2013-14 MLB Hot Stove thread

Maybe he wants to go to Seattle because of the great schools ...

 

Absolutely wasn't saying he needs to be a Yankee to be a Hall of Famer. But his post-career earnings will be far greater as a lifetime Yankee Hall of Famer than as a guy who bounced around to three or four teams during his career.

Of course, he'll be the "the guy" in the Seattle lineup. But he won't be a "brand" the way Jay-Z has talked about. He'll be a guy playing playing for the Mariners. And if you don't think Pepsi would rather see him playing in New York than Seattle, you're crazy.

Also, don't misunderstand - I know the Mariners are throwing him a helluva lot more money than the Yankees right now. Probably enough to offset any post-career earnings. And that's why he's likely going to sign there.

 

That was my all-time favorite.

I guess those great schools didn't teach the physics of throwing a curveball in thin air.

 

I will be happy to change my mind if you can offer a single example of any major free agent who signed with the Mariners, Rangers, Astros, Marlins, Rays, etc., and state income tax has anything to do with the decision.

Using taxes as a negotiation strategy to get more money, sure, any agent worth his salt is going to use every factor available. Bid'ness is bid'ness.

 

And that's the rub. Who knows how much a part of negotiations it is? But really, it isn't that hard to believe that a player and his agent would look at an offer from a California team for $12 million and realize that's actually less than an offer from a Texas or Florida team for $11 million.

Quick Google search finds mention of a study called "Baseball Salaries And State Income Taxes" that says:

Major League Baseball teams in Florida, Texas and Washington benefit from having no state income taxes because they are able to get free agents to accept offers of lower salaries, according to the authors of "Baseball Salaries and State Income Taxes: The 'Home Field Advantage' of Income Taxes on Free Agent Salaries."

Unlike the pre-tax salaries reported in the media, MLB players compare after-tax salaries when considering offers, according to the authors. The study found that differences in state income taxes and local taxes in U.S. cities with MLB teams ranges up to about 10 percent.

"The basic implication of this tax difference is a competitive edge for teams in low-tax areas because they have lower team expenses in signing free agents to contracts that pay the same after-tax wage to players," according to the study.

http://www.parapundit.com/archives/004726.html

Study itself is a dead link, so I don't know what players they cited, or if any.

 

Cano'd be liable for state income taxes in all but a handful of games (played in Texas or Florida) anyway. The tax shield typically obtains only on games played in income-tax-free states ... so your Texas Ranger (or Tampa Bay Ray, etc., etc.) is still on the hook for taxes in California or New York. The no-state-income-tax benefit isn't as big a deal as is commonly understood.

 

I just think the endorsement money potential is being overstated. Being an All-Star with the Yankees, and arguably their best player last year, certainly doesn't seem like it has done much for him so far.

 

Some of that is overcome with bigger signing bonuses and incentives that are easy to reach. Being in the no-income-tax state also allows the player to establish residency that comes into play for other income, which can be considerable.

The bonus thing is a bigger deal in the NFL, which is why so much of the league lives in Florida -- and why, though it's never written about, players get pissed about having to attend the off-season camps. They have to be in Florida for at least six months to be residents, and media recording of the players' attendance at April and May mini-camps puts a major dent in that effort.

 

Your housing for the season is appreciably cheaper, just on the surface. This isn't rocket science.
Cano/Jay-Z are all about maximizing earnings with whatever contract they land.
They have not been shy in expressing that.

 

I can understand that. I do think the endorsement potential is greater in NYC than Seattle, but I'd agree it's not big enough to offset a $50 million gap in guaranteed salary.

 

Oh, there is definitely more endorsement potential in New York, but Cano hasn't been able to tap into that at all.

 

Would love to see those citations. The biggest free agent I can find who signed with one of those teams for less money was Rafael Palmeiro in 1998. He received an offer of 5/$50M from the Orioles, but took an offer of 5/$45M from the Rangers instead. (He publicly cited familiarity and "closer to family" as reasons to go back to Texas.)

http://www.nytimes.com/1998/12/02/sports/baseball-belle-to-orioles-but-palmeiro-heads-to-texas.html

But a vast, vast majority of the time, free agents are signing with those teams — or any team — because they received the highest offer. Those other factors get played up a lot publicly, but in the end, it's usually about the money.