The Boston Red Sox spent big for free-agent star Trevor Story
The moment we’ve been waiting for since the Boston Red Sox hired Chaim Bloom has finally arrived. By inking free-agent infielder Trevor Story to a six-year, $140 million deal, Bloom has proven that he’s capable of spending money to improve a contending roster.
The criticism directed at Bloom wasn’t entirely fair. Under the direction of ownership, his first task upon arriving a couple of years ago was to slash payroll in order to reset the dreaded competitive balance tax penalties. It was a painful process in the short term but Boston’s financial flexibility has significantly improved for the long run. Bloom was determined to rebuild a farm system that ranked among the worst in baseball and he’s done so by lifting them to the middle of the pack with a rapidly improving collection of assets headlined by several high-ceiling prospects.
Bloom arrived with a plan and preached patience as he meticulously went to work on implementing his vision. He made shrewd short-term signings that wouldn’t impede that plan. They didn’t all pan out but several of those moves exceeded expectations. The 2-year, $14 million deal for Kike Hernandez has been an excellent bargain but it was also the largest contract that Bloom had given a free-agent during his tenure in Boston.
He’s proven to be a savvy shopper in the bargain bin but fans expected a club with the resources of the mighty Red Sox to flex some financial muscle. The rumor mill tied the Red Sox to essentially every high-profile player on the market but Bloom never pulled the trigger, leading his critics to chirp that he was treating the payroll as if he were still running the low-budget Tampa Bay Rays.
Bloom silenced those critics by signing Story. He wasn’t the top position player on the market but the two-time All-Star is a clear upgrade in the lineup and on the field. He wasn’t cheap either, as Story’s $23.33 average annual value trails only Chris Sale on this year’s Red Sox payroll.
The Story contract pushes Boston slightly over the line for the first tier of luxury tax penalties, which increased to $230 million under the new collective bargain agreement. The payroll currently sits at an estimated $231.16 million, per the Twitter account Red Sox Payroll. This total includes projections for arbitration-eligible players whose salaries for this year haven’t been finalized yet but it’s clear that the Red Sox aren’t concerned about paying the tax this year.
Nor should they be. After ducking the tax in each of the previous two years and making a surprising run to the ALCS last season, Boston is in better position to exceed the tax than they were at any point since Bloom arrived. Now is the time to strike when the penalty for a first time offender is a modest 20 percent tax on all overages. Going slightly over the tax is a minor slap on the wrist for a club with Boston’s resources.
Bloom will still have room to increase the payroll with trade deadline acquisitions while staying under the $250 million line that would trigger the second tier of penalties. In the unlikely event that the season goes terribly wrong due to a rash of injuries and poor performances, Boston will remain close enough to the tax that they could easily sell pieces at the deadline to get back under.
Avoiding the tax wasn’t entirely financially motivated. There were non-monetary penalties that would have hindered Bloom’s goals. Teams in the deepest waters of tax territory have their highest selection in the next draft moved back 10 spots, which was the price Boston paid when they last won a championship in 2018. Now that Bloom has stabilized the payroll, they aren’t in danger of overspending to that level.
Tax teams face harsher draft pick and international signing bonus pool penalties for acquiring free-agents who declined a qualifying offer. They will pay this price for signing Story but it would have been worse if Boston was over the tax in 2021. If MLB and the MLBPA agree to an international draft later this year, owners have agreed to eliminate the qualifying offer. Suddenly the cost of exceeding the tax wouldn’t be quite as steep.
There’s little reason why the Red Sox shouldn’t pay the tax this year as long as they are in contention. There is a clear path to resetting the penalties next year if they need to with over $100 million potentially falling off of their books after this season. Boston currently has only about $107.54 million committed to their 2023 payroll. That’s plenty of room to hand out new deals to Xander Bogaerts and Nathan Eovaldi while still factoring in an extension for Rafael Devers.
Even when he makes a splash by adding a top free-agent, Bloom hasn’t waivered from his long-term goals. The Red Sox are developing an improving collection of prospects that will provide a pipeline of fresh talent to create a sustainable contender. They have created the financial flexibility to strike when the time is right to supplement their core with pieces that help put them over the top.
Bloom’s goal was never to turn the Red Sox into the Rays. He wants to follow the blueprint of the Dodgers. When his old mentor, Andrew Friedman, went from Tampa Bay to Los Angeles, he didn’t immediately start spending wildly. He cut payroll, focused on rebuilding the farm system and determined which homegrown talent he wanted to build around. Only once he had stabilized the foundation did Friedman open the checkbook.
Bloom is heading down a similar path. It required a bit of patience as the organization took a brief step back but the Story signing shows that the Red Sox are prepared for the next phase of Bloom’s plan where they will cement themselves as a contender for the foreseeable future.