Happy Bobby Bonilla Day! The curious story of deferred payments in baseball
The 1st of July marks a special date for Mets fans and baseball fans in general: Bobby Bonilla Day! This Monday, the former player will receive a check for $1,193,248.20 from the New York Mets, a tradition that is repeated every July 1st from 2011 to 2035.
This situation, which may seem unusual, highlights the salary structure of baseball and the deferred payment agreements that, on occasion, exceed the income of some of the young prospects in the sport.
But the Mets are not the only ones in this practice. Several prominent players, including former MVP and Cy Young winners, continue to receive annual payments from their former teams.
This type of agreement has become even more relevant, such as Shohei Ohtani’s with the Dodgers, in which payments of $680 million of his $700 million contract are deferred, beginning to receive $68 million annually from 2034.
Why does Bonilla receive this payment?
In the year 2000, the Mets agreed to buy out Bonilla’s remaining contract for $5.9 million. Instead of paying that sum at the time, it was agreed to make annual payments of almost $1.2 million for 25 years, starting July 1, 2011, with 8% interest.
Back then, the Mets’ property was invested in a Bernie Madoff account, which promised high returns. However, the investment did not turn out as expected.
Under Steve Cohen’s ownership, the Mets have embraced “Bobby Bonilla Day”, even considering celebrations at Citi Field.
Other notable deferred payment contracts
Bonilla is not the only player with this type of agreement. Here are some examples:
- Bobby Bonilla: A second deal with the Mets and the Orioles pays him $500,000 a year for 25 years, starting in 2004.
- Bret Saberhagen: He will receive $250,000 annually from the Mets for 25 years, also starting in 2004.
- Max Scherzer: He will receive a total of $105 million from the Nationals until 2028.
- Manny Ramírez: He will collect $24.2 million from the Red Sox until 2026.
- Chris Davis: He receives $59 million in deferred payments from the Orioles, extending until 2037.
How does the Bonilla deal compare to Ohtani’s?
The main difference lies in the context. The Bonilla agreement arose from the purchase of a veteran’s contract, while Ohtani’s was proposed by a superstar in his prime.
Ohtani receives only $2 million annually during the duration of his contract with the Dodgers, but from 2034 to 2043, he will receive $68 million per year. This allows the Dodgers greater short-term flexibility and reduces their tax burden.
Players with salaries lower than Bonilla’s in 2025
Due to baseball’s salary structure, some young players will earn less than the $1.19 million that Bonilla will receive this year. Here are some examples:
- Pete Crow-Armstrong
- James Wood
- Paul Skenes
- Riley Greene
- Hunter Brown
- Andy Pages
- Jacob Wilson
