The New York Yankees, at one time, were known for making big splashes after big splashes in free agency every offseason.
In the era of the boss, George Steinbrenner, it seemed every year the team would produce a record-breaking contract. First, it was Reggie Jackson in 1976 for a five-year, $2.96 million contract. Only four years later would he surpass his own record by signing Dave Winfield to a 10-year, $23.3 million contract (which ended in disaster). In 2007, the boss set the precedent for outrageous contracts by signing Alex Rodriguez to a 10-year, $275 million contract.
When you also put in former free agents, including C.C. Sabathia and Jason Giambi, George never stopped short of getting who he wanted. With his son, Hal, at the helm now, things are much more fiscally conservative. It’s irking Yankee fans all over the world.
New York’s front office usually opts to stay under tight wraps about their budget and how much they want to spend in the next season. This year, however, there’s been far more talk about the team staying under a payroll threshold than in years prior.
Yankees play-by-play announcer and insider Michael Kay discussed on his show Dec. 4 about the real possibility that New York does have a payroll limit for General Manager Brian Cashman.
“There is a good chance, everybody, that the Yankees’ intent … is to, in fact, be under the $300 million threshold,” Kay said.
He continued by saying that the team’s projected payroll at the moment would be $279 million. It would essentially mean that New York would “not be getting” Cody Bellinger or Kyle Tucker. It could also mean prized pitching free agent Tatsuya Imai could also be out of consideration.
The next day, MLB insider Jon Heyman brushed off the idea, saying the team would not stay under the threshold.
At the moment, per Spotrac, the team’s projected payroll allocations would be $255 million after arbitration. The Yankees would have eight players making over $10 million, and five players making over $20 million in 2026 alone. That would make New York’s payroll the fourth-highest in the league.
Hal Steinbrenner alluded to a lower payroll for the team as “ideal,” according to ESPN, but said that it was likely not going to happen. The Yankees owner further added that the focus is to “field a team we know could win a championship.”
Kay, during his rant, said that the Yankees had few options to move around contracts to create payroll space. Aaron Judge, Gerrit Cole and Giancarlo Stanton are not going anywhere. Ryan McMahon isn’t appealing with his offensive problems, and Trent Grisham is making $22 million after one good year.
He did hint that Carlos Rodon could be the likeliest to move out of the biggest players on the team, but it would still require someone taking $27 million head-on. Essentially, the Yankees have very few pieces they could consider moving.
One would be second baseman Jazz Chisholm Jr., who is coming off a career year. This would be the likeliest option since the Yankees have options in Jose Caballero and even Jorbit Vivas to fill the void. It would also clear a path for top prospect George Lombard Jr. in a year or two.
New York could also ship away Camilo Doval from the bullpen for a prospect or two. This, however, is far less likely following closer Devin Williams signing with the New York Mets and Luke Weaver’s second-half collapse. The bullpen had serious issues throughout the year, hence why they brought in three relievers to right the ship.
Kay is, unfortunately, right in this case. The Yankees don’t have a lot of space to begin with, and no team would ever want to take on the massive contracts they have. Extending Grisham the qualifying offer for the 2026 season might have been a gigantic mistake for this team.
Even though media figures and sources suggest the team is going to try and do a cap, it’s unlikely that it will be heavily enforced. There are a lot of holes on this team, especially with their starting pitching for the first month of 2026. There’s also the question of what to do with the fledgling Anthony Volpe.
The Yankee way has always been throwing money at the problem and letting it work itself out. With the number of needs to address, Hal Steinbrenner might relent somewhat on his ambitions.
New York still needs outfielders, and Cody Bellinger is still available. At the moment, both camps are reportedly nowhere close to a new contract as teams make a push for him. They do have Spencer Jones waiting in the minor leagues, but there have also been questions about Jasson Dominguez’s ability to achieve at the major level.
There’s also the age question for their rotation, since Cole is going to hit 36 next year, while Rodon and Max Fried are now into their 30s. Imai would bring youth to their rotation, but his market might be inflated thanks to the Toronto Blue Jays signing Dylan Cease to a $210 million contract.
Still, expect the Yankees to sign at least one notable free agent during the course of the offseason. They might be able to hover just around the $300 million mark if that’s what Hal wants. The bottom line is that the team needs more to win their first World Series since 2009.
This is not the same Yankees team that ate up every single free agent, nor broke the bank repeatedly. This is a more fiscally conservative, measured team focused on just being good enough. Unfortunately, “good enough” hasn’t been able to get them over the hump and win. Never mind their 2024 World Series appearance, the city wants a title now.
Hal Steinbrenner, if he wants to keep up with the Blue Jays and emerging Boston Red Sox, must spend. Fans are restless and antsy, especially with the wave of lost players to free agency (especially Juan Soto). It’s time to get into the war room and fire up the tanks.
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