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Winter Meeting Notes: Draft Lottery Results & A Financial Freakout

The Cardinals will pick 7th in the 2024 MLB draft. You can blame Jason Motte.

2024 MLB Draft Lottery presented by Nike at the 2023 MLB Winter Meetings Photo by Daniel Shirey/MLB Photos via Getty Images

The Winter Meetings conclude today from Opryland in Nashville, TN. It’s been a largely disappointing Meetings so far, with only relatively minor free agent signings and trades.

The Cardinals have been quiet. Reports from the Meetings indicate that the front office has checked on the trade market for Tyler O’Neill and relievers. They’ve come away from that believing that free agency might be a better place for them to look to finish out their bullpen. They are looking at both experienced MLB vets RPs and new arrivals from Japan and Korea.

That doesn’t mean there wasn’t some Cardinals-related news yesterday.

The Cardinals have the 7th Pick in the 2024 Draft

MLB held the draft lottery live yesterday evening, with country music star Brad Paisley (awkwardly) calling out the results and team representatives, including Jason Motte for the Cardinals, sitting stoically on the stage with him. It was kind of dumb.

It got worse when the Cardinals came away with the 7th pick in the draft. It’s an unfortunate result. The club had the 5th best odds of getting the first pick in the draft. In typical closer fashion, though, Jason Motte took full responsibility for the loss. “I wasn’t lucky enough today. But it was a good time to take part in it.”

The top slot went to Cleveland, a team with a 2% chance of landing #1. The second pick went to St. Louis’ NL Central rival Cincinnati, who also had a 2% chance of picking that high. Ohio needs to go play the Lotto or something.

With two low-odds winners at the top, everyone else fell back to what could only be disappointing positions. At least the Cardinals finished higher than the Pirates. And they weren’t as unlucky as Kansas City, who will pick 6th.

Drafting 7th will be the highest draft slot for the St. Louis Cardinals in decades.

In 1998, the Cardinals selected J.D. Drew with the 5th overall selection.

In 1991, the club had the 4th overall pick and took Dmitri Young.

In 1996, the Cardinals had the 3rd overall pick and took starter turned reliever turned starter Braden Looper.

Draft and development have changed quite a bit since the ‘90s but it’s good to see three legitimate Major Leaguers on that list and one player who is a borderline Hall of Famer.

To be honest, the Cardinals could have drafted anywhere from 4th to 9th and they would probably still be able to get the player that they want. The MLB draft just doesn’t function the same way as the NFL or NBA drafts.

Even if picking 7th is an unfortunate outcome, it’s still a chance for the Cardinals to nab a caliber of player that they don’t often have a shot at. In that vein, I thought it might be an interesting exercise to list the Cardinals’ first round picks since the 2000 season. Here’s their draft history with players who reached the Major Leagues (with any team) listed in italics:

2000 – 13, Shaun Boyd
2001 – 28, Justin Pope
2002 – no first-round pick
2003 – 28, Daric Barton
2004 – 19, Chris Lambert
2005 – 28, Colby Rasmus
2006 – 30, Adam Ottavino
2007 – 18, Pete Kozma
2008 – 13, Brett Wallace
2009 – 19, Shelby Miller
2010 – 25, Zack Cox
2011 – 22, Kolten Wong
2012 – 19, Michael Wacha
2013 – 19, Marco Gonzales
2014 – 27, Luke Weaver
2015 – 23, Nick Plummer
2016 – 23, Delvin Perez
2017 – no first-round pick
2018 – 19, Nolan Gorman
2019 – 19, Zack Thompson
2020 – 21, Jordan Walker
2021 – 18, Michael McGreevy
2022 — 22, Cooper Hjerpe
2023 – 21, Chase Davis

That’s a lot of Major Leaguers! But it’s not very many quality Major Leaguers, though we still don’t know what kind of career Gorman, Thompson, Walker and those that follow will have.

What’s clear is that drafting seventh will dramatically improve the talent pool that the Cardinals can choose from. And their best grouping of positive production from the first round has come recently. They are drafting well right now.

We should have high expectations of their 2024 first round pick.

