With the 2019 MLB Draft upon us, here’s a friendly reminder: The MLB Draft is something like the lottery – with a budget.
While you can walk into your local 7-11 or Wawa and pick up countless amounts of tickets to hit the jackpot, MLB teams operate with a certain allotment of signing-pool money. This year, the No. 1 overall selection held by Baltimore is worth $8,415,300 up from $8,096,300 in 2018.
This year, with extra compensation picks received in free agency, the Paul Goldschmidt trade and not signing last year’s first-round pick (Matt Lauer), the Diamondbacks have seven picks in the first 75 selections and the most money in the bonus pool to spend in the first 10 rounds of the draft.
Each draft selection is given a certain value. Should there be leftover money from a signing, teams are allowed to use that money for other signings throughout the draft.
Should a team exceed its alloted slot money, it incurs a penalty. A team is taxed 75 percent on overages between 0 and 5 percent. No team has ever exceeded more than 5 percent on its draft allotment. MLB Draft 2019 first-round slot value. All values courtesy of MLB.com. Orioles: $8,415,300 2. Royals: $7,789,900 3. White Sox: $7,221,200 4. The assigned slots are 3.9 percent higher than a year ago, reflecting the increase in MLB's annual revenues. 1 overall selection is valued at $8,415,300, up from $8,096,300 in 2018. In addition to the D-backs, nine other teams have eight-figure bonus pools. With slot values from 2019 locked in for 2020, there are more changes coming than just the amount of rounds in the 2020 MLB Draft.
Should a team exceed its alloted slot money, it incurs a penalty. A team is taxed 75 percent on overages between 0 and 5 percent. No team has ever exceeded more than 5 percent on its draft allotment.
- Day 1 of the 2019 MLB draft is in the books, with the Orioles taking Adley Rutschman at No. We've got analysis of all the first-round picks and more.
- The assigned slots are 3.9 percent higher than a year ago, reflecting the increase in MLB's annual revenues. 1 overall selection is valued at $8,415,300, up from $8,096,300 in 2018. In addition to the D-backs, nine other teams have eight-figure bonus pools.
MLB Draft 2019 first-round slot values
All values courtesy of MLB.com.
1. Orioles: $8,415,300
2. Royals: $7,789,900
3. White Sox: $7,221,200
4. Marlins: $6,664,000
5. Tigers: $6,180,700
6. Padres: $5,742,900
7. Reds: $5,432,400
8. Rangers: $5,176,900
9. Braves: $4,949,100 (Compensation for unsigned 2018 pick Carter Stewart)
10. Giants: $4,739,900
11. Blue Jays: $4,547,500
12. Mets: $4,366,400
13. Twins: $4,197,300
14. Phillies: $4,036,800
15. Angels: $3,885,800
16. Diamondbacks: $3,745,500
17. Nationals: $3,609,700
18. Pirates: $3,481,300
19. Cardinals: $3,359,000
20. Mariners: $3,242,900
21. Braves: $3,132,300
22. Rays: $3,027,000
23. Rockies: $2,926,800
24. Indians: $2,831,300
25. Dodgers: $2,740,300
26. Diamondbacks: $2,653,400 (Compensation for unsigned 2018 pick Matt McLain)
27. Cubs: $2,570,100
28. Brewers: $2,493,900
29. A’s: $2,424,600
30. Yankees: $2,365,500
31. Dodgers: $2,312,000 (Compensation for unsigned 2018 pick J.T. Ginn)
32. Astros: $2,257,300
Compensation picks
33. Diamondbacks: $2,202,200 (via Patrick Corbin signing with Nationals)
34. Diamondbacks: $2,148,100 (via A.J. Pollock signing with Dodgers)
Competitive Balance Round A
35. Marlins: $2,095,800
36. Rays: $2,045,400
37. Pirates: $1,999,300 (Compensation for unsigned 2018 pick Gunnar Hoglund)
38. Yankees: $1,952,300 (From Reds via trade)
39. Twins: $1,906,800
40. Rays: $1,856,700 (From A’s via trade)
41. Rangers: $1,813,500 (From Brewers via trade)
MLB Draft bonus pool money by team
2019 Mlb Draft Prospect Rankings
All values courtesy of MLB.com.
