Manfred: Draft system better for int'l players

February 23rd, 2016

PHOENIX -- The landscape for signing international prospects has changed dramatically in the last five years.
Traditional tryouts have been supplemented by showcases and league games. There's been an overall improvement in transparency due to Major League Baseball's registration program. And perhaps most notably, the system teams use to acquire teenage prospects during the international signing period has also been overhauled.
Another change could be on the horizon.
"I think the first couple of years of the [Collective Bargaining Agreement], clubs were very positive about the system," Commissioner Rob Manfred said Monday during Cactus League Media Day. "I think it had the desired effect. It provided some restraint, yet flexibility within the system for the clubs. I think with an economic change, the real question becomes 'What happens when the system gets stressed?' And the stress that was placed on the international signing pool system was the availability of Cuban talent, and it has proved lacking. There is no other way to say it. There are changes that could be made to the system."
2016 international bonus pools
The international bonus pools system was implemented four years ago, and the possibility of an international draft in the future was among the primary topics discussed at the annual gathering. Commissioner Manfred was clear in stating the direction he wants the system to go, and made it clear that this issue will come up during labor negotiations. The current Collective Bargaining Agreement is set to expire on Dec. 1.
"My own view -- and it's been this view for a long time -- is that sooner or later, it would be better if players, no matter from where they hail, enter the game through the same type of system, and that is a draft system," Manfred said. "It will be a topic we will spend some time on with the MLBPA over the course of the next year."
The current system allows a 16-year-old international player to sign during the period that extends from July 2 through June 15 of the next year if the prospect turns 17 before Sept. 1 of that year or by the completion of his first Minor League season.
In 2012, spending limits were introduced, and each club was allotted $2.9 million to spend on international prospects during each signing period. In addition to that, four "slot values" were given to each team based on their record from the previous year, and those slots plus the $2.9 million account for each club's international spending pool. For example, the Phillies -- who finished with the worst record in 2015 -- have a bonus pool of $5,610,800 for the upcoming international signing period, while the Cardinals -- who had MLB's best record -- have a pool worth $2,027,300. (Clubs are allowed to trade pool money within the period, and bonuses of $10,000 or less are exempt and do not count against the allotment.)
A range of penalties was introduced to deter teams from exceeding their bonus pool. In the most severe penalty, teams that exceed the pool by 15 percent or more in a given year are not allowed to sign a player for more than $300,000 during the next two signing periods, in addition to paying a 100 percent tax on the pool overage. This has become an issue in some years, because in certain cases, a club will decide that once it has gone over that 15 percent threshold, it might as well keep spending, since it will not be able to compete for the top international amateurs for two more years.
The Dodgers have been most aggressive in implementing this strategy, having spent more than $44 million to sign 30 international prospects during the current period -- including $16 million for Cuban right-handed pitcher Yadier Alvarez, ranked No. 1 on's Top 30 International Prospects list, and $15.5 million for Cuban outfielder Yusniel Diaz, who is ranked No. 3. Accordingly, the Dodgers are expected to pay the estimated $44 million in penalty. The Dodgers' original bonus pool was $1,963,800.
"We have opinions on it and ultimately, every team will have opinions on it," Dodgers general manager Farhan Zaidi said. "For MLB, it's going to be about what's best for the game as a whole. Depending on your current situation, you might think the system is fine or it has to be tweaked. How money and talent should be distributed, at some level, it's important for Major League Baseball to figure that out, because every team is going to do what is best for them."
Like the Dodgers, the Cubs, Giants and Royals will not be able to sign any pool-eligible prospects for more than $300,000 for the next two international signing periods after exceeding their bonus pool during the current signing period that ends June 15.
"If you ask the teams that have been able to spend internationally, they would be happy with how [the system] is," Oakland general manager David Forst said. "There are also some teams that feel you lose some of the scouting side of it if you have the [international draft]. You lose the ability to unearth players. But with the information that is out there, I'm not sure that happens."
The Yankees were among the first teams to exceed their bonus pool and enter the maximum penalty when they signed several high-profile teenage prospects during the 2014-15 signing period. During the same period, the Red Sox brought national attention to the bonus pools system when they signed Cuban teenage infielder Yoan Moncada to a $31.5 million contract and took on the $31.5 million penalty that came with it.

Along with the Yankees and Red Sox, the Angels, D-backs and Rays are already in the maximum penalty after exceeding their bonus pool, and they can't sign prospects for more than $300,000 until 2017.
"I think the system has definitely changed the way certain clubs looked at the international, whether they operate within their means or operate with a strategy and philosophy to acquire talent," Padres general manager A.J. Preller said. "You see some teams play it really straight and by the book, and you see some other teams that decide to take on the penalty. There is some thought that the penalty needs to be stiffened up if you go over it, but a two-year ban on signing players (for more than $300,000) is a substantial hit to an international program."
With so many of the high-profile clubs essentially being forced to sit on the sidelines for the next two signing periods, several teams -- including the Braves, Padres and Nationals -- are expected to exceed their allotted bonus pool for 2016, loading up on international talent and being hit with the maximum penalty.
Then there are the Blue Jays, a team that will not be able to sign any pool-eligible players for more than $300,000 during the 2016 signing period after exceeding their bonus pool during the current 2015 signing period.
Another complicating issue is the danger that Cuban players sometimes face when coming to the U.S., which was highlighted by two recent incidents.
Agent Bart Hernandez was indicted last week by a federal grand jury in Florida on two counts related to the smuggling of Seattle outfielder Leonys Martin into the United States in 2011. In 2012, Martin filed a civil lawsuit claiming he was held hostage while a $15.5 million deal was negotiated with the Texas Rangers.
On Tuesday, reports surfaced that Charles Hairston, the agent for 16-year-old Cuban prospect Lazaro "Lazarito" Armenteros, had parted with highly sought-after prospect after his life was threatened by Armenteros' Dominican-based representative.
Cuban teenagers like Jorge Ona, Adrian Morejon and the aforementioned Lazarito, who operate under the international signing guidelines, are among those expected to thrust the teams that sign them into the maximum penalty when they sign during the next international period.
The international signing guidelines do not apply to players who previously signed a contract with a Major League or a Minor League club, nor do they apply to players who are least 23 years old and have played as a professional in a league recognized by the Commissioner's Office for a minimum of five seasons. Cuban players who are at least 23 years and have played in a Cuban professional league for five or more seasons are also exempt, which is why the $30 million the Dodgers spent on 24-year-old Cuban right-hander Yaisel Sierra doesn't factor into their bonus pool equation.

"It's proven itself to be pretty complicated issue," Zaidi said. "I think there are some merits to an international draft, but there's also push back from certain parties. And understandably so, because it's not as clean and easy to implement as a domestic draft, obviously."