Jed Hoyer acknowledged in a radio interview last week that the Chicago Cubs are projected to be over the luxury tax threshold at the end of this season, but there are no indications the team is planning to get below that threshold by placing high-paid players on waivers or that next season’s spending will be affected.
Still, there are no signs that the Cubs will shift gears from recent offseasons and start spending aggressively at the top of the market, which would likely rule out a move for Juan Soto, the crown jewel of their upcoming free-agent class, according to multiple conversations with people briefed on the team’s discussions.
In February, The Athletic reported that with the signing of Cody Bellinger, the Cubs understood that their luxury tax was essentially over when factoring in typical in-season player turnover. In separate radio interviews, both Hoyer and general manager Carter Hawkins acknowledged that, with Hawkins giving several examples of player turnover, including long-term injuries that would force a player to be called up.
The addition of Isaac Parades solidified the idea that the front office wasn’t concerned about the luxury tax limit when making moves at the deadline, and the move did bring a salary boost, as Parades’ salary is about $2.6 million more than Christopher Morrell’s.
Calculating a team’s payroll precisely for luxury tax purposes can be complicated, especially because even the most mundane turnovers can have an impact. When a player goes on the 60-day disabled list (the Cubs currently have six), the tax amount accumulates, as do any players who are subsequently added to the 40-man roster and promoted to the major leagues. The tax also covers benefits that teams provide to players, which can range from private jet time to hotel suites on road trips. With so many variables, front offices often base their calculations on projections rather than exact numbers, according to people familiar with the matter.
After signing Bellinger, the Cubs expected to end up with a luxury tax payroll close to their current amount, which is the budget owners gave them at the start of the offseason. That budget wouldn’t get them far above the initial threshold, but it would still allow them to get under the tax threshold. That would require cutting high-paid players and taking that money off the books, which sources said is not on the table at this time.
Such a move could be possible if the Cubs were completely out of contention for a championship and waved the white flag, but it would likely have to be explicitly mandated by ownership, but even then, there are no signs that it would have a significant impact on offseason spending, and payrolls aren’t expected to change dramatically on either side.
The CBA should give the Cubs some leeway, as the first tier of the luxury tax limit is set to increase from $237 million to $241 million next season.
The biggest impact of exceeding the threshold would be if the Cubs were to sign a free agent who received a qualifying offer from his former team in the winter. In that case, the Cubs would lose the top two and fifth draft picks and the $1 million overseas transfer fee, but for now it is not expected to affect the team’s strategy.
Chairman Tom Ricketts has previously suggested it would make sense to reset the luxury tax every few years if the Cubs were over the luxury tax threshold, but that might not be an issue next season since there’s still a chance the Cubs could end up under the threshold or set a budget that’s below the threshold next season.
Either way, the Cubs are out at least $50 million in signing bonuses this winter, and that figure could nearly double if Bellinger opts out of his contract and relief pitcher Hector Neris misses the 14 games needed to pick up a player option in his contract, meaning the Cubs could lose nearly $90 million from his signing bonus.
While fans may want the Cubs to spend that amount or more, such spending may not be in the Cubs’ plans this winter. The priority remains strengthening the offense, which means strengthening the catcher. Strengthening the relief corps remains on the to-do list, but the Cubs’ strategy is not likely to change significantly from the past. Spending big money on the best free agent relief pitchers is not part of the front office’s strategy. The Cubs will look for value on the market to add starting pitchers.
Those hoping Soto would be part of the Cubs’ offseason plans will likely be disappointed.
The current front office has never shown a willingness to offer the massive contract necessary to lure a 25-year-old superstar who is consistently playing at an MVP level.
The same goes for Corbin Barnes. Like Soto, the soon-to-be 30-year-old Barnes is a Scott Boras client and is likely seeking one of the richest contracts a pitcher has ever received and is unlikely to fit into Hoyer and Co.’s plans. Unless he finds the market he wants in both years and average salary, it’s unlikely Barnes will join the Cubs.
Regardless of the direction the Cubs take this offseason, one thing is clear: the pressure is on to build a playoff contender in 2025.
Fans are tired of talk of building on solid seasons and fundamental metrics that suggest better times are to come. How the front office ultimately achieves those good times may not be what fans envision, but they recognize that time is running out. Ultimately, the front-office mantra that Theo Epstein preached and Hoyer has repeated rings true: They just have to be right.
(Top photo of Cubs team president Jed Hoyer by Michael Reeves/Getty Images)