We’ve written extensively about the Steinbrenner Cap, and repeatedly warned that it would have significant impact on how Cashman & Co. construct the team. We even suggested that the 2014 Yankees will be worse team than the current version, considering the worst contracts will still be on the books (Arod, Teixeira) and the best values will cease being values (Cano, Granderson, Gardner, Hughes).
Yet, it looks like Hal’s Quest for More Profit is already rearing its ugly head this offseason:
The Yankees are so serious about dropping under that $189 million luxury tax threshold for 2014 that, according to a source briefed on their plans, they would not even do a two-year contract in the $20 million range with Torii Hunter, The Post has learned.
Though Arizona’s Justin Upton has become available at the GM Meetings, a person involved in discussions said, “The Yankees are not on him.”
Yankees officials are insisting that you either commit to a philosophy or not, and they remain galvanized on gaining the financial benefits that are available via the collective bargaining agreement if they slip below $189 million.
For now, though, general manager Brian Cashman could not have been more definitive: “We are not going to be over the $189 million.
Upton, a talented, but enigmatic player, has three years at $38.5 million left on his contract and would count as just $8.54 million (the average annual value of his deal) toward the luxury tax payroll. Nevertheless, even committing those kind of dollars plus the cost-effective prospects necessary to land a player of Upton’s ilk currently is against the Yankees strategy.
The Yankees want to solve right field by committing as few (maybe zero) dollars to 2014 as possible. In fact, if they need to go to two years to keep Kuroda (which they might not agree to do either), it would all but assure not one cent of 2014 money is put toward right field.
Unless you live in la-la land, it’s obvious that the “Streinbrenners will do whatever it takes to win!” mantra we’ve heard over the years is pure fallacy, at least now that the kids are in charge.
However, all this budget posturing has got us thinking…what if all this maneuvering is more than Hal just trying to grease his pockets on an annual basis? What if the ultimate goal is to clean up the Yankees’ balance sheet so the team is more appealing to a buyer? Immediately forking out a big luxury tax check isn’t something a buyer would find ideal.
Hal has denied he’s looking to sell the team, but we’re getting the sense that this payroll directive is more than meets the eye.
Excellent.
29 Comments
Hal and Hank November 8, 2012 11:34
L’Chaim!
Hal and Hank November 8, 2012 17:54
or for you third grade level retards:
Le Hiyum!
its what jews say
Ben Ka bak's Dad November 9, 2012 21:15
Sue?
JK November 8, 2012 11:43
There are two huge incentives to get under the luxury tax threshold for 2 years. The new CBA severely punishes fourth time offenders imposing a rate of 50%. However, the tax rate for first year offenders will only be 17.5 percent, and for second and third time offenders, 30 percent and 40 percent, respectively. If they don’t get under $189M for 2014, they will continue to pay 50% each of those years. So, by going under $189 in 2014, they save a huge amount on luxury taxes going forward.
Also, they get a huge rebate in their revenue sharing if they are under the luxury tax threshold for 2 consecutive seasons. I’ve read it could be up to $40M.
If Hal is planning on spending again after 2015, he’s simply being a very smart businessman by not foregoing potentially over $100M. If he doesn’t spend after 2015, then yes, the Yankees will have significantly changed their spending philosophy.
EC November 8, 2012 12:09
There seems to be a third possibility…they know the team is going to struggle in the next few years no matter what they do because the team is old and bloated with A-Rod like contracts. Seems smart to clamp down on expenses for a few years while they figure out what to do with their aging superstars, get away from the luxury tax penalties and then open up the spending when you can really transform the roster in 3-5 years.
When is A-Rod’s contract up again? Yeesh, what a bad move that was.
Dude November 9, 2012 21:17
So assume they will stink and punt 2 years?
LOL
Ask Oak, Bal, Sf, etc about punting. Ask all the people who stopped going to Fenway and Citi.
Moshe Mandel November 8, 2012 11:46
Jew down the price
WW November 8, 2012 22:07
Good to see the racists are back in the comments. Guess you had to find someone else to go after once you lost the election. Maybe you should create a website of a burned cross with your friends and worship it. It would move your backwards ass forward in this digital age
Manager without braces November 9, 2012 05:43
Don’t direct that BS at GOP voters. Any worries about yankee luxury tax impact will seem like a drop in the bucket to the coming Obamacare taxes, repeal of current tax rate come Jan, the eventual downgrade of our credit rating again and inflation that will comes from monetizing the national debt. Everyone gets hurt especially those from the middle class down whose job opportunities and buying power decrease from a bloated out of control federal government and a devalued dollar. If the President keeps on the same path his next four years it will be ugly and hurt a lot of people in this economy.That has nothing to do with his race but his policies.
Obama November 9, 2012 14:13
Thank Jeremiah Wright for dumb brothers voting based on skin color.
critical thinker November 13, 2012 12:45
Let’s assess:
“Any worries about yankee luxury tax impact will seem like a drop in the bucket to the coming Obamacare taxes.”
Wrong, there are no “coming” taxes. There is no separate tax for Obamacare. Look at your paycheck. See that little deduction for “medicare”? It’s already there.
