Resetting the Kansas City Royals Payroll Situation

September 3, 2013; Anaheim, CA, USA; Los Angeles Angels starting pitcher Jason Vargas (60) pitches during the first inning against the Tampa Bay Rays at Angel Stadium of Anaheim. Mandatory Credit: Gary A. Vasquez-USA TODAY Sports

Jason Vargas is now a Royal, and will be paid $32 million over four years to be one. So what does that mean for the Royals payroll and how they will be able to attack the rest of the offseason? Will they be able to add the bat they so desperately need? Will they be able to buy another arm to replace Ervin Santana? Well, here’s how things are looking right now.

Between James Shields, Jeremy Guthrie, Alex Gordon, Billy Butler, Wade Davis, Alcides Escobar, Salvador Perez and Noel Arguelles, the Royals owe $54.43 million according to Cots Baseball Contracts. We do not have the specific breakdown of how Jason Vargas’ $32 million will be divided up over the four years of his deal. If it is spread out evenly, then the Royals are at $62.43 million for the 2014 season.

Additionally, Kansas City has ten arbitration eligible players: Luke Hochevar, Emilio Bonifacio, Chris Getz, Aaron Crow, George Kottaras, Brett Hayes, Greg Holland, Tim Collins, Eric Hosmer, and Justin Maxwell. MLB Trade Rumors estimates those players will earn about $22.9 million in arbitration deals.

Other candidates with a very good shot to make the 25-man roster – Mike Moustakas, Lorenzo Cain, Kelvin Herrera, Jarrod Dyson, Danny Duffy, Pedro Ciriaco, Yordano Ventura, David Lough and Luis Coleman – will all make the rookie minimum of around $500,000.

The position breakdown looks like this:

Starting pitchers (Shields, Guthrie, Vargas, Duffy, Ventura) – $33.5 million
Bullpen (Holland, Crow, Collins, Herrera, Hochevar, Smith, Coleman) – $14.3 million
Starting position players (Perez, Hosmer, Bonifacio, Escobar, Moose, Gordon, Cain, Maxwell) – $33.35 million
Bench (Pena, Getz, Ciriaco, Lough, Dyson) – $3.3 million

In total, this puts the projected Royals 25-man roster at around $84.45 million based on the numbers from Cots Baseball Contracts and MLB Trade Rumors. Previous reports say the Royals would like to stay at around $85 million but they do not feel pressure to be exactly at that number. From Bob Dutton:

"And while general manager Dayton Moore is on record as saying he doesn’t expect the payroll to rise much beyond its current level, roughly $85 million, he acknowledges more is available.“We’ve got flexibility,” he said. “Just because you have extra flexibility, what are you going to spend it on? I don’t know. I don’t envision the payroll going up that much…”"

Reading between the lines a little bit, the Royals have more money to spend if they find the right fit (or their definition of a “right fit” anyway) to go above $85 million. Moore is playing it smart by keeping stated payroll expectations a little bit low.

A few ways the Royals could clear money would be to get rid of players like Chris Getz and Luke Hochevar. The Royals have cheaper replacements for each of them already in their system who would cost the league minimum at the major league level. This would save the Royals about $5.3 million in payroll space, plus Hochevar could be a piece in a trade for either a second baseman or right fielder.

Wade Davis also becomes an interesting trade piece for the Royals. Davis is owed $4.8 million this season with three club options for the next three seasons. He would be an interesting candidate for a team like the Twins, Angles, Astros, Marlins, and Brewers. All are teams that are looking for starting pitching depth at an affordable price. Davis provides all of those things plus gives multiple years of team control. Kansas City would likely not get much back for him on his own, but the near $5 million he would open up would be enough to absorb some added cost in free agency or in a trade.

Another trade piece with more value is Greg Holland. Holland was sensational last season and is at peak value. MLB Trade Rumors has Holland at $4.9 million for 2014. Because he is a closer and affordable, he could be a guy who brings back something decent in a trade. Remember that the Athletics got Josh Reddick for Andrew Bailey in a trade two years ago. Reddick has hit 44 home runs and has an 105 OPS+ in his short tenure with Oakland. Is there a deal like that available to Kansas City for either a second baseman or outfielder? Maybe Anaheim?

Getz, Hochevar, Davis, and Holland combined to occupy $16 million of payroll space, and the Royals have cheap replacements for them in their system. If KC can shed that $16 million and maybe expand their payroll to a modest $90 million – only $5 million over their current target – then they would have about $20 million to add another starting pitcher, a second baseman, and a right fielder.

There’s some wiggle room still left for the Royals to make some big moves even after the Vargas signing.