This is the most important offseason for the New York Yankees in quite some time, possibly since the offseason preceding the opening of their current ballpark in 2009. The Yankees missed the postseason in 2008 and wanted to open their new park with a championship team, so they committed over $400 million to free agents CC Sabathia, A.J. Burnett, and Mark Teixeira. A few months later, those three were leading the 2009 World Series parade down the Canyon of Heroes.

This offseason is unlikely to be as splashy as that offseason, though it is just as important. The Yankees suffered another early (and heartbreaking) postseason exit in 2020, and the clock is ticking on their current core. Aaron Judge and Gary Sanchez are two years away from free agency and core veterans like Zack Britton, Aroldis Chapman, Gerrit Cole, and Giancarlo Stanton are all on the wrong side of 30. How many elite years do they have left? This core may not be the core much longer.

"Our objective was to win a world championship. We failed in that endeavor," owner Hal Steinbrenner told Michael Kay on ESPN New York 98.7 FM last month (via's Bryan Hoch). "Does that mean the entire season was a failure? No. I don't think winning 10 in a row was a failure, and last year, I don't think winning (103) games was a failure. I know people disagree with me on that, but I look at the season as a whole."  

That's a far cry from the "World Series or bust" mantra preached by George Steinbrenner, Hal's father, throughout his rein as owner. The Yankees have been an excellent regular season team the last four years, winning more games (327) than every team except the Dodgers (345) and Astros (340), but those four seasons have resulted in two ALDS losses (2018 and 2020) and two ALCS losses (2017 and 2019). That's not good enough for this franchise.

The Yankees are facing several big questions this offseason and they've yet to answer any of them, though that's not meant to be a knock or to say they've been complacent. The offseason is still young and there has been very little activity around the league in general. Eventually the Yankees will get around to answering those questions and addressing their roster needs. Right now, three needs stand out the most, and their ability to address them will be impacted by payroll.

How much do they have to spend anyway?

Every team lost money during the pandemic-shortened 2020 season and it stands to reason they'll lose more money next year, because full ballparks and a 162-game schedule are far from guaranteed at this point. There has been promising vaccine news these last few weeks and that's great. That said, there is a long way to go between where we are now and full ballparks with MLB back up and running at full speed ahead.

"We sustained significant losses this year, more so than any other team in baseball," Steinbrenner told Kay (via Hoch). "It's just been a crazy year. We're just going to have to see what we really feel we need and what that's going to cost. We'll go from there, the way we do that every year."

Steinbrenner says the Yankees lost "more so than any other team in baseball" and I can buy that. Chances are they also made more than any other team in baseball as well, because their revenue streams are massive. Taking away, say, 40 percent of New York's revenue is much different than taking away 40 percent of Pittsburgh's or Cleveland's or Tampa Bay's. At the end of the day, the Yankees are still the sport's most recognizable brand and a money-printing machine.

The Yankees had several significant contracts come off the books after the season, including Masahiro Tanaka ($22.1 million per year), Jacoby Ellsbury ($21.9 million per year), J.A. Happ ($17 million), James Paxton ($12.5 million), and DJ LeMahieu ($12 million). The Yankees did not pay Ellsbury this year because they allege he received medical treatment without their consent, but he did still count against their luxury tax payroll. Now that his contract is expired, he's completely off the books.

The luxury tax threshold will be $210 million next year. Here is what the Yankees currently have on the books:

Luxury tax payroll

Guaranteed contracts (8 players)

$118.0 million

Arbitration-eligibles (11 players) (via MLB Trade Rumors)

$31.7 million

Pre-arbitration players to fill out 26-man roster (8 players*)

$5 million (estimated)

Rest of 40-man roster 

$2 million (estimated)

Player benefits

$15.5 million

Total$172.2 million

* The Yankees have 19 players who are either arbitration-eligible or have guaranteed contracts, but they need eight pre-arbitration players to fill out the 26-man roster rather than seven because Luis Severino is rehabbing from Tommy John surgery and is not expected to return until midseason. He has a guaranteed contract but won't be on the Opening Day active roster.

First things first: Yes, team contributions to the player benefits package count against the luxury tax payroll. That is true for every team, so the luxury tax threshold is effectively $194.5 million in 2021, not $210 million. The Yankees are about $38 million under the luxury tax threshold at the moment, which is a good chunk of change assuming the luxury tax threshold is their payroll target. It could be lower than that, it could be higher. We don't know for sure.

