Scherzer signs 7 year with Nationals

[Angel Oracle]

Fister is about 6 months older than Scherzer

Even though I don't see Scherzer repeating his 2012-2014 success beyond another 3 seasons, the structuring of the contract might give other GMs/FAs food for thought in the future.  

[LAAMike]

Very interesting contract. It does not indicate whether he will get any interest for deferring. I find it interesting that DC does not tax non resident's income, so half of his first seven years will be tax free and the remaining seven will be 100% tax free of any state taxes. So excluding the time value of money, the Angels would have to pay at least 25 million more to match this contract after tax.

Edited January 19, 2015 by LAAMike

[Lou]

Very interesting contract. It does not indicate whether he will get any interest for deferring. I find it interesting that DC does not tax non resident's income, so half of his first seven years will be tax free and the remaining seven will be 100% tax free.

 

How does mlb deal with interest paid on deferred salaries for luxury tax purposes?

[disarcina]

Nats are going to have a great rotation.........watch out for these guys!!!

[Brandon]

Only negative seems to be inflation affecting his money over the years, but the tax free city makes it easy. Plus, he's getting more than usual up front that won't be affected by inflation because of the 50m signing bonus.

Still interested if he gets interest for deferring or if that's the contract and Washington pulled out a loophole like the Devils tried in hockey to circumvent the "cap".

[Lou]

"To make up for the loss with the deferrals – because of inflation and lost interest-earning opportunity, future money is worth less than present – Scherzer will receive $50 million in the form of a signing bonus spread over multiple years, the source said. The benefit to structuring the contract as such is that because his permanent residence is outside the District, Scherzer will not be subject to a state income tax on money earned in Washington, D.C"

[Lou]

Ken Rosenthal        âœ” @Ken_Rosenthal

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For luxury-tax purposes, #Nationals will be charged present-day value of salaries in each of seven years on Scherzer’s deal, per rival exec.

 

Ken Rosenthal        âœ” @Ken_Rosenthal

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So, luxury-tax salaries for Scherzer likely will be in $26M-$27M range rather than $30M for each of his seven years in deal with #Nationals.

[Blarg]

Even though I don't see Scherzer repeating his 2012-2014 success beyond another 3 seasons, the structuring of the contract might give other GMs/FAs food for thought in the future.

This is an idiots paradise for short term thinking in order to stay under the cap. They over paid by negotiating against themselves and tied up their payroll for 15 Damn long years which only prompts agents to demand similar contracts that have a probability of zero value after the first five.

[Brent Maguire]

This is a very interesting contract. I totally understand it from the Nationals' perspective.

 

This will almost certainly be the best Nationals team they'll put together over the course of the 14 years they're paying Scherzer. With the expiring contracts of Zimmerman, Fister, Desmond, Span and Strasburg over the next 2 years, paying Scherzer less each year allows them to re-sign 1 or more of these guys without creating a stupid high payroll. 

 

People can maybe harp on the fact that there may not be much minimal returns since their rotation was already great but now they just have some crazy good depth. 

[ukyah]

management never fails. nobody was offering him anywhere near that much, and the nationals went ahead and gave it to him anyway. i'll never understand how these guys are this bad at negotiating contracts. how'd they ever get rich? perhaps there's something i just don't get, and i'm the one who's missing the boat.

[Angel Oracle]

It may have started with the Raviners seemingly bidding against themselves to sign Kevin Brown for 7 years/$110 million (and use of a private jet for his family for the home games) in the late 1990s.   He then proceded to give them two really good seasons followed by three mostly injury wracked seasons and then traded with two seasons left on his contract.

I can only begin to imagine what that is worth in today's dollars.

[ELEVEN]

Most of these owners inherited the bulk of their money.

[ten ocho recon scout]

So where would you rank the nats now in terms of rotation?

[Guest]

Scherzer, Zimmermann, Strasburg, Fister, Gonzales, and Roarke.

Talk about overkill.

The Nationals still have an offensive problem. I'm all about improving pitching, but the Nationals already had the best rotation in baseball....they'll still fizzle out the same way they do every year since they can't score runs.

[Brandon]

management never fails. nobody was offering him anywhere near that much, and the nationals went ahead and gave it to him anyway. i'll never understand how these guys are this bad at negotiating contracts. how'd they ever get rich? perhaps there's something i just don't get, and i'm the one who's missing the boat.

 

TV money.

 

I saw someone today refer to it the same way the housing or tech bubble.

 

Hell, Arte bought the team for 2xx million and it's now in the billions....like the Dodgers, much higher than the valuation from Forbes or some independent consulting firm because of the profit margins. Sports franchises are the biggest cash cows and they spend like them.

 

The thing you have to realize is by saying, how'd they get rich or how are they this bad at negotiating, it's actually the opposite. Instead of it being bad on the owners part, it's more telling about how much money they have to spend like this. If there wasn't any kind of cap on sports teams it would be way worse.

[Guest]

So where would you rank the nats now in terms of rotation?

It's the best rotation in baseball...by a huge margin. They have like 3-4 aces.

[Blarg]

It's the best rotation in baseball...by a huge margin. They have like 3-4 aces.

That's what they were saying about the A's last season when they traded for Lester. Edited January 19, 2015 by notti

[Inside Pitch]

management never fails. nobody was offering him anywhere near that much, and the nationals went ahead and gave it to him anyway. i'll never understand how these guys are this bad at negotiating contracts. how'd they ever get rich? perhaps there's something i just don't get, and i'm the one who's missing the boat.

 

To their credit they did get Scherzer to agree to a 7 year contract that won't be paid out for 14 years...

 

 

Most of these owners inherited the bulk of their money.

 

That's actually not true -- Baseball has a lot of self made millionaires.  There are a few that inherited their fortunes -- the Monfort's, Pohlads, and Nuttings come to mind but, the majority actually made their own way.  Baseball is kind of cool in that regard, a lot of guys that were lifelong baseball fans who worked their tails off and ended up buying a team.  Heck, the guy in Philly actually worked as the scoreboard operator in Philly for a while. 

[Ohtaniland]

If the Nats were moving into the AL West I would be concerned. The Nats did us all a favor by getting Scherzer out of the AL so I'm good with it. I also could give a Nats ass about how much $$$ he got unless Arte was the one paying it.

[eligrba]

The Nats could use a left handed power hitting left fielder to help their offense.  Now if only I knew of one that the Angels could trade.......hmmmm.

[Angel Dog and Beer]

Power hitting? Too bad the Angels don't have anyone fitting that description.

[ELEVEN]

Or just the hitting part

[Brandon]

If the Nats were moving into the AL West I would be concerned. The Nats did us all a favor by getting Scherzer out of the AL so I'm good with it. I also could give a Nats ass about how much $$$ he got unless Arte was the one paying it.

 

Tigers lost something like 33 wins with the exit of Scherzer and Porcello.

[Tank]

Nats are going to have a great rotation.........watch out for these guys!!!

 

and they're going to need it since harper will be on the DL for another 40 or 50 games this year.

 

again.

[Tank]

If the Nats were moving into the AL West I would be concerned. The Nats did us all a favor by getting Scherzer out of the AL so I'm good with it. I also could give a Nats ass about how much $$$ he got unless Arte was the one paying it.

 

here's why you should care: agents will use scherzer's contract as a baseline for why their guy should be paid the same or a little bit more when the negotiate his next contract. none of these contracts exist in a vacuum.