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The Yankees announced Tuesday that they are not going to offer arbitration to any of the potential free agents they have, meaning the players are free to sign with any club they want to and that club does not have to worry about giving the Yankees draft picks in return.

For the Yankees, it means that they can set and offer the contract prices they want to for those players and don’t have to rely on what an arbitrator might decide on.  It appears the Yankees feel that this off-season’s free agent market will be the same as last year’s.

Last year, the free agent market did not pay well outside of high-caliber players such as CC Sabathia, Mark Teixeira, AJ Burnett, Derek Lowe and a few others.  Instead, consistently good players were forced to sign for much lower than in previous years.  For example, Bobby Abreu had to sign with the LA Angels for $5 Million, after a 3 year contract with the Phillies and Yankees that saw him earn $16 Million in his final year of his previous contract.

The Yankees have one Type-A free agent in Johnny Damon.  Had the Yankees offered him arbitration and he signed with another team, they would have received a first or second round draft pick as compensation – but they also would hypothetically have to pay him higher then they might be planning to.

Xavier Nady, Jerry Hairston Jr, Erik Hinske, Andy Pettitte, Jose Molina and Hideki Matsui are all Type-B free agents, meaning the Yankees would have received supplemental round picks for each.

I do think the Yankees have made a smart decision here.  Nostalgia and team pride makes you want the Yankee Brass to keep everyone together, but we all know this is a business and all 7 of those free agents are replaceable.  If it was Derek Jeter in this situation, I’d go nuts about it.  However, when the dust settles, I would like to see at least Matsui and Damon still on the team, at least for the next 1-2 seasons.  I’d offer them both a 1 year contract with a team option for a second year that could become guaranteed based on plate appearances or some other performance measure.

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Running for ten days until January 15, baseball’s arbitration filing period begins. The biggest name in this year’s group is Ryan Howard, who set a record last year with a $10 million arbitration contract. With 48 homers and 146 RBIs last season plus winning the World Series, baseball insiders feel Howard could get close to $15 million, setting another arbitration record.

According to MLB.com, the process of arbitration is:

… the player presents the higher figure and the club the lower figure. A panel of three arbitrators must choose between the two after arguments are presented by both sides at yet-to-be-scheduled hearings from Feb. 1-21. Those players who elect to possibly go to a hearing must swap figures with their clubs on Jan. 21.

Since 1974, only 12 percent of the filings have gone to a full hearing, including eight last year, six of them won by the clubs.

In 2008, of the 110 players who filed, only 48 actually exchanged figures with their respective clubs, and 40 of those were settled without a hearing.

Last year, Chien-Ming Wang went to arbitration against the Yankees, asking for $4.6 million. He lost, earning $4 million instead. This year he signed without a hearing for $5 million.

The Yankees also need to make offers to Melky Cabrera (around $750,000), Xavier Nady (around $6 million) and Brian Bruney ($1.1 million).

The Yankees declined to offer arbitration to all eight players who were eligible; Andy Pettitte, Bobby Abreu, Jason Giambi, Pudge Rodriguez, Sidney Ponson, Carl Pavano, Chad Moeller and Mike Mussina.  Mussina announced his retirement two weeks ago.

In a pre-recorded statement, Brian Cashman did not rule out re-signing Pettite or Abreu.  “The determination that we made today was to make sure we control what amount we’d be spending,” Cashman said Monday. “We did not want to put ourselves in a position of having that determined by a third party without knowing what that figure would be.”

CC Sabathia, Derek Lowe and AJ Burnett were all offered arbitration by their respective teams.

Other notables around the league:

Offered Arbitration: Mark Teixeira and Francisco Rodriguez (LA Angels), Manny Ramirez and Derek Lowe (LA Dodgers), AJ Burnett (Toronto), Oliver Perez (NY Mets), Raul Ibanez (Seattle), CC Sabathia and Ben Sheets (Milwaukee)

Not Offered Arbitration: Greg Maddux and Jeff Kent (LA Dodgers), Pedro Martinez and Moises Alou (NY Mets), Frank Thomas (Oakland)

From Jon Heyman at si.com:

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The Yankees have decided to offer star outfielder Bobby Abreu arbitration, people familiar with their thinking tell SI.com. However, it remains more likely that he will sign elsewhere as a free agent.

The Yankees are in fact very likely making the offer with the anticipation he will sign with another team, and should that occur they will net two draft choices as Abreu is a Type A free agent. Abreu would stand to make about $16 million in arbitration after making that much last year after the Yankees picked up a one-year option to retain him and he hit .296 with 20 home runs, 100 RBIs and 100 runs. That marked the eighth time Abreu scored at least 100 runs and seventh time he drove in at least 100.
Abreu is said to be seeking a three-year deal. The Cubs and Mets are seen as among the most likely suitors for Abreu.
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Sounds like a sensible move to me.  At this point, it appears the Yanks do not seem to be interested in Abreu.  At least this way, they will get some draft choices out of it..

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