Why the Mets Still Pay Bobby Bonilla $1.19 Million Every July 1

July 2, 2018 | No Comments » | Topics: Sports

bobby bonilla contract day

Most people celebrate the Fourth of July with some fireworks and hotdogs. Bobby Bonilla celebrates it by cashing a check worth $1,193,248.20. That’s because, like clockwork, every July the former Met receives an annual payout from an early 00s deal concocted by a life insurance agent. Yep, even though Bonilla retired from baseball in 2003 and hasn’t played Major League Baseball since 2001, the 55 year old has the good fortune to still be a part of team payroll until, drumroll please… 2035. 

Towards the end of his career when it came time to negotiate with The Mets, Bobby Bonilla was smart enough to secure one of the most forward thinking contracts in sports history. He knew The Mets wanted him gone but technically owed him $5.9 million. He also knew he had a young son and daughter who would be looking to go to college, and as a 36 year old, he likely had many years worth of life to live. So at this point, Bobby and his agents offered a unique compromise: The Mets would release Bobby to play for another team and they would delay the $5.9 million payment for 11 years, with interest. In essence, The Mets agreed to pay Bobby a total of $29.8 million (instead of $5.9 million) in 25 annual installments of $1.192 million, starting in the year 2011. When he received his first payment, Bobby was 48 years old and had not played in the big leagues for 10 years. He has basically guaranteed himself a big league salary every year for the rest of his life. 

The Bernie Madoff Connection

In 1986, Real estate developer Fred Wilpon purchased 50% of The New York Mets for an undisclosed sum. He purchased the remaining 50% for $135 million in 2002. Wilpon was also one of the biggest investors in Bernie Madoff’s Ponzi scheme hedge fund. Prior to the fund’s December 2008 collapse, Madoff was returning a consistent (and completely fake) double digit rate of return every year. With those returns in mind, Wilpon knew that The Mets would actually make a huge profit by deferring Bonilla’s $5.9 million. Even though that meant agreeing to pay him more than five times the amount they owed ($29.8 million), Wilpon could safely estimate that the Mets would make $60-70 million off $5.9 million over those 25 years investing with Madoff.

Unfortunately, as we all know now, Bernie Madoff’s investment fund was actually a gigantic Ponzi scheme that wiped out between $20 and $65 billion in wealth for thousands of investors. Wilpon, who was under the false impression that he had made $300 million investing with Madoff, had potentially lost as much as $700 million. Not only did this completely invalidate the justification for Bobby Bonilla’s contract but it almost forced Wilpon to sell The Mets to cover his debts. In 2011, Wilpon nearly sold 50% of The Mets to a billionaire hedge fund manager named David Einhorn, but was eventually saved by loans from Major League Baseball and Bank of America. Bobby Bonilla meanwhile is living the good life.