Jeremy Hellickson Accepts Qualifying Offer

In a somewhat surprising move, Jeremy Hellickson has accepted the Phillies Qualifying Offer. Therefore, the Phillies will pay him $17.2 million for the 2017 season. While $17.2 million might sound like a lot for a pitcher of Hellickson’s caliber, there are several reasons why it would have made sense for him to decline.

For one, this free agent class is the most dismal in recent memory. Hellickson figured to get among the highest value contracts of all pitchers this offseason. The only free agent starter who produced more WAR than Hellickson is Rich Hill, who missed a good chunk of the season with injury and will play the 2017 season at age 37. Hellickson, who will play the 2017 season at age 30, appears to be the better bet to stay on the field despite his lengthy injury history.

On the other hand, the 2017 free agent class has the potential to be talented and deep. Some players could negotiate contract extensions before the offseason, but right now the likes of Jake Arrieta, Yu Darvish, Johnny Cueto, Masahiro Tanaka, Michael Pineda, and Lance Lynn could all be free agents. Any one of those pitchers could be in line to make more than Hellickson even if he can repeat his solid 2016.

FanGraphs contract crowdsourcing and MLBTradeRumors predicted a contract in the range of 4 years, $60 million dollars. We’ll never know now, but if they were right, Hellickson just left a lot of money on the table. Despite those concerns, there is reason to believe that Hellickson could make more money in the long run by accepting the Qualifying Offer.

With only one above-average season in his career, teams were very likely to be wary of Hellickson’s continued success. If he can show that 2016 wasn’t a fluke he’s likely to get a contract significantly larger than 4/$60 million after the 2017 season, even with the stronger crop of free agents, while if he agreed to three- or four-year deal this offseason, it would likely be his last opportunity for a significant payday.

There’s also the chance that the Phillies trade Hellickson midseason. Due to the weak free agent crop, there will be some teams looking for rotation help around the trade deadline. If the Phillies are out of the playoff picture, Hellickson could be our best trade chip. If he were traded, he’d enter free agency in 2017 with no draft pick penalty. Without that penalty, he and his agent, the infamous Scott Boras, will be able to squeeze teams for more money.

For the Phillies, this represents something close to an optimal scenario. They get back their nominal staff ace with minimal risk due to the deal only lasting one year. If recent peak payrolls are any indication, the $17.2 million will not hamstring the club financially. It helps that the other four projected starters are all pre-arbitration.

Meanwhile, Hellickson will once again look to stabilize a rotation filled with young pitchers oozing with potential. He and Aaron Nola figure to lead a rotation that also features some combination of Vince Velasquez, Jerad Eickhoff, Jake Thompson, and Alec Asher. The rotation made a surprising leap from 29th in FIP in 2015 to 13th in 2016, and they will look to build on that success once again in 2017.

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9 comments

  1. Bob

    November 14, 2016 06:46 PM

    Happy to have him back. He will go along way in helping to stabilize the young rotation.

  2. Greg

    November 14, 2016 06:52 PM

    Seems like a pretty low-risk option for both parties…

    But will draft picks still be tied into free-agency in 2017? Is that still being negotiated? Would that have changed his chances of taking the QO if draft picks were taken out of the picture entirely?

    • Rob

      November 14, 2016 07:31 PM

      My guess is he and Boras have gambled on a favourable change to the CBA.

      • Snuka

        November 14, 2016 07:56 PM

        Per Boris interview, he said he asked around the league and teams were not that inclined to give up a pick to sign Hellboy.

    • Steve Smith

      November 14, 2016 08:15 PM

      I cant see the new CBA eliminating comp picks altogether. They are meant to be a consolation prize to small market teams who lose their home grown players to big market teams via free agency. Team’s have definately figured out how to work the system to their advantage, and i think the process will be tweaked, but i dont think it will be totally eliminated with the new cba

      • David

        November 14, 2016 10:59 PM

        Which would again make Hellickson a potential Q.O. candidate next fall if he can duplicate or even improve on his performance from this year in 2017 (that is if the Phillies F.O. isn’t able to move him at the trade deadline next season in return for a satisfactory package).

        Here’s hoping he has a great year no matter what. Welcome back Jeremy, great to have you aboard!

      • Romus

        November 15, 2016 09:58 AM

        Steve Smith…..I think you are mixing apples and nectarines.
        The approx. 15 small market teams have the opportunity to be placed in a lottery, where as 12 teams get selected to have a pick…..Round A (after the first round–six teams pick) and Round B (after the second round-six teams pick)…these are called Competitive Balance Picks. These may be eliminated under the new CBA.
        Now losing players under the QO provision of the old CBA is called Compensation Picks and both large and small market teams have this provision, ie Phillies and JHellisckson and if he refused and signed with another team…..this also could change somewhat, but still think teams will be compensated to some degree….be they large or small market team.

  3. David

    November 15, 2016 01:08 PM

    I read Steve’s comment as suggesting that the “compensation picks” (that teams receive for losing a free agent to whom they had extended a Qualifying Offer) are of greater proportionate marginal benefit to smaller market teams. At least in theory, since smaller market teams have a more limited pool of financial resources to draw upon in efforts to sign high dollar long-term contracts, their financial capacity to retain players eligible for free agency is lower than would be the case for larger market teams (on average, after adjusting for current and projected team performance and objectives in any given year). Given this scenario (again in theory), compensation picks would be more likely to go to smaller market teams to help make up for the fact that they can’t compete financially on equal footing with the larger market financial powerhouse teams (like the Phillies).

    In turn, small market teams are incented to build rosters with younger, home-grown controllable assets and value signings while retaining 2nd tier free agents (think Hellickson not Kershaw) on short-term deals through the Q.O. process – without having to lock up a high percentage of their relatively more scarce resources on long-term free agent contracts. The Q.O. designation makes these free agents less attractive to other teams and thereby increases the bargaining power of the team offering the Q.O.

    Because of their relative financial position, this shift in value toward thevteam extending the Q.O. (or, alternatively, the relative value that accrues from the compensation pick itself in cases where another team signs a player with a Q.O.) is of greater marginal value to the small market teams.

    If this is what Steve meant by his comment above, I would agree that his point makes sense and is probably correct – that the Q.O. and compensation pick rules are designed in a way that would be expected to offer greater value to smaller market teams (though I have not read any analysis indicating whether this has actually played out this way in the Q.O. era – with all S.S.S. caveats).

    • Steve

      November 16, 2016 05:15 PM

      Thank you, you said what i meant….. but much better 🙂

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