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Taking a Look at the Orioles' Draft Spending

Perhaps the central keystone principle of the Andy MacPhail regime in Baltimore has been the oft-repeated "Buy the bats and grow the arms". In practice we've all seen that a more accurate mantra would probably be "grow everything, primarily arms". With that mind, it makes sense that in his relatively few and far between public comments Andy MacPhail seems to make sure to always mention that the Orioles are amongst the biggest spending and therefore most serious teams in the Rule IV Amateur Player Draft.

To wit (from The Sun's article on Andy MacPhail making comments to the University of Baltimore's Law School in February, 2011):

"We have to spend our money where we're on equal footing," MacPhail said. "And we have to be efficient with it. Our fans have heard me drone on about growing the arms and buying the bats. Why do we say that? Is it a tactical thing? No, in my view, it's a practical thing


MacPhail said that since 2007, no team in the American League East has spent more money on signing bonuses than the Orioles.


MacPhail said he doesn't believe the economic disparities in baseball are going away, which is why the Orioles have to stick with their philosophy. [snip] In fact, if there was one team MacPhail feels like the Orioles need to emulate, at least from a management philosophy, it's the Tampa Bay Rays.

And from a MASN blogpost about the same event:

"I told Peter [Angelos] you had to pare your payroll down, and you had to start investing in your farm system because you're never going to go toe-to-toe with the Yankees and Red Sox because MASN isn't NESN and it isn't YES."

I certainly won't be the person to tell you any of those quotes are false. Amateur talent acquisition is something that is both incredibly critical to the Orioles' future, and something that other teams have shown is can be used successfully even in this division. I doubt you can find any O's fan to contradict any of this.

So how much did the Orioles practice what they preach this year?

A huge percentage of spending in the draft is due to signing bonuses. This year, according to Baseball America's Jim Callis, "MLB teams combined to spend $227,969,050 on draft bonuses in 2011, and a total of $236,019,050". That's 96.6% of spending coming from bonuses. This is because players are signed to minor league contracts, which are worth substantially less than you would probably guess, especially in a player's first pro season.An exception would be Dylan Bundy, who signed a major league deal that reportedly guarantees him $2.225 million dollars in addition to his bonus.

Now I'm starting to understand why that major league contract was so important to Bundy in his negotiations with the O's.

In the same article I just referenced, Callis notes that for the first time ever, ten teams eclipsed the $10 million threshold in bonuses given out. These big-spending teams include the Rays, the Blue Jays, and the Red Sox, but not the Orioles. The Pirates and the Nationals both surpassed $15 million in draft bonuses.

So where were the Orioles in 2011? I mentioned Bundy as the special case with his major league contract. Additionally, this draft-tracker (thanks, Orioles-Nation!) has the birds at about $10,081,000 when you include Bundy's major league contract. So, you can throw them in with the other ten teams passing the ten million dollar threshold (I will call it "The Kevin Gregg Threshold", since that's how much the O's paid for his irreplaceable services). It does, however, still leave the Birds behind the Rays, the Blue Jays, and the Red Sox.

From a certain perspective, the Orioles coming in lower than their rivals is a good thing. The Dylan Bundy camp's rhetoric even before the draft was that they needed at least $30 million to sign. While that's obviously completely unrealistic, the deal Bundy ultimately did sign was below comparable players such as Rick Porcello, Josh Beckett, and Jameson Taillion. So the Orioles did really well to stay low instead of spending what turned out to be an unnecessarily extra amount of cash in the draft. Waste not, want not.

And it should be pointed out that once again the O's draft budget was raised for this season, despite any hand-wringing that the money spent on free agents over the winter would cut into the amateur budget (I will ignore, for once, the woeful international amateur budget). Last year the Orioles spent $9,159,900 in draft bonuses according to BA. The increase of over $900,000 is good and important, and it continues a rising trend of amateur spending for Baltimore.

That's the good news. The bad news is that the Orioles were 6th in spending for the 2010 draft (notably behind Toronto and Boston) and this year they've fallen all the way to 11th. And they are still behind their direct rivals, and have fallen for the year behind Tampa as well, though not for the first time. And reportedly it would not have taken much to sign at least one more very interesting player in the draft: Fellow CC'er James F told me after the draft that one of the most important players in it was TCU outfielder Jason Coats, who did not sign. From The Star Local:

Though Coats declined to get into specific numbers, he said the Orioles offered him fourth-round money. MLB's estimated slot for the fourth round in this year's draft was a suggested signing bonus of $168,300-$240,300. That number is based on where in the round the pick was made, though teams are allowed to sign draft picks for a figure above or below the slot.

"It was good money," Coats said, "way above where I would have been slotted."

However, it wasn't enough.

"I had a figure in mind and if they would have reached that, I would have signed for sure," Coats said. "If not, I knew I could go back, get my degree and just start my career a year later."

Coats said the two sides were not too far apart, but he was looking for second- or third-round money. Third-round suggested slots ranged between $245,700-380,700 while second round bonuses were $387,700-596,700.

I will leave you to draw whatever conclusions you want from that.

It feels a little bratty and nitpicky to look at what seems in many ways to be an overall improvement in draft practices and what seems to be a pretty decent draft and find the flaws, but the Orioles' unfortunate circumstances require them to strive for perfection in this one field. Andy MacPhail is absolutely right when he says the Orioles need to emulate the Rays, who do strive for that perfection. And in this case, the Orioles came up short. They need to do better.