How Sean Manaea’s Contract Structure Helps The Mets

Sean Manaea's $75 million contract includes deferred payments, but unlike Bobby Bonilla's infamous deal, this could actually benefit the Mets.

Sep 6, 2024; New York City, New York, USA; New York Mets starting pitcher Sean Manaea (59) pitches against the Cincinnati Reds during the third inning at Citi Field. Mandatory Credit: Brad Penner-Imagn Images / Brad Penner-Imagn Images

Any time the New York Mets and deferred money appear together in the same sentence, memories of Bobby Bonilla inevitably resurface. The retired 61-year-old former All-Star has received a $1,193,248.20 check from the Mets every July 1 since 2011, a tradition that will continue through 2035.

So, when Will Sammon of The Athletic first reported that left-handed pitcher Sean Manaea’s three-year, $75 million deal included $23.25 million in deferred payments, it was easy to see why some fans rushed to make jokes. However, Sammon clarified the contract details on Friday, shedding light on why the Mets structured the deal this way.

Manaea will earn a $25 million salary in each of the three years of his contract, bringing the reported $75 million guarantee to fruition. However, $7.75 million of his salary each season will be deferred, totaling the $23.25 million in deferrals. As Sammon clarified, these deferred payments will be paid out in equal installments of $2,325,000 over 10 years, from 2035 to 2044.

More on Sean Manaea's deal, per source: each year of three year deal is $25 million, of which $7.75 million is deferred w/o interest (previously reported total deferred figure, increments, dates).
He would also get $50K for AS, $50K for GG, $50K for Cy Young ($25K-2nd; $10K-3rd).

— Will Sammon (@WillSammon) January 3, 2025

Because of the deferred payments, Manaea’s contract does not hold the same present-day value as its nominal $75 million suggests. As a result, the Mets’ luxury tax hit will be lower than his $25 million average annual value would imply. Plus, unlike Bonilla’s arrangement, there is no interest attached to Manaea’s deferred payments.

Jon Becker of FanGraphs estimates that the present-day value of Manaea’s deal for luxury tax purposes is just over $22 million annually, which is actually less than the AAV the Athletics gave Luis Severino and reportedly offered Manaea. For Mets owner Steve Cohen, who is once again facing a luxury tax in 2025, these savings could make a difference.

Teams with a luxury tax number exceeding $241 million must pay a tax on the excess. For most teams, the tax rate is 20%. However, for the Mets—who are considered third-time repeat offenders like the Dodgers, Yankees, and Phillies—the base rate climbs to 50%.

All of those teams, except the Phillies, also received a 10-pick penalty on their first 2025 draft selections for surpassing the second surcharge threshold of the Competitive Balance Tax.

The tax is tiered, with an additional 12% surcharge on every dollar between $241 million and $261 million. There is a 45% surcharge for dollars between $261 million and $281 million (42.5% for first-time offenders), and a final 60% surcharge for any amount over $281 million.

FanGraphs currently estimates the Mets’ payroll to be $276,606,686 million this upcoming season. While this places them just under the third tax bracket, it marks a sharp decline from the $347,650,544 CBT payroll they finished with in 2024, which resulted in $97,115,609 in penalties, according to ESPN.

Of course, this figure does not include potential deals with first baseman Pete Alonso or any other trades or signings the Mets might make before the offseason ends. Nonetheless, the savings from Manaea’s deferred payments could influence the team’s strategy as they plan future moves.