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B-Tender wrote: ↑Wed Dec 13, 2023 1:03 am Of the $700M in the contract, only $460M counts against the CBT(Competitive Balance Tax). I don't understand why this is so.

By structuring the contract in this way, the idea is to give the Dodgers more financial flexibility in the short term, but also ease their burden relative to the Competitive Balance Tax (CBT). For 2024, the CBT is $237 million, and with the structure of this deal the Dodgers would currently be under the CBT threshold, though it is assumed more big moves are on the way.

A team's Competitive Balance Tax figure is determined using the average annual value of each player's contract on the 40-man roster, plus any additional player benefits. If there was no money deferred, the AAV on Ohtani’s contract would be $70 million. However, any money deferred outside the term of the contract is calculated using its present-day value.

Because the value of a dollar decreases over time, the contract has a present-day value of roughly $460 million for the purposes of the CBT, given that so much of it is deferred for more than a decade. Therefore, the Dodgers will have a CBT payroll hit of roughly $46 million per year for the next 10 years from Ohtani’s contract. Essentially, Ohtani offered to defer this much money in order for the Dodgers to have payroll flexibility to continue building a winning team.

Burn1dwn wrote: ↑Wed Dec 13, 2023 6:58 pm

B-Tender wrote: ↑Wed Dec 13, 2023 1:03 am Of the $700M in the contract, only $460M counts against the CBT(Competitive Balance Tax). I don't understand why this is so.

By structuring the contract in this way, the idea is to give the Dodgers more financial flexibility in the short term, but also ease their burden relative to the Competitive Balance Tax (CBT). For 2024, the CBT is $237 million, and with the structure of this deal the Dodgers would currently be under the CBT threshold, though it is assumed more big moves are on the way.

A team's Competitive Balance Tax figure is determined using the average annual value of each player's contract on the 40-man roster, plus any additional player benefits. If there was no money deferred, the AAV on Ohtani’s contract would be $70 million. However, any money deferred outside the term of the contract is calculated using its present-day value.

Because the value of a dollar decreases over time, the contract has a present-day value of roughly $460 million for the purposes of the CBT, given that so much of it is deferred for more than a decade. Therefore, the Dodgers will have a CBT payroll hit of roughly $46 million per year for the next 10 years from Ohtani’s contract. Essentially, Ohtani offered to defer this much money in order for the Dodgers to have payroll flexibility to continue building a winning team.

Because the value of a dollar decreases over time...

you're the number guy. Maybe you can explain, because I am still confused....

B-Tender wrote: ↑Wed Dec 13, 2023 7:35 pm

Burn1dwn wrote: ↑Wed Dec 13, 2023 6:58 pm

B-Tender wrote: ↑Wed Dec 13, 2023 1:03 am Of the $700M in the contract, only $460M counts against the CBT(Competitive Balance Tax). I don't understand why this is so.

By structuring the contract in this way, the idea is to give the Dodgers more financial flexibility in the short term, but also ease their burden relative to the Competitive Balance Tax (CBT). For 2024, the CBT is $237 million, and with the structure of this deal the Dodgers would currently be under the CBT threshold, though it is assumed more big moves are on the way.

A team's Competitive Balance Tax figure is determined using the average annual value of each player's contract on the 40-man roster, plus any additional player benefits. If there was no money deferred, the AAV on Ohtani’s contract would be $70 million. However, any money deferred outside the term of the contract is calculated using its present-day value.

Because the value of a dollar decreases over time, the contract has a present-day value of roughly $460 million for the purposes of the CBT, given that so much of it is deferred for more than a decade. Therefore, the Dodgers will have a CBT payroll hit of roughly $46 million per year for the next 10 years from Ohtani’s contract. Essentially, Ohtani offered to defer this much money in order for the Dodgers to have payroll flexibility to continue building a winning team.

Because the value of a dollar decreases over time...

you're the number guy. Maybe you can explain, because I am still confused....

