Orioles payroll will rise, just not in a flashy way

Team will have to dole out raises to stars, others

Peter Schmuck

11:10 a.m. AKST, December 1, 2012

Let the debate begin in earnest about the decision by the Orioles to cut loose first baseman Mark Reynolds.

Reynolds is a free agent today because he stood to make about $9 million next year following salary arbitration. He earned $7.5 million during a 2012 campaign in which his offensive numbers sagged but his defensive value surged with a very successful transition from third base to first, leaving club officials with a tough call.

They had to decide before Friday night's deadline for tendering contracts to arbitration-eligible players whether Reynolds' overall contribution to the team's winning chemistry last year would be worth nearly a 10th of the Orioles' total payroll in 2013. That's what executive vice president Dan Duquette was essentially saying when he explained the Orioles could not figure out a way to fit Reynolds into next year's budget.

Of course, this would all be easier to understand if the Orioles revealed the budget for player salaries, but we'll have to figure that out for ourselves. The team's payroll was about $86 million last season and it just subtracted $7.5 million of that by sending Reynolds on his way. It's not out of the question that he might come back later for less than the $9 million estimated arbitration figure, but you have to think that there is a team out there willing to outbid the O's for a guy whose career numbers say he might bounce back and hit 35 home runs next year.

This is the point in the conversation where the cynical fans start shaking their heads and wondering what happened to all that additional revenue the Orioles were supposed to get from the Mid-Atlantic Sports Network, which just experienced a big increase in viewership with the 2012 success of the Orioles and Washington Nationals. There was also a significant jump in attendance at Oriole Park this past year.

In other words, the price of poker just went up and the fans have a right to expect the payroll to reflect that.

Well, it's going to, though not necessarily in a way that is going to get everybody all excited about a big-money acquisition.

There's a pretty good chance the Orioles' payroll will be above $100 million by the end of the team's last arbitration hearing in February.

The Orioles are facing the only downside to developing a broad base of young major league talent. They entered this offseason with the highest number of arbitration-eligible players in the major leagues at the same time that top stars Nick Markakis and Adam Jones are due multi-million-dollar raises under their long-term contracts.

Markakis will get a $3 million bump to $15 million in 2013 and Jones will get a $2.35 million raise in the first year of his six-year contract extension, but that's just the beginning. Matt Wieters and Jim Johnson are both up for big raises in arbitration, as are Jason Hammel and Chris Davis. Throw in a $750,000 raise for Wilson Betemit and arbitration increases for Darren O'Day, Tommy Hunter, Brian Matusz, Troy Patton and Nolan Reimold and estimates range as high as $24 million in increased payroll without adding any big-dollar players from outside the organization.

The payroll space created by subtracting Reynolds' 2012 salary and those of other departed players (most notably reliever Kevin Gregg) still leaves the Orioles with an estimated payroll increase of more than $10 million before anybody starts talking about what it would cost to re-sign free agent outfielder Nate McLouth or pitcher Joe Saunders.

If the Orioles sign one of those two at a reasonable price, it would put the team very close to $100 million in payroll, which probably is the club's salary budget. It is, after all, kind of a big round number.

That would explain why Reynolds didn't fit, but it might not satisfy the masses if the club fails to make any significant improvements during the winter. If ever there was a time to justify pulling an additional $10 million or so out of the improving revenue stream (on top of that organic increase), this would appear to be it.

The other explanation, of course, might be that Duquette has big plans for the Winter Meetings, which are about to begin in Nashville. He's got pitching to trade and there are teams out there with bats to sell.

If he comes back with a decent run-production guy who can play first base and DH for a few million dollars less than Reynolds, it'll all make perfect sense.

Read more from columnist Peter Schmuck on his blog, "The Schmuck Stops Here" at baltimoresun.com/schmuckblog and listen when he co-hosts "The Week in Review" at noon Fridays on WBAL (1090 AM) and at wbal.com.

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