Last week New York Mets fans were left to rejoice in the news that the team had cut ties with arguably one of the biggest free agent busts in baseball history, Jason Bay. The team stated that it had “negotiated an early expiration of Bay’s contract” and that the agreement would provide Bay his unconditional free agency while the Mets would gain roster flexibility. Terms of the agreement were not disclosed at the time but it soon became known that the left fielder would in fact receive his full 2013 salary, though some of that money would be deferred.
Today John Heyman of CBS Sports shed some light on how exactly the financial arrangement will take shape over the next few years and what it means for both sides:
Not only will Bay be paid the entire $21 million he is owed by the Mets, as has been reported, but the $15 million that is being deferred under the terms of the severance agreement is to be paid by the end of 2015, meaning the deferred monies will be paid only over an additional two years, CBSSports.com has learned.
Neither side would comment on the deferred payments, but sources familiar with the deal say the short deferral — the deferred monies are to be paid in five installments — means the present-day value of the contract is worth only about $850,000 less than the full $21 million. Had the team simply cut him, they would have had to pay him all the money by the end of 2013.”
The upside for Bay, beyond a fresh start and a change of scenery, is clear. As Heyman writes “the even bigger financial plus for Bay is that the Mets agreed to waive the usual offset provision, whereby the team would have been reimbursed the amount Bay signed for elsewhere. So if Bay can make a deal for more than $850,000 elsewhere, he’s automatically going to come out ahead of the game.”
Giving up on Bay while ‘negotiating’ a buyout that paid him the full value of his contract may not seem like much of a deal for the Mets, but as Heyman points out, there is a plus side for New York as “the new deal does give the Mets some immediate financial relief.” What the team decides to do with the roughly $15 million that is being deferred remains to be seen, but if it provides them with the flexibility to bring a free agent like Torii Hunter or Melky Cabrera on a 1-year deal then the return on this deferment will go long beyond just having to NOT see Jason Bay in a Mets uniform…..which in itself sort of defines addition by subtraction.
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