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  1. #251

    Re: The 197M thread.

    Quote Originally Posted by nyy42 View Post
    You have the description correct. The penalty is 20% of 50M, based on the amount of overage above the threshold, not the total salary.

    Now there is a surtax applied to teams who have a payroll that exceeds the luxury tax threshold by more than $20M. Between $20M and 40M and there's a surtax of 12%, above $40M and it jumps to 42.5%, and 45% if you repeat it again. For example, assuming the threshold stays at $197M in 2019 (it will probably be higher), if we had a payroll of $238M, we'd pay a total tax of $8,625,000 -> comprising of the flat 20% of $8.2M plus the additional surtax of $425,000 on the excess $1M.

    If we didn't reset this year, we'd pay a total of $20,925,000 -> comprising of the flat 50% tax of $20.5M plus the 45% tax on the $1M ($425,000).

    Additional thing to consider going forward is that the luxury tax penalties going forward will include loss of draft picks
    So all this concern with the luxury tax is over the difference between $20.5M and $8.6M or about $12M in your example, that's like spare change for the Yankees. For example if a $12M player was injured all season and we needed to replace them with another $12M player there would not be a multiyear discussion about it. The Yankees probably make $12M on soft drinks in one summer, or dumping Headley's salary is the equivalent of the tax. Sheesh, I'm not so worried about the $197M anymore.

  2. #252
    NYYF Cy Young


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    Re: The 197M thread.

    Quote Originally Posted by primetime714 View Post
    Harper can play any OF position even CF. Judge or Stanton will also probably backup 1B in the future (both played 1B in high school and are too big to be OFs forever). And then you have the DH to rotate the OFs at. Stanton also has an opt-out that he might take if the market escalates. Offensively Trout is the only player that is a clear better bet to produce than Harper going forward.

    Yankees minor leagues is packed with pitching and with a complete offense they'll have plenty of trade chips to work with to add to the rotation. And if Andujar or Torres doesn't work out they can get cheap vets or defensive players
    You never really know (Judge, Harper, and Stanton in OF). Just read Boone will be trying both Judge and Stanton in LF this ST. Stanton already has a great contract so I don't think he will opt out. I think this move is a great match for everybody. I have high hopes for Torres and Andujar this year. I'll think about Harper next year.

  3. #253
    Slow in, Fast out ThePinStripes's Avatar
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    Re: The 197M thread.

    Quote Originally Posted by YankeeSTH View Post
    So all this concern with the luxury tax is over the difference between $20.5M and $8.6M or about $12M in your example, that's like spare change for the Yankees. For example if a $12M player was injured all season and we needed to replace them with another $12M player there would not be a multiyear discussion about it. The Yankees probably make $12M on soft drinks in one summer, or dumping Headley's salary is the equivalent of the tax. Sheesh, I'm not so worried about the $197M anymore.
    Maybe as a fan, but it would be outright shocking and beyond indefensible from a business and management position if the Yankees went over the luxury tax threshold this year. It's simply not happening.

    Not to mention, with less luxury taxes, that's more to spend on players. Even as a fan, I don't want the Yankees going over luxury tax.

    Think of it this way. It makes every additional player 50% more expensive. So Harper's $400M contract becomes $600M for us and $400M for teams under it. Hard to compete paying 50% more and having NYC cost of living, taxes, etc.
    A fool and his money can throw one heck of a party!

  4. #254
    Very stable genius
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    Re: The 197M thread.

    Even more important the loss of draft picks for repeated offenses
    my sanity is my biggest strength!

  5. #255
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    Re: The 197M thread.

    Baseball now has as close to a salary cap as can be for the first time. We may go over some years but will have to reset periodically. I have a feeling the next CBA negotiations may not be as smooth as they have been.
    my sanity is my biggest strength!

  6. #256

    Re: The 197M thread.

