The streak remains intact. All hail the streak.

The Royals and Eric Hosmer reached an agreement to avoid arbitration less than 24 hours prior to his scheduled hearing in Florida. The contract not only settles the issue of 2015, it also clears the matter for 2016. In sum, Hosmer will be paid $13.9 million for the next two years of work. He earns $5.65 million for next season and $8.25 for 2016.

The Royals entered this winter with nine players eligible for arbitration. All nine reached agreements before going through with a hearing. Dayton Moore has yet to go fully arbitration monty. The last Royal to have a hearing was Jeremy Affeldt back in 2005. For you stat geeks, the Royals have had 19 hearings total dating to 1974, winning nine.

This contract represents a small gamble for the Royals. Small. If Hosmer stumbles again – think 2012 stumble – the Royals will ultimately lose money on the deal. Obviously, the hope is Hosmer can put together a full season where he is locked in at the plate. Think the last four months of 2014 (excepting August when he was injured, but you get the point) extending for the full year and erasing the stench of April and May. If that happens, then the Royals will come out slightly ahead.

The projections are somewhat bullish.

PECOTA – .278/.332/.419 with a .274 TAv and 1.9 WARP

ZiPS – .293/.346/.443 with a .344 wOBA and 2.0 zWAR

Steamer – .278/.337/.437 with a .339 wOBA and 2.3 fWAR

The consensus is Hosmer will have his second best offensive season of his career. Such are the nature of projections for an inconsistent hitter like Hosmer. No computer is willing to go out on a limb and predict a breakout simply because he’s never put together six consecutive months of at least average offense. The streaks run deep.

Will he fully realize his power potential? Last year he hit just nine home runs and finished with a .398 slugging percentage and a career-low .127 ISO. Among qualified first basemen on the Fangraphs leaderboards, Hosmer’s ISO ranked 19th out of 23. (The 20th was Billy Butler who had a .107 ISO.) If he is going to be worth his contract, he’s going to have to find that power stroke. Let’s be real, though. He’s not going to challenge the Royals franchise record for home runs. It sure would be nice if he could hit more than 20 in a year, though.

Hosmer was eligible for arbitration for the first time last winter as a Super Two. The Royals purchased his second and third year of arbitration with this deal, leaving the fourth year unsettled. Should Hosmer progress (remember, everyone is supposed to get better!) he will truly earn the megabucks in 2017. Then, free agency ahead of the 2018 season and he will make Powerball money.

The Royals remain on track to open with a payroll around $112 million, give or take a few dollars. That will be a record. I’m not sure I understand the two-year deals handed out to Hosmer and Kelvin Herrera beyond giving the Royals cost certainty heading into 2016. It’s nice they’re under contract and all, but how does that benefit either side? Both deals are well within range of what they would make in 2016. Neither player figures to regress, but the system pretty much guarantees a solid raise for each regardless. I’m guess this is all about cost certainty and the players willingness to lock in for another season. Or maybe the Royals simply believe Hosmer is about to breakout in a big way and this is how they save a few coins ahead of 2016.

I was looking for financial comps to get some perspective on this contract. This winter, David Freese was eligible for arbitration for a third time. Freese has better offensive numbers (not by much) for his career, but is five years older. He will earn $6.425 million next year. Chase Headley is another who comes to mind. (I know I’m looking at third basemen here, but I really can’t find a comparable first baseman. So corner infielder and all that. If you think of a first baseman I’ve overlooked, leave it in the comments.) His numbers were slightly better than Hosmer, is closer in age and he made $10.25 million for his third year of arbitration eligibility. Headley also had a Gold Glove to his credit. The Braves bought out the second year of Freddie Freeman’s arbitration at $8.5 million. His third year cost $12 million. Todd Frazier will earn $7.5 million for his second year of arbitration eligibility. I guess the lesson here is the $8.25 due Hosmer in 2016 isn’t crazy money, or out of scope for a corner infielder of his status. Just we can’t pass judgement on the deal until we see how the 2015 season plays out for him.

Looking large picture, what’s going to happen for the Royals in 2016? Assuming the Royals will pick up the options on Wade Davis and Alcides Escobar, the Royals are already committed to over $77 million in player contracts and buyouts for the 2016 season. If Alex Gordon makes good and exercises his player option, that total nudges to $90 million for 12 players who will actually play for the Royals and three players they would buy out of their options. With Greg Holland, Lorenzo Cain, Danny Duffy and Mike Moustakas all on the arbitration merry-go-round again, the club would be in record territory with 16 players under contract. They are set to blow past the $115 million mark for 2016. Are they prepared to handle that fiscal burden?

Either way, the manner in which this team is built, the expanding payroll is inevitable. The cost of doing business. The team is going to need some creativity going forward and if there’s one thing Moore, Jin Wong and the rest of the front office have shown is the ability to construct contracts that actually do give the team some financial flexibility. (That’s not to say they spend wisely. Those are two separate issues. Longtime readers know where I stand on how they spend.) There’s a method to their two-year deal madness. It will just take a little bit of time before the larger picture becomes clear.

The next several months will be very interesting and will tell us much about the future of this team.