How Much Luxury Tax Will Jim Crane Pay? A Small Shopping List; My Offseason Preview

The Astros have only a small number of needs --backup catcher, bullpen, and maybe a left handed hitting outfielder. How much will they go over the luxury tax to address them?

The end of the World Series has been bitter for Astros fans in five of the last seven seasons. The team has gotten close to the title each time, and to see it won by another team is a bitter pill to swallow. That taste is even worse in 2023, as the World Series title went to the Astros AL West and in-state rivals, the Texas Rangers. The only Astro fan who wanted this was Ted Cruz. Enough said.

What’s the best way to deal with seeing your biggest rival win the World Series? Work to take it back next season.

And the good news is that the Astros are in good position to do that in 2024. The first set of player and team projections for 2024 have been posted at Fangraphs, and their Depth Charts projection shows Astros players to be projected for 47.1 fWAR next season. That’s the second best of any team in the majors, and well ahead of the Mariners (37.4 fWAR) and Rangers (36.6 fWAR), who are 12th and 13th highest respectively.

These numbers will change over the offseason—there are 78.0 projected fWAR listed on the Depth Charts Free Agents page. But it is a reminder that in 2024, we can expect the Astros to again be a good team with lots of good players.

But, it should be noted that the Astros fWAR projection is not likely to go up that much over this offseason. The Astros have few holes in either their lineup or their rotation that they need to address. Their shopping list this offseason is quite modest—bullpen help, backup catcher, and maybe a left handed hitting outfielder.

Part of the reason for that is that the Astros trade deadline acquisitions—Justin Verlander and Kendall Graveman—are both under contract for 2024. The Astros did their shopping for 2024 with an eye to getting help in 2023. But that decision will continue to pay dividends in 2024.

How Much Luxury Tax is Jim Crane Willing To Pay

The Roster Resource section of Fangraphs currently estimates that the Astros “luxury tax payroll” is at $231 million before they make any offseason moves. That is already the highest nominal number in franchise history. It is also only $6 million below the first “Competitive Balance Tax Threshold”—that’s a baseball PR word for luxury tax. Basically, if the Astros add any player of substance this offseason, they will go over the $237 million threshold and pay some tax.

The Astros have gone over the CBT threshold only once in their history—in 2020, when their their payroll was $224 million, well over the then $210M threshold. But Jim Crane did not have to pay any tax because MLB suspended the tax system in 2020 because of the COVID-19 pandemic.

It is important to note that because it shows that Crane is willing to pay the tax in particular circumstances. As noted above, Crane added to the team’s 2024 at the 2023 trade deadline when he acquired Verlander ($17.0M) and Graveman ($8.0M). These moves indicate that Crane is willing to pay the tax in 2024.¹

The question remains how much. Crane undoubtedly likes to pay “soak the rich” taxes as much as the next rich guy, but there is no logic to go over the tax just a little. If you’re going to pay taxes, it makes sense to run up the payroll a good bit over the $237M threshold, and closer to the next threshold at $257M.

Of course, it is easy for us to say that. That’s not money cutting into our profits. But it is worth noting the only thing that luxury taxes do is cut into the owner’s profits. The choice to pay the tax is entirely up to the owner. And Crane has already made the choice to pay some taxes in 2024.

The big question is how much. And that will play a big role in the talent level and number of free agents the Astros sign this offseason.

The Astros Needs

The Astros enter the 2023-24 offseason with few needs. We can put them into three clear buckets—relief pitcher, backup catcher, and left handed hitting outfielder, maybe.

The Astros return their entire starting infield, an exciting rookie catcher, the five outfielders who played the most innings in 2023, and every pitcher who started a game last season. They will likely return Lance McCullers and Luis Garcia to the starting rotation at some point in the 2024 season.

In short, their shopping list is quite small this offseason and we should not expect too much action. And that is fine, as 1) the team is quite good already (see the Depth Chart number above) and 2) the team has only a few needs

The Astros acquired Justin Verlander (L) and Kendall Graveman (R) to help them in their playoff push in 2023, but they are both under contract for 2024. Acquiring both at the deadline reduces the team’s shopping list for this offseason.

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Trade Possibilities

A team with lots of good players and some payroll limitations may consider trading from its surplus to address needs to to trim payroll. I bring this up because such trades are possible, but I think they are unlikely.

First of all, the Astros have few places where they truly have excess that they might consider dealing to address a different need. One place where you might say they have excess is in the rotation, where they have seven pitchers who started 10 games in 2023 returning as well as the expected returns of McCullers and Garcia. So I could imagine a trade of Jose Urquidy for a left-handed hitting outfielder to work in with Chas McCormick and Jake Meyers. I don’t think that is likely—you can never have too much starting pitching and such a trade relies on McCullers and Garcia returning to good form.

I could also see the team trade Jake Meyers, who a productive year with his excellent defense. But the team seemed to sour on him over time, playing him less and keeping him off of the ALCS roster. One could imagine him going in a deal for relief pitching help or a long-man.

The other reason to make a trade would be to duck paying the luxury tax. I also do not think that will happen. I have been quite critical of owner Jim Crane on this Substack over the last year, and especially in my last article. But let me say something positive about his ownership of the Astros. He has been willing to increase payroll over his tenure as owner.

