How much can the Phillies actually spend this offseason?

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While the Phillies have several contracts coming off the books, they might not have as much financial flexibility this offseason as you think.

With the Phillies long since eliminated from playoff contention, much of the fanbase has already shifted their attention to the offseason.

In theory, the Phillies should have lots of money to spend. As Jake Arrieta, J.T. Realmuto, Didi Gregorius, David Robertson, and more become free agents, the Phillies will have at least $68.125 million coming off the books for luxury tax purposes

However, the luxury tax payroll doesn’t tell the full story. For luxury tax purposes, contracts are assessed at their average annual value (AAV) rather than the actual amount of money the team has to pay the player each year.

For example, the AAV of Bryce Harper’s mega-deal is $25.38 million, and so that’s the number that affects the Phillies’ luxury tax payroll. However, Harper isn’t actually being paid $25.38 million annually. He’ll be paid $26 million a year through 2028, and then $22 million a year until 2031.

This distinction is critical, because if the Phillies are forced to reduce their budget in 2021, the team will need to lower the amount they’re actually spending, not just the amount that counts towards the luxury tax.

Here’s a brief calculation of how much money the Phillies actually have coming off the payroll going into 2021.

Free Agents

Jake Arrieta – 2020 Salary: $20 million
Didi Gregorius – 2020 Salary: $14 million
David Robertson – 2020 Salary: $11 million. Robertson also has a $2 million buyout for 2021 that the Phillies are certain to exercise.
J.T. Realmuto – 2020 Salary: $10 million
Jose Alvarez – 2020 Salary: $2.95 million
Jay Bruce – 2020 Salary (as paid by the Phillies): $1.375 million
Tommy Hunter – 2020 Salary: $850,000
Brandon Workman – The Red Sox paid almost his entire 2020 salary. The exact numbers don’t seem to be publicly available.
David Phelps – Phelps has a $250,000 buyout for 2021 that the Phillies are likely to exercise. This is pretty much equal to what the Phillies paid Phelps in 2020 (40% of his salary), so this one is basically a wash.

That means the actual total coming off the books is around $58.625 million. That’s already $9.5 million less than the luxury tax number I calculated. But we’re not finished yet.

Note: 2020 salary numbers are based upon original contract values and not prorated salaries, with the exception of the players acquired midseason.

Zack Wheeler #45 of the Philadelphia Phillies (Photo by Mitchell Leff/Getty Images) /

Phillies Due for Raises in their Current Contracts

Zack Wheeler – 2020 Salary: $21.5 million, 2021 Salary: $22.5 million
Andrew McCutchen – 2020 Salary: $17 million, 2021 Salary: $20 million
Aaron Nola – 2020 Salary: $8 million, 2021 Salary: $11.75 million
Scott Kingery – 2020 Salary: $1.5 million, 2021 Salary: $4 million
Odubel Herrera – 2020 Salary: $7.35 million, 2021 Salary: $10.35 million

That adds up to $13.25 million in raises for 2021. Subtract that from the previous total ($58.625 million), and we’re left with $45.375 million coming off the books.

It’s also safe to assume that the Phillies will tender Zach Eflin, Rhys Hoskins and Andrew Knapp contracts in arbitration. Based on arbitration numbers for similar players, I estimate that raises for those three will cost somewhere between $5 to $6 million.

That means our new total is approximately $40 million coming off the books in 2021.

Note: The Phillies will also likely tender contacts to at least a few of the eight other arbitration-eligible players on their roster, which would reduce the total spending room even further.

Potential Non-Tenders

The Phillies could save $8.2 million more by non-tendering Hector Neris (2020 Salary: $4.6 million) and Vince Velasquez ($3.6 million). However, they’d likely have to spend at least that much money to replace these two on the free agent market.

They could also non-tender cheaper players like Phil Gosselin ($575,000), David Hale ($575,000) and Adam Morgan ($1,575,000). Once again, the savings here are negligible, considering the Phillies would have to pay three other guys to replace them on the roster.

Final Totals

If the Phillies non-tender all five players I mentioned, that leaves them with a grand total of about $51 million to fill 14 spots on the roster.

Even if the Phillies were to fill 9 of those spots with guys making the league minimum (which is highly unlikely) that would leave the team with about $46 million to spend on only five free agents.

And that doesn’t even account for a payroll reduction.

If the reports are true that the Phillies plan to reduce their payroll in 2021, that leaves the team with very little money to spend on a catcher, a middle infielder, another starting pitcher, and a few quality relievers.

If John Middleton doesn’t invest some more money into this team, the Phillies could be even more disappointing next season than they were this year.

Additional Notes

My Luxury Tax Calculations: Arrieta ($25 million) + Realmuto ($10 million) + Gregorius ($14 million) + Robertson ($11.5 million) + Bruce ($1.375 million) + Alvarez ($2.95 million) + Hunter ($850,000) + $2 million increased luxury tax threshold = $68.125 million

All contract information comes from Spotrac.

To learn more about the Phillies’ payroll as it pertains to the luxury tax, you can read these excellent pieces by Corey Seidman for Yahoo Sports and Matt Gelb for The Athletic.

Related Story. Phillies face tough decisions with 9 eligible free agents. light

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