“repeal of current tax rate come Jan”
First off, the fiscal cliff is not something either party wanted to have happen, and the extension of the bush tax yet expiring at the end of the year was something both parties want. And the major issue holding it up is GOP pandering to it’s corporate base about just letting the cuts expire for those above $250k and keeping the rest in place. It’s pathetic. They can get it done.
“the eventual downgrade of our credit rating again and inflation that will comes from monetizing the national debt.”
Fox News pays economists to say silly things like that, which you don’t even fully understand but you cut and paste it here to sound intelligent. Bravo.
“Everyone gets hurt especially those from the middle class down whose job opportunities and buying power decrease from a bloated out of control federal government and a devalued dollar.”
Or, you can imagine the devastating Romney world we fortunately avoided, where capital gains tax disappears and the middle class loose critical ‘unspecified’ deductions and thereby increase their tax burden, taking money OUT of the consumers pocket and putting it into the wealthiest pockets to invest overseas in tax shelters. With no powerful consumer, our economy sours. That’s where the loss of buying power is.
“If the President keeps on the same path his next four years it will be ugly and hurt a lot of people in this economy.”
No sir, what would have been ugly was Romney dismantling the healthcare law that has saved so many millions of people, and provided healthcare to those with pre-existing conditions. What would have been ugly was reducing or eliminating federal funding for education of our children, leaving only the rich to send their kids to private schools while the poor and middle class kids go to public schools after they turn to shit. What would have been ugly would be women across the country being forced to keep their legimate rape-children. Or discriminating against everyone who’s not a Christian or following some fucking book written 1800 years ago by men living in an ancient world with no scientific knowledge. What would have been ugly would be the oil wells all across this country and the complete disregard for green tech. What would have been ugly would be people’s faucets in Ohio shooting out flammable water because of all the fracking. Or deregulating banks so they could take advantage of customers again.
Going back to the Bush policies would not have worked, because it didn’t work then and it won’t work now, nor will it ever work in the future.
I’m proud of America for making the right choice last week.
Sensitive RAB Guy November 9, 2012 20:22
yeah, all you Jews love the blacks until your daughter brings home one for dinner.
George Lucas November 8, 2012 11:51
I will buy your team for $4.05 billion, and not a penny more!
Mike L. NYDnews November 8, 2012 11:55
EXcellent
Mark Cuban November 8, 2012 12:00
Wouldn’t I be a great replacement for The Boss?
Roy Keane's Dog November 8, 2012 12:27
I’d put the probability of Hal & Co. looking for a buyer at 50% after the Dodgers’ sale. A franchise worth $800m in 2011 sells for $2b a year later? That means the Yankees are worth at least $4b, probably more like $5b.
Chau November 8, 2012 15:12
For fucks sake why can’t Minotaur use the same juice as Big Poppi? Bitch needs to produce more: steroids, speed, crack… Whateva nigga. Just get it done bitch. Suck it gay boys.
Longtime CBS shareholder November 8, 2012 15:45
I know that $100 million is a lot of money, but at the valuations that are getting thrown out ($4 BNish) $100 million seems like a relatively small price to pay to protect your hard-earned brand as baseball’s perennially successful heavyweights. The brand is the main asset they would be selling and if saving $100 million means a roster that stumbles to a couple of 3rd place AL East finishes they will lose multiples of that in the perceived value of the franchise. Any buyer who can justify a $4 BN price tag can only get to that number by ascribing top dollar to the brand, so if the Steinbrenners are really looking to sell they would be best served by investing a relatively minor amount to protect the Yankee image. The alternatives are penny wise but pound foolish.
Mike Burke November 8, 2012 17:02
I would be willing to return as President of the team and restore it to its late-1960s glory on two conditions. The Steinbrenners must go, and someone must figure out how to raise me from the dead.
True Fact November 8, 2012 17:29
In april of 1980 Peter Gammons wrote by 1998
all teams will be owned by banks.
he was off by 20 more years but his notion was correct.
Robinson Tilapia November 8, 2012 18:54
I like Jewish penis ….oy!!
Scott Boras November 8, 2012 19:29
Luxury tax? This is a concept with which I am not familiar.
Racist Coney November 8, 2012 23:01
Can the new owner move the team out of the Bronx? Like Connecticut maybe.
Cashman's Latest Statement November 9, 2012 00:35
When asked if he felt confident if he’d have the Yankees in position for another playoff appearance in 2013, he grimaced.
“I’ve never felt good,” he said.
Here’s the article for those poised over the dislike button– ready to scream “lies.”
http://mlb.mlb.com/news/article.jsp?ymd=20121108&content_id=40217732&vkey=news_mlb&c_id=mlb
Mike L. NYDnews November 9, 2012 09:44
They need to become a successful small market team like the Mets, Boston, Seattle etc. They don’t need to run up their debt, although I believe it’s fine for our country under our great president.
Obama November 9, 2012 14:14
Thanks for supporting me, Mike. To another 4 yrs of shit on a stick!
Dubya November 10, 2012 19:06
Heh heh heh… Heck of a job, brownie!
Next time run up your debt on wars of adventure and nobody will say anything.
Dude November 9, 2012 21:19
Can we merge Hal and Hank and basically make them their father?
Dick Hurtz November 10, 2012 09:41
I hear the Wilpons are looking for another team….