Diamondbacks to Lower Payroll in 2027: What it Really Means

The Arizona Diamondbacks' 2026 season ended unceremoniously in San Diego on Sunday, September 27, the last day of the regular season. Their 86-76 record, while an improvement over their 2025 record of 80-82, still fell one game game short behind the Philadelphia Phillies.

This was despite a team record payroll in 2026, the third year in a row the organization stretched payroll to franchise record levels, according to owner and General Managing Partner Ken Kendrick.

Kendrick was interviewed on Friday, October 2 by John Gambadoro and Tim Ring of Arizona Sports Radio 98.7.

Many topics were discussed, including manager Torey Lovullo's contract extension through 2028. During that interview Kendrick made some direct comments about the 2027 payroll situation.

Diamondbacks 2027 Payroll to be Lower than 2026

Diamondbacks GM Mike Hazen with owner Ken Kendrick and President and CEO Derrick Hall during spring training 2018 — Diamondbacks General Manager Mike Hazen (center) talks with Managing General Partner Ken Kendrick (left) and President and CEO Derrick Hall at spring training in 2018. Diamondbacks Spring Training | USA TODAY Network via Reuters Connect

When the topic of payroll came up, Kendrick's direct quote was succinct and to the point.

"It will not be at the same level. It'll be a lower payroll than we had this year," Kendrick said.

He did not specify how much lower, however, choosing instead to cite expiring contracts and the fact there are many young players in the system that can replace some of the (non-productive) veterans leaving via free agency.

"We have a lot of very outstanding young players that deserve a chance to play. They aren't as expensive as some of the veterans. And so I think we will end up spending less money," said Kendrick.

The Difference Between LRD and CBT Payroll Figures

In the course of reading about MLB team payrolls, you will encounter many different figures, and numbers. This is due to the fact MLB has different categories of payroll calculations. It's very important to understand the differences between them.

LRD payroll is the official number calculated by the MLB Player Relations Department showing the actual dollars paid out for the 40-man roster, including prorated signing bonuses.

The figure just released this past week for the Diamondbacks was 192.8 million. Remember this number.

During the course of the interview, Kendrick mentioned that the team had a payroll over $200 million in 2026. He is likely referring to the CBT Payroll, or Competitive Balance Tax Payroll. CBT Payroll uses the smoothed over "average annual" figure for players on multi year contracts with an adjustment for NPV, or Net Present Value for deferred money.

CBT payroll also includes player benefits, such as health insurance and money paid into player compensations pools set up to reward pre-arb players who finish high in Postseason awards voting. These line items typically add up to over $20 million.

The CBT number is the one used between teams the MLBPA when negotiating labor agreements.

The unofficial CBT number for the Diamondbacks in 2026 is estimated to be approximately $236 million. The tables and analysis that follow, however, is set up to closely mirror the likely LRD amount. That is because it's easier for fans to follow, based on the player salaries that are publicly disclosed.

D-backs 2027 LRD Payroll Snapshot

We'll start with the bottom line total first, and then show how we got there. The current commitment by the D-backs is estimated to be approximately $163 million. This is broken out into four categories, namely Guaranteed Contracts, Arbitration Eligible, Pre Arbitration contracts, and a budgeted amount for injury replacements.

This figure then represents about $30 million dollars less than the 2026 LRD figure of $193 million just released by MLB. Since Kendrick did not specify exactly how much lower the 2027 payroll would end up, we can only speculate.

But it's reasonable to look at these figures and make the assumption that General Manager Mike Hazen probably only has $20 million or so he can add to this snapshot. That would bring the LRD payroll to an estimated $183 million.

Of course, the cut could be more severe than that, or Kendrick may reconsider and add to his final figure at the last minute, as he has done in the past.

Guaranteed Contracts

There are nine players on guaranteed multi-year contracts. The figure showing for Corbin Burnes is the NPV, or net present value of his contract.

His base is $35 million, with $11M deferred. Deferred monies are paid within two years of the money being earned with a deadline of July 1 of the second year.

Arbitration Estimates

There are four players eligible for arbitration in 2027. The estimates for their arbitration awards are my own. Players are typically eligible for arbitration starting with their fourth year of service time, and have three years of arbitration rights prior to free agency.

There are exceptions known as "Super 2", but that does not apply to any of the four players listed above.

Sometimes if a team is looking to save money, or doesn't feel like a player will be worth the estimated arbitration amount, that player will be "non-tendered", meaning he's not offered a contract and becomes a free agent.

Depending on how tight the budget is, Pavin Smith could be a non-tender candidate, although the team leadership has indicated they were pleased with his turnaround in September.

Pre-Arb and Injury Replacement Players

Pre Arb and Injury Replacement Estimates | Jack Sommers

There are 13 players on guaranteed contracts or arbitration eligible. Of course an opening day roster must be filled out with 26 players. The lowest possible way those slots can be filled is with pre-arbitration players (those with less than three years service time) on a league minimum contract.

For the sake of simplicity the MLB League Minimum for 2027 is estimated to be $1 million for 2027

Players on the 40-man roster in the minor leagues are also paid above minor league minimum, and an estimate is included for them as well.

Finally, a budgeted amount for injury replacements is included. You won't typically see this line item on most public website's payroll tables, but in fact the Diamondbacks budget for injuries. When a player is placed on the MLB injured list he still receives his full MLB salary.

The minimum that player can be replaced for is the MLB league minimum for a player on the 40-man roster called up to MLB. The figures are prorated to days estimated to be lost due to injury.

What about Free Agents Coming off the Books?

Often, you will see analysis citing free agents on expiring contracts as "coming off the books." The total dollar amount is often cited as an indication of how much payroll space a team should have.

But as shown above, the correct way to look at the payroll is to simply add up the actual amounts committed to each player for the following season.

Summary

The above figures are all informed estimates. The most important figures to look at when tracking the D-backs offseason financials is the 2026 LRD figure of $193 million, and the current estimate for 2027 of $163 million.

In the past, Kendrick has changed his mind and spent above the initial budget. He did so when Jordan Montgomery was signed for $25 million at the end of spring training in 2024. He did so again in late December 2024 when Scott Boras contacted him regarding Corbin Burnes, resulting in a six-year, $210 million deal.

And then just as spring training 2026 was starting, Zac Gallen was signed to a $22 million contract that included deferrals.

Whether Kendrick has a similar change of heart once again remains to be seen.

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