We know the Yankees are willing to spend at least $18.9 million this offseason because they did make LeMahieu the qualifying offer, which he rejected. That wasn't surprising, but if you're going to make a free agent the qualifying offer, you have to be prepared for him to accept. The Yankees were very willing to add another $18.9 million on top of what they already have on the books next year. Relative to the luxury tax threshold, New York has financial breathing room.

New York opened 2020 with a $265 million payroll for luxury tax purposes, the highest in the sport, and a payroll that high always felt like a one-year thing. They had been in the $220 million to $240 million range every year from 2012-19 with the exception of 2018, when they dipped down to $193 million to reset their luxury tax rate. Payroll was always likely to come down this winter and the pandemic figures to only make the cuts more drastic.

Now, onto those three needs.

1. Alternatives to LeMahieu

We here at CBS Sports don't agree on much, but we do agree that LeMahieu returning to the Yankees is the most likely outcome, probably sooner rather than later too. Both sides have interest in a reunion and it's a natural fit. LeMahieu fills the second-base void and gives New York a high contact hitter to balance out their strikeout prone-sluggers, and the Yankees give LeMahieu a chance to win a World Series and lots of money. Lots and lots of money. As much as any other team possibly could.

"I think I wouldn't be doing my job if I didn't recognize what a contribution he made to the club and how good of a player he is," Steinbrenner told Kay (via Hoch) when asked about the importance or retaining LeMahieu. "So I recognize both those things. I'll leave it at that."  

Reportedly, the Yankees are not planning any major offseason moves until they know whether LeMahieu will return, which may seem inevitable but is not guaranteed. Should he sign elsewhere, the Yankees will have to scramble to replace him at second base. Here are their three possible avenues to replace LeMahieu:

  1. Bring in a different second baseman. (Duh.)
  2. Bring in a shortstop and move Gleyber Torres back to second base.
  3. Stick with internal options (i.e. Tyler Wade and Thairo Estrada).

The Yankees could do something creative like move Gio Urshela to second base and reinstall 2018 AL Rookie of Year runner-up Miguel Andujar at third base, though that seems unlikely. While Wade and Estrada have some ability, a team that fancies itself a World Series contender can -- and should -- do better than two players who ZiPS projects to 0.9 WAR combined at a crucial up-the-middle position in 2021.

The ideal LeMahieu replacement is Francisco Lindor, the top name on the trade market. Like LeMahieu, Lindor is an elite player who provides low-strikeout offense and splendid defense on the middle infield, except he's a switch-hitter and five years younger. The downside is the Yankees have to give up players to trade for Lindor rather than simply spend money. Last winter's Mookie Betts trade is indication it may not take as much to get Lindor as you may suspect, but you still have to give up something.

The free-agent market behind LeMahieu offers a variety of options. If the Yankees want to go heavy on defense, there's Andrelton Simmons. Heavy on offense? There's Tommy La Stella. Cesar Hernandez and Kolten Wong offer offense and defense and lefty bats to complement New York's righty-leaning lineup. Marcus Semien is an option and so is a reunion with Didi Gregorius, though that seems unlikely at this point. Sleeper candidates include Jonathan Schoop and Jurickson Profar.

An outside the box option: Brandon Crawford. The longtime Giants shortstop has one year at $15.2 million remaining on his deal and he still brings a serviceable lefty bat and strong defense to the table. Also, Crawford is Gerrit Cole's brother-in-law (Cole is married to Crawford's sister), which might ease the transition to a new team. San Francisco is on the cusp of contention and may not want to move its shortstop, but, if LeMahieu leaves, Crawford is at least worth a phone call for the Yankees.

My hunch -- and this is just a hunch -- is the Yankees will look for a short-term stopgap should they fail to re-sign LeMahieu, and that does not rule out Lindor, who will be a free agent next winter. He's a one-year rental like Crawford. Going multiple years for, say, Gregorius or Semien doesn't seem likely. The Yankees can bring in a one-year stopgap, then dive headfirst into next year's free agent shortstop class (Lindor, Javier Baez, Carlos Correa, Corey Seager, Trevor Story).

If LeMahieu goes elsewhere and the cost to acquire Lindor proves too prohibitive, New York may simply take whichever free agent middle infielder accepts a one-year contract. If that's Simmons or La Stella or Hernandez, fine. The Yankees have proven adept at turning unheralded pickups into above-average contributors (Urshela, Aaron Hicks, Luke Voit, etc.) and we can't rule them out doing it again. Ultimately, the best way to replace LeMahieu is re-signing LeMahieu. He's an ideal fit.

