Around Baseball 2024

[John_Havok]

They aren’t circumventing the CBA with deferrals and signing bonuses. The CBA accounts for that.

 

The only thing they are circumventing is CA state income tax.

 

Didn't say that were circumventing the CBA, just the spirit of the CBT.

 

And well find out in 2 seasons whether the rest of baseball ownership agrees with that.

[Stangstag]

They aren’t circumventing the CBA with deferrals and signing bonuses. The CBA accounts for that.

 

The only thing they are circumventing is CA state income tax.

 

Which is actually a much more serious offense lol. Will be interesting to see if anything comes of this.

[Terminator]

Didn't say that were circumventing the CBA, just the spirit of the CBT.

 

And well find out in 2 seasons whether the rest of baseball ownership agrees with that.

 

Same goes for the CBT

[John_Havok]

Same goes for the CBT

 

Spirit of. I get it, it's currently allowed. But that's why they make new rules when people abuse it. Just like the LTIR and salary cap stuff I mentioned in the NHL. Allowed by the rules at the time, then the rules changed because of the spirit of the rule they were abusing.

[BTS]

I don't even think the spirit of the rule is being broken. I just can't see the issue that people are seeing with this.

 

Snell signs for 5/182

65M of that is deferred

That reduces the real value of the contract to 5/160 (or so)

Luxury tax hit would be 36M if no deferrals, but is ~32M because of the deferrals.

 

What am I supposed to be scandalized by here? It's not even an advantage unique to the Dodgers. Basically every team would love to defer as much money as possible.

[glory]

The much bigger issue two years from now will be what happens to league revenue with the regional sports networks folding. Manfred apparently wants to consolidate the local rights for as many teams as possible and make them national (ex. selling the rights to Amazon Prime, or ESPN, or whoever) but if he can't do that in time for the next round of CBA talks, or if that approach isn't as lucrative as the outdated local cable model, then we will start to see more chirping from owners (the small market ones). Personally I don't even think the deferral system will be a talking point. Deferrals happened well before the Dodgers recently, and an Ohtani situation will never happen again. He's the only global star baseball has, so he can make $2m a year and get way more in endorsements annually while he plays. Other players won't have that luxury.

[John_Havok]

I don't even think the spirit of the rule is being broken. I just can't see the issue that people are seeing with this.

 

Snell signs for 5/182

65M of that is deferred

That reduces the real value of the contract to 5/160 (or so)

Luxury tax hit would be 36M if no deferrals, but is ~32M because of the deferrals.

 

What am I supposed to be scandalized by here? It's not even an advantage unique to the Dodgers. Basically every team would love to defer as much money as possible.

 

As stated above, we'll find out after 2026 for sure. If new rules get put in we'll have the answer.

[mphenhef]

Which is actually a much more serious offense lol. Will be interesting to see if anything comes of this.

 

This is just it...you start messing with taxes and the individual states might put up enough of a fuss to make the anti-trust exemption get looked at again.

[mphenhef]

I don't even think the spirit of the rule is being broken. I just can't see the issue that people are seeing with this.

 

Snell signs for 5/182

65M of that is deferred

That reduces the real value of the contract to 5/160 (or so)

Luxury tax hit would be 36M if no deferrals, but is ~32M because of the deferrals.

 

What am I supposed to be scandalized by here? It's not even an advantage unique to the Dodgers. Basically every team would love to defer as much money as possible.

 

The deferrals only really help the team in the early years as well. For instance, starting in year 3 for Ohtani the Dodgers need to pay the present day value into an escrow to ensure they have the money to pay him at the deferral date.

[Brownie19]

Brandon Crawford officially retires. Dude had a fantastic career.

[BTS]

Brandon Crawford officially retires. Dude had a fantastic career.

 

Imagine hearing back in like 2012 that Bnandon Crawford would have a 30-WAR career. Dude had no speed, didn't even hit in the minors, but managed to get to just enough raw power to stay on the field everyday and contribute big value with the glove.

[max silver]

I don't even think the spirit of the rule is being broken. I just can't see the issue that people are seeing with this.

 

Snell signs for 5/182

65M of that is deferred

That reduces the real value of the contract to 5/160 (or so)

Luxury tax hit would be 36M if no deferrals, but is ~32M because of the deferrals.

 

What am I supposed to be scandalized by here? It's not even an advantage unique to the Dodgers. Basically every team would love to defer as much money as possible.

 

This deal on it's own isn't particularly egregious. I think where the impact likely starts becoming more apparent is when you tabulate all of the combined luxury tax savings the Dodgers are enjoying in totality with all of deferred money they have on the books. Someone more versed in calculating the savings than myself can hopefully add this all up, but between Freeman, Betts, Ohtani, Snell, and Glasnow as well if I recall correctly there has to be a rather substantial sum that the Dodgers aren't having to pay towards the luxury tax.

