Rodriguez, Yankees settle dispute over home run milestone bonus

The New York Yankees and designated hitter Alex Rodriguez have settled a dispute involving milestone bonuses in his contract.

The New York Yankees and designated hitter Alex Rodriguez have settled a dispute involving milestone bonuses in his contract.

Major League Baseball and the Major League Baseball Players' association announced Friday that Rodriguez and the Yankees have "amicably resolved" the issue that entitled Rodriguez to bonus money after tying Willie Mays on the all-time home run leader board. Instead of paying Rodriguez, the club will pay $3.5 million to charities.

Three organizations will split $1 million in the settlement: the Special Operations Warrior Foundation, the Boys & Girls Club of Tampa and Pitch In For Baseball. $2.5 million will go to MLB's Urban Youth Foundation. Rodriguez will have input on commissioner Rob Manfred's decisions on allocating the funds to the latter.

ESPN's Darren Rovell reports that the settlement only covers the first milestone bonus in Rodriguez's contract, home run No. 660. Rodriguez's contract still contains $24 million in milestone bonuses should he continue to climb the home run list. 

As SI.com's Michael McCann wrote in May, Rodriguez and the Yankees reportedly made a marketing agreement when he signed his 10-year, $275 million contract in 2007 that would pay him $6 million each time he tied or passed one of baseball legends Willie Mays, Babe Ruth, Hank Aaron and Barry Bonds on the all-time home run list – if the Yankees could determine each milestone to be "commercially marketable."

• McCANN: Do Yankees have legal right to deny Rodriguez bonus money?

Rodriguez passed Mays on the list with home run No. 661 early in May. Afterwards, Yankees general manager Brian Cashman told reporters the team would not pay Rodriguez his bonus. "We have the right but not the obligation to do something, and that's it," Cashman said. "We're going to follow the contract as we follow all contracts, so there is no dispute, from our perspective."

MLB-MLBPA statement on @Yankees and Alex Rodriguez: pic.twitter.com/abuJGgqx51

— MLB Communications (@MLB_PR) July 3, 2015

- Jeremy Woo