St. Louis Cardinals: How Will the Cardinals Fill Their Third Base Hole?
By Zach Gifford
Projecting how much the St. Louis Cardinals can afford to spend.
Now that I have the payroll projections that arise from players currently in the organization, I attempt to quantify exactly how much the St. Louis Cardinals can spend on external options. The amount the front office is willing to spend can be approximated using Payroll as a % of revenue (Payroll%)
In John Mozeliak’s tenure, beginning with the 2008 season, the team has averaged a Payroll% of 53.0%. From 2008 to 2013, that number was 56.1%, but has dropped into the mid-40%’s since. This drop has led some to the conclusion that the Cardinals are “cheap” or have “gotten cheaper.”
Yet, despite this sentiment, the Cardinals front office has shown they are not averse to aggressive spending. Between Albert Pujols, David Price, and Jason Heyward, Mozeliak & co. offered nearly $700 million dollars. They’re not cheap, the players just decided to go elsewhere.
That said, 53.0% is a reasonable Payroll% to expect going forward, and 56.1% might be the aggressive limit. To see how many dollars that is, I projected team revenues over the next few years.
Over the past five seasons, the St. Louis Cardinals revenue has grown at an average of 7.9%. I will use that figure to project non-TV-deal revenues over the next five years. 2017 is the last season under the existing deal with Fox, with an expected payment of $30M.
The new deal starts in 2018 with an expected $50M payment, and ends in 2032 with an expected $86M payment. The implied annual growth rate of the deal comes in at 3.95%, so I will grow TV-deal revenue by that annual rate. The result:
The average payroll cap is essentially in line with the luxury tax threshold, which will be at $197M in 2018 and $206M in 2019. The tax rate on the amount above the threshold is 20% for first time offenders, 30% for second timers, and 50% for a third offense.
Factoring in the potential luxury tax for spending near the aggressive cap, we can figure out the dollars available, in millions, for free agency in the 2017, 2018, and 2019 seasons.
As you can see, the St. Louis Cardinals will have plenty to spend, should the two premium third base targets become available.