It’s that time of year, friends! The leaves are turning. The nights are becoming brisk. I broke out a hoodie and stocking cap this weekend. I have a cup of cool apple cider next to me while our fake fireplace crackles.
Yes, friends, it’s payroll season!
It’s time to bust out the Excel spreadsheets, scour the MLB payroll tracking websites, and break out my slide rule. I am here to do all the work that you don’t want to do so we can pretend to know how much money the Cardinals have to spend this offseason.
And guess what? I have good news for you! It comes in two forms:
1. The Cardinals’ payroll is significantly less complicated for 2024 than in the recent past. COVID and its revenue ramifications are over. Arenado’s contract has stabilized. The payroll quirks that dragged us into the mud the last few seasons are mostly resolved. This year the numbers should be more straightforward and that should lead to more alignment between myself here at Viva El Birdos, Derrick Goold and the Post-Dispatch, and the national sites: Cot’s, Fangraphs, and Spotrac. That will (hopefully) save us from unnecessary arguments and uninformed angst in our online chats.
2. The Cardinals have the budget space they need to fill their roster holes and complete their reported offseason plan: add three starters and some relief help. It will require them to move on from some arbitration-eligible players, but not in a painful way, and make a few trades to clean up the roster. Still, you should come away from this article confident that the Cards have the financial resources they need to do what they have to do to return to playoff contention.
That serves as a sufficient introduction. Let’s dive into the details, starting with the club’s payroll obligations for the 2024 season.
2024 Payroll Obligations (as of Oct. 16, 2023)
All payroll discussions need to start with players under contract and team control. As always, I work from the perspective of the Opening Day, 26-man payroll. Why? My goal is not to account for all of the Cardinals’ roster machinations on the 40-man roster over a full calendar year. My goal is to inform our off-season conversations. I want you to have the information that you need to be able to accurately plan, discuss, and evaluate the club’s offseason transactions toward the formation of their final 26-man roster.
Here is where the Cardinals sit in terms of both guaranteed and projected payroll expenses for their 26-man roster as of this Monday morning:
I have the Cardinals with $146.28M in projected payroll commitments for the 2024 season. With a bunch of players exiting through trade and free agency, the Cardinals have just six players under guaranteed contract. They have the most arb-eligibles that I’ve ever covered on this site – 10 players. Since our payroll projection depends on a 26-man roster, we have to dig pretty deep into our list of pre-arbitration players to fill it up. As always, don’t pay much attention to the names in the pre-arb section. This is not a roster projection. Think of them as salary placeholders so the roster number comes out right.
Unlike previous seasons, there’s not a lot of noise in that $146.28M number. Arenado’s contract is still the messiest. He does have deferred money coming out of his salary this season, and that will show up on other sites. However, we learned from Goold’s reporting that deferrals count for the year they are made, not the year they are paid. So, I’m including those deferred monies in the salary figure. What we can subtract is the $5M owed to the Cardinals from the Rockies, which goes toward salary relief this season.
Other sites will also have slight variations in the contract numbers for both Miles Mikolas and Paul Goldschmidt. Both players have signing bonuses built into their contracts. Following the guidelines laid out by Goold, I am choosing to include those bonuses in the year they are paid. I do not prorate them over the life of the contract as the other sites do. (You’ll see how I calculated those in the “Additional Payroll Considerations” section of the image below.)
The Cardinals are also responsible for $2M of Paul DeJong’s option year buy-out. I’m listing that as a projected expense for now but it seems certain that the club will have to pay it.
That leaves the Cardinals with $146.28M in commitments for next season based on who is currently under team control before they enter the offseason. How much higher will that salary number go?
Setting the Cardinals’ Budget
The Cardinals have been pretty quiet about their offseason budget and plans. There was no postseason press conference. There has been very little information coming out through the team reports. Our best nugget came from a recent interview with Bill DeWitt III, who indicated that the Cardinals would “climb the payroll rankings” and that ownership and the front office were in agreement on the need to spend to improve pitching.
We don’t know what the Cardinals’ intended budget is. We never know. What we do know is how the club has handled payroll in the past, including previous Opening Day payrolls, percent change from year to year, annual payroll rankings, and revenue considerations. This info should let us get relatively close to a projected budget number.
