Is the Qualifying Offer Hurting Smaller Market Teams?

In theory, the qualifying offer was implemented to help promote league parity, and possibly help small and mid-market teams. Much like the franchise tag in the NFL, a team would be able to extend a qualifying offer that, if accepted, would allow them to keep a key player at a predetermined salary. Signing a player that declined a qualifying offer would result in the forfeiture of a first round pick, given to the team that lost the player at the end of that round, unless the signing team was one of the ten worst teams last season. Instead, the qualifying offer may actually be doing the exact opposite.

In the two years that the qualifying offer has been in place, twenty two players have been extended the qualifying offer, all of which have rejected it. Interestingly, ten of those qualifying offers were made by either the Yankees (six) or the Red Sox (four). So, for something that may have been intended to help teams with payroll limitations or those that performed poorly, it may actually be helping baseball’s elite instead of teams such as the Kansas City Royals.

Teams like the Red Sox and Yankees, with their higher payrolls and larger markets, may be more willing extend qualifying offers to marginal players. While the Royals have extended a qualifying offer only to Ervin Santana, the Red Sox and Yankees have extended offers to players such as Stephen Drew, Curtis Granderson, Nick Swisher and Rafael Soriano. Hiroki Kuroda has received the qualifying offer twice from New York. While those players may have been valued in the open market, not many teams are lining up to spend a draft choice to sign a player who is not going to be a difference maker. Players such as Drew may be finding that out now.

Yes, the qualifying offer may be helping teams like the Royals by suppressing salaries for those free agents, but is it worth the cost of a draft pick? Teams like the Royals need to be successful in the draft in order to compete, since they are not likely to go out and bring in the bigger names during free agency. Meanwhile, teams like the Red Sox and Yankees can not only sign pretty much anyone they need to, but they are now getting first or second round picks for average to slightly above average players, allowing them to potentially stock their farm systems as well.

The qualifying offer certainly had good intentions, but it appears as though it needs to be tweaked. Not only are agents displeased with the limited markets that their clients have once the qualifying offer is declined, but smaller market teams such as the Royals need those draft picks in order to, theoretically, build a contending ballclub.

Perhaps in the next CBA, when the topic of the qualifying offer comes up, there will be a limit as to how many offers a team can make each offseason, keeping teams from being able to protect three or four players a year. If that happens, then the qualifying offer would be a benefit to the Royals. For now, it just appears to be another way that the larger market teams are finding an advantage.