Unfortunately, they won’t get another pick until the third round. Sonny Gray received a qualifying offer from the Twins. Signing him means the Cardinals forfeit their second round pick. There has been some confusion as to whether or not they will receive a competitive balance pick. As far as I can tell, MLB has not yet announced those.

Now onto something completely different…

The Cardinals’ Financial Freakout

Ok, maybe freakout isn’t the right word. But once you’ve chosen to go with alliteration as a writer, you’re bound by alliteration. It’s the rules. So maybe it would be better if I retitled this section The Cardinals’ “financial fracas” or “spending stall” or “budgetary booboo”. You can choose!

Either way, it’s become clear at the Winter Meetings that the Cardinals are concerned about their revenue and it’s affecting the way they do business.

There was a short and largely ignored blurb in a Monday article from Derrick Goold at the Post-Dispatch that caught my attention. (Thanks to Country Stuff for pointing it out to me in the comments.)

Here’s what Goold reported:

We’ll dig into the content here. First, I want to back up a little and provide some context.

We entered this offseason expecting the Cardinals to spend. They had three holes in their rotation. They cleared significant space from their payroll through free agent departures. They were reportedly under budget last season and then traded away contracts at the deadline, saving even more money.

The Cardinals entered the offseason flush with cash and there was reporting that the club would have their highest payroll ever, exceeding $200M in their final outlay for 2024.

With losses piling up and games not selling out, the club had a lot of incentive to spend to win. Winning, after all, means money for a franchise in ticket sales, TV ratings, merchandise, and the potential playoff payout. It was logical for the Cardinals to come into this offseason looking to dramatically improve their rotation and commit their significant financial flexibility toward fielding a club capable of not only challenging in the NL Central but pushing up against the best teams in the NL.

If the Cardinals wanted to re-secure their financial future it made business and baseball sense to go big. Maybe not Ohtani and Yamamoto big. But my admittedly aggressive strategy of “three starters better than Miles Mikolas in arm talent” was not too unreasonable for the front office, considering the need, players available, and budget space.

They’ve fallen short of any “go big” strategy. We can (and have and will) debate the quality and wisdom of signing Lynn, Gibson, and Gray. What is not up for debate is the amount that they have spent on their winter additions. Like the moves or not, the Cardinals have gone surprisingly cheap.

Lynn and Gibson are locked in on market-value deals for back-end starters at $10-12M each. The commitment is very short; both players have one-year deals with team options. Gray’s deal is also market price – 3/$75 (plus a $5M guaranteed option payout over 5 years) – but it’s heavily backloaded. The club will only pay Gray $10M next season.

It’s not unusual for the club to manipulate salaries and stick to short-term investments. That’s been Mo’s M.O. for a while. It still seems odd for them to commit to those low-cost, short-term contracts so early in the offseason with so many better options still available and so much presumed budget space.

After finishing out their rotation – the largest expense the club planned to have this offseason – the Cardinals still have just $171.25M committed in salary. That’s down from $177.5M spent on Opening Day of last year, a figure Mo himself admitted was lower than they planned.

This year’s current payroll commitment seems certain to decrease even more. Mozeliak has freely advertised his desire to move arbitration-eligible outfielder, Tyler O’Neill. That would gain them another $6M in expected salary for 2024.

A few weeks ago, the club surprised many by non-tendering Dakota Hudson and Andrew Knizner, along with Jake Woodford, to clear $7M in budget space. A big part of those moves was an effort to clean up the roster and create space for younger, more talented players. It’s fair now to speculate that the Cardinals were also at least somewhat motivated by a desire to cut overall payroll commitments.

With so much accomplished for Mozeliak already, we can start to make more precise estimates on where their spending will land on Opening Day. If the club trades O’Neill as expected and receives a pre- or early-arbitration reliever in return – that seems to be their most likely path – the Cardinals would have around $166M in salary commitments for 2024.

If the club then adds a free agent reliever on top of that – let’s just stick with any of the reported arms that Blake wrote about on Sunday – it would cost the Cardinals another $5-8M. Maybe not even that much for the Korean closer Go.

Such a plan would leave the club finished with their offseason shopping and with an Opening Day payroll of $174M on the high end.