2. Cole needs some help 

LeMahieu's decision will have a domino effect on the rest of New York's offseason because it will determine how the club can address the pitching staff. Or, more accurately, how much money the Yankees have to address their pitching staff. If we assume the Yankees will stay under the $210 million luxury tax threshold next season, re-signing LeMahieu could leave them with less than $20 million to handle the rest of their offseason business. LeMahieu's decision is significant.

This is New York's current rotation depth chart now that Happ, Paxton, and Tanaka are free agents:

  1. RHP Gerrit Cole (amazing)
  2. RHP Luis Severino (rehabbing from Tommy John surgery)
  3. LHP Jordan Montgomery (5.11 ERA in 2020)
  4. RHP Domingo German (did not pitch in 2020 while serving domestic violence suspension)
  5. RHP Deivi Garcia (top pitching prospect)
  6. RHP Clarke Schmidt (top pitching prospect with little experience above Single-A)
  7. RHP Michael King (7.76 ERA in 2020)

Not great! Severino is expected back at midseason and you always have to assume some bumps in the road in the early days back from elbow reconstruction. German is playing winter ball in the Dominican Republic -- he struck out seven in the first four innings of a combined no-hitter in his first start earlier this week -- and he was quite good for the Yankees in 2019 (4.03 ERA), though his spot on the team is not guaranteed next year. Steinbrenner did not seem overly eager to welcome him back.

"I have to absolutely feel comfortable that he deeply, deeply regrets and is sorry for what he did, and I absolutely have to be comfortable with the fact that he's turned his life around. Those two things are for sure," Steinbrenner told Kay (via Ken Davidoff of the New York Post) when asked about German last month. "... We will see, but there's no doubt that he needs to prove that he's turned his life around and he absolutely realizes how horrific that was."

Montgomery is better than that 5.11 ERA would lead you to believe -- he fell victim to the "one bad inning" several times in 2020 (he allowed 48 percent of his runs in nine percent of his innings) -- but when he is your second-best healthy starter, it's a problem. Garcia and Schmidt are highly regarded top-100 prospects, and Garcia impressed in his MLB debut last year. Both youngsters will be on workload limits next season, however. The Yankees need to add innings at a minimum.

Trevor Bauer is clearly the best available free agent starter and, beyond the money question, there's an unusual dynamic here: Bauer and Cole are not on good terms. The discord dates back to their time as teammates at UCLA and most notably flared up when Bauer not-so-subtly accused Cole of doctoring the ball with the Astros two years ago. Bauer took another shot at Cole as recently as this past March

For what it's worth, Bauer downplayed the feud with Cole last week, after being named the 2020 NL Cy Young winner. Here's what Bauer told reporters, including Newsday's David Lennon, about his relationship with Cole:

"I certainly would talk to him about it if it's something that he was open to," Bauer said after being announced the NL Cy Young winner. "We don't have much of a relationship I would say. He lives his life and I live mine, and we just don't cross paths a whole lot. It's certainly not, I guess, the hate-filled relationship that many people in the media believe it is, or they try to make it out to be.

"We had our differences in college and that was nine or 10 years ago at this point. I'm a different person now than I was then and I'm sure the the same is true for him. At the end of the day, I want to win ... I think if you look at trying to win a World Series, you want to put the most intense competitors together, you want to put the best talent together, and see what you can do. So certainly if I was given an opportunity to do that, and to play alongside of him again, I'd be more than open to it."

A sincere statement, or a top free agent not wanting to scare away the wealthiest team in the sport? Your guess is as good as mine. Teammates don't all have to love each other, and who's to say Bauer and Cole couldn't bury the hatchet in pursuit of a World Series championship? The bad blood is something the Yankees will at least have to acknowledge when considering a Bauer pursuit. Can they make it work with Bauer and Cole? Or will the relationship do damage to the clubhouse?

Of course, re-signing LeMahieu would almost certainly take the Yankees out of the running for Bauer, assuming payroll is coming down this winter. Heck, they may not want to commit $30-plus million to Bauer even if they're unable to re-sign LeMahieu, because it would leave them with limiting spending room to do other things. With or without LeMahieu, it could be second-tier free agent starters for the Yankees this winter. Here are the top available free agent starters by 2021 WAR projections (via FanGraphs):

  1. RHP Trevor Bauer: 3.8 WAR
  2. RHP Masahiro Tanaka: 3.1 WAR
  3. RHP Charlie Morton: 2.7 WAR
  4. RHP Corey Kluber: 2.6 WAR
  5. LHP James Paxton: 2.4 WAR

It may be Rays or retirement for Morton, and I'd call those Kluber and Paxton projections optimistic given their rather serious injuries this season. No other free-agent starter projects to even 2 WAR in 2021, so yeah, it's not the greatest class. Tanaka loves being a Yankee and a reunion makes sense, but the fact the Yankees did not tender him the qualifying offer tells us they don't want him back at $18.9 million next year. Could two or three years at, say, $10 million to $12 million annually work instead?