[BTS]

This deal on it's own isn't particularly egregious. I think where the impact likely starts becoming more apparent is when you tabulate all of the combined luxury tax savings the Dodgers are enjoying in totality with all of deferred money they have on the books. Someone more versed in calculating the savings than myself can hopefully add this all up, but between Freeman, Betts, Ohtani, Snell, and Glasnow as well if I recall correctly there has to be a rather substantial sum that the Dodgers aren't having to pay towards the luxury tax.

 

But I don't even consider it "savings". They're paying a luxury tax that reflects the actual value of the deal, all things considered. Like, they're not paying the amount they would if all 182M was paid in the next 5 years, because the actual contract Snell signed is significantly less valuable than a deal with no deferrals. If deferrals were not allowed, Snell doesn't get 182M. He gets 160M (or whatever).

[Orgfiller]

But I don't even consider it "savings". They're paying a luxury tax that reflects the actual value of the deal, all things considered. Like, they're not paying the amount they would if all 182M was paid in the next 5 years, because the actual contract Snell signed is significantly less valuable than a deal with no deferrals. If deferrals were not allowed, Snell doesn't get 182M. He gets 160M (or whatever).

 

Yeah I think the biggest thing here is just how these deals are reported. Ohtani signs for 10/700 and Snell for 5/182 makes it seem as if the Dodgers are flexing their financial muscle to vastly overpay for players. They aren't really, Ohtani actually went for 10/460 and 5/153 or whatever, which they still need to pay over the duration of their contracts into escrow. It's not like they're "only" paying Ohtani $2MM and Snell $18M per season, they still have to pay out the escrow amount. The rest of it is still being actively paid out by them, so this is where their financial muscle is actually being flexed.

 

They're still spending an insane amount each year on payroll, be it for present year payments, or future payments to the same players. Not every team can pull this part off, you still need to be able to afford having Freeman, Betts, Ohtani, Snell, Glasnow, Yamamoto etc. on FA level deals at the same time, while still affording to give out "pillow" 1/23.5 deals to Teoscar Hernandez level players. I think this is the part people are/should be actually upset about, but it's being convoluted around the misunderstanding from them as being mad at all these deferrals and complex contract structures. The Dodgers are on a late 90s/early 2000s Yankee esque run of domination that includes them attracting and signing just about every big FA. That's disheartening as a fan of a non big market team, and I'm not even really including the Blue Jays in this as we've seen that a top 10 payroll can very much get the job done against these kinds of teams.

 

Adding Soto to this mix would be an absolute slap in the face to MLB fans in terms of parity. Super teams are great for ratings but it sucks for everyone else who are fans of the sport or literally any other team.

[Brownie19]

Yeah I think the biggest thing here is just how these deals are reported. Ohtani signs for 10/700 and Snell for 5/182 makes it seem as if the Dodgers are flexing their financial muscle to vastly overpay for players. They aren't really, Ohtani actually went for 10/460 and 5/153 or whatever, which they still need to pay over the duration of their contracts into escrow. It's not like they're "only" paying Ohtani $2MM and Snell $18M per season, they still have to pay out the escrow amount. The rest of it is still being actively paid out by them, so this is where their financial muscle is actually being flexed.

 

They're still spending an insane amount each year on payroll, be it for present year payments, or future payments to the same players. Not every team can pull this part off, you still need to be able to afford having Freeman, Betts, Ohtani, Snell, Glasnow, Yamamoto etc. on FA level deals at the same time, while still affording to give out "pillow" 1/23.5 deals to Teoscar Hernandez level players. I think this is the part people are/should be actually upset about, but it's being convoluted around the misunderstanding from them as being mad at all these deferrals and complex contract structures. The Dodgers are on a late 90s/early 2000s Yankee esque run of domination that includes them attracting and signing just about every big FA. That's disheartening as a fan of a non big market team, and I'm not even really including the Blue Jays in this as we've seen that a top 10 payroll can very much get the job done against these kinds of teams.

 

Adding Soto to this mix would be an absolute slap in the face to MLB fans in terms of parity. Super teams are great for ratings but it sucks for everyone else who are fans of the sport or literally any other team.

 

That's just because a lot of people are easily fooled and can't comprehend what's really happening. We just saw a very good example of this. People who take the time to understand the deals don't think Ohtani got $700M - we know he got the equivalent of $460M.

[John_Havok]

That's just because a lot of people are easily fooled and can't comprehend what's really happening. We just saw a very good example of this. People who take the time to understand the deals don't think Ohtani got $700M - we know he got the equivalent of $460M.

 

I understand completely how it works, which is why I understand that its a very creative and rule abiding way to not pay as much tax when 70 million leaves the Dodgers every year, but only has to worry about potential penalties on 46 million of it.

[jaysblue]

In 2003, the Mariners used only 5 starting pitchers during the entire season. Without looking online, can anyone name all 5 starters?

[BTS]

In 2003, the Mariners used only 5 starting pitchers during the entire season. Without looking online, can anyone name all 5 starters?

 

Freddy Garcia

Aaron Sele

Jamie Moyer

Joel Pineiro

Gil Meche?

