Happy Bobby Bonilla('s Agent) Day 2023!
by meep
It’s July 1, which means it’s Bobby Bonilla Day! One of the happiest days of the year at STUMP!
Talk about showing off the value of a promise!
Here’s ESPN’s story for this year: Bobby Bonilla Day: Why the NY Mets pay out $1.19M on July 1
The calendar has turned to July 1, and that means one thing: It’s time for Mets fans everywhere to wish each other a Happy Bobby Bonilla Day! Why? On Saturday, 59-year-old Bobby Bonilla will collect a check for $1,193,248.20 from the New York Mets, as he has and will every July 1 from 2011 through 2035.
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In 2000, the Mets agreed to buy out the remaining $5.9 million on Bonilla’s contract.
However, instead of paying Bonilla the $5.9 million at the time, the Mets agreed to make annual payments of nearly $1.2 million for 25 years starting July 1, 2011, including a negotiated 8% interest.
At the time, Mets ownership was invested in a Bernie Madoff account that promised double-digit returns, and the Mets were poised to make a significant profit if the Madoff account delivered — but that did not work out.
Under new owner Steve Cohen, who mentioned the possibility of celebrating Bonilla at Citi Field annually soon after taking over the team, the Mets have embraced Bonilla’s day.
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Here are some other notable deferred-money contracts, courtesy of ESPN Stats & Information:
• Bobby Bonilla (again): A second deferred-contract plan with the Mets and Orioles pays him $500,000 a year for 25 years. Those payments began in 2004.
• Bret Saberhagen: Will receive $250,000 a year from the Mets for 25 years (payments also began in 2004; this was the inspiration for Bonilla’s deal).
And there are several others at the link.
UPDATE: 99 Bottles in Sarasota has a special on:
In honor of Bobby Bonilla — a great ballplayer, a great guy, a Sarasota local, and the most baller contract buyout king of MLB history… we are offering $1.19 pints of Captain Lawrence Orange Crusher beginning at 5pm on Saturday, July 1st, until the keg is gone!
Why??
Bobby Bonilla was a Major League Baseball All Star player for 16 seasons. He played for the New York Mets from 1992-1995, and, again from 1999-2000…
The Mets released Bonilla in 2000 owing him $5.9 million left on his contract.
Bonilla’s advisors negotiated a deal that would pay him $1.19 million per year for the 25 year period from 2011 thru 2035!
Yes, you read that correctly — he was owed $5.9 million, and, instead of paying him that lump sum in 2000, the Mets pay him $1.19 million every July 1st for 25 years!
That is worth celebrating!!!
(maybe, if he sees this, Bobby Bonilla will make an appearance for a beer or two with us!)
Also – NY Post: This year’s Bobby Bonilla Day is quite fitting with Mets’ 2023 turmoil
This year’s Bobby Bonilla Day might be the most appropriate of them all.
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The Mets might not have another Bonilla plan arranged by agent Dennis Gilbert, but if their season keeps spiraling, Bonilla might have company for some of the most bizarre deals in franchise history.
“I talk to Bobby on a regular basis anyway,’’ Gilbert, now a former agent, told USA TODAY in a recent interview, “but I really think about him on Father’s Day, because it’s the father of all deferred contracts.’’
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At one point during his 23-minute press conference Wednesday to address the state of the Mets, Cohen, sitting behind a Mets bistro table in a raised chair, fielded a question about how much money he’s losing this season.
Contract after contract has backfired — or, at least, not been worth what he agreed to pay at signing.
….
The record-setting payroll around $364 million contains three contracts with base salaries over $30 million and 10 with a base salary over $10 million.
“Well, bigger than a breadbasket, I’ll tell you that,” Cohen said about the money lost.
He then joked about sharing that number with the reporter outside following the press conference, before cracking a smile, pointing at the reporting and ending his joke with a sarcastic, “No, I’m not [telling you].”
The Best Baseball Deal: Bruce Sutter
Though not listed, I believe the best actual guaranteed interest rate was that of Bruce Sutter, which he got in a deal with the Atlanta Braves. The interest rate was 12.3% over a 35/36-year period. Guaranteed.
Evidently, it was interest-only and he got a balloon payment in 2022. The reason it’s not listed is that he’s not still receiving payments.
This is the last year [2022] the Braves pay Bruce Sutter for his 1988 contract.
Bruce Sutter may be the closest to Bobby Bonilla in terms of the number of deferred payments that he’s received. In 1984, Sutter signed a six-year contract that paid him $4.8 million. His Braves tenure was highlighted by injuries. Sutter annually receives $1.12 million from the Atlanta Braves and will continue to receive payments until 2022. The payments began in 1991, which means that Sutter has been receiving deferred payments for 30 years. In addition, the Braves will also have to pay Sutter one final check for $9.1 million when the deferred payments stop. It’s pretty impressive that Sutter is receiving more than $10 million a whopping 35 years after he announced his retirement.
Video on Bobby Bonilla Day from 2019
And here is a spreadsheet checking that they indeed bought him out at 8%.
As for how the agent was able to swing the deal, there is a Madoff connection, and the Mets just have a long history of bad finance:
Feb 2021: GameStop Frenzy Lessons: Don’t Bet the Milk Money
How was Gilbert able to secure such a sweet deal for his client? They can both thank disgraced financier Bernie Madoff and Mets owner Fred Wilpon.
The Mets wanted to part ways with Bonilla in 1999 but he had $6 million left on his contract. Wilpon believed he was getting a huge return on his investments through Madoff but the Mets owner turned out to be a victim of Madoff’s infamous Ponzi scheme
(and the most recent owner got caught up in the GameStop frenzy. Ugh.)
Prior Bobby Bonilla posts
2016: Happy Bobby Bonilla Day! and more Americana
2018: Mornings with Meep: Happy Bobby Bonilla (and Bruce Sutter) Day!
2020: Classic STUMP: Happy Bobby Bonilla Day! And Independence Day!
2021: Happy Bobby Bonilla Day! In Praise of Valuable Annuities
2022: Happy Bobby Bonilla Day for 2022!
Bobby Bonilla is getting this series of payments because his agent got it valued at 8% (considered a deal to the Mets, who thought they had a guaranteed 12% through their investments with Madoff), instead of the risk-free 5.9% which was the 30-year Treasury rate at the time, and the promise was for 35 years.
Guaranteed interest rates, especially at those levels, are very valuable.
Let’s hear it for the agents who negotiated these deals for their players!
