Examining Teams’ Arbitration Decisions

Teams had until last night to offer arbitration to ranked free agents. Now that decisions from the National and American Leagues are in, here’s an explanation of what certain offers may mean, starting with players who obtained offers:

• David Ortiz (A) – The slugging DH has a strong case for a multiyear deal, but which team will offer him one? If there’s no multiyear offer on the table by December 7, Ortiz may consider accepting Boston’s offer. It would likely mean a raise from the $12.5MM salary he earned in 2011.
• Raul Ibanez (B) – It seems that the Phillies have a handshake agreement with the 39-year-old and that he'll decline the team's offer. With all due respect to Ibanez, it wouldn't make sense for the Phillies to commit an eight-figure salary to a defensive liability who posted a .707 OPS in 2011.
• Edwin Jackson (B) – The Cardinals’ projected 2012 rotation is currently full, so their decision to offer Jackson arbitration suggests they believe he’d have positive trade value on a one-year deal.
• Heath Bell (A) – It seems as though Bell’s future in San Diego has been uncertain for years. He now has two weeks to decide whether to accept the Padres’ offer or decline and hit the market in search of a multiyear deal.
• Francisco Rodriguez (A) – The Brewers already have a closer in John Axford, but they seem to be gambling that Rodriguez will turn their offer down in search of a closing job elsewhere. It’s worth noting that he complained about his role late in the season and that Rodriguez won’t cost a draft pick under the new CBA. It’s hard to imagine him accepting the Brewers’ offer.
• Blue Jays – Toronto extended four arbitration offers — more than any other team. Their interest in accumulating draft picks persists, despite spending limitations in upcoming drafts. The Phillies, Cardinals, Red Sox and Twins each offered three free agents arbitration.

Here's a look at one player who didn’t obtain an offer of arbitration:

• Roy Oswalt (A) – The Phillies could have obtained draft picks for Oswalt if they were convinced that he wasn’t going to accept arbitration. Instead, they withheld an offer, making Oswalt the lone Type A free agent not to obtain one (not counting players who had clauses in their contracts ruling out the possibility of an offer). This suggests the Phillies aren’t completely convinced Oswalt would turn arbitration down, despite a strong early market for his services. After earning $16MM in 2011, Oswalt wouldn’t necessarily have positive trade value on a one-year deal.

It’s worth noting that players can re-sign with teams after declining their offers of arbitration. Similarly, teams can re-sign players to whom they did not extend offers of arbitration.