San Diego general manager Kevin Towers said on Monday that the Padres opted not to offer the Major League career saves leader arbitration.
There have been no talks between the Padres and Hoffman about returning in 2009 after the team pulled its one-year $4 million offer from the table last month.
If the Padres offered him arbitration and he signs elsewhere, the team that signs him would lose its first-round Draft pick (or second rounder if it finished in the bottom 15 in the Major Leagues last season) and the Padres also would gain a supplemental pick between the first and second rounds.
But the risk, from the Padres' perspective, outweighed the reward.
Had Hoffman, a Type A free agent, been offered arbitration and accepted, his salary for next season would have eclipsed the $7.5 million he made in 2008. And with the Padres trying to shed payroll, that would have limited their resources.
Hoffman said his chances of returning to the Padres are "not even 99-to-1" after the club took its offer -- which included a 2010 club option -- off the table.
The Padres are looking to decrease their payroll from the $73.6 million they spent last season to perhaps in the $40-50 million range.
Corey Brock is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.