    Quote Originally Posted by YankeeSTH View Post
    So all this concern with the luxury tax is over the difference between $20.5M and $8.6M or about $12M in your example, that's like spare change for the Yankees. For example if a $12M player was injured all season and we needed to replace them with another $12M player there would not be a multiyear discussion about it. The Yankees probably make $12M on soft drinks in one summer, or dumping Headley's salary is the equivalent of the tax. Sheesh, I'm not so worried about the $197M anymore.
    That's because its not your money. Hal has clearly stated that's its vitally important to him, so I assume he's pretty worried about the $197M, and him being the owner and all, Cashman will in fact come in under that number.

  7. #257

    Re: The 197M thread.

    I'm curious to see how Hal wants to handle the luxury-tax going forward.

    We have a really young team and are building up for championship runs w/ the young core, so I think it makes plenty of sense to establish an initial payroll under the tax. I'm interested to see if he is as concerned w/ staying under the tax when it is second contract time for guys like Judge, Sanchez, and Severino.

  8. #258

    Re: The 197M thread.

    Quote Originally Posted by 51 View Post
    I'm curious to see how Hal wants to handle the luxury-tax going forward.

    We have a really young team and are building up for championship runs w/ the young core, so I think it makes plenty of sense to establish an initial payroll under the tax. I'm interested to see if he is as concerned w/ staying under the tax when it is second contract time for guys like Judge, Sanchez, and Severino.
    I'm more interested to see if he'll do what it takes to win once the tax has been reset. My guess is he'll continue to stay under and rely on Cashman to work with that even if teams like the Dodgers and others go back over. I think Hal wants the team under the threshold no matter what moving forward.

  9. #259
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    Re: The 197M thread.

    Quote Originally Posted by primetime714 View Post
    I'm more interested to see if he'll do what it takes to win once the tax has been reset. My guess is he'll continue to stay under and rely on Cashman to work with that even if teams like the Dodgers and others go back over. I think Hal wants the team under the threshold no matter what moving forward.
    That would be a poor decision. He should take advantage of the market he's in.

  10. #260
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    Quote Originally Posted by primetime714 View Post
    I'm more interested to see if he'll do what it takes to win once the tax has been reset. My guess is he'll continue to stay under and rely on Cashman to work with that even if teams like the Dodgers and others go back over. I think Hal wants the team under the threshold no matter what moving forward.

    I support the decision to be competitive and get under the threshold so that going forward they can be spenders when there's a strong FA class or its time to resign the good young players.

    If the goal is to get under and stay under no matter what then I and I assume many fans will not be too supportive of that.

  11. #261
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    Re: The 197M thread.

    Having a huge payroll is mostly a sign of a poorly run baseball operations department.

    If you're constantly bring in new kids on rookie deals you shouldn't have much of a problem staying under.

  12. #262

    Re: The 197M thread.

    Quote Originally Posted by 51 View Post
    I'm curious to see how Hal wants to handle the luxury-tax going forward.

    We have a really young team and are building up for championship runs w/ the young core, so I think it makes plenty of sense to establish an initial payroll under the tax. I'm interested to see if he is as concerned w/ staying under the tax when it is second contract time for guys like Judge, Sanchez, and Severino.
    I wouldn't be surprise that another reason why they want to get under the threshold this year is so they can extend some of those guys next off season like they did with Cano one time. They can't do such extensions this year without going over the threshold.
    Poor ownership can hold a baseball team down for years!

  13. #263

    Re: The 197M thread.

    Quote Originally Posted by YankeePride1967 View Post
    Baseball now has as close to a salary cap as can be for the first time. We may go over some years but will have to reset periodically. I have a feeling the next CBA negotiations may not be as smooth as they have been.
    What's wrong with the current CBA from the players perspective is that the thresholds are set too low compare to the increase in baseball revenues. IMO, the following should have been threshold limits or something similar than what they are now.

    2018 - 210-215M
    2019 - 220-225M
    2020 - 230-235M
    Poor ownership can hold a baseball team down for years!

  14. #264
    Slow in, Fast out ThePinStripes's Avatar
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    Re: The 197M thread.

