Gallardo's pact a growing trend in baseball
Like other deals, extension covers start of free agency
MILWAUKEE -- The Brewers followed a trend when they signed 24-year-old right-hander Yovani Gallardo to a contract extension on Thursday -- develop your own young pitchers, test them in the big leagues and then lock them up.
That was the path followed by Gallardo and the Brewers, who struck an agreement on a five-year contract reportedly worth $30.1 million that buys out all three of Gallardo's arbitration seasons and one year of free agency. There's also a $13 million option for 2015, which could give Milwaukee its ace through a second season of would-be free agency.
It's essentially a Jon Lester contract. Lester, the Red Sox left-hander who overcame cancer, agreed last March to a five-year, $30 million contract that included a $13 million club option for a sixth season. If that option is exercised, Boston will have bought out two of Lester's free agent years.
According to Yahoo! Sports, which broke the news of Lester's deal last year, that contract was the richest for a pitcher with around two years of Major League service. Lester was 25 at the time. Now it appears that Gallardo, 24, who has two years and 108 days in the big leagues, has him beat by $100,000.
The Brewers and Red Sox are far from the first teams to take this approach with a pitcher, trading the obvious risk for the potential reward that comes with a productive, relatively young and cost-certain arm for a few extra years. This year alone, the Rangers have struck a similar pact with Scott Feldman, and that came after agreements between Matt Cain and the Giants, Nick Blackburn and the Twins, Felix Hernandez and the Mariners and Josh Johnson and the Marlins. All of those pitchers were either drafted or signed by those teams, and all of their extensions gave the team some degree of control over at least one year of free agency.
"I agree it's a trend," said Mariners special assistant Tony Blengino, who was in Milwaukee's scouting department when the Brewers drafted Gallardo in 2004. "I think if you look back, it's been going on for a little while. Look at [Brewers outfielder Ryan] Braun and [Rays third baseman Evan] Longoria.
"There's a trade-off here. You're taking a risk with a good bit of money, but if a player stays healthy and maintains his standard of performance, you're not only keeping the player, you're keeping him at a certain price."
Braun agreed to a seven-year extension nearly two years ago that runs through 2015. Longoria is halfway through a six-year contract that includes club options through 2016.
Pitchers, though, carry significantly more risk. That's what makes the recent run of extensions so intriguing.
"I can only speak for our own guys," said Twins assistant general manager Rob Antony, whose club has signed both Blackburn and fellow right-hander Scott Baker to long-term contracts in the past 13 months. "With our guys, we had the belief that they have a reasonably good chance of staying healthy and being a part of this club for a long time.
"We were able to get some cost certainty through the arbitration years, where you just don't know where some of those [salaries] are going. Some of them have exploded. In exchange, a player gets some security into his free-agent years."
The Twins considered a number of factors before engaging Baker and Blackburn in negotiations.
"You look at, 'How are they going to handle the pressure of going from making $450,000 to all of a sudden making $3 million or $5 million?'" Antony said. "Are they going to think they have it made and not work as hard? We don't believe that's the case with [Baker and Blackburn]. Or are they going to try too hard? We don't believe that's the case, either, with our two guys.
"Then you have to look at the physical part. Are they high-risk? Some pitchers, you don't feel good about that. I'm not sure there's an exact science to it, but that plays a role. You also have to ask, 'Does the guy deserve it? Have they earned it? Do you trust and believe that they are going to be able to back up what they've done in the past in the future?' If you're not comfortable with the answers to those questions, maybe you're better going year-to-year."
Said the Mariners' Blengino: "There is more risk, so you have to really examine the type of pitcher you're dealing with. [But] pitching is hard to find, and everybody is always looking for more of it."
With help from the Web site MLB Trade Rumors and MLB.com's own archive, here is a timeline of extensions for young pitchers this year:
April 8: Gallardo
Gallardo would be been eligible for salary arbitration next winter. Instead, according to The Associated Press, he gets a $1.25 million signing bonus plus a new salary of $500,000 for 2010, then $3.25 million in '11, $5.5 million in '12, $7.75 million in '13 and $11.25 million in '14. The '15 option would pay $13 million option or a $600,000 buyout. Gallardo is banking $16.5 million for his three arbitration seasons.
April 2: Feldman
Like Gallardo, Feldman was Texas' Opening Day starter, and he received a two-year extension through 2012 that covered his remaining arbitration seasons plus a club option for his first year of free agency. Feldman is 27 and one year ahead of Gallardo in terms of Major League service. He gets $2.425 million in 2010, $4.4 million in '11 and $6.5 million in '12, and the Rangers own a $9.2 million option for '13. Feldman was the club's 30th-round Draft pick in '03.
March 28: Cain
The 25-year-old Cain is two years ahead of Gallardo in terms of service time, so his three-year extension through 2012 covers his final two arbitration seasons plus one year of free agency. Cain will earn $4.5 million in 2010, $8 million in '11, and $15 million in '12. Cain was the Giants' first-round pick in '02.
The Giants announced their deal with Cain along with extensions for relievers Jeremy Affeldt and Brian Wilson.
"It's our window," Giants general manager Brian Sabean said. "We had a position-player window with [Barry] Bonds and we have these guys [through 2012]. The comfort in knowing that they are going to be in Giants uniforms helping us win games is a statement in itself."
March 6: Blackburn
A good comparable for Gallardo, at least in terms of big league service. Blackburn, 28, agreed to a four-year, $14 million extension that covers all three of his arbitration seasons and includes a club option for his first year of free-agent eligibility. Blackburn will get $750,000 in 2010, his final pre-arbitration season, plus $3 million in '11, $4.75 million in '12 and $5.5 million in '13. The club option for '14 calls for an $8 million salary. Blackburn was the Twins' 29th-round selection in 2001.
Feb. 4: Justin Verlander, Tigers
About two weeks after the Mariners struck a deal with King Felix, Detroit locked up its own ace to a five-year, $80 million contract that covers his final two arbitration seasons and three years of free agency. Verlander reportedly will earn $6.75 million in 2010, $12.75 million in '11, then $20 million each year from 2012-14. He was the club's first-round Draft pick in '04, second overall and 44 slots above Gallardo.
Jan. 21: Hernandez and Johnson
Like Verlander, both Hernandez and Johnson are two years ahead of Gallardo and more accomplished in the Major Leagues. Hernandez's five-year, $78 million contract also covered his final two years of arbitration and bought out three free-agent seasons. Hernandez reportedly will receive a $3.5 million signing bonus and a $6.5 million salary for 2010, plus $10 million in '11, $18.5 million in '12, $19.5 million in '13 and $20 million in '14. Seattle signed him out of Venezuela in '02.
Johnson, meanwhile, got a four-year, $39 million deal that covered his final two years of arbitration plus two free-agent seasons. He will make $3.75 million this season, $7.75 million in '11 and $13.75 million in both '12 and '13. Johnson was the Marlins' first-round Draft pick in '02, and his deal was very similar to the one struck between Zach Greinke and the Royals a year earlier.
Greinke might have been the best such signing in 2009, but he was not the only one. There was also Lester, Adam Wainwright of the Cardinals, Scott Baker of the Twins, Paul Maholm of the Pirates and Ubaldo Jimenez of the Rockies, who just beat the Brewers on Opening Day.
Adam McCalvy is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.