The MLB Qualifying Offer Blues

It seems everyone is singing the qualifying offer blues because a few very good players are still jobless. To me it looks like everyone wants to fix the system but actually it isn’t broken. Let’s go over the MLB qualifying offers…

The Qualifying Offer Blues

(With sincere apologies to Woody Herman, Johnny Mercer and Harold Allen)

My agent done told me
When it was my walk year
My agent done told me son!
The team will sweet talk
They’ll make a Q O
But just tell them you’re done
You’d be silly to stay
Don’t worry bout a thing you won’t sing the blues in the night

The Qualifying Offer

The QO was created to replace the old type A and B free agent system and try to prevent teams with deep pockets from signing free agents the less well off teams that developed them. The concept is simple, if you want a top flight free agent – a player in roughly the top 16.6% of the earning scale – you have to give the team that let’s him go something in return, in this case your first unprotected draft pick in the next rule four draft.

The rules are pretty straight forward.

1. The value of the QO is the average salary of the top 125 players in the year just ended, this off season that number was $15.8M.
2. Teams have until five days after the end of the World Series to tender the offer.
3. Once the offer is made the player then has seven days to accept or decline
4. If the player declines he becomes a free agent with loss of a draft pick added to his cost to the acquiring team

If the player accepts a QO:

1. He cannot be traded without his consent until June 15
2. If he does consent to the trade the team that trades him receives only $50,000
3. He becomes an unrestricted free agent after the season ends – no QO may be offered

Intent versus Effect

The idea of the QO was to compensate teams for what would have been type A free agents under the old system but became a way to snag a draft pick for a player who had a good year with an agent too blind to see or a player unwilling to accept his true worth.

In the beginning teams acted within the intent of the QO,  most players receiving the $13.3M offer in 2102 at least had an argument that they belonged in that elite group. That year all nine of them rejected it although Michael Bourn was a late sign. The discussion became in fact whether any player would ever accept ever one;  teams listened and understood that they could put almost anyone out there and he’d probably accept.

Publicly teams said they hoped a the player being offered the QO would accept but privately they never expected it. After all these were players who presumably had turned down  extensions or multi-year offers yearning for the free agency gold mine; why would they accept?

In 2013 the number receiving the $14.4M  QO grew to 13 and a strong argument could be made that at least 5 of those were borderline candidates. Once again no one accepted the offer but this time the effect of the loss of a draft pick for these marginal players was more obvious.  Of the borderline players none reached a contract at QO value and only Ubdaldo Jimenez could be said to have made out better than expected while Stephen  Drew and Kendrys Morales didn’t sign until after the draft.

Seeing Boras unable to find a home for a player at the start of the season meant that even the best agent couldn’t get money for a player who didn’t deserve it. Whether a side effect of the Drew/Morales situation or simply the strength or the free agent class only 12 players received a QO following 2014 and only two were really borderline and the one who surprised watchers the most – Michael Cuddyer– actually gained his team a draft pick when the Mets smoked something strange and gave up a draft pick and a two year deal to sign him.

In 2015 the list of players offered the $15.8M QO in 2015 exploded to 20; of that number I felt that at least eight were borderline and a couple were just a joke.  The talk was still that bats were in high demand and no one would accept the QO. Clubs expected that players who should never have been given an offer would either sign back with the offering team at a lower AAV or find a home elsewhere creating a win-win for the team.   A few players and their representatives were watching however, learned from history and made good decisions.

Next: Making History