TAMPA, Fla. -- Grant Balfour is returning to the Rays.

The announcement that the hard-throwing former Rays reliever had signed a two-year, $12 million deal came Thursday afternoon at the Tampa Museum of Art.

"There are other teams out there that wanted my services," said Balfour, who lives in Clearwater, Fla. "Like I've said, it wasn't all about the money, I did have other offers that were higher offers. But to be here in Tampa, to play with [Tampa Bay manager Joe Maddon] and have the familiarity, and I love the area. And I love playing for the Rays. My family is here, and I love staying at home.

"I want to win a World Series. We got really close here in 2008. And I'm really hoping that here, in the next few years, that I can win one."

Balfour, 36, served as a setup man for the Rays during his previous tenure, but he will be slotted as the club's closer this time around. Earlier this offseason, Tampa Bay traded for veteran closer Heath Bell and signed Juan Carlos Oviedo (formerly known as Leo Nunez), who also is an experienced closer. Fernando Rodney closed for the team the past two seasons.

Bell struggled with the D-backs last season, and Oviedo did not pitch at all while recovering from Tommy John surgery to his right elbow. Thus, there are questions regarding how effective either will be. Meanwhile, Balfour accrued 62 saves as Oakland's closer the past two seasons after serving in a setup role for the Athletics in 2011.

"I think I'm at the peak of my game," Balfour said. "I've got to feel that way. ... It's one of those things, they named me to the All-Star Game last year, so I guess I'm in a pretty good spot.

"I work hard every year to get myself in physical and mental shape, to be the best I can every year. I feel like the past three years, the past year that I've had, I feel like I've put myself in position to be one of the better relievers in the game."

Last week, Balfour was reported to be close to signing a deal with the Nationals.

In December, the Australia native agreed to a two-year, $15 million contract with the Orioles, but that deal fell through when Baltimore said he didn't pass his physical. In the aftermath of that news, Seth Levinson, Balfour's agent, charged that his client was healthy and that the O's had just decided against signing him. Validating his charge, Levinson cited the findings of two doctors who found nothing out of order after looking at an MRI of Balfour's right shoulder.

"It was a bit of a stressful thing, seeing that go down, knowing I was perfectly healthy," Balfour said.

Balfour brings an angry facade to the mound, which could be evident when the team plays Baltimore this season, given his recent history with the Orioles. Balfour smiled when asked whether his rage could step up a notch.

"I guess you have to tune in," he said.

Maddon is looking forward to having Balfour -- complete with his mound mentality -- back with the Rays.

"When we re-signed him, I immediately went to the confrontation with Orlando Cabrera a couple of years ago and how that typifies what 'Mate' is all about," said Maddon, referencing a row Balfour entered into with the former big league shortstop during the Rays-White Sox 2008 American League Division Series. "He's such a competitor and such a great teammate within the clubhouse. So to have that little extra zeal out there, I'm all for that. And I know he's contagious with the group, so it was an exciting thought to get him back."

Maddon has seen changes in Balfour, the pitcher, over the course of the past three years.

"The big thing I've seen is his ability to use the breaking ball and get more out of it," Maddon said. "With us, he only threw fastballs and not enough breaking balls. I saw better sliders, curveballs last year, and I saw him use that more liberally. That's a big part of his success over the last couple of years."

Balfour pitched for Tampa Bay from 2007-10, posting a 14-7 record and eight saves with a 3.33 ERA in 203 appearances. He is 62-for-67 (92.5 percent) in save opportunities over the past two seasons -- the fourth-best percentage in the Majors during that time, behind Huston Street, Joe Nathan and Craig Kimbrel.

Included during Balfour's two-year run with Oakland was a streak of 44 consecutive saves, an A's franchise record and the sixth-longest save streak in Major League history.

Balfour's addition pushed the Rays' payroll to approximately $80 million, which is much higher than expected from when the team entered the offseason. Principal owner Stu Sternberg addressed the payroll escalation.

"In for a penny, in for a pound a little bit, I guess," Sternberg said. "We keep coming back to this. This year's the exception, this year's the exception -- well, we've had some exceptional teams. And as the owner and along with Matt [Silverman, team president] and Andrew [Friedman, executive vice president of baseball operations] and my partners and others, we want to give this organization and teams like this a chance to compete and win. And we know that it's going to cost us more than we can afford.

"When you see the opportunity for somebody like [Balfour], the way the payroll has grown around it, in some respects, this is the price of success. If you didn't have these kinds of players, you'd be looking at a whole different kind of payroll."

Balfour appeared at home.

"It definitely worked out great," Balfour said. "I'm happy to be here."