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MLB Draft Basics

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Let's go over the basics of the MLB Draft which begins in just two days.

2014 MLB Draft Photo by Rich Schultz/Getty Images

The 2016 MLB Draft begins on Thursday. I can hardly believe it's that close. This is going to be an important one for the Brewers. It's the first time they'll be drafting during the rebuild. It's also the first time the team will be drafting under the leadership of General Manager David Stearns. This will be the second time under Scouting Director Ray Montgomery though. So it will be interesting to see how their styles mesh. And fortunately for all involved the Brewers have a rather enviable position with the 5th overall draft pick. But like all things baseball, the draft is a bit complicated and so I'm going to go over some of the basics for those that don't know or need a refresher.

The MLB Draft--also known as The First Year Player Draft or the Rule 4 Draft (see even the name is complicated)--consists of 40 rounds. Actually that's technically not true. There are essentially 43 rounds. The extra three come from the two Competitive Balance Rounds A and B as well as the picks awarded from free agent compensation--though those are technically considered first round picks. The Comp A round takes place right after the first round. The Comp B round takes place right after the second round. This year the Brewers got a Comp B round pick.

The first ten round are the most important. Each pick in the first ten rounds has a value attached to it. Each club then adds up all their picks from the first ten rounds and that's where they get their draft pool allotment. The important thing to remember here is that teams don't have to spend the exact slot amount on the player taken with that pick. So if they save money with one pick, they can use it to sign another pick. In this way, draft pool allotment is just as important as draft position.

The Brewers pick 5th this year. That's really good. But because they only got a Comp B round pick, they ended up with just the 8th largest draft pool. That is still good though. It gives them plenty of money to play around with. They could sign the best overall talent with their 5th pick, or perhaps try to sign a guy they think is a sleeper for less money and try to get better picks with their later selections.

This is something similar to what they tried doing last year with their selections in rounds 11-40. They selected quite a few players that were considered hard to sign away from their college commitments. In plainer terms, they drafted a bunch of expensive players. Teams will often take kids that were borderline 1-2 round talent that fell because they wanted more money than teams were going to give them. The hope was they would save enough money in the first ten rounds to lure one of these players away. The didn't get any of the bigger name kids, but they did sign some players for "overslot" in those rounds.

Rounds 11-40 don't have values associated with them. Teams are allowed to sign these picks for up to $100,000 without it counting towards their draft pool allotment. But every dollar over that $100,000 does count. So in a way, by waiting to draft some of these kids, they get an extra $100,000 to play with, that wouldn't have been there in the first ten rounds.

There is another reason teams wait to draft these hard to sign players. If a team drafts a player in the first ten rounds and doesn't sign them, the team loses the ability to spend the money that was associated with that pick. This has the potential to be disastrous. It happened to the Astros a couple years ago when they failed to sign first rounder Brady Aiken. Because they lost so much pool space, they were unable to afford another draft pick. Had they signed him they would have faced severe penalties for going over their draft pool allotment.

Teams can go up to 5% over their allotted pool without severe penalties. They only have to pay a 75% tax on overages. Then the teams that don't go over get to share whatever that tax was for the teams that do go over. However if a team goes over that 5% they start losing draft picks for future drafts. This has never happened and it will never happen. It's one of the few penalties in baseball that actually works as a deterrent. But it mostly hurts the kids because they don't have unlimited earning potential which isn't exactly fair to them, but makes the owners very happy.

Well, I think that's everything I wanted to go over with you all. We'll have a more Brewers specific 2016 Draft prep for you by Thursday afternoon. We'll also have a draft thread for everyone to hang out in during the three days of the draft. Hopefully the Brewers do well this year!