FanPost

The Forthcoming Lance Lynn Contract Extension

One of my favorite players to watch, write about, and discuss over the last few years has been Lance Lynn. Lance Lynn is having the season of his life as a 27-year old in 2014. While Lance will likely not compete for the Cy Young Award in 2014, he may currently be the best starting pitcher on the roster while Adam Wainwright goes through some struggles off and on here in August. 2014 is Lance Lynn's last year in which he will make less than $1M. He becomes arbitration eligible this offseason and will be so for three offseasons. Arbitration typically pays out 40% of free agent contract value in your first year, 60% of that value in the second year, and 80% of it in the third year.


As of the morning of August 26, 2014 (writing this as Lance Lynn is pitching to the Pirates) Lynn has been worth about $16.2M per season at 32 starts and 192 innings per year. If he continues to pitch at the rate he is this year, then this number could rise fairly drastically - a couple million more per year at most. (This comes from Fangraphs' "VALUE" section near the bottom of Lance's player page.) You'd expect the next 3 years (his arbitration years) giving him somewhere in the range of $6.5M in 2015, $9.75M in 2016, and $13M in 2017. That is $29.25M in the next three years for a guy who has made just a shade over $1.5M in his three+ year MLB career.


Something that could fuel a higher total than that is that Lynn has gotten better and better each year, seemingly. Lynn pitched in 18 games, starting only 2 of them in 2011. He had a 2.88 FIP that year with a 3.12 ERA. Over the next two years he started more and more games. In 2012, he started 29 out of the 35 games in which he pitched, with a FIP of 3.49 and ERA of 3.78. In 2013, he started all 33 games he pitched and had a FIP of 3.28 and ERA of 3.97. This year is the first year in which he has (so far) outperformed his FIP - with a 3.06 FIP (the best of his career) being beat by his 2.78 ERA. What if he gets better? The Cardinals would love that on the field, but the pocketbooks might not like it quite as much. Luckily (not really "luckily") the Cardinals have built some space into their self-imposed cap this year and for the next few years.


What else does Fangraphs' tell us? Well, below the "VALUE" section of the Fangraphs' page is a 5-year projection by the Oliver projection system. They figure him to be worth 13.7 fWAR over the next 5 years. (Aside: I believe he will be worth FAR more than that.) That should be worth something between $68.5 and $82.2M over that time period, depending on what the $/WAR value is over those years. It's currently seen to be between $5M and $6M per season. That's where I got those two numbers. a good midpoint on those numbers is a nice round $75M over the next 5 years. The problem with that is that he is only arbitration eligible the next three years, thus deflating his value a bit. Another thing that could hurt Lynn is that he came up a little later. He'll be entering his age 31 season when he reaches free agency and could command a contract like that - but could also be past his prime.


If Lance Lynn gets $29.25M over the next three years as I outline above, the Cardinals should stick to their laurels and only offer him market value for those years directly after his arbitration years if they feel like an extension is in order. I believe that market value for Lynn will be higher than what the 13.7 fWAR would dictate paying him for two reasons: 1) I believe he'll pitch better than that and 2) I believe that free agent contracts continue to rise year after year. Case in point is Homer Bailey (a worse pitcher than Lynn) getting a 6-7 year extension worth between $105M and $125M.


Lance could have a lot to say about this contract situation by how he pitches the remainder of this year and any/all of the next three years during his cheaper-by-comparison arbitration eligible season. If he continues to improve over the next couple of years, without an extension his value he receives via arby will rise, if not it will not. While a good median contract (outlined above) would pay him around $70M over the next 5 seasons. I don't see Lynn taking that after Homer Bailey's deal being signed in the past. Agents seem to look much more closely at that total value number than they do the average per year offer (AAV). Bailey's AAV will be either $17.5M or $17.857M. The 5 year, $70M extension I have proposed for Lynn will only pay him $14M per season - although he's not likely to make $14M in any season over the next 3 years. The upper end ($82.2M) that i mentioned earlier would put Lynn around $16.44M per season. That is likely not enough to sign him.


Another thing to consider is that perennial staff ace Adam Wainwright is making $19.5M over the next 4 seasons. Lance Lynn will not be given an extension larger than Wainwright's at this point in his career - especially with arbitration years in the mix.


While I do not know if I sign Lynn to an extension or not, since the Cardinals have him through his age 30 season fairly cheaply; I believe I'd go for 5 years (through his age 32 season) but not 6 or more. That basically goes for any starting pitcher, however, no matter how old. Were I to offer a 5 year deal, (as I said earlier) I would not overpay for the arbitration years by much. Assuming he gets better each year, the arby numbers could go up by a bit. Assuming they do, here's my outlined deal:


2015: $8.5M

2016: $12M

2017: $14.5M

2018: $17M (Wainwright's last year under contract, so I don't mind going over $19.5M after this)

2019: $19M

2020: $2M buyout, $20M club option

2021: $2M buyout, $20M club option


That gives Lynn $35M instead of $29.25M during his next three seasons. I think that could get you a little leeway in those last two years, in which you could get MAYBE him for another $36M total. Then, adding on two years with $2M buyouts and club options would help out as well. That would push the deal to $75M guaranteed over 5 years and up to $115M over 7 years and through his age 33 season.