The official word won't come until after tonight's 11 p.m. deadline, but all indications are that Carl Pavano, Orlando Hudson and Jesse Crain will decline arbitration offers from the Twins.
Sports Illustrated's Jon Heyman reported (via Twitter) that Hudson will decline, and people familiar with the discussions have told me the Pavano and Crain decisions are practically no-brainers.
This would put the Twins in position to gain four extra picks in next June's amateur draft if those players sign elsewhere. Declining arbitration would not prevent those players from re-signing with the Twins, however.
Pavano is a Type A free agent, so the Twins would gain two high draft picks if he leaves (including a potential first-round pick from the team that signs him). He's arguably the top free agent starting pitcher on the market behind Cliff Lee, especially now that Jorge De La Rosa re-signed with the Rockies for three years, $32 million. Pavano, who turns 35 in January, wants to return to Minnesota, but it's uncertain if they'll meet his expected three-year asking price.
Crain and Hudson are Type B free agents. If either leaves, the Twins get an extra pick between the first and second rounds of next June's draft.
Crain likely has his pick of multi-year offers, and he had to be thrilled when fellow righthanded reliever Joaquin Benoit signed his three-year, $15.5 million deal with Detroit. Crain is young (28), he's cheap ($2 million last year), he won't cost a team a draft pick, and he's coming off a good season (with a 1.06 ERA between May 20 and Sept. 27).
Hudson, who turns 33 in December, has played for three teams in the past three years (Diamondbacks, Dodgers and Twins) and has gone his entire career without a multi-year deal. Offering him arbitration seemed risky for the Twins, especially now that they have exclusive negotiating rights with Japanese infielder Tsuyoshi Nishioka. If Hudson wanted to stick the Twins with a $6 million tab for next season, he could, simply by taking arbitration.
I haven't confirmed that Hudson and the Twins had an unwritten agreement that he would decline. We know Hudson had language in his contract that would have prevented the Twins from offering arbitration if he was a Type A free agent. (Type A status hurts players like him because teams hesitate to lose a draft pick by signing them.)
Why do teams make these unwritten agreements (see Trevor Hoffman/Brewers and Javier Vazquez/Yankees)? Even if Hudson wanted to formally extend the same courtesy to the Twins -- for example, "You guys won't offer me arbitration if I'm a Type A, and I promise to decline arbitration if I'm a Type B" -- players can't include such language in their contracts.
The union apparently views this as a slippery slope, where teams might try to entice players to accept other concessions -- for example, "Player X agrees to salary Y but agrees to give up Z in meal money."
These unwritten Type B agreements technically don't cost anyone anything. No team loses a draft pick. The compensatory pick is simply added to the supplemental round. If anybody had a complaint it would be the teams picking high in the draft, as their second-round picks get pushed behind the sandwich picks.
It's an imperfect system, but to me, the bigger issue is the way players get designated Type A and Type B (MLBTradeRumors.com's explanation here). Players are grouped together by positions (1B, OF and DH in one group, SS, 2B and 3B in another, while relievers are given their own category) and rated based on their performances over the previous two years. That's how Aubrey Huff and Juan Uribe (starting position players for the World Series champion Giants) become Type B free agents, while Matt Guerrier and Grant Balfour are Type A's.
Note: The Twins declined to offer arbitration last week to free agents Guerrier, Jon Rauch (Type B) and Brian Fuentes (Type B), so the team won't receive any draft pick compensation if they leave.