The Angels are in a really tight luxury tax situation for the next few years, because of that, I’ve suggested before that they probably need to pass on giving a contract extension to Kole Calhoun, despite him being an obvious candidate for such a deal. The potential savings just don’t justify the increase in his salary cap number and the impact that would have on the Angels’ spending flexibility.
Matt Shoemaker, however, is a horse of an entirely different color. Black, like his luxuriant beard. Not ginger. Nobody likes ginger horses.
The Cinderella story that is Shoemaker puts the Angels in a difficuly weird position. The rookie is having a stellar season and putting up the kind of numbers of a number one starter. Of course, nobody expected him to do that, what with Shoemaker being an undrafted non-prospect and all. As such, there is still plenty of skepticism as to whether or not he can continue to pitch at such a high level.
What makes the position difficult is that the Angels will have a hard time forecasting his salary going forward. For the next two years, they have the luxury of Shoemaker being a pre-arbitration player, so he won’t be earning much more than $500,000 those years. That is hugely beneficial for the Angels’ luxury tax number. However, once he hits arbitration, his salary could be in for a big jump.
If Shoe keeps pitching at this level, or close to it, he’s going to make big money during arbitration. We’re talking about several million in his first arbitration year and eight figures by his final arbitration year. That’s great for him but not so great for the Angels.
However, if the clock strikes midnight and Shoemaker turns into the Quad-A pumpkin that many thought him to be (myself included, sorry, Matt) over the next two years, he’ll be lucky to make as much during his three arbitration years as he would make in his first arbitration season of the above best-case scenario.
So what are the Angels to do? My recommendation is to offer him an extension as soon as the season is over.
It would be a roll of the dice for the Halos, but because of Shoemaker’s unusual rise to prominence, it could also result in huge savings.
First of all, offering a starting pitcher a lengthy extension after his rookie season is largely unheard of because of how volatile pitcher performance can be. The only recent example I can find is Wade Davis, who signed a four-year, $12.6 million contract after a solid (but not Shoemaker-good) rookie campaign. Davis quickly flamed out as a starter though and ended up getting traded to Kansas City where he has become an amazing reliever. Like I said, pitcher performance is volatile.
But even with that volatility, $12.6 million dollars over four years isn’t that much money, especially to the Angels. If Shoemaker regresses to become a fringy back-end starter, that’s a price tag that they wouldn’t like paying him, but they also wouldn’t lose much sleep over it, not when they’ve been paying tens of millions in dead money to the likes of Gary Matthews, Vernon Wells and Joe Blanton over the last few years.
If Shoemaker continues to pitch at a high level, however, that’s an amazing bargain. The contract number isn’t all the unreasonable either when you consider that Davis was a pretty good prospect, so there was actually more certainty that he’d continue to pitch well and probably get better. It didn’t work out that way, but that doesn’t really matter. With Shoemaker, there isn’t nearly the same certainty as he lacks anything resembling a prospect profile. That’s not really his fault, but it is a factor, a factor that will likely cost him money in a potential extension.
What also works against Shoemaker, and for the Angels, is that he is already 27 years old. Davis was coming off his age 24 season when he signed his deal. That again reduces the incentive to pay Shoemaker more since he’s basically already in the prime of his career. It also means Matt doesn’t have as much time left on his career clock to risk heading into the arbitration process and on into free agency to bank big paydays. If he wants to secure his financial future, he has every incentive to act as soon as possible.
Shoemaker is no dummy. He knows what he had to overcome to get to where he was. Because of that, he is likely quite aware of how quickly it could all go away. He’s one Tommy John surgery away from waving bye-bye to his prime money-making years. I’m sure he also has a lot of confidence in his own ability to continue pitching at a high level, so he probably won’t just take the first offer the Angels make to him.
With that in mind, the Angels should look to offer Shoemaker a five-year, $15 million deal. That trumps what Davis got from the Rays, but comes in shy of the kind of deals be handed out to other young starters who signed extensions after their second season. Take Jose Quintana as a comparison. He, too, was a virtually unheard of prospect who turned into a legit front-end starter out of nowhere. After his second season, he signed a five-year, $21 million deal. But that deal includes buying out a year of free agency, which the Angels wouldn’t do here and probably should avoid, unless they get a cheap buyout. After all, Shoemaker will be 33 years old by the time he is scheduled to hit the open market. The Angels don’t need to get involved with that.
For Shoemaker, he’d be passing up the opportunity to make potentially twice that much money if he went year-to-year through arbitration, but he’d be assuming a lot of risk in the process. That’s a whole lot of risk for a guy who couldn’t even get drafted to take.
For the Angels, it isn’t. $15 million is pocket change to them. The $3 million annual luxury tax hit is more than palatable, especially when the trade-off is potentially paying out so much more on a year-to-year basis, not to mention the much large tax hits those arbitration salaries would come with.
I know this isn’t the time of year for considering such things, but once the post-season is over for the Halos, it makes a lot of sense for them and Shoemaker to get together and make this extension happen.
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