Front-loading buyouts and cash commitments
Aug 8, 2013 22:02:42 GMT -5
Post by Ben (Rays GM) on Aug 8, 2013 22:02:42 GMT -5
I was thinking about buying out players today and came up with an idea for a new rule that would allow teams a little more flexibility when it comes to getting rid of those unwanted contracts. The idea is that, instead of being on the hook to pay the player's whole salary each year, the GM could instead decide to pay all (or most) of the salary up front, lightening the load later on. So if I wanted to cut Miguel Cabrera, for example (I don't), I could choose to continue to pay him $27.6 million per season through 2015, or, if I had the cap space in 2013, I could pay him 82.8 million in 2013 and then be off the hook in 2014 and 2015. Or I could pay him 62.8 million in 2013 and 10 million each in 2014 and 2015. Or I could pay him the 27.6 million I owe him in 2013, then the rest (55.2 million) in 2014 so that I don't have to pay him anything in 2015.
What I wouldn't be allowed to do would be to backload it - I couldn't move any salary backward, just forward. So if I wanted to pay him less in 2013, that's not happening since there's nowhere I can move it. If I wanted to pay him less in 2014, fine, but only if I moved that salary to 2013 - not to 2015.
Furthermore, all years after the second year would have to decrease or stay the same, not increase. If I had a player signed to 25 million per year for four years and wanted to buy him out, I could load it the following ways:
75, 25, 0, 0
25, 75, 0, 0
55, 25, 10, 10 or 25, 55, 10, 10 or 45, 25, 15, 15 (etc)
What I could NOT do would be something like:
55, 25, 5, 15, where the fourth year has more than the third.
I also would not be allowed to do something like
55, 10, 25, 10, where the third year has more than the second. It's fine if the second year has more than the first (as long as the first isn't below the original salary), but after that, salaries can only decrease, not increase.
Alright, process that for a bit, then consider this:
In addition to being able to front-load buyouts, we could also allow people to front-load cash commitments when trading a player. So if I wanted to trade my $25 million for four years player to Ringo, and Ringo wanted me to pay $5 million of his salary each year so that he was only on the hook for $20 million per season, I could pay $5 million per season, or I could pay $20 million all this season, that way Ringo still gets the player for $20 million like he wants, but after this season I don't have to worry about it.
However, what we don't want to have happen is for teams to front-load their own contracts. For example, if I had $80 million this offseason and wanted to sign Clayton Kershaw, I would not be allowed to sign him for $20 million a year for four years and then front-load it all so that I'm paying him $80 million now and getting him for free later. But there's a loophole here: I can sign Kershaw for $20 million per season, trade him to Ringo while front-loading the contract, and then have Ringo trade him back to me for a late round pick. Obviously this would be frowned upon, so we'd have to prohibit teams from re-acquiring any players whose cash-considerations they front-loaded.
Any thoughts on this? Do you guys like both these ideas or perhaps just the first one, which is a little less drastic of a change? If we did implement one or both of these rules, would we let people adjust the way they loaded the contracts, or would they have to decide at the moment of the buyout/trade?
What I wouldn't be allowed to do would be to backload it - I couldn't move any salary backward, just forward. So if I wanted to pay him less in 2013, that's not happening since there's nowhere I can move it. If I wanted to pay him less in 2014, fine, but only if I moved that salary to 2013 - not to 2015.
Furthermore, all years after the second year would have to decrease or stay the same, not increase. If I had a player signed to 25 million per year for four years and wanted to buy him out, I could load it the following ways:
75, 25, 0, 0
25, 75, 0, 0
55, 25, 10, 10 or 25, 55, 10, 10 or 45, 25, 15, 15 (etc)
What I could NOT do would be something like:
55, 25, 5, 15, where the fourth year has more than the third.
I also would not be allowed to do something like
55, 10, 25, 10, where the third year has more than the second. It's fine if the second year has more than the first (as long as the first isn't below the original salary), but after that, salaries can only decrease, not increase.
Alright, process that for a bit, then consider this:
In addition to being able to front-load buyouts, we could also allow people to front-load cash commitments when trading a player. So if I wanted to trade my $25 million for four years player to Ringo, and Ringo wanted me to pay $5 million of his salary each year so that he was only on the hook for $20 million per season, I could pay $5 million per season, or I could pay $20 million all this season, that way Ringo still gets the player for $20 million like he wants, but after this season I don't have to worry about it.
However, what we don't want to have happen is for teams to front-load their own contracts. For example, if I had $80 million this offseason and wanted to sign Clayton Kershaw, I would not be allowed to sign him for $20 million a year for four years and then front-load it all so that I'm paying him $80 million now and getting him for free later. But there's a loophole here: I can sign Kershaw for $20 million per season, trade him to Ringo while front-loading the contract, and then have Ringo trade him back to me for a late round pick. Obviously this would be frowned upon, so we'd have to prohibit teams from re-acquiring any players whose cash-considerations they front-loaded.
Any thoughts on this? Do you guys like both these ideas or perhaps just the first one, which is a little less drastic of a change? If we did implement one or both of these rules, would we let people adjust the way they loaded the contracts, or would they have to decide at the moment of the buyout/trade?
