Rosenthal: Long-term Felix deal being discussed

The Mariners have initiated long-term contract discussions with right-hander Felix Hernandez, but the two sides are far apart, according to a major-league source.

Hernandez, 23, is two years away from free agency. He is happy in Seattle, the source said, but willing to continue going year-to-year in arbitration and then seek a CC Sabathia-type contract on the open market.

Sabathia signed a seven-year, $161 deal with the Yankees last winter. The average annual value of that contract is $23 million.

The Mariners are believed to have offered Hernandez a four-year contract in the $45 million range. Such a deal would cover his final two years of arbitration and first two years of free agency.

Hernandez earned $3.8 million last season and finished second in the American League Cy Young Award balloting. His salaries in arbitration could rise to $7 million next season and then $10 million in 2011.

Add two free-agent years at $23 million, and his goal in a four-year deal likely would be above $60 million. He also could seek a longer term — say, six years — and a total package of more than $100 million.

about 2 years ago JY 31 comments 0 recs |

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I am convinced we will sign him to at least a four year deal very soon.

Also unrelated, I just read an other team’s fan comment that he wishes he was a Mariners fan right now because these are looking like good times for Seattle.

How far we have come…

by EnglishMariner on Dec 6, 2009 3:07 PM PST via mobile reply actions

Yes!

Figgins signed, important stuff begins.

Fuck Anaheim.

by Eyeball Kid on Dec 6, 2009 3:39 PM PST reply actions

I don't see GMZ giving him more than 15-18mil a year

by OlSalty on Dec 6, 2009 3:43 PM PST reply actions

That would be a deal.

Of course, if he continues pitching as he has, 20 million would be a deal too, just one that would hamper our other operations a bit.

"Ever tried? Ever failed? No matter. Try again. Fail again. Fail better." - Samuel Beckett http://mvn.com/marinersminors/

by JY on Dec 6, 2009 3:46 PM PST up reply actions

My rational side is kind of kicking in here, maybe it's because Rosenthal suggests he wants us to pay him equal to what he'll command on the market

Felix might be worth that much but that’s sort of assuming everything goes right over the life of the contract

There’s a really good possibility he misses time on the DL over the life of a 6 year deal. And honestly I think Jack and his team pretty much share a brain with Dave at this point and realize how risky it is to tie up so much of the teams yearly budget in one pitcher, even if it is Felix. Thus their pretty low initial offer in both years and money. That’s not to say we shouldn’t pay him, but we shouldn’t pay him like the Yankees or Red Sox would once he hits free agency because unlike them we can’t maintain the kind of roster flexibility they can with a contract like that on the books.

by OlSalty on Dec 6, 2009 5:07 PM PST up reply actions

I understand all of these principles

and yet contracts, authored by Scott Boras and signed by the Yankees, make me weep internally, if not go through the whole mourning routine of rolling around in dirt and tearing the robes and such.

"Ever tried? Ever failed? No matter. Try again. Fail again. Fail better." - Samuel Beckett http://mvn.com/marinersminors/

by JY on Dec 6, 2009 5:24 PM PST up reply actions

I'm not one to theorize on a GM's ulterior motives

But I imagine that the Mariners would want to wait until next week to start serious negotiations with Felix. When he’s not locked up to a contract he remains a trade possibility, which could open the door for Jose Lopez or Brandon Morrow discussions.

by JLC on Dec 6, 2009 5:52 PM PST reply actions

If I was a billionaire I would buy Felix a new car to stay in Seattle.

With 100 million in small, unmarked bills in the trunk.

by hcoguy on Dec 6, 2009 10:47 PM PST reply actions

Geehwiz Felix might have taken 4/45 last summer but nuts on us for not offering it to him

by Robert on Dec 7, 2009 12:08 AM PST reply actions

Definitely a low-ball offer today.

I would bet a deal gets done, but GMZ had to put in a floor price while Felix’s agent put in the ceiling. They will work to a middle ground and I would suspect something like a 4/75 will get done.

by Wilder. on Dec 7, 2009 10:01 AM PST up reply actions

4/45 last summer only buys out one FA year,

so considering the time frame, 4/45 last year ~= 4/65 now

by Matthew on Dec 7, 2009 10:11 AM PST up reply actions

I wonder if a player would be more likely to take an under market value contract if it was heavily front loaded.

Like 20/20/20/8/8/8. That’d be 6/84, but they’d get 60 mil within just 3 years.

...and now I'm here

by CapSea on Dec 7, 2009 2:37 AM PST reply actions

This is great, for many reasons. This makes me suspicious that I'm over looking something obvious.

