Red Sox announce five-year contract extension for Chris Sale
By Sean Penney
The Boston Red Sox officially announced an extension for ace Chris Sale, revealing details that benefit the team’s future payroll.
A press conference was held at JetBlue Park Saturday morning to officially announce Chris Sale‘s contract extension with the Boston Red Sox.
The deal is a bit different from previous reports that pegged the value in the range of $150 million. The total comes close but there are some creative quirks in the contract that benefit both Sale and the Red Sox down the line.
Sale’s new deal is a five-year, $145 million extension that runs from 2020-2024, as reported by The Boston Globe’s Alex Speier.
Sale’s salary for 2019 remains $15 million, an important distinction to make as it relates to the luxury tax implications. Had the agreement ripped up Sale’s current deal to replace it with a new one beginning this season, the average annual value of the contract would count against Boston’s payroll in 2019, pushing the team deeper into the tax. Instead, the Red Sox should be able to stay below the third tier of penalties that would result in a heftier tax bill and draft pick repercussions.
The insistence on staying out of the deepest waters of the tax was the excuse for not re-signing free agent Craig Kimbrel, so the front office would have some explaining to do if they blew past that threshold anyway while their former closer remains in limbo.
Sale’s contract includes deferrals that lower the average annual value to $25.6 million for tax purposes. The tax rules can get complicated but Speier explains it as the luxury tax is calculated based on the net present value of the deal, which deferrals lower by spreading out the payments. It’s a clever bit of tax manipulation that creates more breathing room for the team with MLB’s highest payroll.
Sale wanted the Red Sox to have more flexibility to build the team around him so that they would remain competitive throughout the duration of his contract. The structure of this deal helps create room in the budget for Rick Porcello, Xander Bogaerts, and J.D. Martinez, all of whom could hit free agency next winter.
While the extension seems quite team-friendly, there are some provisions built in that benefit Sale. There are escalators that can increase his salary up to $2 million per year starting in 2021, depending on where he finishes on the Cy Young ballot the previous season. Sale has never won the award but has finished in the top-6 in every season since he became a starter in 2012 and he was the runner-up during his first season with the Red Sox in 2017. A fiery competitor like Sale must find these escalators well within reach, increasing the value of the deal compared to what it appears on the surface.
The deal includes a $20 million option for 2025 that automatically vests if Sale finishes in the top-10 in Cy Young voting the previous year. Sale will be 36 years old by that point and may not find that type of money on the open market if his skills deteriorate. Boston will happily pay him that salary if he’s still pitching at an elite level by that age though.
Sale will reach 10 years of MLB service time next year. Despite that he’ll only be entering his fourth season with the Red Sox, the team has agreed to give him 10/5 rights (10 years of major league service, five with one team) beginning in 2020, allowing him a full no-trade clause.
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The contract also includes an opt-out after the 2022 season. Sale may have been amenable to a below market level extension in the wake of a season in which he missed significant time with shoulder inflammation. If he puts those concerns behind him with a few more spectacular years, he may want the opportunity to ask for a new deal ahead of his age 33 season. The opt-out lines up with when David Price‘s massive contract comes off the books. Boston will hopefully have Mookie Betts locked up to a long-term deal by that point, further clarifying the team’s payroll commitments ahead of when Sale could potentially be eligible for a raise.
Sale will earn $30 million in each of the first three years of the extension, followed by $27.5 million in 2023 and 2024 if he doesn’t opt out.
Had Sale put together a full, healthy season that was productive enough to put him in the Cy Young conversation for an eighth consecutive year, he certainly could have commanded a larger contract in free agency. He could have challenged Price’s $217 million deal or at least the record $34.4 million average annual value of Zack Greinke.
For Sale, the best possible deal wasn’t the most money. He’s happy in Boston and wants to play for a contender. After seven seasons in Chicago where he never had the opportunity to pitch in October, he’s now made it to the postseason in each of his first two years with the Red Sox and won a World Series championship in 2018. There’s no better place for him to compete than with the reigning champions and by not grabbing every dollar he could, Sale has enabled the Red Sox to sustain this success for years to come.