The Total Cost of the Correa Hack

Yesterday, Major League Baseball announced that the Cardinals would have to forfeit their first 2 draft picks (56 and 75 overall) and $2M to the Astros for Chris Correa hacking their system. The penalty comes after months of investigation and a 46 month jail sentence for Correa.

The general MLB public is mixed on the penalty – half think it was a slap on the wrist for the Cardinals and the other half think this is a major setback for the Cardinals.

But what is the real impact to the Cardinals?

The financial penalty is self explanatory. The Cardinals can absorb a $2M hit. The draft picks are different.

For 2017, the 56th pick has a slot value of $1,122,400 and the 75th pick has a slot value of $730,800 (total of $1,853,200 in slot money). Factor in the loss of pick 19 with a slot of $2,953,700 for the signing of Dexter Fowler, and the Cardinals are left with $2,072,300 to spend on their first 10 rounds in the draft; that’s the lowest amount of all teams.

Losing the pool money goes beyond not signing 2 more guys; the Cardinals have traditionally tried to go under slot with picks in the second through 10th rounds so they can go over slot with their first round pick and those after the 10th round. Without those picks and pool money, they’ll struggle to possibly buyout high school players college commitments.

Now there is the question of players. Both picks are in the second round; pick 56 was their normal second round pick and the 75th pick was their Competitive Balance pick. The Cardinals have made 58 picks in the second round of the draft. 25 of those players have made the majors. Of those 25, 14 have positive WARs and 8 of them have been worth 2 Wins or more. The top 6 is:

The average WAR for second round players by the Cardinals is 5.2.

Basically, it would have been about a 50/50 shot of a second rounder making it to the Majors for the Cardinals; still, those odds are better than most draft picks, especially as the draft goes on.

Another way to think about it would be timing of those picks making the Majors. I’ve had someone say to me it’s not a huge deal since the Cubs “own the division.” The average major league player takes 4-6 years from the time they are drafted to reach the highest level. If you look at the Cubs’ 40-man roster right now, 68% of their roster is scheduled to hit free agency in those years, including Anthony Rizzo, Kris Bryant, and Jon Lester. If their roster stayed static (which we know it won’t), those drafted players would help the Cardinals as a bulk of the Cubs roster could possibly leave. This might be a moot point as the Cubs have the revenue to continue to supplement their roster as players leave.

Lastly, if you look at recent Cardinal teams, you find that a majority of their teams’ value comes from drafted players. In 2016, the Cardinals had a team WAR of 40.1; 15.4 of that was from drafted players, or 38% of their value. Next closest was 11.5 from non-drafted free agents (aka international signees).

The 15.4 WAR was the lowest they’ve had from drafted players since 2008, which they had 11.2 WAR. The 38% of their value from drafted players was also lowest since the same year and the first time it was below 50% of their roster since 2009. This shows that team is reliant on the draft for building their roster.

While 2 draft picks and a couple of million dollars might not sound like much for a Major League team, this penalty will hurt the Cardinals more than most think.