In the report above, Goold reiterates what he’s said all season. The Cardinals expect their “payroll to grow for 2024”. I used that information to project a $192M Opening Day payroll for 2024, assuming a slightly above average 8% increase in spending. (6% is their average increase.)

If the Cardinals play out their advertised plan, they would land about $20M below that figure.

(Here is another reminder for all of you who call my budget proposals “too conservative” that the club rarely even spends to my suggested levels.)

In an offseason where they should be spending aggressively to secure their financial future, the evidence suggests that the Cardinals are cutting costs and pushing as much money as possible to future seasons. They are still trying to build a team that could contend in the NL Central, but they’re trying to do it at a bare minimum of cost.

That gap in expected spending and expected talent has led many of us to speculate that something big could be on the horizon.

Maybe that would be a play for Yamamoto? Katie Woo shot that down for good on Monday morning.

Maybe Dylan Cease or Tyler Glasnow? Those two might still be in play, but Mozeliak has downplayed the possibility of acquiring another starter. Both moves would also involve shedding Steven Matz’s contract. He is reportedly on the trading block as well. Grabbing Cease or Glasnow would significantly improve this team, but neither would stretch to expected levels.

Simply put, there is no reported plan out there that has the Cardinals spending up to budget expectations in 2024.

That brings me back to the blurb above. Fear surrounding two of the Cardinals’ critical revenue sources is handcuffing Mozeliak’s efforts to improve this team: expected loss of ticket sales due to a poor 2023 season and the ongoing bankruptcy of Diamond Sports and Bally Midwest.

I can understand the club’s concern about ticket sales. Based on the team’s performance last season, it’s fair to believe that fewer people will come through the turnstiles in 2024. That’s a self-induced issue and a resolvable one. The best remedy to poor ticket sales is winning. And winning typically requires spending. That’s just the simple truth. If the Cardinals want to secure full stadiums at Busch, then they need to finish this team off with significant talent.

I think the bigger concern is the situation with Bally Sports Midwest. Other MLB clubs with broadcast contracts in the Bally/Diamond conglomerate have already suffered missed payments. The league had to step in to cover broadcasts and make up for missed funds for two teams in 2023. MLB covered 80% of missed contract payments to those teams.

The Cardinals are not one of the teams who have missed revenue so far. St. Louis has some of the best TV ratings in the league. That might not matter in the end. Reports indicate that Bally plans to halt their broadcasts for all their franchises in September of 2024.

It seems very likely that at some point next season the Dewitt’s and the Cardinals will have to find another way to get their product to their fans. The league will intervene to get games to fans and maybe cover some of the costs, but the Cardinals will lose significant revenue next season. And a lot of security for future seasons.

Once Bally dies, what comes next for the Cardinals? Instead of guaranteed income that would pay them over a billion dollars through 2032, the Cardinals will have to move to an unknown and unproven model.

I believe it’s that uncertainty more than anything else that’s causing the Cardinals to spread out any big financial hits for as long as possible, limit long-term contracts, and hold payroll static.

Their actions suggest that maybe my “freakout” language in the header above is not that far off. And it’s a “freakout” that is likely to last for multiple years.

In a year where the smart business move was to spend to win and secure attendance and TV viewership, the Cardinals are saving to shelter themselves from an anticipated storm.

Are they being overly cautious? Or do things look that bad for them? We don’t yet know. As always, we want this sport to boil down to competitiveness, contention, and winning. It doesn’t. It’s about money. It’s all about money. It will always be about money.

The Winter Meetings will end today with the Rule 5 draft. In light of what I’ve argued above, and reporting from Katie Woo, I expect the Cardinals to be active. Rule 5 is another cost-saving way for the club to complete their bullpen and lower overall costs.

It seems extremely risky for a 71-win team that needs to sell itself to ticket buyers and get their postseason playoff payout to rely on a gaggle of mid-30s starters, a Rule 5 pick, and/or an overseas RP or two. But that’s the Caridnals’ most likely plan.

This offseason appears to be about balancing the risk of going cheap against the threat of significant lost revenue. A wrong outcome here could set the club back for a while and cost a lot of people their jobs.

We’ll have information and updates from the Winter Meetings as news breaks. Stay tuned.