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How the Orioles are affected, or not, by baseball’s new CBA

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The players and owners of baseball came together to avoid a work stoppage, signing a new five year Collective Bargaining Agreement.

MLB: World Series-Chicago Cubs at Cleveland Indians
Commissioner Rob Manfred took a break from screwing over the Orioles to negotiate a new CBA.
Charles LeClaire-USA TODAY Sports

There will be labor peace in baseball. Despite some briefly apocalyptic rhetoric from the owners, the players and owners came together in advance of their contract expiring and reached a new Collective Bargaining Agreement, a five year pact that should carry baseball’s current streak of labor peace more than 25 years beyond the last work stoppage.

That’s good news for all baseball fans. A lockout from the owners would have tossed the offseason into chaos, effectively cancelling next week’s winter meetings and leaving things hanging beyond that until a deal was reached.

We want to be reading about who’s signing where and who’s getting traded where, not about how negotiations are progressing. Granted, for Orioles fans, it doesn’t make much difference, because the team is unlikely to do much any time soon regardless, but still. Things will keep happening. That’s good for everybody.

Will anything change for the Orioles from this new CBA? Probably not much. Some of the provisions of the CBA compiled from baseball reporters, along with how they might impact the O’s:

There is no 26th roster spot

If you were following the rumor mill of CBA negotiations, you were probably taking for granted that there was going to be a 26th roster spot given to teams. Dan Duquette and Buck Showalter were probably salivating. Alas, this was not meant to be. Active rosters during the season will remain at 25. The Orioles will have to keep squeezing their Rule 5 guys into the same space as ever.

There were also discussions, that ended up not bearing fruit, about possibly capping the number of players who can be called up in September. Joe Girardi will still be able to terrorize everyone by using eleven relievers every game for the last month of the season.

The changing of the luxury tax

The luxury tax threshold has been $189 million. Next year, that will raise to $195 million and this will increase to $210 million over the life of the CBA. There will be stiffer penalties for teams that exceed the tax by a large amount.

The Orioles’ two big-spending division rivals, the Yankees and Red Sox, were both over even the larger $195 million threshold in 2016 salaries. The Red Sox are already committed to $192 million next year without signing anyone. The Yankees have about $167 million committed. Those teams will not be able to dramatically outspend the rest of baseball without paying a price.

Both of these teams were reportedly sitting out the free agent market until after the CBA was settled. Now that they know about the luxury tax, they can formulate plans - probably to spend a lot of money.

Note that these are not large increases. The Yankees, in fact, with a $225 million payroll in 2016, would have been paying the tax even at the 2021 level. They’re said to be looking to stay under the tax threshold now, according to the New York Post.

No more lost first round draft picks after this offseason

The qualifying offer system kind of sucked for certain players. Now, it’s gone. Draft pick loss remains in a less severe fashion. Teams who are over the luxury tax would forfeit a second round pick and a fifth round pick. Teams under the threshold would forfeit a third round pick. That’s according to ESPN’s Jayson Stark.

That’s a big deal for the Orioles, although whether or not it’s good news is another story. Yes, the Orioles won’t lose top draft picks for signings any more, but it probably means they’ll have fewer chances to get potential free agent bargains any more either.

Nelson Cruz at one year for $8 million doesn’t happen without the old QO system being in place. And the Orioles would have never gotten close to signing Dexter Fowler last year without the lost draft pick holding up other teams, either. The “wait and see” approach, if it ever worked, will now be even more of an uphill climb.

Teams will also no longer gain any picks as compensation unless the player signs a new contract that exceeds $50 million in value.

On the bright side, there will be no more giving up a draft pick in the teens to sign Yovani Gallardo... at least not after this offseason. The O’s will have a last chance to lose a pick in an attempt to hunt a bargain on someone who fell through the cracks. MLB Network’s Jon Morosi reported that the prior rules will continue to apply to this offseason’s QO free agents, including Mark Trumbo.

No international draft

This was something the owners were said to be looking to get, however, Latin America-born players resisted it. Instead of the current system of varying bonus pools based on previous season’s record, teams will now have a hard cap on how much they can spend in those markets on amateur talent each year.

Whether that’s actually better for the amateurs is not immediately clear. Baseball owners are not unlike a casino in this way: The house always wins.

As to how this affects the Orioles, well, it doesn’t affect them at all. By and large, they do not sign these players. That has been true across multiple GMs. Now, they won’t have the opportunity to trade pool slots they wouldn’t use to attempt to pick up marginal talent. That’s how they got current 40-man lefty pitcher Chris Lee.

The international amateur market is kind of like a lawless frontier in baseball and it seems like the Orioles don’t care to participate at all. Their farm system and major league team pay the price every single year.

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Note that not everything is completely, 100% settled at this moment. The sides have agreed on the framework and there are still some details to hash out, with both sides still needing to officially ratify the deal. However, barring an unexpected reversal, labor peace is secured.