In the convoluted world of MLB’s collective bargaining agreement, nothing better exemplifies the contractual cat-herding than the qualifying offer system. The deadline for extending these offers is coming up at 5pm ET on Monday, November 6, so I’m fixing to give you the skinny on this somewhat esoteric wrinkle and what it means for the Cubs.
If “esoteric” sounds like a weird way to describe the QO system, consider that only 30 or so players received one over the last two offseasons combined. Distilled to its simplest definition, this is a way for teams to receive draft pick compensation for a free agent who signs elsewhere. They do so by extending a qualifying offer that is worth the mean salary of MLB’s top 125 players, which this season is worth $17.4 million.
Make sense so far? Good, ’cause it’s about to get funky.
A player receiving a QO has to have spent the entire last season on that team’s roster and he cannot have received a QO in the past. Once extended, the player has 10 days to decide whether to accept or decline the offer. If he accepts, he’s under contract; if he declines, he’s a free agent. Ah, but that’s where we get to the good stuff.
The team that signs a player who rejected a QO will be subject to draft pick and international bonus pool forfeiture, either of which can be pretty important. It’s not quite as stiff as the loss of a first-round pick under the old rules, but the variations in the new CBA make for some interesting reading. It’s too much to even bother block-quoting in here (hence the link), but suffice to say the compensation is tied to both the revenue-sharing status of the signing team and the contract to which the player agrees.
That’s all been a (perhaps overly long) preamble to the focus of this piece, which is the likelihood of and motivation for the Cubs extending qualifying offers to both Jake Arrieta and Wade Davis. While the governance of these offers is identical, the Cubs’ motivations for doing so vary greatly. Well, maybe not greatly, but there are notable philosophical differences.
Arrieta is one of the top two free-agent pitchers on the market and is in line for a contract north of nine figures. His declination of the QO is a formality. Because he’s not expected to re-sign with the Cubs — an scenario that grew even less likely once Masahiro Tanaka and Johnny Cueto both opted back in with their respective teams — this is their only chance to get something for him on the way out.
As for Davis, the Cubs have slightly different machinations. Where Arrieta figures to pull down around $25 million AAV, the closer has no chance at earning nearly as much as the QO for multiple seasons. Aroldis Chapman got $17.2 million per and Kenley Jansen got $16 million, so you figure Davis is in that four-year, $60 million range at best. It’s possible, then, that he’d be willing to accept the offer and head back into free agency again a year from now.
The Cubs would certainly love that, since it fits their budget and limits their commitment down the road. The real beauty of such a deal is that it would enable them to spend a little more than originally expected this winter while also buying time to see whether any of their in-house options can eventually close. Of course, that’s assuming Davis would accept the offer in the first place.
Getting more for one year than he could otherwise is cool, but what if he sucks out loud for the Cubs while playing under that tenuous guarantee? Or, even worse, what if he gets hurt? Considering his age (32) and the earning ability afforded by his excellent performance in 2017, I have to think Davis would turn down the offer.
That’s still not a bad deal for the Cubs, who would either receive draft-pick compensation or would be able to negotiate with Davis on a new deal. Where Arrieta’s departure is more of less fait accompli, Davis is in a great situation and isn’t likely to score a better combination of money and opportunity than he’s got in Chicago. Unless Houston woos him, but even that doesn’t offer appreciably more attractiveness on any level.
As for the other free-agents-to-be on their roster, the Cubs won’t be extending any more offers. It’d be a huge overpay to throw $17 million at Jon Jay, Brian Duensing, or Kohi Uehara. John Lackey, though, he might…ah, who am I kidding? No way.
On the flip side of this coin is that the Cubs may be pursuing players who will themselves be the recipients of qualifying offers. Brendan Miller’s got a little more on exactly how that impacts Chicago, but the Cliff’s Notes version is that they’d forfeit $500K and a pick to sign such a player. While that penalty is not insignificant, the expiration of their IFA caps and the ability to trade for more pool money could mitigate the sting.
So there you have it, a comprehensive look at why the Cubs will extend qualifying offers to Arrieta and Davis and how other such offers will impact their pursuit of new players. Please go forth and share this newfound knowledge with all those who would hear it and maybe a few who don’t care to.