This stands in sharp contrast to Crane’s predecessors as owner, who were always more bottom line conscious. This was especially true in the 1990s under the ownership of Drayton McClane, when the Astros made a series of moves to trade away star players before free agency to keep the payroll down (c.f. Ken Caminiti, Steve Finley, Mike Hampton, Carl Everett, Billy Wagner). We have never seen this type of trade under Crane’s ownership, and there is no reason to expect one this offseason.

Free Agent Targets

The Astros have two clear areas where we can expect them to sign a free agent this offseason—relief pitcher and backup catcher.

Backup Catcher

The backup catcher position is of course, not every exciting. In an interview Thursday with Ari Alexander of KPRC, General Manager Dana Brown says he expects Yainer Diaz to be “the main guy next year” behind the dish. He certainly earned that promotion with his bat in 2023.

One possible backup catcher is Martin Maldonado, who is now a free agent. If I were Maldonado, I’d hold out as long as possible for an offer from the Astros. His performance in 2023 was worthy of being a backup, and at age 37, it’s hard to believe he’ll be better next year. Maldonado should want the Astros because he knows the team’s pitchers want him to be behind the plate for them. He’s likely to get more playing time in Houston than anywhere else. But it seems better to give the Astros—and especially their new manager—a clean break from Maldonado and take the security blanket away from a set of veteran pitchers who should not need one.

One weakness of Diaz’s is in framing pitches. He was worth -5 framing runs in 2023, which was 9th worst in baseball. One free agent with good framing skills (6 framing runs) and an acceptable bat for a catcher (95 OPS+ in 2023; career OPS+) is Victor Caratini. Those skills may get him an offer as a starter though.

They also could punt on a top backup and sign a catcher to a minor league deal and let him compete with Cesar Salazar for the backup job in Spring Training. Austin Hedges—who has excellent framing numbers—would be a candidate for this type of contract.

Relief Pitcher

The Astros have three members of the 2023 bullpen who are free agents this offseason—Hector Neris, Phil Maton, and Ryne Stanek. They retain Ryan Pressly and Bryan Abreu as the top two men in the bullpen, and Graveman and Rafael Montero would set the those two up. Right now, the bullpen would have guys like Seth Martinez, Ronel Blanco, Bennet Sousa, and whatever starter does not make the rotation fill out the final spots. One can see why they may want to add another reliever (or possibly) two now.

This is where the question of how much Jim Crane wants to spend really matters. Does he just want to get a left hander to fill out the bullpen. If so, they could sign someone like Wandy Peralta or Matt Moore to a modest contract. Do they want another late inning option like they had with Neris? Then they could bet on the come on Robert Stephenson (improved by a stint with the Rays) or Chad Green (recovered from injury to be in the Blue Jays playoff bullpen) and sign a reliever to a multi-year contract.

There are obviously lots of options for bullpen arms, though of course, just about every team could use another bullpen arm, so there is a good bit of competition for them. They’ll sign at least one.

Left-handed hitting outfielder

The Astros have one other potential need, though it is unclear if they will actually address it. That need is for a left-handed hitting outfielder to work in with righties Jake Meyers and Mauricio Dubon. But in his interview with Alexander yesterday, Brown did not mention an outfielder in his list of team needs.

The Astros can certainly make an outfield of Meyers, Dubon, and Chas McCormick—in addition to Kyle Tucker in right field-work. They did so in 2023. But a left handed hitter can add to that mix.

One option—discussed by David Coleman on his Astros Things Substack on Friday—is signing Cody Bellinger. Bellinger had a bounce back 2023 season—producing 4.4 bWAR in Chicago with a combination of a good bat and excellent defense at two positons—center field and first base. As such, he is expected to be one of the offseason’s top free agents.

The Astros under Jim Crane—under all three of his general managers—have never signed a free agent to a massive contract. So doing so for Bellinger would be a significant departure from their well-established pattern. I do not expect them to do so.

They could consider a more modest free agent signing—Kevin Kiermeier is an excellent defensive center fielder when healthy—or Joc Pedersen or Eddie Rosario could provide left handed power, and their defensive liabilities would be limited by Minute Maid Park’s short left field.

The decision to sign a lefty swinging outfield gets back to the earlier point—how much money does Jim Crane want to spend in luxury tax. If he’s willing to spend a lot, then they could sign an outfielder. If their budget is limited, they’ll get by with what they have, and may wait for the trade deadline to get an outfielder.

An Uneventful Offseason

Because of the modest shopping list, it is unlikely that Astros have a very exciting offseason. They have shown a repeated pattern of eschewing top free agents in the offseason, and there is little reason to expect them to change this offseason.

One reason for that is that they do not have to rely on outside options. They have a strong team in 2024 due to their internal options—Depth Charts projects them to have six players at an All Star level in 2024 and strong internal options at another of other spots on the roster.

They addressed the 2024 pitching staff in both the starting rotation and bullpen at the 2023 trade deadline when they acquired Verlander and Graveman. There are bigger decisions to come down the road on the long-term shape of the franchise. But in the short term, Jim Crane has made a decision to focus on winning in 2024. His team is set up again to do it.

They will make a handful of small additions this offseason, but one should not expect more than that.

1. I covered in my most recent article why the choice to bring in Verlander and Graveman are on Crane’s ledger, not GM Dana Brown’s. It is clear that Crane is making the most important decisions in baseball operations.