Yankees: The financial challenges of signing star players for 2022

As the mighty Chicago White Sox discovered this past week, the New York Yankees have a juggernaut roster heading into the remainder of the season. After painfully losing the Field of Dreams game, the Yanks battled back and won two games in Guaranteed Rate Field from the White Sox.

Especially impressive is that the Bronx Bombers outplayed the mighty White Sox without several important players, including Garret Cole, Corey Kluber, Jordon Montgomery, Aroldis Chapman, Gary Sánchez, Gleyber Torres, and Gio Urshela.

All of these players are expected to return shortly, making the Yanks even more formidable as they compete against their powerful AL East Division rivals in head-to-head contests.

However things turn out this season, the Boys in Pinstripes will face difficult financial decisions during the offseason as they attempt to preserve their player assets and improve their roster.

For instance, the Yanks might decide to pursue one of the elite free agent shortstops on the market this winter, while also fortifying the team’s starting and relief pitching. Nabbing an established quality center fielder may be on the club’s “to do” list as well.

A major question for the Yanks is whether to retain Gary Sánchez, who continues to be inconsistent at the plate and a below-average defensive catcher. The Yanks could use the money they save by jettisoning Sanchez to acquire either a catcher, pitcher, or a position player via free agency.

A more challenging problem for the Bombers is the amount of money required to maintain the present player contingent. Whether the Yanks can retain all their excellent players is financially uncertain. Can the team keep all their stars and fill their roster holes without breaking the bank? How much is Hal Steinbrenner willing to spend?

Now seems a perfect time to examine the financial challenges the Yanks will face before entering the 2022 season and then beyond.

A brief look at current players’ salaries and their contract stipulations

Several players are on the guaranteed salary distribution list for 2022. They include Giancarlo Stanton ($29M), Gerrit Cole ($36M), DJ LeMahieu ($15M), Luis Severino ($11.5M), Aaron Hicks ($10.79M), Rougned Odor ($570K, only Yankees’ share), and Aroldis Chapman ($16M).

Other players will be arbitration-eligible in 2022: Gary Sánchez, Aaron Judge, Joey Gallo, Luke Voit, Gio Urshela, Clint Frazier, Gleyber Torres, Jameson Taillon, Chad Green, Jordan Montgomery, and Wandy Peralta. Players not arbitration-eligible and with less MLB time will be paid based on their service term. The Yanks have a substantial number of these players who receive only a modest salary.

The Yanks have team options for 2022 on Zack Britton (already picked up, $14 million), Joely Rodriquez, Brett Gardner, and Darren O’Day.

Free agents for 2022 are Anthony Rizzo, Corey Kluber, and Andrew Heaney.

Eligible free agents for 2023 worth keeping in mind are Aroldis Chapman, Gary Sánchez, Aaron Judge, Joey Gallo, Darren O’Day, Jameson Taillon, Chad Green, Zack Britton, and Brett Gardner. Severino and Odor have team options this year as well.

The financial challenges moving forward

As most fans know, Steinbrenner insisted on a significant decrease in payroll this season to get below the $210 million luxury-tax demarcation because of substantial losses due to the COVID-19 pandemic (or so we were told). It seems likely that the Yanks will pass the luxury tax threshold this offseason, though, now that they’ve reset it.

Whether there will be a luxury-tax policy in the future is up in the air. The MLB and the players’ union will have to decide upon a new collective bargaining agreement since the current one ends on December 1.

In terms of free agents for 2022, I am quite confident that they will want to reenlist Rizzo and potentially Kluber due to preexisting relationships within the ranks of the staff. However, the price tag may be considerable for both of them. Rizzo is coming off a seven-year, $41 million contract with the Chicago Cubs, and Kluber is making $11 million this year. Rizzo will likely want a prime-ending contract, perhaps in the $15-20 million per year range. As a starting pitcher with an injury history, Kluber should be more affordable for the Yanks, but probably won’t accept a significant one-year discount.

As noted, Green, Judge, Sanchez, Chapman, and Taillon will become free agents after the 2022 season. The Yanks will have to determine whether to keep these five players. Judge, of course, will be expecting a long-term contract at perhaps $25 million a year or more. If the Yanks agree to offer him a lucrative, multi-year agreement, then what will they do with Sánchez? And will they really want to pay more money to retain Chapman?

At this point, I would guess that they will undoubtedly retain Judge, Green, and Taillon and let Sánchez and Chapman explore their options in free agency. Keep in mind that the team already has huge, long-term contracts with Cole and Stanton. Adding Judge will be a stretch for them financially, but one they can and should make.

The most interesting issue the Yanks will be facing this offseason is whether to pursue a star shortstop at what will probably be a high price or whether they decide to stick with Torres regardless of how poorly he plays shortstop. Torres won’t become a free agent until 2025, and he remains a low-cost option. Anthony Volpe and Oswald Peraza are waiting in the wings, and their stocks are rising.

I don’t see the Bombers exercising their team options for Rodriquez, Gardner, and O’Day for various reasons. Heaney will likely be gone as well. This will save the team a decent amount of money.

The New York Yankees are a wealthy team, and they should be spending a lot more money on salaries for quality players than they have. There is no reason why they can’t be spending at least as much as the Los Angeles Dodgers this year.

Being penny wise and pound foolish will not get Steinbrenner a World Series. It is time for the Yanks to break the bank and begin constructing a dominant team that will be successful for many years to come. The organization owes it to the fans.