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With six of the Chicago Cubs’ seven arbitration cases settled, and the roster rounding into shape, it’s fair to start taking a look at the Cubs’ 2012 payroll obligations, and what the team might have “left” to spend in the next couple of months.

Our general sense has been (a) available payroll will be somewhere around $125 to $130 million in 2012 (depending on team revenues in 2011 minus non-player expenses in 2012), and (b) to date, the Cubs have committed about $100 million. That would mean that the Cubs still have a considerable chunk of cash left that they could spend in 2012 if so inclined.

But are we wrong?

First, let’s take a look at the players the Cubs have under contract for 2012, with a couple of guesses on the bench for purposes of this exercise:

Starting Position Players:

Geovany Soto – $4.3 million

Bryan LaHair – $480k

Darwin Barney – $480k

Starlin Castro -$600k (estimated raise)

Ian Stewart – $2.238 million

Alfonso Soriano – $18 million

Marlon Byrd – $6.5 million

David DeJesus – $4.25 million

Starting Rotation:

Matt Garza – $9 million (estimated raise)

Ryan Dempster – $14 million

Paul Maholm – $4.25 million

Travis Wood – $480k

Chris Volstad – $2.655 million

Bullpen:

Randy Wells – $2.705 million

Manny Corpas – $1 million

Jeff Samardzija – $2.7 million

Kerry Wood – $3 million

Jeff Beliveau – $480k

James Russell – $480k

Carlos Marmol – $7 million

Bench:

Steve Clevenger – $480k

Blake Dewitt – $1.1 million

Jeff Baker – $1.375

Tony Campana – $480k

Reed Johnson $1.15 million

Total Commitment for 2012: $89,183,000

Hey, all right, awesome. That’s even lower than we thought!

But. There’s always a but. In fact, in this case, there are several buts.

The first but is a big one: the Cubs owe the Marlins the difference between Carlos Zambrano’s salary ($18 million) and Chris Volstad’s salary ($2.655 million), which comes to another $15.345 million.

So, we’re up to $104,528,000. Ok. Well, there’s still plenty of room.

But.

The Cubs also owe Carlos Pena a deferred $5 million payment this month as part of his $10 million deal from last season.

So, we’re up to $109,528,000. Things are getting a little tighter.

But the Cubs still owe Jim Hendry and Mike Quade their salaries for 2012. That money doesn’t come directly out of payroll, but it does reduce the total dollars available for spending in 2012, and, like payroll, it varies from year to year (in other words, payments to executives and managers feels a lot like payroll). So that’s a total of about $2 million more.

Now we’re at $111,528,000.

And then there are the new hires in the front office. Theo Epstein is making a little over $3.5 million in 2012. Jed Hoyer is getting an estimated (by me) $1.5 million. Jason McLeod, Joe Bohringer, Shiraz Rehman, and Matt Dorey together are probably at least another $1 million. And then there was the raise for Oneri Fleita. All told, let’s say there’s an additional $6.5 million in executive expenses this year, which is probably conservative.

That brings things to $118,028,000.

(There is one good but: folks have talked at length about a $2 million payment owed to Carlos Silva in 2012, but after some digging, it looks like that payment is being covered by the Mariners.)

There could also be an extra $500k going to someone like Andy Sonnanstine if he makes the roster (I chose Corpas to make the roster to split the baby in terms of Corpas and Sonnanstine, each of whom the Cubs signed on a split deal that will pay them about $1 million if they make the big team), and I may have gone too low on Castro’s raise (as an auto-renew player, the Cubs can essentially pay him whatever they want – stars, however, tend to get raises as a sign of good faith). And we haven’t even gotten into a variety of new, non-player, non-executive expenses associated with improved organizational technology, facilities, scouts, etc.

