Dodgers react to Shohei Ohtani’s $680 million deferment request: ‘Holy f***’

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Shohei Ohtani’s $700 million contract with the Los Angeles Dodgers shocked the baseball world this offseason. It reportedly stunned even the Dodgers.

A Sports Illustrated feature published by Tom Verducci on Ohtani ahead of the Dodgers’ debut in South Korea on Wednesday sheds new light on how the two-way phenom’s contract came together a few months ago, specifically the $680 million deferred. How did the idea of ​​doing this come about? Money till the end of the contract.

Such a structure is without precedent in baseball. A player agreeing to an IOU for 97% of his contract amount is so team-friendly that Ohtani’s contract sparked debate over whether MLB should act to shut that thing down Which many people call a flaw. It’s such a bizarre idea that only the player himself could come up with it to improve the competitiveness of his new team.

Per SI, Ohtani’s agent Nez Balelo explained the offer to the Dodgers’ president of baseball operations Andrew Friedman on December 7, two days before the deal was announced. Friedman told Verducci to shout “Deal!” Told the word. A few more things came to mind immediately, then after the call ended:

Friedman and Balello, who still had interest from other teams, agreed to talk in more detail again the next morning. After hanging up the phone, Friedman called Dodgers president and CEO Stan Kasten.

“Holy f—,” Friedman said.

“Is that ‘holy f—’ good or ‘holy f—’ bad?” Kasten asked.

Very nice indeed.

Instead of paying Ohtani the average annual value of his contract this year, $70 million, the Dodgers will pay him $2 million. Then another $2 million the next year, and every year until 2033. They will then pay him $68 million annually, presumably with the expectation that Ohtani’s revenue stream will already guarantee that it has paid for itself.

SEOUL, SOUTH KOREA - MARCH 18: Shohei Ohtani #17 of the Los Angeles Dodgers prepares to bat in the 5th inning during an exhibition game between Team Korea and the Los Angeles Dodgers at the Gocheok Sky Dome on March 18, 2024 in Seoul, South Korea .  (Photo by Chung Sung-jun/Getty Images)

Shohei Ohtani’s contract could only come from Shohei Ohtani. (Photo by Chung Sung-jun/Getty Images)

Financially, Ohtani will have to pay the price for his lack of interest in subsequent payments. This is such a big factor that the MLB Players Association estimates the actual present value of Ohtani’s contract at approximately $438 million, while MLB values ​​it at $460 million.

However, this would not be a total loss, as Ohtani would be able to avoid a large amount of California state income tax. Verducci noted that the California Center for Jobs and the Economy has estimated that if Ohtani is not living in California through the end of his contract, he could avoid $98 million in income taxes.

California State Comptroller Malia Cohen was not happy about using the news to demand a moratorium on the contract moratorium.

Shohei Ohtani’s deferred funding opens up the Dodgers’ offseason

Meanwhile, the Dodgers could use that $68 million on other things, namely making sure Ohtani wasn’t their only splashy acquisition in the offseason. On the same day Ohtani was dealt to the Los Angeles Dodgers, the team traded for Tampa Bay Rays All-Star Tyler Glasnow. They then signed another Japanese free agent, Yoshinobu Yamamoto, to the largest contract ever for a pitcher, as well as signing Teoscar Hernandez (one year, $23.5 million) and James Paxton (one year, $11 million). .

At average salaries, Glasnow, Hernandez and Paxton will combined to make $61.5 million next season — or $6.5 million less than the salary Ohtani is touting.

As Friedman said during Ohtani’s conference call, it’s a deal that any team would be afraid to pitch to Ohtani so they don’t disrespect him:

“I wouldn’t have had the guts to propose it, and that’s what’s funny about ‘Oh, the Dodgers!’ Friedman said. “I don’t have the courage to do that. But like [Ohtani’s agent Nez Balelo] He looked at it and brought it up while we were talking, everything he said throughout the process was incredibly consistent. Sometimes you get those experiences, but they don’t sync and match.”

The new-look Dodgers will make their debut in L.A. on Wednesday morning, with first pitch at the Gocheok Sky Dome scheduled for 3:05 a.m. PT against the San Diego Padres.

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