Yoan Moncada

How the Red Sox Will Navigate the Next Two International Signing Periods

Last year the Red Sox blew past their international signing bonus pool by early July, nabbing a pair of coveted right-handed pitchers, Anderson Espinoza and Christopher Acosta, for a combined $3.3 million. Then, in March, Boston won the Yoan Moncada sweepstakes with a record-breaking $31.5 million deal. For a franchise already sporting an international flare, from major-league shortstop Xander Bogaerts (2009-’10 class) to top prospects like Rafael Devers (2013-’14) and Manny Margot (2011-’12), the 2014-’15 July 2 signing period represented a further commitment to developing high-upside foreign talent from within the organization.

The downside? The spending spree triggered harsh penalties under MLB’s latest CBA, which included a tax on the amount Boston spent over its near $1.9 million international signing bonus pool — effectively doubling Moncada’s $31.5 million investment to $63 million — and future spending restrictions. Those restrictions prohibit the Red Sox from spending over $300,000 on any single player in both the 2015-’16 and 2016-’17 July 2 signing periods, a roadblock that will keep the Red Sox, along with the Yankees, Diamondbacks, Angels, and Rays, out of the running for any premium international amateur free agents until the summer of 2017. Despite the spending limits — and thanks to a 71-win 2014 season — Boston retains all of its $3,681,000 international bonus pool for the 2015-’16 signing period, the sixth-largest in the league. Even though they can’t splurge on one player, the Sox can spend as much of that bonus pool as they see fit, potentially trading away leftover funds to teams looking to add flexibility of their own.

While the Red Sox won’t grab any headlines for juicy seven-figure bonuses, there’s a good chance they remain a significant player for the $300,000-and-under subset of talent — and when you’re dealing with 16- and 17-year-old kids, sometimes those guys end up providing the most bang-for-buck (for a variety of reasons). Recently, Kiley McDaniel of FanGraphs released a ranked list of international players with projected landing spots, and he has the Red Sox signing Albert Guaimaro and Eduardo Torrealba, a couple of Venezuelan infielders estimated to go in the $300,000 range. Rather than focus too narrowly on individual players, however, I wanted to attempt to outline what kind of strategy the Red Sox might employ this signing period by investigating how under-the-penalty teams have operated in the past.

The Rays, Rangers, and Cubs have each spent one July 2 signing period under spending restrictions (under previous rules, they couldn’t spend more than $250,000 on any player). The following table shows how much each team spent in that period compared to their respective bonus pool, as well as the number of players they signed and how much pool money they dealt away:

Team Signing Period Bonus Pool Actual Spending* Players Signed* Pool Money Traded Away
Rays 2013-’14 $1,975,500 $1,900,000 43 $0
Cubs 2014-’15 $3,962,700 $3,100,000 47 $832,000
Rangers 2014-’15 $2,015,500 $1,930,000 34 $0

Data from Baseball America
*Actual spending and players signed are estimates. BA tracks calendar year spending, but doesn’t appear to track actual spending for a specific signing period. The number of players signed comes from BA’s international reviews, but are also for the calendar year, I believe. Either way, the numbers should be close, as most international players are signed during July and August of the signing period, and I’ve made some slight adjustments to try to estimate actual signing period spending. Consider these numbers, and the ones in the following paragraphs, for illustration purposes and not necessarily exact.

Despite their collective inability to spend over $250,000 on a single player, all three teams were incredibly active during the international amateur signing periods in question. The Rays were the first team to test the system in 2012, when each team was given a $2.9 million bonus pool under the new CBA, and they spent over $4 million to reel in two $1 million-plus pitchers. They responded in the 2013-’14 signing period by inking 43 players to deals, third behind the Dodgers and Yankees, and 14 more than the average team. They weren’t all just $10,000 flyers, either — the Rays signed eight players to six-figure deals, third behind the Rangers (13) and Astros (10).

The Cubs and Rangers, who each spent well over their respective pools in 2013, behaved in a similar fashion to the Rays during the most recent signing period. The Cubs signed 47 players, third-most in the league behind the Yankees and Astros. They also nabbed a staggering 12 players in the $100,000-$250,000 range, including seven for $250,000 on the dot. Like the Rays, both of those numbers were well above average, as they inked 20 more players than the typical team and nearly doubled the average amount of $100,000-plus players signed. The Cubs also had the fourth-highest bonus pool in the league — just south of $4 million — and they couldn’t spend all of It. Last November, they traded right-handed pitcher Arodys Vizcaino and $832,000 in international slot money to the Braves for second basemen Tommy La Stella. The Rangers followed with a similar, if less extreme, spending pattern, signing 34 players. They only signed one player, Dominican right hander Jeifry Nunez, for the maximum $250,000, but added six more at six-figure price tags.

While the Red Sox will obviously be hampered by their inability to spend big on international amateurs for the next two years, there are some hidden advantages to the MLB-sanctioned handcuffs.

While the Red Sox will obviously be hampered by their inability to spend big on international amateurs for the next two years, there are some hidden advantages to the MLB-sanctioned handcuffs. Like the Rays, Rangers, and Cubs, the Red Sox can adjust to a quantity-over-quality approach, beefing up the lower rungs of the system with 40 or 50 lottery tickets. Unlike teams that sign players for $2 or $3 million a pop, Boston will be forced to spread its money around, perhaps wisely hedging against the volatility of 16- and 17-year-old prospects.

The Red Sox also have the benefit of limiting the pool of players they’ve had to scout. McDaniel’s list contains 43 players projected to sign for $500,000-plus, a group the Red Sox have probably largely ignored since the time they knew they were going to bust their bonus pool last year. It’s perhaps only a small advantage, but focusing all its resources on under-the-radar prospects while other teams are more invested in high-profile players might allow Boston to better scout and uncover low-priced talent. Don’t be surprised if the Red Sox turn to Venezuela (as they’ve done frequently in the past), which Ben Badler describes as a more challenging process than ever due to political and economic issues, or less scouted countries like Aruba, where the Sox once uncovered Bogaerts for $510,000.

There are obvious downsides, of course, as the Red Sox are relegated to the sidelines on highly touted players for the next two signing periods. Exciting youngsters like Vladimir Guerrero Jr. await their professional debuts and a seemingly endless supply of promising Cubans are leaving the island to pursue major-league dreams. The Dodgers, per McDaniel’s big board, are poised to sign two Cubans for $27 million in total, part of an overall international outlay likely north of $30 million. The opportunity cost for the Red Sox might even be larger next signing period, where as many as 10 (or more) teams, including Boston, could face the $300,000-and-under penalty, and the rest of the league will have their pick of the international crop without interference from most of the big spenders.

In the end, the Red Sox made their splash during the 2014-’15 signing period, a calculated move that cost them future spending flexibility but also infused the organization with a major dose of foreign talent. While Boston won’t be inking any Moncadas in the near future — they do remain eligible to sign older international players who aren’t pool-eligible, however — expect them to keep busy in the international market, playing the field in a similar fashion to the Rays, Rangers, and Cubs. There’s still plenty of international stars to be unearthed and the Red Sox, with an already stocked minor league pipeline and plenty of resources, have the ability to find and develop them despite a two-year spending limit.

Photo by Kelly O’Connor/www.sittingstill.smugmug.com

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