Once it was announced that two-way superstar Shohei Ohtani was signing with the Dodgers on the record-setting 10-year contract, worth $700 million, it was also said that the deal would have plenty of deferrals within it. We now know exactly how much that will be. Insider Fabian Ardaya of The Athletic broke the news.
Ohtani agreed to defer all but $2 million of his annual salary each season. This means that $68 million of the $70 million will be paid out at the end of the contract.
“In an effort to enable the Dodgers to continue spending around stars Ohtani, Mookie Betts and Freddie Freeman, Ohtani agreed to defer all but $2 million of his annual salary — $68 million of his $70 million per year — until after the completion of the contract. The deferred money is to be paid out without interest from 2034 to 2043.”
Per Fabian Ardaya of The Athletic
This is an unprecedented move by a player of Ohtani’s caliber, as we never see players doing anything like this. This gives major flexibility back to the Dodgers in terms of spending to keep the team competitive around him.
It has been noted that the idea for these massive deferrals was the idea of Ohtani himself. After spending years with the Los Angeles Angels stuck in mediocrity, Ohtani wanted to make sure that things didn’t repeat themselves with the Dodgers.
For CBT purposes, the average annual value of the contract will be closer to $46 million per year. This gives LA so much extra spending power for the duration of his contract.
Many have wondered if the league would allow this to happen, and no the league can’t challenge it. ESPN Insider Jeff Passan explained that deferred money is limitless.
For this coming season, the Dodgers are still looking into signing free-agent pitcher Yoshinobu Yamamoto and possibly trading for other top-tier starters on the market. This extra money will allow them to spend more freely.
If Ohtani wasn’t already loved by the fans in Los Angeles, this will certainly do the trick! It’s Sho Time LA!
Photo Credit: Dale Zanine-USA TODAY Sports
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