Proposal to change Compensation Rules

[Flash]

I believe there is a way to implement a luxury tax threshold.  Our salary caps are variable, and it's based on market and fluctuates based on team performance for the most part...which is realistic.  I consider those salary caps to be our "budget"...what ownership allows us to spend based on the state of the business.  The team salaries fall varying degrees below that salary cap/budget, just like what would happen in reality.  While I'm fairly certain it's not calculated this way in MLB, as I'm pretty sure it's predetermined in the CBA, 2016's luxury tax threshold was $189M, which was ~150% of the average 2015 team salary of $125M.  IF we wanted to implement a luxury tax, I think we could based on 150% of the previous year's average team salary.  Roster pages were updated to 2017 and forward, so i can't view 2016 team salaries to place a hypothetical on what the threshold would be for this year.  If there's enough interest, maybe someone can go back and look.

Upon reviewing the salaries for 2016 and 2017, I found that the average team salary was $103.5m, with the ~150% of this coming out to a luxary tax threshold of $155.5m.  The only team this would really affect is the , since no other team approaches their salary cap total.

In 2018, we will find that the average salary increases to $163.5m, with the ~150% luxuary tax threshold again finding the and the only teams exceeding that total. 

I guess we could institute a luxury tax based on the premise of a ~150% threshold, but it seems like it really is not really feasible since our salary cap increases are based on success and not reckless spending.  The are going to experience a drop in their salary cap and the , like many teams in FGM will see an increase in their cap allowance.  Seems counterproductive to penalize teams for improving their salary cap when the basis of that increase was competitive success.  In MLB, there is no salary cap, so if a team wants to spend a lot, like the real life , then a luxary tax seems reasonable, but in FGM, it goes against the basic premise of the league--where success equals a bump in salary cap money.

I would not support a luxuary tax in FGM.

Additionally, our milb rosters are much shallower than real teams and thus mirroring the same draft pick rounds as compensation may not give us the desired results.  I took a look at the # of picks used in this past amateur draft to see how each round is valued within FGM:

Note: the 20 compensation picks are considered 2nd round, pushing the start of the 3rd round to pick 2 - 10, 4th started at pick 3 - 10, and 5th started at pick 4 - 10.

1st - 30 picks
2nd - 26 picks
3rd - 16 picks
4th - 15 picks
5th - 12 picks

With only 50% of the teams even leveraging the 3rd - 5th rounds, these are really the bottom of the barrel draft picks just based on our roster sizes.  So they don't really add much value in my mind from a competitive balance standpoint.

Although I see the basic premise of your argument that 3rd and 5th round picks are not as valuable in FGM as they are in MLB, I would offer this, with the disclaimer that I am not seeking to disrespect, or disparge anyone, as to how they run their team.

In this year's draft, if you take out the Compensation Round, gave only one pick for Type A free agents and did not give a draft pick for Type B free agents, the draft would have had a different persona.  Under the proposed 2017 plan, there would only be 28 1st Round picks, a Compensation Round with 2 picks, and the remaining 5 Type A picks would have been taken in the 2nd Round (with the 2nd Round remaining at 30 picks).  Therefore, 30 players would be drafted prior to the beginning of the 2nd Rould (28 1st Round picks and 2 Compensation Round picks). 

With all this, there is the absentee factor that plagued this year's draft.  , for example, got the 1st pick of the draft, but did not participate in the draft.  So, the first pick of each of the succeeding rounds was not utilized.  MiLB roster was full and the GM chose not to do anything to take advantage of his draft position.  The same thing can be said of and .

The absentee factor was compounded by the fact that and all had replacement GMs come in after the draft had already started and they all lost the opportunity to utilize early round picks.  There were a lot of autopicks for teams, but the main reason was absentee GMs (which lead to some of them being replaced in the interest of league success). 

So while I see the premise of your argument, I believe that in a league with active GMs, a draft without the huge Compensation Rounds of the past, future drafts can be a valuable way to improve a team, with 3rd and 5th round picks having value. 

I'm just piecing this together as I type, but what if we went with a luxury tax threshold and any team above the threshold signing a $50M+ FA sends the team losing the FA their 1st round, and any team under the threshold would send a 2nd round pick. (No protected picks in the first 10 of first round.  If you're above the threshold AND finish bottom 10, you deserve to lose that top 10 pick!)

