Why J.T. Realmuto’s Contract Extension With the Phillies Might Take Some Time

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SCOTTSDALE, Arizona - The Phillies went into this offseason prioritizing a contract extension for All-Star catcher J.T. Realmuto.

Even as the Phils pursue pitching and possibly a third baseman, they are quietly trying to hammer out that extension, according to multiples sources. 

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But the extension might not come before the New Year. It might not even come before the opening of spring training.

Don't panic. Realmuto solidified his status as the top catcher in baseball by winning the Gold Glove and Silver Slugger awards in 2019. The Phillies very much want to prevent him from becoming a free agent after next season and Realmuto, for months, has professed his affection for the Phillies and Philadelphia as well as his desire to stick around.

"Everything I've experienced in Philadelphia has been awesome so I wouldn't be opposed to spending the rest of my career there," he said in July. 

In order to preserve some payroll flexibility for the 2020 season, it is possible that the Phillies could sign Realmuto to a one-year contract this winter - he projects to make about $10.5 million in his final arbitration year - then subsequently finalize a separate multi-year extension that would kick in at the start of the 2021 season. The extension could be finalized and announced later this offseason or even in spring training.

Realmuto, who turns 29 in March, is projected to get an extension of four or five years with an average annual value of $20 million or more. By starting the extension in 2021, the AAV of Realmuto's deal would not count toward the 2020 payroll and thus affect luxury-tax calculations. For tax purposes, the Phillies currently have about $116 million committed to nine players for 2020. Even with Realmuto's 2020 salary still to be determined and raises due to a number of other players, the Phils do not appear to be in jeopardy of reaching the $208 million tax threshold in 2020 and have the room to pursue top free agents. But pushing Realmuto's extension back to 2021 would allow for even more room under the tax threshold and that could come in handy this winter or even at the July trade deadline.

After the 2020 season, the Phils will gain some payroll flexibility as Jake Arrieta's $25 million AAV and David Robertson's $11.5 million AAV come off the books just as Realmuto's extension would kick in.

The Phillies have never exceeded the tax threshold. Teams exceeding it for the first time pay 20 percent on every dollar they go over. Last month, owner John Middleton offered his thoughts about exceeding the tax threshold.

"I'm not going to go over the luxury tax so we have a better chance to be the second wild-card team," Middleton said. "That's not going to happen. I think you go over the luxury tax when you're fighting for the World Series. If you have to sign Cliff Lee and that puts you over the tax, you do it. If you have to trade for Roy Halladay and sign him to an extension and that puts you over the tax, you do it. But you don't do it for a little gain."

Other than expressing a desire to extend the relationship, Phillies general manager Matt Klentak has steadfastly declined comment on the status of talks with Realmuto on a possible extension. Klentak continued that tack at this week's GM meetings.

"We love J.T.," Klentak said. "Every week, it seems like he's winning a new award. What all of that is doing is confirming what a lot of us have felt for a long time. This guy is the real deal. He can do everything. At some point in this offseason, we will likely talk to him about trying to keep him in the fold beyond his control years and hopefully we'll line up on something."

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