2024 Draft - Part 29 - The Draft Bonus Pool Rules And What Happened To The Guardians On Day 2

 The draft bonus rules are a little complicated but, in a nutshell, here they are:

• MLB assigns every draft pick in the first 10 rounds a dollar value. 
• To calculate a team's total bonus pool just add up the dollar values for all the slots they draft at in the first 10 rounds.   
• Aggressive teams can spend up to 4.999% above their bonus pool and only be penalized 75% of that excess.  If they spend 105% of their bonus pool or more, they lose one or more draft picks.
• Any player drafted (or acquired as a non-drafted free agent after the draft) is allowed to be paid a bonus of $150,000.  Any part of the bonus above that figure counts against a team's draft budget.
• To figure out how much of a team's bonus pool they have used, just add up all the bonus amounts they have paid to players they drafted through round 10 and add in the amounts above $150,000 they paid to any player acquired after round 10.
• One very important nuance to this system is, if a team fails to sign a player from the first 10 rounds they lose the slot amount from that draft slot from their bonus pool.  As their 104.999 percent bonus pool is calculated based on the bonuses a team pays out, if they lose a bonus amount from a slot they also lose the ability to have that overage amount.  Thus, if a team fails to sign a pick from a slot that is worth $500,000, they lose $500,000 from their bonus pool plus the ability to add to their bonus pool with an overage of $249,000 for that 4.999% overage.

Why is all this important to the 2024 Cleveland Guardians draft?  Well, the Guardians did something VERY unusual in this draft.  Normally teams will have a player they REALLY want to sign in their first 10 rounds of picks or even in rounds 11-20.  To get that money they will draft, in the other spots of first 10 rounds, players who will sign for below the slot that they are drafted in.  These include: college seniors and players who didn't expect to be drafted as high as they were.  But there are only usually 10-11 players drafted in the first 10 rounds by a team.  It sometimes takes them saving money on a lot of their first 10 picks to pay that one player who will require a higher bonus to keep them from going to (back to) college.  

Last year the Guardans messed up and had to pay a much higher over slot bonus to ONE player, that made them not be able to sign two other players later in the draft.

And this year they may have screwed up worse than last year.

This year, however, they may have gone overboard.  With one day to go in the draft the 

1. Bazzana - $1.3 million

36. Doughty - 0

48. Cozart - $200,000

84. Oakie - $1.1 million

113 - Sleshinger - $143,000

146 - Major - $75,000

175 - Favors - $257,000

205 - Sullivan - $720,000

235 - Zsak - 0

265 - Matson - 0

295 - Mobley - $817,000

By this calculation, the Guardians have overshot their bonus pool by $662,000.  This is using conservative estimates that Sullivan and Mobley will sign for $1 million each and all the other guys in the draft will accept the under slot or at slot bonuses for the spot they were drafted that I have listed above.

While that is possible as our 5% overage amount is actually $914,000 ABOVE what our bonus pool of $18,334,000, giving us a maximum pool, without losing a draft pick next year, of $19,248,000, it is cutting it really, really close.  

If any of the prospects listed above wants a bonus above what the Guardians thought they would settle for, their draft can fall apart like a house of cards.  That did happen to them last year when they had to pay Alex Mooney $1 million meaning that they suddenly did not have enough money to sign two highly touted HS pitchers, Ryan Marohn and Mac Heuer,   And last year, they had to sign Mooney or they would have lost his bonus slot, causing them to have to not sign ANOTHER draftee.  So they chose to sign Mooney and let Marohn and Heuer walk.  Not ideal and, this year, it looks like they are going back to the same house of cards approach, except worse because if they can't sign Mobley, Sullivan, Oakie and Doughty for bonuses as small as I used to do the calculations above, those players will walk and we will lose their slot values.

Plus, cutting it this tight means they are unlikely to draft any players tomorrow who will require bonuses larger than $150,000, meaning the talent from this draft will likely be lower, overall, than if they had the money to spread around to the entire draft.

Up to last year the Guardians were masterful at using exactly 104.999% of their draft budget.  Let's hope they get back to that this year.  The numbers above make me worry A LOT though, especially after last year's disaster.