sports 6 days ago

Report: MLB sets qualifying offer at $17.4M

theScore

Major League Baseball has reportedly set the value of the one-year qualifying offer teams can make to impending free agents at $17.4 million, according to Tim Dierkes of MLBTR.

Implemented in 2012, the qualifying offer system was conceived as a competitive balance mechanism to compensate teams with draft picks for losing players to free agency. Under the current rules, which were restructured in the newly ratified collective bargaining agreement, players can only receive qualifying offers once in their careers - any player who received one prior to 2017 is ineligible for a qualifying offer this winter - and only if they spent the entire season on that team's roster.

Under the previous agreement, any team that signed a qualified free agent would forfeit its top unprotected pick in the upcoming MLB draft. The new CBA re-jigged that rule, though, and the current draft-pick forfeiture system works as follows, per MLB.com:

A team that exceeded the luxury tax in the preceding season will lose its second- and fifth-highest selections in the following year's Draft as well $1 million from its international bonus pool. If such a team signs multiple qualifying offer free agents, it will forfeit its third- and sixth-highest remaining picks as well.

Examples: A team with one pick in each round of the 2018 Rule 4 Draft would lose its second- and fifth-round picks. A team with two first-round picks and one pick in each subsequent round would lose its second-highest first-round pick and its fourth-round pick.

• A team that receives revenue sharing will lose its third-highest selection in the following year's Draft. If it signs two such players, it will also forfeit its fourth-highest remaining pick.

Examples: A team with one pick in each round of the 2018 Rule 4 Draft would lose its third-round pick. A team with two first-round picks and one pick in each subsequent round would lose its second-round pick.

• A team that neither exceeded the luxury tax in the preceding season nor receives revenue sharing will lose its second-highest selection 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.

Examples: A team with one pick in each round of the 2018 Rule 4 Draft would lose its second-round pick. A team with two first-round picks would lose its second-highest first round-pick.

Moreover, the draft-pick compensation that the team losing the player to free agency receives depends on their financial status, too:

If a free agent who rejected a qualifying offer signs a contract that is worth at least a guaranteed $50 million in total value, and his previous club is one of the teams that receives revenue sharing, said club will be given a compensatory pick immediately following Round 1 in the next year's Draft. If such a club loses a free agent for a contract worth less than a guaranteed $50 million in total value, the club will receive a compensatory pick after Competitive Balance Round B (which follows the second round).

If a qualifying-offer free agent's previous team is over the luxury-tax threshold, said team will receive a compensation pick after the fourth round has been completed. 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.

Like standard Draft picks, compensatory picks in a given tier are ordered in accordance with the previous season's standings. If a team with MLB's worst record and a team with a .500 record both lose a free agent that signs for more than $50 million, the team with the worst record would receive the higher of the two compensatory picks.

Teams have five days from the morning after the conclusion of the World Series to tender qualifying offers to their soon-to-be free agents, and those players have 10 days to either accept or reject the one-year offer (worth the average salary of the 125 highest-paid players in 2017).

Since 2012, only five players - Colby Rasmus, Matt Wieters, Brett Anderson, Neil Walker, and Jeremy Hellickson - have accepted qualifying offers. This year, with several marquee free agents getting traded midseason, only a few players are expected to receive qualifying offers, namely Jake Arrieta, Lorenzo Cain, Mike Moustakas, Eric Hosmer, and Wade Davis.

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