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A DP Outlook On The New MLB CBA


Tuesday, November 22nd, Major League baseball and the Major League Baseball Player's association announced the new collective bargaining agreement for the next five years. The sport has come a long way since its last work stoppage in 1994. A stoppage that not only broke my heart as the Yankees were poised to make a run to a championship for the first time, but entirely erased the World Series and placed the game of baseball on hard track back to respectability amongst its fans. Yet, 1994 seems like ages ago as the new CBA guarantees 21 years of labor peace for MLB. Who would of ever thought? Heck, who would ever think MLB would become the model for financial well-being in the sports world? However, that is exactly where we are today.

As a super baseball enthusiast, I am excited. Very excited. Commissioner Bud Selig, and MLPA President, Michael Weiner, ought to be applauded for simply getting this deal done (Looking right at you NBA!). And with a new CBA, comes various changes that will not only alter the game, but move baseball ahead into the future, changes, DP enthusiast know that I've been basically yelling for from my rooftop for years. With the many changes occurring, let's take a look - a closer ponder if we shall - at the various changes brought by the new official CBA, including some other fun changes not CBA related, and some wishful changes for the future.

I. TERM
 a. Five-year contract
b. December 1, 2016 termination date

II. SCHEDULING,, REALIGNMENT,, AND POSTSEASON PLAY
a. Beginning no later than the 2013 Postseason, Postseason play will be expanded for the first
time since 1995. A second Wild Card will be awarded to the Club in each league with the
second-best overall record among Clubs that do not win a division. The two Wild Card Clubs
will play a single Postseason game, the winner of which will advance to the Division Series. A
decision on adding two Wild Cards for 2012 will be made no later than March 1, 2012.
b. The Houston Astros will move to the American League West starting in 2013, creating two
leagues of 15 Clubs each.
c. Starting in 2013, Interleague games will be played throughout the entire schedule, rather than
exclusively in specific inter-league segments.
d. Active Roster limits will be expanded to 26 for certain regular or split doubleheaders.

DP Outlook: Thumbs Up - First of, I love the idea of adding another Wild Card to postseason play. I still cannot wrap my mind around those who are opposed to this. It places enormous emphasis on winning your division (Think 2010 Yankees not caring for AL East Title) , increases opportunities for additional clubs to make the playoffs (I really see this as Toronto's chance), will keep various cities involved through September, and will create a severe disadvantage for Wild Card winners (Using your ace in Wild card round, and disadvantage of possible tired bullpen)

Thumbs Up - If traditionalists hate the idea of adding Wild Card teams, they surely went to town on the movement of the Astros to the AL West, and the idea of interleague games being played everyday.  Any baseball fan would have told you there was something odd about a 14 team AL and a 16 team NL, especially the 6 team NL Central, and the 4 team AL West. I personally would have liked to move the Colorado Rockies or the Arizona Diamondbacks because of the geographical nature for scheduling, but it worked out that the Astros were in limbo of a sale, and a move could be worked out. Plus, despite 50 years of being in the NL, the Astros haven't won a World Series, and only appeared in one. The Rangers and the Astros won't necessarily overtake football culture in Texas, but being in the same division could spark a rivalry, which is always good for the game.

Thumps Up - Getting back to interleague play, listen, it is time. Simple as that. I love the distinction of the separate leagues as much as everyone, and very much miss the days of the World Series having two teams that rarely, if ever, played one another. However, we're in an age of marketability and promotion. It is imperative that the sport gets it's major stars to every city. Look at it this way, what if LeBron James never played in specific cities because of a hard line between conferences, no one would think that is healthy for the sport. Then why does this apply for baseball? Albert Pujols should play at Yankee stadium. Seattle should see Matt Kemp. The Red Sox should be able to roll into San Diego for a three game set. It helps promote the game, period. And let's be honest, there is a monetary reasoning to this change. I'm sure there are many owners who are thrilled to have the Yankees, Red Sox, and Phillies come to town to help gate attendance.

