Hot Stove Update: Thoughts on Giants Needs, Payroll and Giancarlo Stanton

As the Hot Stove starts to flicker to life, let's take a quick inventory of the Giants offseason needs which are amazingly complex, diverse and difficult to quantify.  They could probably field a team if they do absolutely nothing, but what kind of team would it be?  Actually, there is one position that they don't have a current option with Nick Hundley a free agent and a decline of Tim Federowicz' option making him a minor league FA, backup catcher.  So, in a way, you could reasonably put backup catcher as the one essential hole to fill this offseason, especially since Bochy seems to want to gradually increase Buster Posey's use at 1B.  

Adding to the complexity of the situation is that many fans perceive the Giants biggest need to be a power hitting LF, but that is not necessarily the thoughts of the Giants front office.  In a recent interview, Brian Sabean reiterated the need for improved OF defense, specifically CF, and then somewhat surprisingly added an everyday 3B to the list and mentioned that the Giants have to be "resourceful" in improving the bullpen.

So, let's list them:

1.  Back up Catcher.

2.  Upgrade CF defense

3.  Everyday 3B.

4.  Bullpen.

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Further complicating the Giants offseason is the Competitive Balance Tax(CBT).  This one is a challenge for fans to wrap their heads around not only because of the arcane way it is calclulated but because there are now multiple levels or thresholds for CBT penalties which now include more than just money.  Fortunately the website Cot's Baseball Contracts, linked to the left, provides something called a Tax Tracker in a separate spreadsheet from payroll, which is not the same number.  According to the updated Tax Tracker, the Giants are just $9.5 M under the first CBT threshold after adding in estimated salaries for arbitration eligible players and salaries for the remaining 40 man roster.  If you go by MLBTR's Arbitration Salary estimates, you can add another $1.5 M to that number giving them $11 M to spend this winter before they hit the first threshold.

Since the Giants have gone over the threshold the past 3 seasons, the penalty for going over in 2018 is a 50% penalty for every excess dollar. There are two more thresholds:  A surcharge kicks in if the threshold is exceeded by more than $20 M and non-monetary penalties such as devaluation of draft picks and loss of International bonus pool money kick in at $40 M over the limit.

It is difficult to interpret what the Giants stance is on the CBT.  On the one hand, they keep listing multiple offseason needs.  On the other hand they express concerns about exceeding the CBT threshold.  Those two concerns seem close to being mutually exclusive as $11 M might get you a barely league average player in free agency, if you are very lucky.  Bobby Evans has expressed a preference for acquiring needed players by trade, but even players coming in trades will have salaries that get added to the payroll.  Players earning league minimum salaries are seldom available in trade and would come at high prices in prospects, probably higher than the Giants have available even if they wanted to pay the price. 

Larry Baer has expressed concern about the non-monetary CBT penalties.  Most of those kick in at $40 M over the first threshold, so maybe the management group has clearance from ownership to add as much as $30 M in AAV salary this offseason?  That would enable them to acquire 2-3 players in the $10 M range or, here we go, acquire a Giancarlo Stanton without shedding payroll.  It's a tangled web the Giants have woven here.  Cutting through it to make the upgrades they need and want will be a challenge.

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MLBTR reports that the Marlins have discussed a Giancarlo Stanton trade with 4 teams, the Cardinals, Red Sox, Giants and Phillies.  It's hard to reconcile the Giants reported interest in acquiring Giancarlo with their stated goals and CBT limitations, but the rumors continue to persist.  I would note that while the Giants vehemently denied the accuracy of a recent Jason Heyward rumor, there have been no such denials around the Stanton rumors.

The Cardinals would seem to have the best combination of CBT space and tradable assets to acquire Stanton.  The Red Sox have never worried much about the CBT and Dave Dombrowski likely does not care about the non-monetary penalties, so the Red Sox rumors have legs.  The Phillies have an intriguing combination of low current payroll and an up-and-coming team of young players which might interest Stanton who has full veto power over any trade.  Stanton is believed to prefer a coastal team which may complicate the Cardinals pursuit.  He's from California, so the Giants may have a leg up on his preference list. Perhaps the Giants could ask the Marlins to take on the short term salaries of Denard Span and Hunter Pence to offset the first year of Stanton's salary, but it's unlikely the Marlins would accept that.  BTW, Stanton's AAV which is the number that would count as CBT salary, is $25 M.

While I would not want to see the Giants incur draft pick and international bonus penalties to acquire Stanton, I would be otherwise fine with adding him.  It's not my money and the Giants are widely believed to have plenty of it. Whether Stanton is enough of a difference maker that the Giants could add just him and go with internal options everywhere else?  Probably, but they would be boxed in for at least the next 3-4 seasons until the Posey/Crawford/Belt/Cueto/Samardzija contracts are up.  They also have to think about what they are going to do with Madison Bumgarner whose contract will have to be extended and will be quite costly if they want to keep him beyond 2019.

In summary, I would still rate a Stanton trade as unlikely.