Starting pitcher Max Scherzer signed a seven-year, $210 million deal with the Washington Nationals in late January and became the highest-paid right-hander in history. But did the financial structure of his contract upset other MLB executives?
According to ESPN's Buster Olney, "There is anger among teams that Major League Baseball permitted Max Scherzer's deal to have such a high percentage of deferred money." Here's the breakdown of the $210 million contract:
2015: $10 million
2016: $15 million
2017: $15 million
2018: $15 million
2019: $35 million
2020: $35 million
2021: $35 million
*$50 million signing bonus will be spread out over the duration of the seven years (approximately $7 million per season).
According to sources, $105 million in deferred money (from 2019-2021) will be paid out through 2028. This gives Scherzer an average annual salary of $15 million for the next 14 years and is the largest sum deferred in a contract in baseball history. Although it may seem like the Nationals are gaining a substantial advantage from the deferred money, they really aren't. Even though they may not be paying Scherzer the money that year, his salary for that season still counts against the payroll, so the team won't be benefitting by working to avoid the $189 million luxury tax threshold.
"The advantage for the team isn't as significant as one might believe, either. Baseball's collective-bargaining agreement calls for the Nationals to start funding the deferred payments by July 1, 2017, with enough money in a liquid asset to cover the first payment in 2022," writes Jeff Passan of Yahoo! Sports.
As for reasons other executives may be upset, perhaps the only reason is because $210 million is the now the new ceiling for an elite free-agent starting pitcher. A pitcher such as Scherzer - who is without a doubt talented - earned such a colossal amount of money and he has a 3.58 ERA and 1.22 WHIP for his career. For some perspective, Clayton Kershaw signed a seven-year, $215 million extension with the Los Angeles Dodgers and his career ERA (2.48) and WHIP (1.06) are considerably lower than Scherzer's.
Unless an executive comes out and voices a specific frustration of theirs, that's all we can gather at this point.