III.. RESERVE SYSTEM INCLUDING AMATEUR PLAYERS
a. Free Agency
1. All eligible Players will become free agents as of the end of the World Series, with no
election required, and the “quiet period” will be five days.
2. The tender date will be December 2 beginning in 2012.
3. Article XX(B) free agents signing minor league contracts who are not added to the
Opening Day roster or unconditionally released 5 days prior to Opening Day shall receive
an additional $100,000 retention bonus and the right to opt out on June 1.
b. Draft Pick Compensation
1. Starting in 2012, “Type A” and “Type B” free agents and the use of the Elias ranking
system will be eliminated.

DP Outlook: Thumbs Up - I've always hated the draft compensation rule. Yes, it helps along the competitive balance baseball seeks, but certain guys in free agency get hurt when tagged as a "Type A" free agent. Remember poor Juan Cruz's free agency? Many teams interested, but no one wanted to give up a supplemental first round pick.

2. The current system of draft pick compensation will be replaced with the following
system:
A. Only Players who have been with their Clubs for the entire season will be subject
to compensation.
B. A free agent will be subject to compensation if his former Club offers him a
guaranteed one-year contract with a salary equal to the average salary of the
125-highest paid Players from the prior season. The offer must be made at the
end of the five-day free agent “quiet period,” and the Player will have seven days
to accept the offer.
C. A Club that signs a player subject to compensation will forfeit its first round
selection, unless it selects in the top 10, in which case it will forfeit its secondhighest
selection in the draft.
D. The Player’s former Club will receive a selection at the end of the first round
beginning after the last regularly scheduled selection in the round. The former
Clubs will select based on reverse order of winning percentage from the prior
championship season.
4
c. Salary Arbitration Eligibility
1. The percentage of players with two years of service who will be arbitration eligible will
be increased from the top 17% to the top 22% in terms of service.
2. All players tied at the 22% cutoff will be eligible for arbitration.
d. Minimum Salaries
1. Major League will increase from $414,000 in 2011 to: $480,000 in 2012; $490,000 in
2013; and $500,000 in 2014; COLA in 2015 and 2016.
2. Minor League will increase from $67,300 in 2011 to: $78,250 in 2012; $79,900 in 2013;
and $81,500 in 2014; COLA in 2015 and 2016.
e. Rule 4 Draft
1. The draft will continue to be conducted in June, but the signing deadline will be moved
to a date between July 12 and July 18 depending on the date of the All-Star Game.

DP Outlook: Thumbs Up - An overall win with the new signing deadline. Teams are able to move forward without losing an entire year of development with a recent pick. And, I'm sure college coaches will adore this rule with the clear knowledge of which players will be returning to the program.

2. Drafted players may only sign Minor League contracts.
3. Signing Bonus Pools
A. Each Club will be assigned an aggregate Signing Bonus Pool prior to each draft.
For the purpose of calculating the Signing Bonus Pools, each pick in the first 10
rounds of the draft has been assigned a value. (These values will grow each year
with the rate of growth of industry revenue.) A Club’s Signing Bonus Pool equals
the sum of the values of that Club’s selections in the first 10 rounds of the draft.
Players selected after the 10th round do not count against a Club’s Signing
Bonus Pool if they receive bonuses up to $100,000. Any amounts paid in excess
of $100,000 will count against the Pool.
B. Clubs that exceed their Signing Bonus Pools will be subject to penalties as
follows:
Excess of Pool Penalty (Tax on Overage/Draft Picks)
• 0-5% 75% tax on overage
• 5-10% 75% tax on overage and loss of 1st round pick
• 10-15% 100% tax on overage and loss of 1st and 2nd round picks
• 15%+ 100% tax on overage and loss of 1st round picks in next two drafts 

DP Outlook: Thumbs Up - Taxation on the signing bonus for first round picks will help curtail and create competitive balance for small market teams who have been skipping over talented draft picks in fear of not being able to sign them. While this will hurt the larger market teams, this is just another example of closing the gap without having to have a hard salary cap.

4. Proceeds generated by the tax will be distributed to payee Clubs under the Revenue Sharing
Plan that do not exceed their Signing Bonus Pools. Draft picks that are forfeited by Clubs will
be awarded to other Clubs through a lottery in which a Club’s odds of winning will be based
on its prior season’s winning percentage and its prior season’s revenue. Only Clubs that do
not exceed their Signing Bonus Pools are eligible for the lottery.

