Tuesday, August 11, 2009

Arbitration Files: Josh Johnson

Josh Johnson (Current 4th year salary - $1.4 million)
2008 - 87.1 IP, 7-1, CG, 3.61 era, 77 K, 1.35 whip
2009 - 148 IP, 10-2, 2 CG, 2.98 era, 123 K, 1.11 whip (as of Aug 6th)
Reasonable Expectation Season Line - 220 IP, 15-4, 3.25 era, 185k, 1.15 whip

Usually it's tough to find comps as good as this one, but we got lucky below.

Zack Greinke
2007 - 122 IP, 7-7, 3.69 era, 106 K, 1.30 whip < - Half year because of injury, just like JJ
2008 - 202.1 IP, 13-10, 3.47 era, 183 K, 1.28 whip < - $1.4 million year 4. Same as JJ

Post 2008, Greinke signed a 4/$38 extension, $3.75-$7.25-$13.50-$13.5 (signed after year 4)

So where do we begin. Greinke is spot on from years 3/4. This is the slot, we just have to value how much more is Johnson than Greinke. JJ has an enormous “loss” advantage, a bit of whip, and probably a quarter to a half run less era. He also made the all-star team in 2009. JJ is clearly going to be slotted above Greinke off performance, and because of inflation.

Contract Comparisons - Player Stats for Year 4 / Contract Value Year 5
Adam Wainwright - 158.1 IP, 12-7, 2.79 era, 1.28 whip, 140 K / $4.65 million (signed after year 2)
Matt Cain - 148 IP, 12-3, 2.25 era, 1.16 whip, 117 K / $4.25 million (signed after year 1)
Jon Lester - Currently in year 3 / $5.75 million (signed after year 2)
James Shields - Currently in year 3 / $4.25 million (signed after year 1)

Cole Hamels (a Super2), signed a contract for years 3-4-5 for $4.35, $6.65, and $.9.5 million. The $9.5 is technically his year 5 salary so that isn’t comparable to JJ, but that $6.65 certainly marks the HIGH. Hamels was coming off a 227 IP, 14-10, 3.09 era, 1.08 whip, 196 K season. That is certainly very comparable to what Johnson is doing right now. Hamels signed the deal after year 2.

Other notable pitchers hitting arbitration year 5, year 4 salary noted - Felix Hernandez ($3.8), Justin Verlander ($3.6)

So the question now is, what is Johnson’s arbitration status for next year. What is his long-term contract status for next year. Each probably have very different responses.


At this point, it is clear Johnson is going to murder people all year. Most believed at some point that he would come back to earth but that is simply not going to happen. Since his return from Tommy John surgery, Johnson is an amazing 18-3. But JJ has decided he’s going to be a legitimate # 1 SP. Great, awesome. Despite the fact his Year-3 innings are low and Greinke is such an amazing comp for all the reasons where we’d hope he’d only slot above him maybe a million bucks to the “Wainwright” level of compensation, we have the new Lester and Hamels contracts to deal with. JJ has to go above Lester in arbitration. He’s simply better than him and the Marlins are going to get slammed if they try and argue a low 3 era / 1.15 whip / 180 K JJ, is lower than a (projecting) 3.75 / 1.30 / 200 K Lester. There’s just no way an arbitration panel is going to buy that, even if you want to argue AL/NL, etc. Additionally, Lester is a bad comp for JJ because the 5th year contract price is LOWER than what the ‘free market’ would give because the Red Sox bought this year 3 years in advance. Jon Lester arguing a contract in three years is a higher value than him signing one right now. So suffice to say, if the Marlins are insane and don’t offer JJ a 4-5 year deal (see below), they are going to get slammed. I don’t know if JJ can get up to Hamels, who has been healthy and won the World Series, but it’s going to be. An additional problem would be if King Felix or Verlander randomly have their arbitration hearing before Johnson’s, or sign new deals. They would each get to Hamels levels easily. Making the case even harder for the Marlins.

So the Arbitration Projection.

Low - $4.75 million. Wainwrightish, and JJ is hurt by his lack of innings in 2008.
Medium - $5.8 million. Lesterish, and JJ because the top non-Super2 slot for 5th year players. (not including Verlander or Felix really jumping here, which is possible)
High - $6.75. Hamelsish, and JJ becomes the new slot because he is that awesome and general inflation

I think the Marlins strategy would be a low 5 and arguing everyone but Hamels. I think if Johnson attempts to go huge with Hamels, he’ll get shot down for the lack of innings in year 3. Those innings won’t have a major effect on his figure, but they are still there to tip the scale. If the Marlins try to low-ball this, like they did with Dan Uggla last year, they are going to lose. But, I think discussing arbitration strategy is foolish. JJ needs the contract. And he needs it now.


So you don’t have to scroll up, Greinke signed a 4/$38 extension, $3.75-$7.25-$13.50-$13.5 (4/$38). Lester is making (years 5-8, including option) $5.75-$7.6-$11.6, $13 (4/$37). So we have a nice baseline for top young starters here. One, who has the same innings pitched track JJ does, and the other bought out years in advance. JJ has to be slotted above this. Forgot Wainwright, who is $4.6-$6.5-$9-$12 (4/$32). Nice deal for the Cards.

So after the back and forth with Johnson wanting a $70 million deal and the Marlins wanting to give him $38.01 million, I think this is reasonable.

2010 - $5.5 million
2011 - $7.75 million
2012 - $14 million
2013 - $14.25 million
2014 - $14.5 million club option / $1.5 buyout
4/$43 or 5/$56

That seems about right. JJ will either be 29 or 30 at the end of this deal, meaning he is due another huge payday in his career. Which is very important and why he’d never sign a 7 year deal. Not that we would want to either, but just saying.

Overall. I find it imperative the the Marlins sign Johnson to a 4-5 year contract similar to the above. Not just because arbitration is scary, but because we don’t have to sign anyone else. JJ is simply a cornerstone player you build around. Also from JJ’s perspective, he still is coming off the major arm surgery. Banking $5-6 million in arbitration would be nice, but that’s not “settle down forever” money. Getting a $40-50 million dollar contract is “locked up for life.” The time is now for both parties for the deal. Make it happen. Git R Dun.

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