I believe that the if we use the MLB's minimum contract provision of $52.0m, which, for FGM, constitutes an annual salary of $10.5m (rounded up from $10.4m) we are sufficiently meeting the needs of the league.  We are not seeking to punish any team, we are simply trying to seek a happy medium so that teams can get compensated for the loss of a free agent they could not sign because of the cost of the extension for that particular player.  Again, with our hard caps, we are not allowed to spend recklessly, and still field a competitive team, so I am seeking a way to have the league continue to prosper by utilizing the processes adopted by MLB.

[game162]

I have a couple of considerations that were kicking around in this mostly hollow noggin of mine.

I believe there is a way to implement a luxury tax threshold.  Our salary caps are variable, and it's based on market and fluctuates based on team performance for the most part...which is realistic.  I consider those salary caps to be our "budget"...what ownership allows us to spend based on the state of the business.  The team salaries fall varying degrees below that salary cap/budget, just like what would happen in reality.  While I'm fairly certain it's not calculated this way in MLB, as I'm pretty sure it's predetermined in the CBA, 2016's luxury tax threshold was $189M, which was ~150% of the average 2015 team salary of $125M.  IF we wanted to implement a luxury tax, I think we could based on 150% of the previous year's average team salary.  Roster pages were updated to 2017 and forward, so i can't view 2016 team salaries to place a hypothetical on what the threshold would be for this year.  If there's enough interest, maybe someone can go back and look.

Additionally, our milb rosters are much shallower than real teams and thus mirroring the same draft pick rounds as compensation may not give us the desired results.  I took a look at the # of picks used in this past amateur draft to see how each round is valued within FGM:

Note: the 20 compensation picks are considered 2nd round, pushing the start of the 3rd round to pick 2 - 10, 4th started at pick 3 - 10, and 5th started at pick 4 - 10.

1st - 30 picks
2nd - 26 picks
3rd - 16 picks
4th - 15 picks
5th - 12 picks

With only 50% of the teams even leveraging the 3rd - 5th rounds, these are really the bottom of the barrel draft picks just based on our roster sizes.  So they don't really add much value in my mind from a competitive balance standpoint.

I'm just piecing this together as I type, but what if we went with a luxury tax threshold and any team above the threshold signing a $50M+ FA sends the team losing the FA their 1st round, and any team under the threshold would send a 2nd round pick. (No protected picks in the first 10 of first round.  If you're above the threshold AND finish bottom 10, you deserve to lose that top 10 pick!)

Feel free to poke holes...I'm sure I haven't thought of every gotcha.  Just wanted to throw these ideas out there before we decided on anything.

[Flash]

With a hard cap, I really don't see the need for a luxury tax rule. I agree we need to support team rebuilding, because having gone through a rebuilding process, and not having the draft picks early enough to really support a rebuild, is a true pain, and detrimental to league stability.

I like the idea of the Option 2 Award.

With our hard cap, there cannot be a luxury tax. 

The provision outlined in the two options listed above is related to a Type A free agent being signed to a contract with an average annual of $10.5m or more.

[RSmetana]

With a hard cap, I really don't see the need for a luxury tax rule. I agree we need to support team rebuilding, because having gone through a rebuilding process, and not having the draft picks early enough to really support a rebuild, is a true pain, and detrimental to league stability.

I like the idea of the Option 2 Award.

[Flash]

I would be interested to see if we can implement a certain cap threshold to mirror the MLB's luxury tax threshold and big market teams here spending past that threshold lose a 2nd and 5th pick. Helps us smaller market teams.

I like that idea too. If a cap threshold is tough to do with a hard cap, maybe over certain average annual salary.

Keeping these two requests in mind, since we have a hard cap that prohibits us from exceeding our allocated salary cap limit, it doesn't seem possible to institute any form of a luxury tax.  MLB has a soft cap and teams can exceed it.  This, of course, results in a luxury tax and the corresponding loss of a 3rd and 5th round pick in the new rules governing the lost of a player with a designated Qualifying Offer.

However, jpmanchester's idea utilizing "annual average salary" as an alternative to crossing the luxury tax threshold is certainly viable.  Here are the Type A free agents that were signed during the 2015 off-season free agency, who lost them, who signed them, and their new annual contract.

CI Joey Votto -- -- -- $22.0m
CI/MI Logan Forsythe -- -- -- $16.0m
SP Jake Arrietta -- -- -- $11.5m
SP Chris Archer -- -- -- $13.0m
C Francisco Cervelli -- -- -- $2.5m
SP Jose Quintana -- -- -- $6.5m

If we were to use the MLB's minimum contract provision of $52.0m, which, for FGM, constitutes an annual salary of $10.5m (rounded up from $10.4m), you can see that this would affect 4 of the 6 Type A free agents signed.  OF those 4, the signed 2, so we would have to tweak the rule a bit.  Using our recent draft as an example, we could do something like this:

Option 1: Award 3rd Round pick to the team with the worst record () and 5th Round pick to the other team with the better record (). Then give a supplemental pick at the end of the 3rd Round and a supplemental pick at the end of the 5th Round.

