Dodgers: Why Mookie Betts’ extension doesn’t affect extending other stars

The Los Angeles Dodgers agreed to a 12-year, $365 million contract extension with Mookie Betts.

In February the Los Angeles Dodgers traded Alex Verdugo, Jeter Downs and Connor Wong to the Boston Red Sox in exchange for former American League MVP, Mookie Betts. On Wednesday, the Dodgers made sure that this trade was more than just a one-year rental.

The Dodgers signed Mookie Betts to a massive 12-year, $365 million contract extension. On top of the $27 million salary that he had in 2020, Betts will be making $392 million with the Dodgers over 13 seasons. Well, $375 million, as he is only making $10 million this season at his 60-game prorated salary.

The stigma that the Dodgers never sign superstars to large contracts is now erased as the team has signed Betts to the largest contract in baseball history, and would be largest in sports history if it was not for Patrick Mahomes’ extension just a few weeks ago.

Most Dodger fans are celebrating the news, but there is one question that has emerged for those that like to be worrisome: does this mean the Dodgers won’t be able to extend Cody Bellinger, Walker Buehler and other notable stars down the line?

The answer to that question is simple: no. Mookie Betts’ extension has no impact whatsoever on the Los Angeles Dodgers extending their homegrown stars.

Why Mookie Betts’ extension doesn’t handcuff the Los Angeles Dodgers with Cody Bellinger and Walker Buehler:

First, let’s look at how much Betts is earning per season. The exact details of his contract have not yet been released but he has an annual approximate value of $30.6 million. That will likely start lower in the beginning years and balloon towards the later years, but either way, unless the contract is unprecedently back-loaded, the most the Dodgers will pay Betts in a season is $36-37 million.

There is no hard salary cap in baseball, but there is the luxury tax threshold, which is currently set at $208 million, that fines teams for spending too much with the tax rate increasing every year that a team spends over the threshold.

The Dodgers have avoided going over this number in the past and they likely will do their best to avoid ballooning the payroll to avoid paying the tax. But if it does come down to it, the Dodgers have more than enough money to pay the fine.

The luxury tax threshold increases year over year as well, although it is hard to gauge what it will be like in the near future with revenues down from the coronavirus pandemic. However, by the time Cody Bellinger and Walker Buehler are set to get paid, things should be back to normal and the tax should be back on its way up.

The three important players to keep in mind are Corey Seager, Cody Bellinger and Walker Buehler, who are set to become free agents in three consecutive offseasons. Seager after the 2022 season, Bellinger after the 2023 season and Buehler after the 2024 season.

So right away you can tell that the Dodgers have time to figure this out.

Not only do they have time to figure it out, but they have so much payroll being freed up in just the next two years alone. Justin Turner, Joc Pederson, Enrique Hernandez, Alex Wood, Blake Treinen and Pedro Baez are all free agents after this season. They account for $51.65 million in salary-cap space being freed up.

Of course, there are arbitration increases and the Dodgers are going to want to perhaps re-sign Justin Turner to another short-term deal, but Betts is only set to have a $3.6 million raise (based on his AAV) from this season to next and the Dodgers are already under the luxury tax threshold.

Then, the following offseason, the Dodgers are freeing up another $51 million just counting Clayton Kershaw and Kenley Jansen. Like Turner, Kershaw might get another short-term deal at a high salary and Jansen will absolutely not be re-signed for much.

So yes, while they have to figure out the likes of Pederson, Hernandez, Chris Taylor and some of those other guys if they want to keep them around, they are saving so much money over the next two years alone. Over $100 million.

The front office is smart as well. They are not going to sign an older Turner or Kershaw to long-term deals that restrict Bellinger, Seager and Buehler.

The money is there and with the Dodgers consistently having a top-10 farm system in baseball, the team will likely continue to bring up prospects that make a huge impact for a lower cost, just as they have been over the last several years.

So at the end of the day, don’t worry about the Dodgers not being able to re-sign Cody Bellinger, Walker Buehler and Corey Seager. They have the money, they have the brains to make it work, and at the absolute worst, we get 3-4 years of the best young core in baseball.