The beginning of July is home to a wonderful holiday celebrated by millions of Americans each and every year. No, we’re not talking about the Fourth of July; we’re talking about Bobby Bonilla Day, of course.
What Is Bobby Bonilla Day?
Major League Baseball contracts are guaranteed, which often puts some teams in an interesting, precarious position as the years and dollar values continue to rise in a sport without a salary cap. So in order to remain competitive in the near-term, teams sometimes have to get creative with the backends of their deals with aging veterans.
Bobby Bonilla is perhaps the most famous case, as it comes to light every July 1 when the New York Mets pay the former outfielder/third baseman/first baseman, who last played in the majors in 2011 with the St. Louis Cardinals, the won-the-lottery-type-sum of $1.19 million.
When Bonilla last played for the Mets in 1999, the team still owed him $5.9 million. At the time, the team’s ownership was actually involved in the infamous Bernie Madoff pyramid scheme. And with that invested money soon vanishing into thin air (much like the aliens who might be playing ball at the Area 51 baseball field), the team opted to defer the payments to Bonilla starting on July 1, 2011 and running through 2035, with a nifty 8% interest rate.
It’s going to take a long time for MLB’s minimum salaries to catch up to Bonilla, too. In 2023, the minimum salary is $720,000. That increases to $740,000 in 2024, $760,000 in 2025, and $780,000 in 2026. Bonilla, who played 16 years in the majors, will continue to be making more than today’s young players for quite some time.
How Often Do Baseball Teams Defer Payments to Players?
It happens more often than you think. Bonilla has another deferred contract he’s collecting from for starters, which in 2004 began paying him $500,000 a year for 25 years. Other players like Bret Saberhagen, Manny Ramirez, Todd Helton, and Max Scherzer have also opted for deferred contracts over the years.
One of my personal favorites is Ken Griffey Jr.’s deferred contract with the Cincinnati Reds, which pays him $3.59 million every year through 2024 as part of his original nine-year, $116 million deal he signed with the team in 2000. The fun note about Griffey’s deferred contract is that his $3.59 million payment currently makes him the third-highest-paid “player” on the young, rebuilding (but exciting) Reds.
