Dodgers' Andrew Friedman Rips 'Lazy Narrative' About Rumored $1B Contract Deferrals

Los Angeles Dodgers president of baseball operations Andrew Friedman is pushing back against criticism for how the team is structuring contracts to help add marquee players to an already-loaded roster.

Speaking to reporters during Blake Snell's introductory press conference, Friedman addressed the "lazy narrative" that the Dodgers are manipulating the system.

"I think the Shohei one is just jarring to people because it's so different, and I think the others just unfairly get lumped into that," Friedman said. "But I think it's kind of a lazy narrative."

The two marquee deals the Dodgers have done so far this offseason for Snell (five years, $182 million) and Tommy Edman (five years, $74 million) both included deferred money. The total deferred money in those contracts bring their total amount of deferrals over $1 billion.

The bulk of that deferred money is from Shohei Ohtani, who will be paid $680 million of his $700 million contract after the deal expires following the 2033 season.

Structuring deals with deferred money serves two purposes for the Dodgers. The first is it allows them to lower the net present value of the contract, which lowers the amount that counts toward the competitive balance tax.

The Dodgers are currently more than $40 million over the 2025 CBT threshold of $241 million, with more moves likely to be made, but the amount of money they will owe for exceeding the limit isn't as much as it would be if they were paying all of the deals over the life of the contract.

The other purpose is the Dodgers can entice players to sign and not have to worry about paying California tax because they may not be living in the state by the time they receive the deferred payments.

For instance, Ohtani is going to save an estimated $98 million in state tax payments by deferring 97 percent of his salary. The move generated so much attention that California lawmakers are attempting to change the federal tax code to block such moves from happening in the future.

Even if MLB teams are upset about the Dodgers' strategy, they aren't breaking any rules. The collective bargaining agreement states there is no limit to how much deferred money teams can carry.

It's a practice that's been employed for decades. The first-known contract with deferred money was Daryl Strawberry's contract with the New York Mets that was signed in 1985.

Deferred deals were a key part of the Washington Nationals' team-building strategy in the mid-2010s and helped them field a roster that won a World Series title in 2019. Stephen Strasburg, Patrick Corbin and Max Scherzer all signed contracts with the club that included deferred money.

The Dodgers may have taken deferred money to an extreme level, but their business savvy is making it work for a team that is going to be among the favorites to win the World Series for years into the future.