When teams sign or trade for big time free agents the art of
deferring payments is not something new in Major League Baseball but the Max
Scherzer contract brought up an interesting aspect of the deferral. As we all
know Scherzer signed with Washington for seven years and $210 million with 50%
of that money being deferred out over an additional seven seasons. So many
times we have seen the Bobby Bonilla’s of the world getting paid millions of
dollars for being retired due to deferrals and do not blink an eye but could a
team that is looking to get under the luxury tax threshold use this to their
advantage?
I found it interesting when Jon Heyman tweeted out that, for
luxury tax purposes anyway, the Nats were on the hook for a shade over $191
million rather than $210 million due to the deferral of money. Now while an AAV
of $27.29 million is a miniscule discount from $30 million it is a discount
nonetheless. Could a team like the Yankees, the Dodgers, the Phillies or any
other big market team with staying power financially take advantage of this
loophole?
Naturally these deals would have to be reasonable as I am
sure MLB and the Player’s Union have to come to terms and agree on them but
this could work for New York. With an absolute ton of money coming off the
Yankees books after the 2016 and 2017 seasons the Yankees, while employing this
strategy, could conceivably still go large with their spending and get under
the cap for one season to get the fiscal benefits of the penalty reset.
Whether Rob Manfred and the league would allow this on a
large scale remains to be seen but I personally would rather the Yankees be
ahead of this curve than behind it. Try it out, all the league can do is
continue to show their bias against the team and say no.
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Sorry for the Capatcha... Blame the Russians :)