Phillies and Aaron Nola cannot agree on contract, likely headed to arbitration

It appears as if the Philadelphia Phillies and their ace, Aaron Nola, could be headed to court.

The two sides were unable to agree on a one-year or multi-year deal by today’s arbitration deadline, so now both sides will exchange numbers and could appear before an arbitration hearing next month. However, it is still possible for both sides to come to an agreement before that hearing.

At the moment, the two sides do not appear to be close. Nola has filed at $6.75 million while the Phillies are offering $4.5 million, making a trip before the arbitrator more likely.

Last year, Nola emerged as one of the best young pitchers in the National League, finishing third in the NL Cy Young voting with a 2.37 ERA that ranked second only to Jacob deGrom. His 5.6 fWAR was 4th-best with a 27.0% strikeout rate was was 7th-highest and a K-BB% that was 5th-best.

Nola is not the only big-name, first-time arb-eligible pitcher to fail to reach a deal with his team. The Yankees were not able to come to a deal with their young ace, Luis Severino. In fact, few pitchers have ever been in a situation similar to Nola’s and Severino’s. Former Astros pitcher Dallas Keuchel set the Arb 1 record for pitchers at $7.25 million after his second season, the year he won the AL Cy Young Award.

A deal similar to that is not out of the question for Nola. And for those wondering about a long-term extension for Nola, it’s possible that could happen, but it’s not likely. Nola is under team control until after the 2021 season, and it’s more likely he’ll wait for a market value deal closer to free agency, although the Phils certainly should try to buy out a free agent year or two if at all possible.

As for the rest of the Phillies’ arb-eligible players, one-year deals were reached on all of them.

How does this affect the Phils’ payroll for 2019? Combined with existing deals for Jake Arrieta, Jean Segura, Andrew McCutchen, David Robertson, Juan Nicasio, Tommy Hunter, Pat Neshek, Odubel Herrera and Scott Kingery, the Phillies payroll currently stands at $105 million.

The Phils still have to pay Nola, and for argument’s sake, let’s put that number at $7.5 million. The Phillies also have to give Pre-Arb deals to Rhys Hoskins, Jorge Alfaro, Victor Arano, Seranthony Dominguez, Zach Eflin, Andrew Knapp, Nick Pivetta, Roman Quinn, Edubray Ramos, and Nick Williams and others that should come in somewhere around $6 million. There is also $5 million in deferred salary to Howie Kendrick.

That would bring the 2019 payroll to approximately $123.5 million in terms of actual cash payout. However, for luxury tax purposes, contracts are calculated evenly on an annual average value basis, so no matter how the Phils may choose to distribute the money each season, it’s calculated as the same amount every year. That brings the Phils’ luxury tax payroll to about $148 million.

This year, the luxury tax is set for $206 million, leaving the Phillies $58 million under. Can they sign both Machado and Harper under this scenario?

If both players signed deals that paid them $30 million a year, they’d be about $2 million over. However, the Phillies would also likely have to trade a player or two. If they were to move Maikel Franco to another team, that would take $5.2 million off the payroll and bring the Phils under the tax. Any additional players they trade would further reduce that number. However, it would also leave them precious little breathing room if they needed to make deals during the season.

Of course, owner John Middleton could choose to ignore the luxury tax altogether, in which case, all bets are off!

The good news is, now the Phillies know where they stand in terms of dollars to existing players, with the exception of Nola. All eyes are on Matt Klentak to see how much of that “stupid money” that’s left over will be spent on any other high-priced acquisitions.