5. Competitive Balance Lottery
A. For the first time, Clubs with the lowest revenues and in the smallest markets will
have an opportunity to obtain additional draft picks through a lottery.

DP Outlook: Thumbs Up - Pretty much self explanatory...

B. The ten Clubs with the lowest revenues, and the ten Clubs in the smallest
markets, will be entered into a lottery for the six draft selections immediately
following the completion of the first round of the draft. A Club’s odds of winning
the lottery will be based on its prior season’s winning percentage.
C. The eligible Clubs that did not receive one of the six selections after the first
round, and all other payee Clubs under the Revenue Sharing Plan, will be
entered into a second lottery for the six picks immediately following the
completion of the second round of the draft. A Club’s odds of winning the
lottery will be based on its prior season’s winning percentage.
D. Picks awarded in the Competitive Balance Lottery may be assigned by a Club,
subject to certain restrictions.
E. Top 200 prospects will be subject to a pre-draft drug test and will participate in a
pre-draft medical program.

DP Outlook: Thumbs Up - Drug Testing? Yes please! Should have been done yesterday.

f. International Talent Acquisition
1. By December 15, 2011, the parties will form an International Talent Committee to
discuss the development and acquisition of international players, including the potential
inclusion of international amateur players in a draft or in multiple drafts.
2. For the 2012-13 signing season, each Club will be allocated an equal Signing Bonus
Pool.
3. For each signing period after 2012-13, Clubs will be allocated different Signing Bonus
Pools, based on reverse order of winning percentage the prior championship season
(i.e., the Club with the lowest winning percentage the prior season shall receive the
largest Pool).
4. Bonus Regulation of International Amateur Players
A. Beginning in the 2013-2014 signing period (July 2, 2013 - June 15, 2014), Clubs
may trade a portion of their Signing Bonus Pool, subject to certain restrictions.
B. Clubs that exceed their Signing Bonus Pools will be subject to the following
penalties in the 2012-2013 and 2013-2014 signing periods:
Excess of Pool Penalty (Tax on Overage/Draft Picks)
• 0-5% 75% tax
• 5-10% 75% tax and loss of right to provide more than one player in the next signing period with a bonus in
excess of $500,000.
• 10-15% 100% tax and loss of right to provide any player in the next signing period with a bonus in excess of $500,0000.
• 15%+ 100% tax and loss of right to provide any player in the next signing period with a bonus in excess of $250,000.
C. The penalties for exceeding the Signing Bonus Pool will increase beginning with
the 2014-2015 signing period if a draft or drafts is not agreed to by July 2014.
5. All international amateur players must register with the Scouting Bureau to be eligible to
sign, and the top 100 prospects will be subject to a drug test.
6. The Office of the Commissioner and the Union will form a joint committee to assist
international players with their transition to educational/vocational programs after their
baseball careers are over.

DP Outlook - Thumbs Middle - I love the idea of having a signing bonus pool that is acquirable by trade. This can help many smaller market teams in the drafting process, and once again, will create a even playing field that every fan is looking for. However, such signing bonuses will hurt many international academies.

Thumbs Up - International amateur players registering with the scouting bureau will create an avenue that can protect organization investments, as well as cease identity fraud cases which has been prevalent in various Latin markets. 

IV.. REVENUE SHARING
a. The net transfer value of the Revenue Sharing Plan will be the same as the current plan. Net
transfer amounts will continue to grow with revenue and changes in disparity.
b. The fifteen Clubs in the largest markets will be disqualified from receiving revenue sharing by
2016. The revenue sharing funds that would have been distributed to the disqualified Clubs will
be refunded to the payor Clubs, except that payor Clubs that have exceeded the CBT threshold
two or more consecutive times will forfeit some or all of their refund.
c. The Commissioner’s Discretionary Fund will increase from $10 to $15 million per year.

DP Outlook: Thumbs up - Ahh, where are all those who urgently announced that baseball needed a hard salary cap to survive, or to even create competitive balance? Allow the rest of us who opposed you in those debates to collectively say, "we told ya so". The current revenue sharing system has done wonders for MLB with a more diverse landscape of championship teams and playoff teams than any other sport over the past ten years.

