Casilla Costly?

[sharksrog]

Intriguing re-signing of Santiago Casilla by the Giants. Casilla was projected at $5.4 million in his last year of arbitration. That would indicate a clearly higher price in free agency. He would have been eligible a year from now.

Instead, the Giants locked up Casilla with a guaranteed 3/$15, which I'm guessing grows to 4/$20 if the Giants execute their option for a fourth year.

My sense is that if the Giants went to arbitration with Santiago and he became a free agent a year from now, he could earn $12-$15 million the next two seasons. So the Giants appear to have swung a nice deal.

But Casilla is already 32, which means he will be 35 or 36 before the deal is done.

For Casilla, this represents a very nice contract for a guy who three years ago came to the Giants on what I believe was a minor league contract.

Santiago has posted ERA's of 1.95, 1.74 and 2.84 in his three Giants seasons. That likely places him among the top 10% to 20% among all pitchers. Although he ultimately stumbled as the Giants' closer, he still saved 25 games in 31 opportunities.

If Casilla stays healthy and productive for three or four years, the Giants got a good deal. This contract illustrates a willingness on the Giants' part to stretch out a contract for even an older pitcher.

This contract will to some degree set a model for Sergio Romo's contract a year from now. Romo has posted ERA's of 2.12, 3.97, 2.18, 1.50 and 1.79 with the Giants and finished the season as their closer.

His career 2.20 ERA is outstanding. It is virtually identical to the 2.21 of Mariano, the best reliever in history. To top things off, a year from now, Romo will be two years younger than Casilla is now.

Perhaps the Giants re-signed Casilla as protection in case they are unable to lock up Romo (although I think they will do so). Based on Casilla's deal, Romo could command something in the range of 4/$33 with an option that would make it 5/$42. He might also get even more. (Brian Wilson made $8.5 million this past season.)

Of course, if he has a down season and/or becomes injured, he would likely receive quite a bit less. Or he might become a free agent and wind up earning as much as $65 million over those five years.

Maybe the Giants will even wrap him up now, perhaps for something akin to 4/$28 with an option to make it 5/$37.

These are the types of decisions that can make or break a GM. The even bigger one the Giants face this off-season is Buster Posey. The longer they put it off, the more it is likely to cost them.

[rxmeister]

I'm not sure Casilla's contract is the model for Romo, since Romo clearly emerged as the closer last year. If this continues, he'll be looking at the 10 million per year and up closer market when he becomes a free agent, as Brian Wilson clearly would have been looking for if he had stayed healthy. I think the Casilla contract was an overpay, but it's an overpay with an asterisk. It's too much money for a setup man that's not elite, but down the line it could become a bargain if somehow he becomes the closer again, due to injury or Romo leaving or losing effectiveness. In that context, the contract is a necessary evil. However, I'm guessing the Giants see the closing situation for the near future as Romo, being eventually replaced by Heath Hembree if he becomes too expensive.

[sharksrog]

Mark -- I'm not sure Casilla's contract is the model for Romo, since Romo clearly emerged as the closer last year.

Rog -- I should have made my comment more clear. What impressed me about Casilla's contract was its length. I believe it is the longest contract given to a Giants reliever, although On March 25, 2010, Brian Wilson signed a two-year extension to the one-year arbitration compromise of $4.4 million that he had signed that winter. Casilla received three years with a one-year option.

A year from now, Romo be two years younger than Casilla is now. It would seem to me that could lead to a four-year contract with a one-year option, or one year longer than Casilla's recent contract.

You are right that Romo could be looking at a free agent contract of $10 million or more per season. If he were to prove himself as a closer over the next two seasons, he could well qualify for the biggest closer contract ever.

That is why I suggested the Giants lock him up a year from now, or perhaps even this season. The numbers I gave were high, but they weren't nearly as high as Romo might get in free agency.

I can't remember the salary Romo is expected to get in free agency, but IIRC it's less than $4 million. (He made just $1.575 million last season. Clearly closers are the relievers who make the huge bucks. At the same time in his career, Wilson made the $4.4 million, and he wasn't as good as Romo was -- Brian simply was known as a proven closer, while Romo was known as "only" arguably the best set up man in the game.)

If Sergio proves himself as a closer this season, his salary in his final year of arbitration (2014) should be close to the $8.5 million Wilson was paid this past season. Wilson had the advantage of being a Super Two (similar to Tim Lincecum and Buster Posey), which meant he was eligible for arbitration four different times.

If the Giants were to wrap up Romo a year from now for $4/33 with a $1 buyout and $10 million option for a 5th year as I suggested, that would make a very nice deal both ways. That would buy out Sergio's final arbitration year and three years of free agency, with an option for his fourth free agent season.

Sergio would be 35 at that point, so a long-term contract with the Giants in the next year or so would probably be the biggest payday of his career.

Mark -- If this continues, he'll be looking at the 10 million per year and up closer market when he becomes a free agent, as Brian Wilson clearly would have been looking for if he had stayed healthy.

Mark -- I think the Casilla contract was an overpay, but it's an overpay with an asterisk. It's too much money for a setup man that's not elite, but down the line it could become a bargain if somehow he becomes the closer again, due to injury or Romo leaving or losing effectiveness. In that context, the contract is a necessary evil.

Rog -- Casilla was being treated in arbitration similar to Romo -- except that he was one year closer to free agency than Sergio is. And while we would rank Sergio ahead of Santiago (as the Giants ultimately did in making Sergio their closer), their Giants ERA's are almost identical. Sergio's is 2.20 ; Santiago's is 2.21. And while Sergio has been with the Giants two more seasons than Santiago, he has pitched only 57 more innings for them.

Here is what I think the deal was with Casilla. He was expected to make $5.4 million in arbitration this season. He would then have been eligible for free agency a year from now, and some team would likely have given him a big contact (say 3/$25) and made him their closer.

Assuming the Giants would indeed have had to pay Casilla $5.4 million in arbitration this season, for an extra $9.6 million, they got two more years of his services, with an option for a third year (at what I'm guessing is a reasonable price, although I don't believe it has been announced).

Mark -- However, I'm guessing the Giants see the closing situation for the near future as Romo, being eventually replaced by Heath Hembree if he becomes too expensive.

Rog -- If the Giants lock up Romo as they did with Casilla, they are in a nice position to trade one of that duo or Hembree himself.

Or, if they continue to use some modification of a closer-by-committee approach, all three could be quite valuable.

As it is, there may be an expectation that Casilla will serve as a secondary closer so that the Giants can avoid over-using Romo's arm.

See what you think of this definition of the Giants:

Built on pitching, speed, defense and improved hitting. Any question marks about the rotation should be offset by a bullpen that will win a very high percentage of games in which it is given a lead in the seventh or even sixth inning.

Here is an unbiased article that likes the Casilla re-signing. It addresses any questions about Santiago's aging over the course of the contract:

www.mlbinjurynews.com/2012/12/santiago-casillas-extension-makes-the-giants-the-team-to-beat.html

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