Washington Nationals Sign Gio Gonzalez To A Contract Extension Through 2016 Season.

Comack mentions that he was expected to make about $3.8 million in 2012.. he’ll clearly be paid well in five years :)

Extend’um

I wrote a full length article here where I examined a handful of players who had produced right around the range of Gio’s fWAR the past two years (6.7). Most of the players I used were actually in similar situations to Gio when they signed their long-term deal. That group included the following list of players:

Ricky Romero (6.9 WAR) signed a five year extension midway through his second MLB season (one non-arb season and one FA season). The deal will pay him $27.5 million and includes one option year at $13.1 million.

James Shields (6.9 WAR) is entering the first of his three option years on a deal that he signed after his second big league season. His contract is considered to be among the most club-friendly in all of baseball. Since the Rays would be idiots not to pick up all of his options, it looks like the total deal will come out to be seven years and $38 million. There are performance bonuses that could kick it to $44 million over that same span.

Jaime Garcia (6.7 WAR) signed an extension that’s probably a little more club-friendly than Gio late last season….. this would have been his first arbitration year. Garcia’s deal was for four years at $27 million with two option years that would kick it to $50.5 ($500,000 buyout for each option year) over six years. The deal was actually pretty comparable, if a slightly better value than what the Nats got (potential for $65 over seven years).

Matt Garza (6.6 WAR) is the only player on this list who hasn’t signed a long-term deal…. Also a Super Two, Garza got $3.35 in his first arby year, $5.95 in his second, and is expected to get around $9 million in Year 3….. Probably somewhere in the $12 million range for his fourth and final year assuming similar production. You figure that his total four year arbitration process yields him somewhere in the $30 million range, but the Cubs have no leverage as of this moment when he hits free agency.

Chad Billingsley, who I termed “the lesson” (6.6 WAR) The Dodgers waited until after his second time through arbitration to give Bills a long-term deal. When they signed him, they guaranteed him $35 million over three seasons with a $14 million option ($3 of the $35 million is the buyout on the option year). They’d be paying Billingsley $4 million more over the next four years than the Nats would be paying Gio over the next five.

Buehrle is a bad comp who I didn’t use in the article for the two main reasons that William posted below.

1) He’s a free agent, which means his salaries aren’t depressed by the arbitration rules.

2) He’ll turn 33 in March, which means he’s giving the Marlins what figure to be the early years of his decline. Gio is 26, which means he should be entering his peak seasons. Buehrle should be expected to decline. Gio should be expected to improve.

Teams wager on deals like this (as you can see with Romero, Garcia, and Shields) because it’s an opportunity for them to gain cost assurance for a longer term and do so while the player has less leverage. While there’s obvious risk on both ends, the player considers the risk of not taking a deal like this to be bigger because of how far away he is from his big payday. By taking a five year, $42 million deal, Gio ensures himself that even if the unthinkable happens (he flames out… he gets injured, as you mentioned) he’s set for life. Players tend to think about those things differently as they get closer to actually being able to hit free agency, though. Even one more season at the production level that Gio has shown the past two years in Oakland probably means that the Nats are paying an extra $10-$15 million to extend him through 2016-2018 as they did yesterday.

The “lesson” that I learned by looking at Billingsley’s salary is that the earlier a team got in and locked their guy up, the better a deal they got.