[Jimcanuck]

I understand completely how it works, which is why I understand that its a very creative and rule abiding way to not pay as much tax when 70 million leaves the Dodgers every year, but only has to worry about potential penalties on 46 million of it.

 

Are you sure its 70M. Wouldnt the money put in escrow be invested and increase in value over time? So only $46M or whatever the accountants say is proper is put in escrow?

[Stangstag]

I understand completely how it works, which is why I understand that its a very creative and rule abiding way to not pay as much tax when 70 million leaves the Dodgers every year, but only has to worry about potential penalties on 46 million of it.

 

Yeah the most frustrating thing about all this is that when you try to argue why its shady/problematic, people immediately assume it’s because you don’t understand the numbers or don’t understand accounting.

 

Fact of the matter is, we haven’t seen any other team take advantage of deferrals nearly as much as the Dodgers have these past 2 years. I am very interested to see if the Soto deal is also a ballooned fugazi with 200 million in deferrals.

 

And if other teams aren’t doing it… then why? Why do the Dodgers stand alone here?

[BTS]

Are you sure its 70M. Wouldnt the money put in escrow be invested and increase in value over time? So only $46M or whatever the accountants say is proper is put in escrow?

 

The Dodgers pay Ohtani 2M a year + 44M into escrow. 46M. The same as their luxury tax hit.

[Jimcanuck]

Yeah the most frustrating thing about all this is that when you try to argue why its shady/problematic, people immediately assume it’s because you don’t understand the numbers or don’t understand accounting.

 

Fact of the matter is, we haven’t seen any other team take advantage of deferrals nearly as much as the Dodgers have these past 2 years. I am very interested to see if the Soto deal is also a ballooned fugazi with 200 million in deferrals.

 

And if other teams aren’t doing it… then why? Why do the Dodgers stand alone here?

 

The actual question is why did Ohtani and Snell agree?

 

Ohtani just likes to sleep and play video games with his doggo at his side. Probably figures he will grow out of that and make better use of the money later.

[Jays24]

The actual question is why did Ohtani and Snell agree?

 

Ohtani just likes to sleep and play video games with his doggo at his side. Probably figures he will grow out of that and make better use of the money later.

 

It's obvious isn't it? Ohtani eventually gets his money while allowing the Dodgers to stack up their team during his playing career. It's a win/win.

[G-Snarls]

It's obvious isn't it? Ohtani eventually gets his money while allowing the Dodgers to stack up their team during his playing career. It's a win/win.

 

Ohtani also makes a s*** ton of money in endorsements every year

 

So it's not like he has to "get by" on 2M a year so he might not care that much.

 

When ranking the highest-paid athletes in the world in February, Sportico estimated he had $40 million in endorsements in 2023. Forbes followed up in May and raised the figure to $60 million.

 

And for sure he's getting even more now

Edited November 29, 2024 by G-Snarls

[Key22]

That's just because a lot of people are easily fooled and can't comprehend what's really happening. We just saw a very good example of this. People who take the time to understand the deals don't think Ohtani got $700M - we know he got the equivalent of $460M.

 

The same people who don't understand how tariffs are going to cost them far more money. The Dodgers are playing within the system - period.

 

If you are a free agent and baseball is your life and the money is roughly the same - you are going to either your hometown team or the team that has the best chance to win - or where all the hottest women live - LA is pretty damn hard to beat. Oh and the weather VS Toronto is an added bonus.

[Carlos Danger]

[L54]

The same people who don't understand how tariffs are going to cost them far more money. The Dodgers are playing within the system - period.

 

If you are a free agent and baseball is your life and the money is roughly the same - you are going to either your hometown team or the team that has the best chance to win - or where all the hottest women live - LA is pretty damn hard to beat. Oh and the weather VS Toronto is an added bonus.

 

Please keep your political allegiances to yourself thanks

[Masterbather]

Please keep your political allegiances to yourself thanks

 

I mean, commenting about tariffs COULD be interpreted as demonstrating political allegiances although you can still support either side and still think people are dumb for not knowing how tariffs work.

 

However having a certain image next to your username on EVERY SINGLE post you make most definitely is demonstrating your political allegiance 100% of the time.

 

For the record, I don't personally care dude but if you're going to throw stones from glass houses...

Edited November 29, 2024 by Masterbather

[Spanky__99]

Sure, I preferred him over Max Fried and if the Jays had an unlimited payroll, sure thing! I was expecting more around $150M for Snell. If he signed for a total of $182M with the Dodgers, it would have likely cost the Jays $200M to have him sign here. He wasn't going to sign for the same amount with the Blue Jays durh.

 

Okay.

[L54]

I mean, commenting about tariffs COULD be interpreted as demonstrating political allegiances although you can still support either side and still think people are dumb for not knowing how tariffs work.

 

However having a certain image next to your username on EVERY SINGLE post you make most definitely is demonstrating your political allegiance 100% of the time.

 

For the record, I don't personally care dude but if you're going to throw stones from glass houses...

 

That’s my favourite catcher Chadwick Tromp