Royals payroll assessment: The past, the present and the future outlook

Asked in November if he had a set budget for the 2021 season, Royals general manager Dayton Moore explained the present strategy, which focuses not just on one season but the next three years.

Doing so involves projections for current big leaguers. Prospect development plays a role, too. So does the free-agent market, potential trades that pop up and the looming changes that could come up once the current collective bargaining agreement expires at year’s end, among a bunch of other factors.

Moore, Royals chairman and CEO John Sherman and the collection of owners have thought through them, of course. For now, one theme has emerged.

“Where (many of our players) are in their service time,” Moore said, “is naturally going to keep our payroll a little bit down, which I’m more than fine with because we have to give our young players opportunities if we’re going to get back to a championship level of play on a consistent payroll.”

None of this is to say Moore lies in bed at night tossing and turning over dollar figures. He doesn’t. His mind flips from the Royals’ current crop of players to prospective players, and how they may or may not make sense for the team at a certain time. Those types of decisions require financial analysis, though, so the payroll remains present, hovering above what’s tumbling inside the mind, and spoken through conversation, almost as an extension of the subconscious.

With that in mind, we thought it’d be valuable to take a deeper dive into the dollar figures, seeing what we can learn from the past, thinking about what might change in the present and pondering what the books could look like in the future.

A road map from the last decade

Past experiences influence most present and future decisions, and baseball takes from life in this respect.

That said, there are many confounding variables. To name a few: The COVID-19 pandemic has altered projections and expectations in ways that lack precedent; the Royals announced a multiyear television agreement with Sinclair Broadcast Group in August; a new ownership group is making the financial decisions.

So this section comes with a caveat: Perusing past numbers can go only so far.

Let’s start with the Royals’ previous contention cycle. Moore was hired in 2006, and by 2007, the Royals’ Opening Day payroll hovered around $67 million, per Cot’s Contracts. That figure crept close to $75 million in 2010, but dipped back down as the Royals prepared to launch a competitive club from the ground up.

In 2012, the Royals made two moves that, thinking about the current state of the roster, are intriguing. They extended both Salvador Perez and Alcides Escobar before both players became arbitration-eligible. Could that happen again for pitchers such as Josh Staumont, Scott Barlow, Tyler Zuber, Brady Singer or Kris Bubic? Time will tell, of course, but Moore’s perspective on extensions is clear-cut.

“All of our players, especially the homegrown guys entering the prime of their careers, we want to do our best to keep them here long term,” Moore said recently. “You can assume that we’re always having those discussions. … We’ll always do our best to keep our good players here as long as we can.”

Getting back to the overall dollar figure, the Royals started 2014 committed to paying nearly $92 million on Opening Day. That number peaked in 2017 at around $143 million but dipped down consistently ahead of 2020. Had it not been for the COVID-19 pandemic and prorated salaries, the Royals were projected to pay nearly $89 million at the beginning of last year.

Which brings us to the present.

What’s the plan for 2021?

The Royals knew they had flexibility when this offseason arrived.

Danny Duffy and Salvador Perez were entering the final years of their deals, and Whit Merrifield was the only player under contract through 2022. So they targeted specific needs: a center fielder, which became Michael A. Taylor; a middle-of-the-order bat, which became Carlos Santana; starting pitching depth, which became Mike Minor; and bullpen help, which meant the return of Greg Holland.

Add the eight arbitration agreements into the fold and the Royals’ Opening Day payroll currently is projected around $84 million.

Royals' payroll commitments

Player	2021	2022	2023
Danny Duffy	$15.5 million	FA	N/A
Salvador Perez	$14.2 million	FA	N/A
Mike Minor	$7 million	$10 million	$13 million option ($1 million buyout)
Carlos Santana	$7 million	$10.5 million	FA
Jorge Soler	$8.05 million	FA	N/A
Whit Merrifield	$6.75 million	$2.75 million	$10.5 million option ($750,000 buyout)
Brad Keller	$3.35 million	A2	A3
Greg Holland	$2.75 million	FA	N/A
Hunter Dozier	$2.72 million	A2	A3
Adalberto Mondesi	$2.525 million	A2	A3
Jesse Hahn	$1.75 million	FA	N/A
Michael A. Taylor	$1.75 million	FA	N/A
Jakob Junis	$1.70 million	A2	A3
Franchy Cordero	$800,000	A2	A3
Josh Staumont	Pre-arb	Pre-arb	A1
Brady Singer	Pre-arb	Pre-arb	A1
Scott Barlow	Pre-arb	Pre-arb	A1
Tyler Zuber	Pre-arb	Pre-arb	A1

As we’ve noted in recent weeks, the Royals may add more players before the season begins. Moore has repeatedly mentioned a search for a left-handed bat, a player who will provide depth in the outfield but also some versatility. Starting pitching depth is a focus, and another bullpen arm may make sense, too.

How much more do the Royals have to spend? The answer may indicate where the Royals feel they are on the contention curve.

What the future looks like

Extensions made sense in the Royals’ first wave of contention under Moore and they make sense now. As mentioned earlier, Perez and Duffy are entering the final years of their contracts. Jorge Soler, meanwhile, will be a free agent at season’s end.

You could make a case for an extension for each player. Perez, 30, underwent Tommy John surgery — a rarity for a catcher — but returned in 2020 and won a Silver Slugger Award. With the young pitching rising the ranks, how could a club turn down the services of a productive veteran catcher?

Duffy, 32, posted a 4.95 ERA in 11 starts last season, but he’s a homegrown Royals pitcher, and when the Royals have used him out of the bullpen in his career, Duffy has posted a 2.57 ERA in 35 innings. Could he anchor a bullpen and help the young prospects transition for a price the Royals would be willing to pay?

Soler, 28, may be the most interesting case of all. He has had an injury-riddled career, but when he’s been healthy like he was in 2019, he can do things like lead the American League in home runs (48). Does Soler’s love for Kansas City mean he’ll be willing to take less than he could get elsewhere?

The larger question: Do the Royals have enough flexibility to extend all three of these players?

ICYMI — Royals GM Dayton Moore talks potential free-agent additions, Ervin Santana, final roster spots and much more: https://t.co/cwS3nEo4zI

— Alec Lewis (@alec_lewis) January 9, 2021

The answer to that question, of course, is affected by the younger players. Brad Keller, Hunter Dozier and Adalberto Mondesi are all homegrown players. Each agreed to deals with the Royals ahead of the arbitration deadline, but the Royals could buy out their remaining arbitration-eligible seasons by signing them to extensions. (In 2019, the Royals extended Merrifield, canceling out the final pre-arbitration season and three arbitration-eligible seasons.)

Then there’s the potential strategy the Chicago White Sox have employed recently, extending Luis Robert and Eloy Jimenez even before they made their debuts. Whether a Royals prospect such as Bobby Witt Jr. or Daniel Lynch would be open to this type of deal is a valid question, but it’s another possibility for the future.

The Royals are fortunate in that the payroll provides loads of flexibility in the next three years, the timetable Moore mentioned. As things currently stand, the Royals’ 2022 payroll sits at around $40 million, though arbitration-eligible players would see bumps in pay and others would be entering arbitration.

Beyond Merrifield’s team option in 2023, the slate is clean. The best comparison is a cloudless blue sky, the sun beaming, a whole host of possibilities awaiting.

(Photo of Soler: Mike Dinovo / USA Today)