Hal Steinbrenner was asked about the luxury tax at Wednesday’s MLB owners’ meetings and said, “If I really felt we needed that deal that takes us over the top, then yes, I would. But we still have a decent amount of cushion. I’m not concerned about that. It’s a decent cushion.”
Hal also acknowledged the team’s starting pitching concerns when making these statements.
The Yankees are currently about $20M under the top threshold, which is $246M. Going over that number comes with an increased tax percentage (42.5% for first time offenders, which the Yankees are since they finished under the base threshold in 2018) and the team’s highest selection in the next draft will move back 10 places.
On the face of it, these statements from Hal are good. We want our owner to do anything in his power to put a winning team on the field. So why am I writing this blog? Because last week Brian Cashman said something entirely different when talking about Dallas Keuchel and the luxury tax on WFAN.
“We were interested. We made an offer that we were comfortable with and that was it. Atlanta made a higher one. It wasn’t like a back-and-forth. We had two that we ultimately made and we stopped and we waited to hear if it was a yes or a no. We were very transparent about where we’re at. There’s a financial limitation until we go into the next luxury tax level and that was obviously conveyed and that pushes next year’s No. 1 (top draft choice) pick back. There’s a number of different penalties associated with that. So we’re trying to stay under the second luxury tax penalty that crushes next year’s pick. All that stuff was communicated. Our highest offer was at the rate of the qualifying offer and Atlanta apparently went higher.”
What I highlighted in bold directly contradicts what Hal said this morning. It doesn’t sound like Cashman is willing to go over the top threshold. Or Steinbrenner hasn’t communicated to him yet that he (Cashman) has the green light to go over it. Or Steinbrenner is just appeasing fans with his comments and he knows they aren’t going to come close, because they have “a decent cushion.”
No matter what the reason is it isn’t good. The luxury tax clearly played a factor in their Keuchel negotiations and that was only two weeks ago. If they made the decision to say Screw it! because Keuchel signed in Atlanta, then shame on them. They missed an opportunity to add a good (not great) starting pitcher to a desperate starting rotation for just money. Now it is going to cost prospects in addition to money, to acquire a pitcher at the trade deadline. But that might not happen for another four or five weeks meaning they’ll have to piece the rotation together with 3-and-a-half starters between now and then.
So the question is: Are the Yankees actually willing to spend over $246M and pay the top threshold penalty?
My gut says no, because if they were I think Dallas Keuchel would be a Yankee. Hal’s comments strike me as propaganda, the same way the Yankees were “in” on Manny Machado and Bryce Harper, and the same way the Yankees were “willing” to go over the tax threshold last season for the right move. Don’t hold your breath they’ll spend over and just go spend $12 on another beer at Yankee Stadium while Chad Green opens.