Thumbs down - As much as I love revenue sharing, I firmly believe completely eliminating large market teams from revenue sharing by 2016 is a bit unfair, and questionable. Not a fan. I would give a thumbs up if a revenue sharing recipient floor was included.

V.. COMPETITIVE BALANCE TAX
a. The threshold level of $178 million in 2011 will remain unchanged in 2012 and 2013. The
threshold will increase to $189 million for 2014, 2015, and 2016.
b. The tax rate will decrease to 17.5% for Clubs that exceed the threshold for the first time, and
the rate will increase to 50% for Clubs that exceed the threshold for the fourth time or more.
Rates will remain the same for Clubs that exceed the threshold for the second time (30%) and
third time (40%). The CBT rates in 2012 will be subject to a transition rule.
c. The Competitive Balance Tax structure under the 2006 Basic Agreement will be modified so that
a team that moves below the threshold will be treated as going over for the first time when it
next exceeds the threshold.

DP Outlook: Love it. I love the Yankees, but if you spend over the threshold, there should be a severe taxation penalty. I also love the new addition provision that resets the taxation percentage once your organization moves below the threshold.

VI.. DEBT SERVICE RULE
a. The Debt Service Rule will be maintained, but the default EBITDA multiplier has been lowered
from ten to eight, and from fifteen to twelve for Clubs incurring stadium-related debt in the first
ten years of a new or renovated stadium.
b. Debt of a Club’s owner or related party will be covered by the Debt Service Rule if the debt is
serviced, in whole or in part, using Club funds or assets.
c. Debt Service Rule certification process for new ownership has been modified.

DP Outlook: Somehow, I feel this was added due to the Wilpon's and Frank McCourt's mismanagement.

VII.. BENEFIT PLAN
a. Players will continue to receive the maximum allowable pension benefit under IRS rules.
b. Owners will make a $184.5 million annual contribution.
c. Waiting periods for life insurance and disability insurance for active players have been
eliminated.
d. Pension benefits and life insurance benefits for certain classes of retired players and widows
have been improved.
e. The payments to the former non-vested players that began in 2011 will continue for the term of
the Basic Agreement.
f. Access to health coverage has been improved for international players and their families.
g. Health care benefits have been improved while managed care initiatives have been introduced
to help with costs.

VIII.. HEALTH AND SAFETY
a. Players, managers, and coaches will be prohibited from using smokeless tobacco during
televised interviews and Club appearances. In addition, at any time when fans are permitted in
the ballpark, players, managers and coaches must conceal tobacco products (including
packages and tins), and may not carry tobacco products in their uniforms or on their bodies.
Individuals who violate the policy will be subject to discipline. The parties also agreed upon an
extensive program of education and public outreach regarding the dangers of smokeless
tobacco.

DP Outlook: Thumbs Up - When did use of tobacco become culture for baseball? I agree with Bud Selig, who recently beat throat cancer, on pushing this into the new CBA. You can still partake in your habit (as nasty and disgusting as it maybe), but you will not represent the game while doing so. 

b. The parties agreed on a program of mandatory evaluation by a trained professional for Players
who are suspected of an alcohol use problem (including Players who are arrested for DWI or
other crimes involving alcohol), and for players who are arrested for crimes involving the use of
force or violence.

DP Outlook: Thumbs Up - With stories like Josh Hamilton and Miguel Cabrera, MLB is doing the responsible thing by not only helping its players, but helping them overcome their personal demons. Protecting players, from themselves.

c. The parties agreed that no new players will be permitted to use a low density maple bat during
the term of the agreement.
d. By 2013, all Major League players will wear a new batting helmet developed by Rawlings that
protects against pitches thrown at 100 miles per hour. The new version of the helmet is
significantly less “bulky” than prior versions of the more protective helmet.

DP Outlook: Thumbs Up - Safety precautions against concussions are important. Good to see all of the research committees Selig talked about for months finally paying dividends. I'm very Curious about the reasoning behind the ban on low density maple bat? Broken bats and jagged edges?

e. The concussion policy that was implemented prior to the 2011 season has been improved and
will remain in effect for the duration of the Basic Agreement.

