56.2% of revenue on their players in 2017, which is nearly identical to Lindbergh’s findings for baseball overall.
And that’s not even the full picture, as there are many more costs outside of player salary, benefits, and signing bonuses. This doesn’t account for coaching and other expenses to put on a major league production, such as the 220 members of the front office staff.
As of today, the Rays have a projected 2018 Opening Day payroll of just over $77MM, which would be the highest in franchise history. If no further salary is moved it’s likely over $80MM will be spent on the MLB payroll in 2018 after paying for replacements due to disabled list stints. For the amount of revenue they are given, the Rays spend as much as anyone else.
As a fan I would love for there to be a bigger budget, but that’s not likely to be the case under any ownership group without improved revenue streams. Fortunately, the Rays have that coming down the pike.
Today it’s being reported that the Rays might have a deal that will substantially increase their TV deal starting next year. That is the first step in a meaningful increase in expected payroll in the future. The second would be an improved stadium location. Hopefully the Rays have more clarity on that situation in the near future.
For now the Rays MLB payroll has stagnated, at an ~$80 million ceiling, but the Rays have also increased spending on amateur talent acquisition through the draft and international free agent market. If the trade off for more MLB spending is amateur talent acquisition that’s fine.