Diamondbacks: $16,093,700
Orioles: $13,821,300
Royals: $13,108,000
Marlins: $13,045,000
White Sox: $11,565,500
Braves: $11,532,200
Rangers: $11,023,100
Padres: $10,758,900
Tigers: $10,402,500
Rays: $10,333,800
Pirates: $9,944,000
Twins: $9,905,800
Reds: $9,528,600
Giants: $8,714,500
Blue Jays: $8,463,300
Mets: $8,224,600
Dodgers: $8,069,100
Angels: $7,608,700
Mariners: $7,559,000
Yankees: $7,455,300
Rockies: $7,092,300
Cardinals: $6,903,500
Phillies: $6,475,800
Indians: $6,148,100
Nationals: $5,979,600
Cubs: $5,826,900
A’s: $5,605,900
Astros: $5,355,100
Brewers: $5,148,200
Red Sox: $4,788,100
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Major League Baseball is set to formally announce in the coming days that the 2020 draft will be only five rounds, the fewest since the draft began in 1965.
MLB and the MLB Player’s Association agreed in March to cut the draft from its usual 40 rounds to as few as five rounds as a result of the shutdown caused by the coronavirus pandemic. With the 2020 season still uncertain to be played—though owners have begun presenting a proposal to players for a shortened, 82-game season beginning in July—clubs are seeking ways to save money in order to offset the revenue losses from a shortened or unplayed season. Reducing the number of players drafted, and by extension the amount of money teams pay out in draft signing bonuses, is one of the most direct ways to do so.
MLB proposed a 10-round draft where bonus slot amounts in rounds 6-10 would be halved from last year, but the MLBPA rejected that proposal. As such, the draft will consist of five rounds with slot values equal to 2019. A total of 160 players will be drafted compared to the more than 1,200 normally selected.
In baseball terms, the amount of money clubs save by reducing the number of draft rounds is minimal.
Teams combined to spend $23.319 million on signing bonuses for players drafted in rounds 6-10 in 2019. That’s an average of $777,300 saved per team by eliminating those draft rounds this year.
Teams combined to spend $79,215,284 on signing bonuses for players drafted between rounds 6-40 in 2019. That’s an average of just over $2.64 million saved per team by not having a full 40-round draft.
Mlb Draft Money Slots 2019 Free
On the surface, $770,300 is a small price to pay for the chance to draft a Jacob deGrom, Paul Goldschmidt, Justin Turner, Marcus Semien, Whit Merrifield or Edwin Encarnacion, all of who were drafted between rounds 6-10.
Similarly, $2.64 million seems a small price for the chance to draft an Albert Pujols, J.D. Martinez, Lorenzo Cain, Matt Carpenter or Josh Hader, all of who were drafted between rounds 11-40.
In non-player terms, however, those savings can be meaningful.
For example, $770,300 could be the difference between 12 team employees making $60,000 a year remaining employed or being laid off. $2.64 million would be the difference between 44 such employees keeping or losing their jobs.
Teams are saving money through the draft in other ways. Players drafted in the first five rounds will receive only $100,000 of their signing bonuses this year. They will receive 50 percent of their bonuses in 2021 and the remaining amount in 2022. Typically, draft bonuses are paid out by the end of the following year after a player signs.
Players drafted in the first five rounds last year received a combined $237,345,700 in signing bonuses. If all 160 players drafted this year sign for the full slot amount, teams will save more than $221 million in spending in 2020 by deferring all but $100,000 of those bonus payments, although clubs will still have to pay out the full amount in later years.
Teams will likely save more than that $221 million in spending this year because many players, particularly those drafted in the fifth and final round, are expected to sign less than the full slot amount.
Clubs are making these moves because they face steep revenue losses this season, even if games return but fans are not allowed into stadiums.
About 40 percent of team revenues come from ticket sales and attendance-related expenses such as parking and concessions, according to league sources and publishedreports. The exact figure varies by team.
The Mariners, Padres and Rangers announced employees making more than a certain amount would take pay cuts this year in order to help avoid furloughs and layoffs. The Rays began furloughing staffers at the start of May and the Marlins will reportedly furlough between 90 and 100 employees beginning June 1, according to Ken Rosenthal of The Athletic.
MLB saw gross revenues of $10.7 billion in 2019 according to Forbes, its 17th consecutive year of record growth.