For these calculations, I prefer to use the Opening Day payroll numbers from Cot’s Contracts - Cardinals. I would probably take issue with a few of these numbers based on how we know the Cardinals calculate payroll, but for this exercise, they will work well enough. Here are the payroll numbers, the rate of change, and the league rankings for the Cardinals since 2010:
Percent Change: The Cardinals’ payroll has increased by an average of 6% every year since 2010. If we cut out the COVID years (2020-2022), the highest increase was 19% and the lowest was -5%. Last year, the Cardinals had recovered much of their lost revenue from the 2020-21 seasons and returned to something resembling a normal payroll. Their 14% increase in spending brought them their highest payroll ever. Don’t think that rate will continue. After cutting payroll, the Cardinals wanted to return to their pre-COVID payroll framework rather than setting some kind of new trend.
Historic Payroll Rankings: The Cardinals have been as high as 7th in the league in spending and as low as 15th (last year). Their average finish is around 11th in baseball. For years the Cardinals bragged about their spending relative to their market size. It was true then. It isn’t anymore.
Current Payroll Rankings: Ownership has already said it expects the club to climb in the payroll rankings in ‘24. Cot’s contracts ranked the Cardinals 15th in payroll last season. Here’s how they compare relative to the teams ahead of them:
#8 – Atlanta Braves - $203.0
#9 – Texas Rangers - $195.8
#10 – San Francisco Giants - $187.9
#11 – Chicago Cubs - $184.2
#12 – Boston Red Sox - $181.2
#13 – Chicago White Sox - $181.1
#14 – Houston Astros - $179.8
#15 – St. Louis Cardinals - $176.5
Revenue Considerations: The last-place 2023 season surely caused a hit in the Cardinals’ expected revenue. Ticket sales were down. Interest in the team was down. TV ratings were down. They missed the playoff profit windfall. Bally did not miss payments to the Cardinals for their broadcasting rights, but the ongoing bankruptcy and high risk of default is a significant concern for the club going forward.
Entering 2024, the Cardinals have to be concerned about their largest two revenue streams: ticket sales and television. The best way for them to secure ticket sales and probably guarantee as much TV income as possible for as long as legally possible is to win games. More wins = more tickets sold, more viewers watching, more ad revenue for Bally, and overall more revenue security for the Cardinals.
Hunkering down, tightening the belt, and cutting payroll costs is a surefire way for the club’s dip in revenue to only worsen. If the Cardinals want to regain what they lost this season, they have to spend and subsequently win their way to it.
Add all of that up. The Cardinals have a historic trend of raising payroll. They still have space to climb relative to their historic league spending ranking. They should have significant motivation to be aggressive in spending to secure their core revenue streams.
That’s my justification for proposing a fairly optimistic bump in payroll:
Projected payroll increase: 8%
Projected 2024 Cardinals Opening Day Payroll: $192M
I’m pretty comfortable projecting an 8% increase in payroll next season. Yes, that’s a lower rate of increase than last season, but most of that is due to accounting methods around Arenado’s salary, the need to return to their pre-COVID budget structure, and under-contract salary increases. I’m not comfortable projecting such an increase again this season, barring more information from the club.
The $192M payroll I am projecting would have ranked 10th in baseball this season. It won’t get them that high in ’24, but it should be sufficient to raise them from 15th to around 12th, which is where I think the Cardinals prefer to be.
Lastly, I know some of you will say “that’s too conservative! The Cardinals need to go all-in!” You’re free to think that. Keep in mind that every year I make these projections using these same tools. Every year fans and media members tell me my numbers are too conservative. Pretty much every year the Cardinals’ payroll has come in even with or slightly lower than what I projected. The air gets awful thin up there; climb upwards at your own risk.
How Much Do the Cardinals Have to Spend?
With projected salary commitments covered and a budget set, we can do some planning, starting with how much that $192M figure leaves the club for additions. If we simply subtract their current payroll from their expected budget, we get a total of $45.72M in available budget space.