The point of this exercise is not to put a precise dollar amount on where things stand (we’re close, but throwing in the executive dollars makes the estimate a bit mushy). Instead, the point is only to help us keep perspective on how much money the Cubs have “left” to spend on players. Sure, it could be another $20 million. Or it could be as little as just a couple million. Or none.

I still think the Cubs make large offers on guys like Yoenis Cespedes and Jorge Soler, in part because the amount of money to be spent on amateur players is very much in flux this year, but it may well have turned out that those “crazy” suggestions that the Cubs couldn’t afford a guy like Prince Fielder this year weren’t so crazy after all.

EDIT: To reiterate, the point here is not to contend that executive salaries are “payroll.” In fact, I said the opposite. The point, instead, is to look at known, hard dollar costs to evaluate how much room is actually available for payroll (because, as Tom Ricketts has said, the total baseball operations budget will approximately equal the revenue coming in the door – so revenue minus unknown expenses = expected payroll. To the extent we can discuss some of those non-payroll expenses – like executive salaries – it’s worth doing so).

Inartfully explained in the original post, but I’m not saying executive pay is a part of payroll. I’m saying it’s LIKE payroll, because it reduces the amount the Cubs can spend on payroll.

Think of it this way: if the Cubs spend $5 million on a free agent, the available dollars for payroll go down by $5 million. If the Cubs spend $5 million on a new executive, because the money is all coming out of the same pot – the total baseball operations budget – the available dollars for payroll also goes down by $5 million.

It’s another way of thinking about it, not a mischaracterizing of the line items on a budget statement.

  • cubincardinalland

    18.7 million bucks a year for 6 years with 51 mil paid right now, to a guy who has never thrown a pitch in the big leagues. How does Garza look at 9 mil for this year?

  • Joker

    Wow.  My wife gets on me for spending too much time on fantasy baseball which she affectionately refers to as “fantasy accounting”.  I wonder how much flak she’d give me if she found out I just spent 10 minutes reading this article, the subsequent comments, and replying?

  • Karen P

    Interesting. Not that I was super concerned about the front office going after Fielder, but it never even occurred to me that the team might not be able to afford it. I can’t even imagine how Billy Beane would feel about this…

  • Ogyu

    I disagree with the notion that executive pay is like payroll because it reduces the amount that can be spent on payroll. The payroll is either $130 million or it is not. If $11 million of executive pay reduces the amount that can be spent on payroll, then the payroll is $119 million — not $130 million. Stated differently, if the team tells fans they have x dollars to spend on players and then allows the amount spent on execs to reduce the amount for players to less than x, then the team is not being candid with the fans.

    • BetterNews

      As far as I know, executive payroll is not considered “club” payroll, it is considered “overall” payroll.

    • BetterNews

      As far as I know, the two are supposed to be kept separate.

    • http://www.bleachernation.com Brett

      The Cubs have explicitly said they aren’t going to publicly say what payroll is going to be. It all comes out of the same pot. Calling this expense “payroll” and that expense “non-player salary” is a wholly academic exercise. They’re just labels – but the more the Cubs spend on the latter, the smaller the pool available for the former.

  • BetterNews

    Mr. Ricketts is broke! Ya, right.

  • Oswego Chris

    You have to be kidding me?…you guys are still discussing the fact that Brett put the executive pay in the payroll/budget….. There is a finite amount of money the Ricketts family can spend, ALL team expenses come out of that, we don’t know for sure what that number is….the MLB budget is part of that, they aren’t going to tell us the major league budget……..THE END

    now talk about something worthwhile like the new rotation or the the line-up that(right now) looks anemic

     

    • Toosh

      Campana/Soriano
      Castro
      DeJesus
      Soto
      LaHair
      Byrd
      Stewart
      Barney

  • EtotheR

    Bingo, Chris…payroll is payroll.

  • Scotti

    Brett, last year when Pena was signed the Cubs explicitly said that the “deferred” amount would not affect this year’s payroll. Now, I argued that they were not being altogether truthful on the matter but that was what was said…

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