Late Tuesday night, the Yankees and Gerrit Cole agreed on a record-shattering, nine-year, $324-million contract. What does this mean for Cole, the Yankees and Major League Baseball? Here are some quick questions and answers.
Q: How high will the 2020 Yankees’ payroll be?
A: The respected website Spotrac estimates the 2020 Yankees’ current luxury-tax payroll, with the addition of Cole’s $36 million salary, at just over $249 million.
Q: Can you clarify what you mean by “luxury-tax payroll?”
A: Gladly. A luxury-tax payroll is calculated by using the annual average value for players with long-term contracts as opposed to the actual dollars spent on such a player in a given year. For instance, Giancarlo Stanton (sorry) will earn $26 million next season, yet his luxury-tax payroll number stands at $22 million. The Yankees care most about their luxury-tax payroll because that number determines their luxury tax.
Q: Which leads naturally to…how much will the Yankees pay in luxury tax next season?
A: Well, all we’re dealing with now are estimates and there are more moves to come, but the key number will be how much they pay above $248 million, the highest threshold….