Yankees hope to get under luxury tax by 2018

The New York Yankees were previously known for being big spenders in the free agent market.

Now, the Yankees are going to be thrifty spenders with hopes of getting underneath the $197 Million luxury tax in 2018.

“We will put money back into the club like we always do,” Yanks owner Hal Steinbrenner told reporters on Thursday. “But I think the threshold is a good payroll. I don’t think any team should have to be more than that to win a championship.”

Steinbrenner also reiterated four times that he wasn’t going to sell the Yankees, as he hopes to keep the business within the family.

In the past, the Yankees were either ‘World Series or bust’. With the realistic state of the team, Steinbrenner took the ‘World Series or bust’ card off the table, and admitted that he would be happy with just a trip to the playoffs.

The Yankees clearly have the players to compete in the postseason. The team is attempting a new approach this season by having a healthy mix of veterans and kids, versus relying on all veterans to carry them throughout the year. Homegrown players such as Gary SanchezAaron Judge and Greg Bird all figure to have starting jobs with the Yankees this season–that is if Judge and Bird can win the right field and first base job out of Spring Training.

The team prioritized going under the luxury tax before 2018, especially since the 2018 free agent class is expected to be one of the best in recent years. If the Yankees play their cards right, they could have Bryce Harper or even Manny Machado in pinstripes by 2019.

CC Sabathia and Alex Rodriguez‘s contracts come off the books after the 2017 season. And the team tried enticing buyers for Chase Headley and to a lesser extent Brett Gardner. The Yankees opted to keep Headley and Gardner for the 2017 season and will reassess where they are by the trade deadline on July 31st.

The luxury tax for the 2017 season is $195 Million, but the team already has $184 Million committed to 17 players. That means they have a long way to go before they’re safely under payroll and no longer have to pay a luxury tax.

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9 Responses to Yankees hope to get under luxury tax by 2018

  1. uyf1950 says:

    "The luxury tax for the 2017 season is $195 Million, but the team already has $184 Million committed to 17 players. That means they have a long way to go before they’re safely under payroll and no longer have to pay a luxury tax." Actually that's not true.

    The Yankees payroll for 2017 all inclusive: the 40 man roster, Benefits and incentives and dead money E.g,: Alex Rodriguez and Brian McCann come to just about $210MM. Alex Rodrigues ($27.5MM AAV) comes of that total at the end of 2017. Factor in Sabathia's, Pineda's and Clippard's combined total of $40MM and just those subtractions: Alex, Sabathia, Pineda and Clippard and the Yankees 2018 payroll comes to about $144MM. Sure there will be arbitration award increases for players eligible in 2018 but no where near the amount coming off the books. In fact even with those increases in arbitration awards for eligible players next winter the Yankees will have money to spen in free agency and still be under the tax threshold.
    The Yankees if they chose can't help but get under the 2018 Tax Threshold.

    • mosc says:

      I still think there's a strong chance they're strategizing dumping at the trade dealine… or if they're in a good place bringing in more. They want to get under the deadline either in 2017 or more likely 2018 and they also want to compete so they've kind of split the difference with this roster. They can compete but they can also dump if it doesn't work out.

    • YankeezFan says:

      I agree with this assessment, but if you use the numbers from Baseball Reference the 2017 Yankee payroll is 194M, which isn't that far from the 2017 Luxury Tax threshold. If the Yankees really wanted to get under the Tax threshold, they would move Gardner and maybe Castro, as they have some young depth at both positions, and BOOM, your at or around 170M under the tax, and then you can clear up the rest of the payroll in 2018. The only problem is 2018 is going to have to be a year where you need to have substantial depth in the minors in order to Trade and Sign 2019 free agents like Machado or Harper. However if the Yankees youngsters perform, they may not have to sign position players, but will need starters, which are hard to find. Position players is not a depth problem for the Yankees, Starters are where the Yankees need help, so that's where the focus on management should be.

    • fuster says:

      after 2017, the Yankees have only 6 players under contract and making significant money, $5M they have to pay for McCann, 8 guys eligible for arbitration (not all of whom are likely to be retained)……….. and a big bunch of kids making MLB minimum.

      the contractual obligations for the six plus McCann amount to $101M ………. altogether the payroll for everyone on the roster doesn't seem to reach $150M
      well below the $197 luxury tax threshold for 2018

      they've got room to work something out with Tanaka, replace Pineda with Ohtani or Darvish, and still have a few million bucks in the piggybank

  2. ERIC PELLIS says:

    Hal gives us two versions of who he is. One, he states that he will always put money back into the team to compete for championships. Two, he says that he is much more a businessman than his Dad. He sees the value of homegrown succesful players that will limit his spending which makes a lot of sense. However, he should be held accountable for putting this luxury tax bonanza of 50 million back into the team. I don't want to hear any exuses about not spending in 2019. This IS THE NEW YOR YANKEES we are talking about. Having a fruitful farm system is the way to go but not the only way. Trades and Free Agency should also be a major option when 2019 arrives.

    • Celerino says:

      I don't think there's an issue with Hal investing in the team. If saving money was his prime motivation, be would have gone the tear down route rather than trying to remain competitive while rebuilding. On another note, we shouldn't wait anxiously for the 2018 free agent bonanza. There won't be one. Harper, Machado and company will all either be resigned or traded at July 31. No way their teams let them go for a draft pick.

      • tom says:

        That is fans' point of view. No businessman in MLB should fixate at 18-19 free agents today. Hal's wanted to get the team under luxury tax because he is tired of spending too much money on elsewhere (the absolute opposition of returning money to the true club). It has nothing to do with potential big 19 FA class even though it certainly is in the back of Hal's head.

  3. mosc says:

    You know, the luxury tax is not as "soft" as it used to be and every iteration of bargaining makes it a little harsher. Meanwhile, there are still many other areas where the Yankees can spend money to outclass the competition. International spending pools have restricted some of it but they can still out-spend on front office, staff, facilities, SCOUTS, trainers, analytics, development leagues, etc. Just because the payroll may not lead the league every year anymore doesn't mean they aren't out-spending the league in other areas.

  4. BALT YANK says:

    Harper, Machado, Trout, are fine players but none of them are worth the seven to ten year mega-deals that the market will command. The Yankees should get under the luxury tax and invest in home grown players while using the FA market for key parts, like Holliday this season in a 1-year low risk deal. The Yankees have a lot of money tied up in mediocrity still: Ellsbury, Headley, Castro, Rodriquez, Sabathia, that's $100 million in dead weight right there. The answer is not more FA spending.

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