So the way I read this, is they are saying $46M/yr now is equal to $70M/yr 10 years from now. I'm assuming they are using a standard inflation rate. Basically, Otani signed a $460M contract, but because he is differing the payout, it will take $700M in 2034 dollars to provide the same value.

saltydog wrote: ↑Wed Dec 13, 2023 8:50 pm

B-Tender wrote: ↑Wed Dec 13, 2023 7:35 pm

Burn1dwn wrote: ↑Wed Dec 13, 2023 6:58 pm

B-Tender wrote: ↑Wed Dec 13, 2023 1:03 am Of the $700M in the contract, only $460M counts against the CBT(Competitive Balance Tax). I don't understand why this is so.

By structuring the contract in this way, the idea is to give the Dodgers more financial flexibility in the short term, but also ease their burden relative to the Competitive Balance Tax (CBT). For 2024, the CBT is $237 million, and with the structure of this deal the Dodgers would currently be under the CBT threshold, though it is assumed more big moves are on the way.

A team's Competitive Balance Tax figure is determined using the average annual value of each player's contract on the 40-man roster, plus any additional player benefits. If there was no money deferred, the AAV on Ohtani’s contract would be $70 million. However, any money deferred outside the term of the contract is calculated using its present-day value.

Because the value of a dollar decreases over time, the contract has a present-day value of roughly $460 million for the purposes of the CBT, given that so much of it is deferred for more than a decade. Therefore, the Dodgers will have a CBT payroll hit of roughly $46 million per year for the next 10 years from Ohtani’s contract. Essentially, Ohtani offered to defer this much money in order for the Dodgers to have payroll flexibility to continue building a winning team.

Because the value of a dollar decreases over time...

you're the number guy. Maybe you can explain, because I am still confused....

So the way I read this, is they are saying $46M/yr now is equal to $70M/yr 10 years from now. I'm assuming they are using a standard inflation rate. Basically, Otani signed a $460M contract, but because he is differing the payout, it will take $700M in 2034 dollars to provide the same value.

The Dodgers will make $250-$300m in merchandise sales alone to the Japanese market within 3-4 years.

saltydog wrote: ↑Wed Dec 13, 2023 10:51 pm

B-Tender wrote: ↑Wed Dec 13, 2023 10:59 pm This will make it even sweeter when the Dodgers win 100 games in the regular season and then lose in the first or second round of the playoffs.

pork wrote: ↑Tue Mar 26, 2024 3:54 pm too bad pete rose didnt have an interpreter

Animal wrote: ↑Tue Mar 26, 2024 4:27 pm

pork wrote: ↑Tue Mar 26, 2024 3:54 pm too bad pete rose didnt have an interpreter

if escaping gambling charges is as simple as pointing to another guy and saying "he did it". then I wonder why Pete Rose didn't think of that?

Animal wrote: ↑Tue Mar 26, 2024 4:27 pm

pork wrote: ↑Tue Mar 26, 2024 3:54 pm too bad pete rose didnt have an interpreter

if escaping gambling charges is as simple as pointing to another guy and saying "he did it". then I wonder why Pete Rose didn't think of that?

Reservoir Dog wrote: ↑Tue Mar 26, 2024 4:34 pm

Animal wrote: ↑Tue Mar 26, 2024 4:27 pm

pork wrote: ↑Tue Mar 26, 2024 3:54 pm too bad pete rose didnt have an interpreter

if escaping gambling charges is as simple as pointing to another guy and saying "he did it". then I wonder why Pete Rose didn't think of that?

There's something smelly going on here.

How could an interpreter get access to millions of Ohtani's money?

Animal wrote: ↑Tue Mar 26, 2024 7:44 pm

Reservoir Dog wrote: ↑Tue Mar 26, 2024 4:34 pm

Animal wrote: ↑Tue Mar 26, 2024 4:27 pm

pork wrote: ↑Tue Mar 26, 2024 3:54 pm too bad pete rose didnt have an interpreter

if escaping gambling charges is as simple as pointing to another guy and saying "he did it". then I wonder why Pete Rose didn't think of that?

There's something smelly going on here.

How could an interpreter get access to millions of Ohtani's money?

No doubt about it. And I am going to bet that they have the proof. what will it take for that interpreter to roll over on him?