Option 2: Award 3rd Round pick to the team with the worst record () and give the very next pick in the 3rd Round.  Then do the same thing in the 5th Round, with picking ahead of

I believe this would be a viable way to incorporate the essence of the new MLB CBA.  The Annual Average Salary provision would simply be added to the others proposed for the 2018 season.



 

[jpmanchester]

I would be interested to see if we can implement a certain cap threshold to mirror the MLB's luxury tax threshold and big market teams here spending past that threshold lose a 2nd and 5th pick. Helps us smaller market teams.

I like that idea too. If a cap threshold is tough to do with a hard cap, maybe over certain average annual salary.

[Anthony]

 

I would be interested to see if we can implement a certain cap threshold to mirror the MLB's luxury tax threshold and big market teams here spending past that threshold lose a 2nd and 5th pick. Helps us smaller market teams. 

[ldsjayhawk]

I am good with the proposal.  It does make the draft serve the purpose it is supposed to.

[jpmanchester]

I'm ok with the new proposal as well. Strategies will change a little since third Rd pick is obviously far less valuable than end of the first. By the third time they're all crapshoots pretty much. Which means small market teams will likely have to trade their big budget stars a year early to get any value. Or if they think they have a shot, play it out and take the third rounder when they can't keep them all. These rules really don't effect big budget teams much imo... They can more easily work around the cap implications of keeping and losing stars.

Just my thoughts on the proposals, but I'm ok with both, will just adjust our strategies accordingly.

[BHows]

There was a change to the Qualifying Offer in the new CBA, but it won't go into effect until the next off-season prior to 2018.

"There will be subtle changes to free agency, however, in that players will be virtually unrestricted. Teams will no longer forfeit a first-round draft pick when signing free agents. If a team is under the luxury tax, it would lose a third-round draft pick when signing a player who rejects the qualifying offer. If a team is over the tax, it would lose a second- and fifth-round pick and $1 million in international bonus money.

The team that loses a free agent with a qualifying offer will receive a pick, according to Fox Sports, only if the player receives a contract worth at least $50 million. The pick the team receives will depend on its market size."

With this, there are some factors which are not a part of how we operate in FGM, so we would have to adjust our rules accordingly.  We do not have a luxury tax or international bonus money.  We also don't expect to have many Type A free agents signed to a contract of $52m or more.  With our salary cap structure, there has been a marked reduction in the contract amounts given to players we sign during free agency.  We do have some "reckless" bidding sometimes, but the rule of the day seems to lean towards more responsible bidding.

So now that an agreement on a new five year CBA has been reached, here's what I am proposing:

For 2017:
1) Only one draft pick as compensation for a Type A free agent;
2) The elimination of Type B free agents;
3) Protection of 1st Round Picks for the top ten teams in the draft;
4) When a team loses a 1st Round pick, the team gaining the pick does not replace that team in the 1st Round.  Instead, the 1st Round is condensed and that pick becomes a part of the Compensation Round between the 1st and 2nd Rounds.  If the pick lost is protected (1-10), then the pick lost is the teams 2nd Round pick, or possibly a Compensation Round pick, whatever is higher.

We would not have this tied to 2017, but would include it in the future, beginning in
---Type A compensation tied to a player who has been on a team the entire season.

For 2018:
1: Continue one draft pick compensation for Type A free agents;
2: Draft compensation would be a 3rd Round pick--which would be taken in the same spot as the team who signed the free agent would normally have.
3: Compensation would be tied to a player who has been on a team the entire season.

These changes are significant in that it reduces the large Compensation Round (as we have had over the years) in 2017 and completely eliminates it in 2018.  We would the be mirroring, as best we can, the components of MLB's CBA.  Additionally, it gives teams a greater opportunity rebuild through the draft and should help the league be more competitive in the future. 

We all know that drafted rookies do not always perform at expected levels, and that sometimes we have surprises, both good and bad, but I believe this is a move which will benefit the league in the long term.

It appears that those that have replied are basically in agreement that we need to change our rules. I don't see this as a significant enough change to reset the clock on discussion. Let's continue, with this proposal in mind, until 12/6