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The Houston Astros made it official on Monday. The team announced its new five-year, $95 million contract with reliever Josh Hader and designated left-hander Matt Gage for assignment. Hader is now the highest-paid reliever in baseball history.
But Hader's record-breaking salary isn't the end of the road for the Astros. Houston knowingly signed Hader to a mega-deal despite the fact the lefty had a Qualifying Offer attached to his signing. The San Diego Padres wisely slapped the QO on the free-agent-to-be shortly after the end of the 2023 season.
Rather than accept what amounted to a one-year deal worth approximately $20 million, Hader rejected the QO, meaning he was free to sign with any major league team of his choosing. But Hader's new team was destined to pay a price for the closer's services.
What Astros must forfeit after Josh Hader mega-deal
According to Jordan Shusterman of FOX Sports, the Astros will forfeit their second-round pick in the 2024 MLB Draft as well as $500K of international bonus-pool money. That's a hefty sum, but Houston's front office was willing to take the gamble.
According to FanGraphs, the Astros' projected payroll now stands at $239 million for the 2024 season. That estimate pushes Houston past the $237 million Competitive Balance tax threshold. The last time the Astros crossed the threshold was in 2020, but due to the coronavirus pandemic, the taxes were suspended for that season.
All of this is to say that the Astros liked Hader enough to sacrifice draft capital, lose international bonus pool money, and pay extra taxes. One could surmise the narrative about owner Jim Crane pinching pennies this offseason can now go out the window.
For those who are curious, the Astros' second-round draft pick from a year ago is right-hander Alonzo Treadwell. The year prior, Houston was stunningly able to land their top outfield prospect Jacob Melton late in Round 2. So there's some risk involved in giving up such a high draft pick, but the Astros were desperate to upgrade their bullpen, and did so by signing the best reliever available.