The trade deadline is over. Once again, the Orioles have traded a prospect for a reliever. At least the reliever is actually a good pitcher this time. The O's roster is pretty much set for the rest of the season, and Dan Duquette's focus should be shifting to offseason planning (Of course, there is the playoff race, but Duquette can't really help that cause at this point). One third of the O's regular starting lineup is set to become free agents at the end of the season, including Nick Markakis who will get there if the O's are smart to decline his $17.5 million club option in favor of the $2 million buyout. All three players, J.J. Hardy, Nelson Cruz and Markakis are eligible to be offered qualifying offers, which would amount to one-year contracts of around $15 million. They would have to either accept the offer or decline it and enter free agency with a compensation draft pick attached. All three decisions are rather difficult considering that they are above-average players who are not close to the elite level.
The O's currently have only $34 million on the book next season, but that does not include Wei-Yin Chen's and Darren O'Day's team options or the salaries for the players eligible for arbitration. Including both options and slight raises for those entering arbitration, the O's would have about $80 million on the payroll. The O's can shed a few millions by non-tendering Tommy Hunter and/or Brian Matusz, but that does not change the big picture. The O's have a payroll of $107 million this season. Barring a significant increase in budget, the O's could only afford two players on qualifying offers without even accounting for other free agent signings.
Let's start with the easy decision. Markakis should not be getting the qualifying offer. If the O's want to keep him at this price, they can simply pick up his option. Declining his option and re-signing him for the qualifying offer saves the O's less than a million. Why would the O's allow Markakis to make that decision instead of themselves? Markakis is nowhere close to being worth $15 million for a year. He has had a bounce back year, but his power remains down and his range as limited as before. He has succeeded this year thanks to a few more hits falling in and a few more outfield assists. I might hesitate to give him an annual salary of $10 million over three years, let alone $15 million.
Nelson Cruz presents a more curious case. After a prolonged slump, Cruz is hitting .258/.328/.508, very similar to his line of .266/.327/.506 last season. Remember, Cruz declined the qualifying offer from the Texas Rangers last season and received only a one-year $8 million contract from the O's. I find it difficult to imagine any team increasing their valuation of Cruz by $7 million after one season, if he were to decline the offer. Hence, I find it more likely than not the Cruz would accept the qualifying offer if the O's extend it. The question becomes whether Cruz is worth $15 million on the payroll. Cruz is a one-dimensional slugger only fit for DH. The O's already have a lesser version of Cruz who can also handle the field in Steve Pearce, who has been curiously missing from the lineup. The O's don't need to commit half of their remaining budget on Cruz. This does not necessarily mean the end of Cruz as an Oriole, as the O's can re-sign him if the market for him fails to materialize.
Hardy is the polar opposite of Cruz as a player. He has value as a slick fielding shortstop with a slightly below-average bat. This season is no different, but the way he performs at the plate has changed considerably. His strikeouts have gone way up and power way down. He is managing an acceptable batting line with an unsustainably high BABIP. Hardy is the kind of player who will be undervalued in the open market as a large portion of his value stems from his defense. As a result, Hardy would likely accept the qualifying offer too if extended. The O's already have a shortstop waiting in the wings in Manny Machado, so Hardy may hold less value to the O's than another team. This decision is really a tossup for me and comes down to how the organization views Machado as a shortstop. Moving from Hardy to Machado also produces gaping holes at both second base and third base. At this point, I would probably lean towards extending the qualifying offer to Hardy, as I would rather not see how Machado's range translates in shortstop, even if it means limiting Machado's glove at third base.
The system of qualifying offers allows teams to regain value in the form of a draft pick when losing a premier free agent. However, the O's have more marginal players entering free agency who will likely accept the qualifying offers. The decisions to extend qualifying offers become simply questions of the players' values. To me, Hardy is worth the qualifying offer, but Cruz and Markakis are not.