    Quote Originally Posted by Yankees1962 View Post
    I wouldn't be surprise that another reason why they want to get under the threshold this year is so they can extend some of those guys next off season like they did with Cano one time. They can't do such extensions this year without going over the threshold.
    Interesting thought but the two biggest people they'd want to sign- Sanchez and Judge, will be in their 30s when they're FA eligible. Judge may become the face of the franchise, so it's hard to let him walk, but he'll command a lot less than a Harper or Trout, who would be in their primes.

    Baseball has been pretty shy about signing anyone to big money after their early 30s. It's not like it was with Arod and Pujols, etc. I think the shelf life of a lot of a lot of hitters was extended by PED and when they went away, we saw reality set back in. It was with the Arods and Pujols type contracts
    A fool and his money can throw one heck of a party!

  15. #265

    Re: The 197M thread.

    Quote Originally Posted by YankeeSTH View Post
    So all this concern with the luxury tax is over the difference between $20.5M and $8.6M or about $12M in your example, that's like spare change for the Yankees. For example if a $12M player was injured all season and we needed to replace them with another $12M player there would not be a multiyear discussion about it. The Yankees probably make $12M on soft drinks in one summer, or dumping Headley's salary is the equivalent of the tax. Sheesh, I'm not so worried about the $197M anymore.
    The big deal isn't the luxury tax in a given year but the fact that it accumulates. Getting down below the cap in 1 year puts you back down at the lowest penalty percentage. Staying over the cap adds to the percentage of the penalty each year.

  16. #266

    Re: The 197M thread.

    This article says the NY Yankees 2017 revenue was 526M

    https://www.forbes.com/teams/new-york-yankees/

    Would you spend an extra 12M in tax (or only 2.28% of last years revenues) if you wanted to go for it and win the World Series this year and increase your revenues by way more than 12M?

    Maybe we should sign a SP, infielder and BUC?

    I know, I know, I've been for getting under the 197M up until now but 12M out of 600M may be worth it?

    Either way, I am eagerly anticipating the 2018 season and going to the ballpark more times this year than past years!

  17. #267
    Very stable genius
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    Re: The 197M thread.

    Quote Originally Posted by Yankees1962 View Post
    What's wrong with the current CBA from the players perspective is that the thresholds are set too low compare to the increase in baseball revenues. IMO, the following should have been threshold limits or something similar than what they are now.

    2018 - 210-215M
    2019 - 220-225M
    2020 - 230-235M
    Would have been much better
    my sanity is my biggest strength!

  18. #268

    Re: The 197M thread.

    Quote Originally Posted by Yankees1962 View Post
    What's wrong with the current CBA from the players perspective is that the thresholds are set too low compare to the increase in baseball revenues. IMO, the following should have been threshold limits or something similar than what they are now.

    2018 - 210-215M
    2019 - 220-225M
    2020 - 230-235M
    This is what I said when they new CBA was signed. Hard to believe the Union agreed to stiffer penalties for going over the threshold without 1) a significant increase in the threshold level 2) Some type of spending floor. Additionally they agreed to a hard cap on international speeding which goes against everything Marvin Miller and Don Fehr fought for decades. Tony Clarke is the gift that keeps on giving for the owners.

  19. #269
    NYYF Cy Young


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    Re: The 197M thread.

    Quote Originally Posted by Yankees1962 View Post
    What's wrong with the current CBA from the players perspective is that the thresholds are set too low compare to the increase in baseball revenues. IMO, the following should have been threshold limits or something similar than what they are now.

    2018 - 210-215M
    2019 - 220-225M
    2020 - 230-235M
    Not only are they lower than the increase in baseball revenue, but the amount that the thresholds increase every year are lower than the rate of inflation. MLB revenue growth has also significanty outpaced the rate of inflation. But yeah, this chart shows how quickly MLB revenue growth has grown and how little of that money is now going to players (and players definitely deserve more of this money than the owners do). It’s a little outdated, but do you really think that it’s changed much?


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