Yankees’ tricky money challenge could force DJ LeMahieu split: Sherman

Let’s do an exercise. Because Brian Cashman and his baseball operations staff almost certainly are in the midst of doing it for real to determine, among other items, how much they can offer DJ LeMahieu while keeping enough money to deepen the pitching staff.

Cashman has said he will not “telegraph” the Yankees’ budget. So, this is a moment in which we can point out what the Yankees’ revenues were going into 2020, or what the exorbitant franchise value is, or play every fan’s favorite game: “This Is What George Steinbrenner Would Do.”

Except the Yanks really have telegraphed their intentions. Every team official who has spoken has mentioned the substantial COVID-created losses of 2020 and — without a firm idea if fans will be back in any sizable way in 2021 — the need to plan as if next year will be more of the same.

Thus, the Yankees are going to dramatically cut payroll. How much?

They were projected to be around $265 million for luxury-tax purposes if a full season were played in 2020. The luxury-tax threshold for 2021 is $210 million. The Yanks can go beyond it assuming in a newly negotiated collective bargaining agreement that will begin for 2022 that either the tax thresholds will be eliminated or substantially higher, lessening the long-term tax implications for the Yankees.

My hunch is the Yanks will see no sense in getting close to $210 million next year and not being under. So, for this exercise, let’s assume a $200 million payroll that would give the Yanks wiggle room for in-season maneuvering. If Hal Steinbrenner needed any other reason to ask baseball operations for austerity — if $200 million is austerity — he received it when his Yankees were eliminated by a Rays team that had one-third the payroll. The new Boss will demand the Yanks also find a way to do more with less.

That is tricky because the Yankees have so much guaranteed for next year.

LeMahieu, Masahiro Tanaka, Jacoby Ellsbury, J.A. Happ, James Paxton and Brett Gardner come off the books as free agents, plus the Yanks will not tender a contract to Tommy Kahnle, who after Tommy John surgery is likely to miss all or most of what would be his walk year in 2021. That group represented just north of $100 million in 2020 toward the luxury-tax payroll. So that is a big savings. But …

The Yanks have seven players — Gerrit Cole, Giancarlo Stanton, Aroldis Chapman, Zack Britton, Aaron Hicks, Luis Severino and Adam Ottavino — signed for next year at $117.5 million. They have 11 arbitration-eligible players, not counting Kahnle, with the likelihood that Clint Frazier, Gleyber Torres and Luke Voit will slip above the Super Two threshold while Miguel Andujar and Kyle Higashioka will not. That group — which also includes (among others) Chad Green, Aaron Judge, Gary Sanchez and Gio Urshela — should come in at around $34 million, but to be budgetary safe, let’s say $35 million.

Each team is charged roughly $15.5 million for items such as insurance and pension and budgets about $3 million for in-season call-ups. Add that all up, and the Yanks are at $171 million. So if the budget is $200 million they will have about $29 million to spend. So think what that would mean if LeMahieu even takes the $18.9 million qualifying offer. What if he costs $20 million a year or $25 million per season?

My suspicion is the Yankees will make the qualifying offer, see if LeMahieu accepts or almost certainly rejects, then make a lower-than-his-value offer — say three years at $48 million ($16 million per year toward the tax payroll) — and say 1) take this, 2) shop the market and see if anyone in this depressed environment will top that, or 3) while you are shopping, we also will be shopping and if we use the money we will pull the offer, so if this is where you truly want to play, then the money could evaporate to keep you here while you are out shopping.

For example, could the Yanks bring in free agents Didi Gregorius to play short and Tommy La Stella to move around? They are not LeMahieu, but they make up a lot of his value as two desperately needed lefty hitters at probably less than $16 million in 2021.

How can the Yankees create more payroll space? Stanton is untradeable (seven years at $218 million with a no-trade clause he will not waive). The Yanks do not want to trade Cole. Severino, after missing most of the past two years, is probably not tradeable. Hicks and Ottavino likely cannot be traded without taking money back. Would a team take the two years at $32 million of Chapman or the two years at $27 million (assuming his 2022 option is picked up) of Britton — and would the Yanks want to break up their endgame?

The Yanks can non-tender or trade Sanchez, which would save about $5 million, but could they find his replacement for significantly less. Torres and Voit are both first-year arbitration players, looking at $3 million-ish. They are attractive, but also cost-friendly pieces for the Yankees.

You see the budget-planning issues: The Yanks are locked into a lot of money, much of which is either near untradeable or untradeable without taking money back. They can move some players, but they are core talents and it would mean rethinking the roster construction. Then there are questions if Tanaka would come back for, say, $10 million (or is that even too much for this Yankees exercise)? Would Gardner return for, say, $5 million (or is that even too much for this Yankees exercise)?

The expectation is that a record number of non-tenders will join the free-agent class, saturating the market and leading to club-favorable deals, especially if desperation peaks as 2021 spring training nears. The Yanks may be able to wait out the market and try to problem solve in that fashion while hoping the front office unearths a few more Urshelas and Voits — inexpensive gems.

This is the puzzle. This is the exercise. For the Yankees, it is real — and it has now begun: How to drastically cut payroll yet improve the product.

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