IX.. DRUG PROGRAM
Commencing in Spring Training 2012, all players will be subject to hGH blood testing for reasonable cause at
all times during the year. In addition, during each year, all players will be tested during Spring Training.
Starting with the 2012-2013 off-season, players will be subject to random unannounced testing for HGH. The
parties have also agreed on a process to jointly study the possibility of expanding blood testing to include inseason
collections.

DP Outlook: Thumbs UP (Up, and Up, and Up!) - Hallelujah! I still wonder how the NFL gets away from the media on such an issue...

X.. OTHER
a. Participation in the All-Star Game will be required unless the Player is unable to play due to
injury or is otherwise excused by the Office of the Commissioner. Players Trust will receive an
increased contribution and players will receive additional benefits.

DP Outlook: Thumbs Up - Uh oh Jeter, no more vacations. Seriously, if the game determines home field advantage for the World Series, this should be added.

b. All Players will be subject to a policy governing the use of Social Media.

DP Outlook: Thumbs Middle - As a twitter supporter, I do believe there should be some scaling back on using social media (during games and stating inappropriate comments), but I just hope it doesn't turn the personalities of the games brightest starts into drones. I highly recommend following Nick Swisher.

c. Weekend waivers during the regular season will be implemented beginning in 2012.
d. The parties will agree upon a comprehensive international play plan in which Clubs and Player
will visit countries in which games have not been staged in the past.

DP Outlook: Thumbs Middle -  I'm all for expanding the game globally, but I'll admit, there is a selfish part of me that knows the Yankees will be sent, and those are home games and travel schedules that can hurt the ebb and flow of a season.

e. Non-discrimination protections based on sexual orientation were added to Article XV.
f. Instant Replay will be expanded to include fair/foul and “trapped” ball plays, subject to the
Office of the Commissioner’s discussions with the World Umpires Association. 

DP Outlook: I'm torn on instant replay in games. Fair/foul calls and trapped balls though are reasonable uses for such technology. As long as it does not interfere with the flow and time of the game. 
Who approved the Marlins new logo?

g. Modifications to Fourth Option and Outright Assignment rules.
h. The parties agreed to an improved process for challenging official scorer decisions.

Now that some of the serious CBA things are out of the way, here are some other fun changes I am looking forward to:

Miami Marlins New Feel: Thumbs Middle - Ownership is everything is sports. Ownership can change the culture and fortune of a franchise for the best (See: Tampa Bay Rays) or for the worst (See: New York Mets). The new ownership lead by Jeffrey Loaria is one that could potentially create another viable franchise for baseball in what is said to be a new beautiful ballpark. What brings the grade down is the new logo for the new Marlins. Ugh! Could have done better - easily. 

Blue Jays New Uni's...Awesome!
Toronto Blue Jays Back To The Future: Thumbs Up - I never quite understood the reasoning behind the Blue Jays moving to a color scheme emphasizing silver, black and very little blue along with referring to the team as the "Jays". After a few years of being confused, the organization has combined their old logo with a bit of the new bird from the past few years to recreate their old logo. Got it? If not, just know that the uniforms are awesome, and easily one of the best looking looks in baseball. 

San Diego New Uniforms: Thumbs Middle - I absolutely hated the beige look along with the huge font and lettering on the front of the jersey, but the Padres new uniforms are a bit plain. 
Old is New Again.

Baltimore Orioles Having Fun: Thumbs Up - Moving back to the cartoon bird logo? Defintely a thumbs up. Now if only Peter Angelos would do more than just change logos and color schemes, then Baltimore will be in business. 

Finally, while the changes for baseball heading into the 2012 season are abundant and exciting, there are a few changes I will like to see amended under the new agreement. 
  1. Increased marketing and promotion of the game's stars. 
  2. Increased effort to correct declining black players in the game. Please check out this story.
  3. Worldwide draft with financial slotting. 
  4. Enforced pitch delivery rule (Officially at 12 seconds in between pitches in the rule book). What better way to help pacing and to speed up the game by attacking the root of the problem? 
  5. Revenue Sharing Floor (Very wishful thinking, but why not?)
Nonetheless, baseball's future is one that is healthy, and the new changes that comes with the new CBA are ones that keep the game growing and strong.

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