What the Dodgers added to the payroll in trade deadline deals

Now that the dust has settled and the Dodgers’ trade deadline deals are done, let’s look at how that affects the payroll. In adding Max Scherzer, Trea Turner, and Danny Duffy in two separate trades, the Dodgers added likely over $20 million in payroll, and something just south of that for competitive balance tax purposes.

Scherzer has the most complicated contract of the bunch, only because of deferred money. He’s making $35 million this season, with roughly $12.4 million remaining. But all of Scherzer’s salaries from 2019-21 are deferred through 2022-28, which discounts the present value, for competitive balance tax purposes.

Cot’s Contracts has Scherzer’s discounted salary for 2021 as $27,360,323, which would make the Dodgers’ CBT portion roughly $9.7 million over the final 66 days of the season.

Turner’s salary is $13 million, which leaves roughly $4.6 million for the Dodgers to pay. Turner is eligible for salary arbitration this winter, and isn’t a free agent until after the 2022 season.

Duffy has a $15.5 million salary in 2021, the final year of a five-year, $65 million contract signed back in January 2017. He has $5.5 million remaining the rest of the way, though the Royals are sending a yet undisclosed amount of money in the deal.

With Duffy on the injured list and likely unavailable until September, Royals general manager Dayton Moore told Lynn Worthy of the Kansas City Star the money sent to the Dodgers was to offset some of the risk going forward, but didn’t affect the group Kansas City will pick from for the player to be named later:

“The pool of players are what they are. We’ve agreed upon those. And the cash gives us a little bit of relief. Not as much as I’d hoped. Not as much as we tried to get in return. But at the end of the day, we made the best deal we could.”

With the caveat that we don’t yet know the amount of cash sent by the Royals, here’s a rough look at what the Dodgers added to the payroll at the deadline:

The Dodgers started the season with a projected competitive balance tax payroll of roughly $257 million, so adding these deals would put them even higher.

Major League Baseball’s competitive balance tax threshold for this season is $210 million. For the first $20 million over that threshold, the Dodgers would pay a 20-percent tax ($4 million), then a 32-percent tax for the next $20 million over ($6.4 million). For every dollar their CBT payroll is over $250 million, the tax rate is 62.5 percent, plus their first draft pick in 2022 dropping 10 spots.

“We don’t look at payroll on a one-year basis. We view payroll over a multi-year period,” Dodgers president of baseball operations Andrew Friedman said Friday. “From our standpoint, it’s about maximizing our odds of winning a championship whenever we can.”

With Trevor Bauer currently on administrative leave, it’s unclear how his CBT number is affected if he ends up suspended without pay. The average annual value of his three-year, $102 million contract is $34 million, so under normal circumstances that would be his 2021 CBT number. But given the various opt-out clauses in Bauer’s deal, his entire $28 million salary for this year is due on November 1 rather than paid throughout the season.

But let’s assume for a moment that Bauer is suspended without pay dating back to July 2 — the day he was placed on administrative leave — through the rest of the season, and that missing those 81 games would affect his salary accordingly. That lops $14 million off his CBT number for 2021, but with these trade deadline additions, the Dodgers would still be at a higher number than the $257 million projection at the start of the season.

That still leaves the Dodgers in the third and highest tier of competitive balance tax, which was expected.

“We know there are some added costs associated with it, which is not ideal, and it is a cost,” Friedman said of the payroll in February. “But we feel like with where we are and the team we have, the reward outweighs that.”