July 1 in baseball is Bobby Bonilla Day, when the Mets pay $1,193,248.20 to their former third baseman, who hasn’t set foot on a major league diamond since 2001, as part of a deferred payment plan. It’s a check the Mets have been cutting annually since 2011, and they will send a seven-figure sum to Bonilla, every July 1, through 2035.
Thanks to that arrangement, a 57-year-old man stands to be one of baseball’s highest-paid players in 2020. Bonilla’s money is fully locked in, and not subject to being prorated for a shortened season this year. After all, he earned that money back in the 1990s for games that absolutely were played.
Bonilla’s annual payday is far from the only example of deferred money in baseball, but it’s easily the most famous.
“I have Mike Young, who gets $30 million deferred — he gets $3 million deferred for 10 years,” Jeff Borris, one of the agents who represented Bonilla, told Deadspin. “Nobody ever talks about it. Nobody ever asks me about it. Nobody ever interviews me about it. I get asked about Bonilla all the time. $1.2 million per year for 25 years is very nice, but $3 million a year for 10 years is nothing to sneeze at! But nobody ever talks about Mike Young.”
There are reasons that Bonilla’s deferral is the standard reference for a practice that is not uncommon in baseball.
One is that Bonilla’s deal with the Mets, for $29 million over five years, was the richest in the majors when he signed in December 1991. Even though Bonilla made All-Star teams in 1993 and 1995, he never was more than a 3.2 WAR player with the Mets, after having been a 4 WAR-or-better player in each of his last four seasons with the Pirates. Combine sagging performance, a lucrative contract, a frosty relationship with the media, and the most self-flagellating fanbase in sports, and you’ve got a recipe for a contract to be talked about for decades to come.
On top of all that is the fact that the Mets were counting on being able to finance Bonilla’s deferred payments through investments they had made with Bernie Madoff, who turned out to be the architect of history’s biggest Ponzi scheme. Instead of paying dividends to Mets ownership, Madoff left them on the hook for a multimillion-dollar settlement.
The funny thing is, Bonilla’s deal isn’t even the only deferred-money contract that the Mets did with Bonilla’s agents. The Mets agreed to a similar structure with Beverly Hills Sports Council client Bret Saberhagen, who, like Bonilla, was an All-Star for the Mets but never reached the heights of his previous stop, in Saberhagen’s case Kansas City.
“Bobby was always a guy who didn’t spend a lot of money,” said BHSC co-founder Dennis Gilbert. “Bobby was security-minded, and wanted to make sure that he had money after he played. It was the same thing for Bret. They were both getting eight percent on the money. I thought that was a very fair interest rate. … Remember, I come from an insurance background, a life insurance background, and I’ve done quite a few deferred compensations through the years for other clients outside of sports.”
Gilbert had other clients who were not interested in doing deferred-money deals, and in one case a player who wanted to but whose team was unwilling to go that route. In the case of Bonilla and Saberhagen, he was able to match players with a long-term financial view with teams willing to put off payment for several years.
The Mets were interested because, as Borris noted, “they expected to be getting double-digit interest from Madoff,” but that does not mean the Wilpons were the only owners who were open to structuring a contract with deferred money for Bonilla.
“Jerry Reinsdorf would have done a deal like that,” Gilbert said of the White Sox owner, whom he now works for as a special assistant, having sold his stake in BHSC. “We talked about deferring some money and doing it at an interest rate. We never got down to specifics. In that situation, we never got an official offer with the White Sox. … Jerry was very pointed, he said, ‘Bobby, if we give you X, Y, and Z, will you be a White Sock?’ Bobby wasn’t ready to give him that answer, so we moved on.”
After meeting with several teams on his free agent tour, Bonilla wound up with the Mets, but the deal did not initially include the deferred money. The deferral was added during the deal, around the same time that Saberhagen signed an extension with the Mets during spring training in 1993.
Bonilla’s restructured deal called for a portion of his salary in each of the final two seasons of his contract to be deferred. When Bonilla was traded to Baltimore in 1995, according to Borris, there were negotiations between the Mets and Orioles over who would be responsible for the deferred money, and the entire responsibility landed with New York.
After the 1996 season, Bonilla signed with the Florida Marlins and was part of their World Series-winning team in 1997 before getting traded twice in 1998 — first to the Dodgers as part of the first Mike Piazza trade, then back to the Mets after the season.
When the Mets released Bonilla after the 1999 season, he got a second deferral, and this was the big one that boosted his 2020 pay to seven figures.
“Bonilla will eventually be paid the full $5.9 million plus interest,” New York Daily News writer Bill Madden reported on December 18, 1999. “But as the source explained, ‘the club will make far more than the interest on the investment.’”
As much as that report is a great moment in “And Then What Happened?” annals, the Wilpons’ quagmire with Madoff had zero effect on Bonilla, who made a smart deal that has set him up for the rest of his life, avoiding a common problem for athletes of running into post-career financial distress.
“They were involved in the biggest fraud of the last 50 years with Madoff, and still they’re paying,” said Irwin Nachimson, a partner and the head of forensic accounting at Nigro, Karlin, Segal & Feldstein in Los Angeles. “There’s much less of a risk being guaranteed payment from a Major League Baseball team than there is in having the player get the money and invest it in a dry cleaner franchise, or something like that, or just spending it.”
That, above all else, may be the lesson of Bobby Bonilla Day: just because the window for players to earn money as professional baseball players is short, it doesn’t mean the time that the game takes care of them has to be.
“It’s a great thing for Bobby Bonilla,” Gilbert said. “It worked out really well for him. … I understand recently [Christian] Yelich did a big deferral on his contract. I can’t tell you if it becomes a trend. I hope it does, because players, in my opinion, don’t have the business experience to know where to put their money. A lot of people just invest with people where they take their friends with them, and the next thing you know, their experiences haven’t been real good. If you take a look at the history of players that are out of the game, the ones that leave their money to the wrong people, and a lot of them have, they’ve ended up losing it in one type of scam or another.”
It’s happened to stars for decades, from Jack Clark to Jake Peavy. But no matter what happens with the Wilpons, it’s the Mets as an organization who owe Bonilla $1,193,248.20 every July 1, and with the backing of Major League Baseball, they’ll always be good for it.