That’s not the number we should work with. The Cardinals have several players on their list of arbitration-eligibles who aren’t likely to remain with the club next season. The club will almost certainly clear more salary space by non-tendering or trading some of these players.
Candidates for Non-Tender/Trade
Tyler O’Neill - $5.58M
Dakota Hudson - $3.65M
Andrew Knizner - $1.85M
Jacob Barnes – $1.25M
John King - $1.25M
Jake Woodford - $1.0M
We can’t just add $14.58M to the $45.72M number above. The Cardinals will not make all of these moves.
I have argued strenuously that the club should keep Tyler O’Neill and his relatively discounted $5.85M salary projection. I’m not getting the same vibe from reporters and club insiders. We can probably subtract his number from their projected payroll. He’s likely on his way out.
I will argue strenuously that the club should move on from Dakota Hudson and Andrew Knizner. I’m not getting the same vibe from reporters and club insiders. We probably need to keep their payroll numbers on the books.
The other three – Barnes, King, and Woodford – seem like obvious non-tenders, but the Cardinals don’t just get rid of players that often. King has an option year remaining and performed pretty well after coming over to the Cardinals. Let’s say that Barnes & Woodford go, while King stays. That, along with trading O’Neill, nets the Cardinals additional savings.
There are other moves the Cardinals could make too. They could trade Carlson. Helsley’s name has come up a few times. I’ve never counted those chickens until they hatch. That’s why this document is v1.0. We’ll adjust the numbers as moves are made.
We can now add everything up and give you the answer to the question you wanted 1,700 words ago: How much money do the Cardinals have to spend this offseason?
Projected Budget Space + Non-Tenders/Trades: $53.6M
That is by far the most amount of available budget space that I’ve ever projected the Cardinals to have in an offseason. That’s great news. At the same time, the Cardinals have more expensive roster needs that I’ve ever covered.
Do they have enough to get the job done and return to contention in the NL Central? Yes, definitely.
The Cardinals are going to be players at the upper end of the pitching market. That means taking on significant salaries. $53.6M isn’t that much when we start dividing it up between three quality starters plus relievers. However, signing upper-end pitchers does not guarantee that the team will have to shell out upper-end salaries immediately.
Look at the Willson Contreras deal. Contreras got the guaranteed years and total value that he wanted. What he didn’t get was a huge payout in year one. His salary in ‘23 was only $10M. It jumped $8M this season. That’s called backloading and it’s a common practice for teams to push budget hits to later seasons when revenue will be higher and other guaranteed contracts will come off their books.
Someone at the top of the FA starter pool, like Aaron Nola, could pull in a deal worth $30M annually. He might only make $22M next season. Sonny Gray, who is looking at a shorter-term and lower contract, could be in the $15-19M range next season and still average $21-25M over his 3-4 year deal.
The same logic applies to the foreign market. Yamamoto and Imanaga will require the club to make a posting fee before they can sign them. Based on how we know the Cardinals calculate payroll, such a fee would go into the current year’s expenses. Mozeliak and ownership can make that up by carving out a chunk of the player’s first and second-year salaries.
This is why I have proposed a 2 free agent + 1 trade approach to filling out the rotation. Such an approach allows them to spend for one top-tier starting pitcher (like Aaron Nola or Yamamoto) and one second-tier starter (like Gray or Imanaga). They can then finish out the rotation by trading an extraneous piece – like O’Neill or Carlson and some prospects – for a starter with a reasonable salary, 2-3 fWAR upside, and 1-2 years of control.
Starter 1 - $20-27M
Starter 2 - $12-20M
Starter 3 - $5-12M
That gives them an effective range of $37 – 59M spent on the rotation, depending on who they target. With that broad of an operative range, they can’t splurge on every arm, but I’m very confident that the Cardinals can find a combination of quality starters that fits their budget. If they arrange it right, they can also get their bullpen pieces without blowing up my proposed budget.
The bottom line is that the Cardinals have the budget flexibility that they need to fix their roster holes. They could create more space through some relatively painless moves. They have the depth and talent on their roster and in the minor league system to make some useful trades. There is enough talent on the free agent, trade, and international markets to get the kinds of players they need.
Everything is there for Mozeliak and the front office. It’s just up to them to get the job done.