The trade market is more appealing than the free agent market at this point. Lance Lynn has one year and $8 million remaining on his contract and gosh, that sure looks great next to that group of free agents, doesn't it? Lynn was briefly a Yankee in 2018, which may or may not help facilitate a trade with the Rangers. A few other possible trade targets:

  • RHP Carlos Carrasco, Cleveland: His 5-and-10 no-trade protection kicks in next April, so this offseason is Cleveland's last chance to trade him (and his contract) without his consent.
  • RHP Yu Darvish, Cubs: The Cubs are said to be cutting payroll and Darvish is owed $62 million the next three years. Pricey, but he is an impact starter, and those are in short supply.
  • RHP Pablo Lopez, Marlins: Miami has sneaky good rotation depth and, even after dealing Caleb Smith at the trade deadline, the Marlins could use Lopez to bolster their offense.
  • RHP Joe Musgrove, Pirates: An analytics darling with great spin and swing-and-miss rates. The Pirates are early in their rebuild and in "everything must go" mode.

Yankees pitching coach Matt Blake was an integral member of Cleveland's pitcher development machine from 2015-19 -- Shane Bieber has credited Blake for helping him get to the next level -- so perhaps that pushes New York to Bauer or Kluber or Carrasco. Either way, the Yankees need to get Cole some help this winter. Re-signing Tanaka seems like an easy enough move. Even then, the Yankees still need another starter, and someone better than a back-end type.

3. The catcher question

Gary Sanchez had a disaster season in 2020. The soon-to-be 28-year-old backstop hit .147/.253/.365 with 10 home runs in 49 games and lost his starting catcher job to Kyle Higashioka in the postseason. Manager Aaron Boone and GM Brian Cashman have long stood behind Sanchez, but even their tunes began to change following the season.

"It's certainly a fair question the way Gary Sanchez's season transpired," Cashman said about Sanchez's role with the team going forward during his end-of-season conference call. "It's one of the discussion points we're going to have to focus on. Obviously this COVID season was unique. You saw a lot of unexpected performances throughout both leagues, from players that are capable of more. We have to determine if (Sanchez's season) was a byproduct of unique circumstances or more a reflection of what is to be expected moving forward."

The New York Post reports the Yankees will at least listen to trade offers for Sanchez this offseason and, frankly, that's a nothing rumor. Every team listens to trade offers for every player every offseason. If they don't, the general manager isn't doing his job. This offseason the Yankees must decide whether to stick with Sanchez and hope he rebounds in 2021, or make a permanent change behind the plate. By projected 2021 WAR, the free agent catcher market is grim beyond J.T. Realmuto:

  1. J.T. Realmuto: 4.0 WAR
  2. Yadier Molina: 1.4 WAR
  3. Wilson Ramos: 1.2 WAR
  4. Mike Zunino: 1.1 WAR
  5. Several tied at 1.0 WAR

The Yankees have already been connected to Molina, which could be sincere interest or it could be Molina using the Yankees as leverage during contract talks with the Cardinals (or both). Giving the catching job to Higashioka outright is unlikely. He just played his first full season in MLB -- Higashioka caught only 21 games at that, including the postseason -- at age 30 and posted a .250 on-base percentage. Hard to buy into him as a starter.

It is so very unlikely the Yankees will spend the money necessary to sign Realmuto while adequately replacing LeMahieu and addressing their pitching needs. They are far more likely to dedicate their dollars to LeMahieu (or LeMahieu's replacement) and starting pitching. You can never rule out the Yankees just blowing everyone out of the water and spending big on multiple free agents. It's just really hard to see any team doing that after the pandemic. Money is truly tight.

To me, the most sensible solution is sticking with Sanchez, a two-time All-Star who slugged 34 homers -- the most by a catcher since Javy Lopez hit 43 homers in 2003 -- and was a 3.1-WAR player as recently as 2019. Making big career-altering decisions with talented players after this weird 60-game season isn't the best idea. The Yankees are smart to look for catching upgrades because you should always look for upgrades, but standing pat is often the best option.