I just can’t see a whole lot wrong with setting up the money like that, and holy moly does it increase his value in trade to smaller market teams that last couple of years.

by Kermit. on Dec 7, 2009 8:49 AM PST up reply actions

I'm totally guessing here but maybe the CBA would effect this, because a player cannot take more than an 80% pay cut year-on-year?

by EnglishMariner on Dec 7, 2009 10:01 AM PST up reply actions

I think that only matters when it comes to arbitration.

But I do like the idea behind front loading contracts.

by Wilder. on Dec 7, 2009 10:07 AM PST up reply actions

You see this in hockey all the time.

by Matthew on Dec 7, 2009 10:12 AM PST up reply actions

Football, too

where a huge portion of the contract comes in a giant signing bonus which ends up being virtually the only guaranteed money in the contract

by seattlebruin on Dec 7, 2009 5:51 PM PST up reply actions

Teams want to back-load a contract.

Because inflation means that paying a player 10 million dollars this year is more than paying them 11 million dollars in 4 years. Also, inflation means your team is theoretically earning more dollars in the future even if the major factors (attendance, tv audience) stay the same.

Players don’t mind much because the contracts are all guaranteed.

If Brad Pitt is playing Beane who do you want playing you?
JD: Eddie Guardado.

by GhettoBear04 on Dec 7, 2009 2:40 PM PST up reply actions

Okay, here is my response:

Because inflation means that paying a player 10 million dollars this year is more than paying them 11 million dollars in 4 years

Except if you notice, with that contract I just saved the team 16 million – far more than inflation, reduced the albatross during Felix’s riskiest years, and made him an EXTREMELY wealthy man in just 3 years, rather than requiring he wait all 6 to enjoy the perks.

Players don’t mind much because the contracts are all guaranteed.

But players are people too, and the ability to get 60 mil in practically no time – is very tempting. If I could win a 750,000 dollar lottery now, or win a 1,000,000 lottery in 10 years, I choose now, and not just because of inflation, but because having the money now is what I want.

inflation means your team is theoretically earning more dollars in the future even if the major factors (attendance, tv audience) stay the same.

Perhaps, but hey – when Felix will be just 8 million in the future, you will have an even greater budget to play with due to this theoretical increase in salary. Also, that implies that you can buy those wins for the same amount, which also may not be true.

I think if you have the budget and really want to underpay a great player while still making it worth his while and reducing the risk of it affecting your team due to injury, a heavily front loaded contract makes a lot of sense for both sides.

...and now I'm here

by CapSea on Dec 7, 2009 5:09 PM PST up reply actions

It's not an outrageous way of structuring a deal

Gives the team a lot less flexibility in the short term but it might be beneficial for both parties given the right circumstances.

There’s a reason why, when you win the Lotto and they offer you the lump sum up front vs. the pay out over time, the lump sum is a lot less but often is accepted: Having a lot more money right up front gives you the option of investing that money and making up your losses (maybe even making more than you would’ve) that way, and it gives you a lot more financial flexibility.

It’s an interesting idea but a lot depends on what the teams plans are as far as contention windows are concerned.

by OlSalty on Dec 7, 2009 10:42 PM PST up reply actions

People are blowing inflation way out of proportion.

Inflation is generally around 2% a year, which isn’t much. And when it comes to a business’ operations, inflation has little to no effect on long-term earnings. Unless the Mariners have a reserve pool of cash to earn interest on, back loading contracts doesn’t do much good. But like most businesses, budgets are determined by projected earnings. In other words, the money the Mariners save this year has zero effect on the budget next year; thus, there is no money for inflation or interest to have an effect on year-over-year.

Players are the ones who are concerned with interest. It is more beneficial for them to receive as much cash in the early years because they have greater buying power today and have the ability to invest the money to beat inflation. This is why when Griffey deferred payments into the future on the contract with Cincy he had the team guarantee a certain amount of interest over each of those years (I believe Ichiro had this done with his last contract as well). Griffey transferred the risk to the Mariners so he wouldn’t have to worry about inflation.

Bottom line: back loading contracts has nothing to do with inflation from a team’s perspective. Teams back load contracts so they can fit a player into the current year’s budget and how the budget projects going into future years.

by Wilder. on Dec 7, 2009 9:22 PM PST up reply actions

2% economic inflation, you mean?

Since free agency began, inflation on baseball salaries has far outstripped inflation on the American economy.

It’s just like a business loan, Wilder. Why would a business take out a loan knowing they were going to have to pay more in the long run because of interest?

by nathaniel dawson on Dec 7, 2009 11:10 PM PST up reply actions