Anthony Rendon will get paid
The Washington Nationals are treating baseball’s luxury tax like a communicable disease, and want to stay as far away as they can from it.
But the Nationals may soon find a large check in the mail, and, luxury tax or not, they will be pressured to spend their windfall on players one player in particular, Anthony Rendon no matter what the penalty.
Washington went over baseball’s payroll spending limit last year by $8 million, resulting in a $2.4 million tax paid for simply spending money.
It must have been very painful for the Lerner family to pay a penalty for spending money. They are typically the ones who make others pay penalties.
“It’s a pretty severe penalty if you go over and it’s been our goal all year to stay under that,” his son, Mark Lerner, who took over last year as the team’s managing general partner from his father Ted, told NBC Sports Washington last month.
But circumstances can affect those goals, and circumstances may be changing soon for the Lerners and the Nationals.
With Bryce Harper in the rearview mirror, the player Washington has to set its sights on keeping is third baseman Anthony Rendon, who is going into the last year of his contract. While not in line for Harper numbers, Rendon is still set to land a lucrative contract that could put Washington back in baseball’s leper colony the luxury tax penalty.
There may be an added development that pressures the Lerners to sign Rendon, penalties be damned a fat paycheck from the Baltimore Orioles and the Mid-Atlantic Sports Network.
The battle between the two teams for network revenue has dragged on for seven years, but may finally be coming to a close. According to sources, that could cost the Orioles a lot of money. Club officials in Baltimore expect to lose big when the decision is announced by baseball’s Revenue Sharing Definitions Committee, where the fight began and wound up in the courts for years before being sent back to the committee for a decision.
They had a hearing in November, and a ruling is expected to come down at any time a ruling that could like cost the Orioles $200 million in regional cable revenue for the Nationals that has been frozen while the dispute has gone on.
That is likely an Anthony Rendon contract and then some.
The Lerners will have a difficult time not spending that MASN money on players, luxury tax be damned. They have argued in court documents that the Orioles’ failure to pay the Nationals their fair market value in television money has hurt their ability to pay players.
“MASN’s underpayment of rights fees has already required the Nationals to fund payroll and other expenses from its own reserves, and further delay could require the Nationals to seek new financing,” according to an affidavit filed by Washington lawyers several years ago. “This is not only burdensome in its own right, but it places the Nationals at a competitive disadvantage to other baseball clubs, which typically receive fair market value from their regional sports networks for their telecast rights. Without this added income, the Nationals are handicapped in their ability to invest in efforts to improve the team. For instance, without this added and steady income, the Nationals cannot bring full economic confidence to investments in multi-year player contracts to keep up with the fierce competition for top players especially when such control over finances is in the hands of a neighboring club.”
I believe once that MASN check is written, this becomes Rendon’s negotiating statement.
Now, the Orioles can appeal the committee’s decision again, as they have in the past. But previously they appealed it on the grounds it wasn’t a fair hearing. They can’t plow that ground again. Now they may be limited to the judgment amount alone to dispute. They are running out of room and maybe time.
Like ESPN and other cable networks, MASN has been losing subscribers in the cost-cutting movement, and the network could find itself up for sale soon. But regional sports networks are still hot commodities, and it’s possible that MASN could wind up under the ownership of Ted Leonsis and the NBC Sports Washington umbrella.
And the Orioles have their own issues. The Baltimore Sun has reported that Major League Baseball has asked the team to tell them who is running the organization, with 89-year-old owner Peter Angelos reportedly in failing health. The two sons, John and Lou Angelos, are in line to operate the franchise, but that needs approval from other owners. That could be problematic, and the team struggling with poor attendance could find itself for sale as well.
But likely not before they have to write a big check payable to the Washington Nationals, who may just sign it over to Anthony Rendon.
⦁ Hear Thom Loverro on 106.7 The Fan Wednesday afternoons and Saturday and Sunday mornings.