Salary Cap Disparity across the NFL

After seeing the uproar out of some of the Pittsburgh Steelers about Le’veon Bell’s absence yesterday, I wanted to take a look a look at the disparity between the rosters of the NFL Teams. I turned to overthecap.com, and am basing this little project on their accuracy.  I divided the salaries into subsets $20M+, $15M+, $10M+, $5M+ $1M+ and sub $1M.  Using the site page for each team, I charted the players based on their 2018 cap hit. Players who are either suspended, on IR, PUP, were not included, and neither was dead money for players no longer on each team.

AFC Summary

The two things that jump out at me the most is the Broncos, have the most 10M+ players in the AFC, and are tied for the most in the NFL with 6 and the fact that the Patriots have the second most players in the NFL (34) making $1M. I guess that is a perk of #fytb’s contract, but hey not everyone has a side business  (cough Balco part 2 cough) located onsite at the teams facility or a supermodel wife that brings in more money.  Jacksonville leads the NFL with 3 players over $15M, and with a reported $19M of cap space according to the NFLPA, and a $10M cap hit on their mediocre,  on a good day, QB Bortles, I’m sure they would have jumped at the chance of upgrading the position had a player like Aaron Rodgers been a free agent. The Colts and their billionaire buffoon owner Jim Irsay have the fewest players (33) making less than $1M dollars in 2018. #SuckwithLuck is hitting its prime. Good job Jimmy. Staying in the South, the Titans of Tennessee have the most players (35) making $1M+ for the 2018 season which is 66% of their roster, and they only have three making more than $10M. Buffalo has one lone player with a ’18 cap hit north of $10M and that is DE Jerry Hughes.

NFC Summary

Surprisingly, the Dallas Cowboys have the fewest players making $1M. That kinda goes against the stereotype, and with Prescott and Elliott still on rookie deals, it’s a bit more mind boggling.  Another thing that jumps out is the Los Angeles Rams, with all of their signings, and maneuvering, they don’t have a player commanding a $15M+ salary, but they are tied with the Bears for the most in the NFL making $5M. The Bears are also a bit of a surprise having that many at $5M+. The Bears also have the most players (32) making $1M+ this season, which again is a bit surprising, but their highest paid player, Khalil Mack ($13.8M), hello Oakland, is the lowest “highest paid player on a team”, in the NFC. So it seems they have their money spread out the best.  It should be noted that both the Rams and the Bears have this luxury due to having a star QB on his rookie deal. The Rams have done better than the Bears so far, but the Bears seem to be headed in the right direction.  Green Bay and Minnesota top the NFC with the most players making $10M+ with six each. Seattle has the fewest players earning  $5M+ and hopefully that equates to missing some talent on the field starting this Sunday when the Legion of B (only one of them left) comes calling in Denver.

Division Summary

The AFC East has the most players making $1M this years, and the NFC West has the fewest.  The NFC North and the AFC West have the most $20M+ players, but when the split shifts to $15M+, it’s the AFC North and the NFC East who have the most players on the field.

NFL Summary

When it comes to #’s, I’m not a fan of coincidences or oddities. I found it odd that each Conference had the same # of players with a $1M+  salary cap figure and below. I double checked it. It’s just one of those weird occurrences. The NFC has more players at the $20M, $15M and $10M dollar level but the AFC has more making $5M+.

10/16 teams in the AFC have 50%+ when it comes to players making $1M or more this year. In the NFC the # is 11/16 giving the NFL 21/32 which is 65.6%. There has always been a celebration of $1,000,000. The league minimum for 2018 is $480,000 for a rookie and jumps to $1,015,000 if a 10 year vet is on a league minimum contract. A quick looks shows that 28 of the Broncos on the 53 man roster have base salaries based on the league minimum, with Adam Jones the only 10 year vet. That’s just the base salary portion of the contract, many have some bonuses that add to it, and some have prorated bonus dollars that push their cap # into the various categories.  Rookies, Bradley Chubb and Courtland Sutton each earn the league minimum for their base salaries, but each have are in the $1M category based on the addition of the prorated signing bonus and Chubb nearly missed the $5M mark with his cap # coming in at $4,958,407

Closing

There are plenty of ways to build a team. You can try to stock the talent evenly on both sides of the ball, you can put more of an effort into dominating one over the other.  For the past couple of years, from a cap and an on field perspective the Broncos have been more invested in the defense. Adding Case Keenum at QB has given a bit more to the offense.  It’s a bit comical that Derek Carr ($25M ) is the highest paid player in the AFC this year, and Khalil Mack ($13.8M) has the lowest, “highest paid player” label in the NFC, with Gruden saying the Raiders couldn’t afford him. According to the NFLPA, it says the Raiders have $19M in cap space, but couldn’t find a way to structure a contract to keep their best player in Alameda County. Good for them /sarcasm, though that is good for the Broncos.

 

 

Case Keenum and a reported 2 years $36M What it could look like.

This topic will be revisited and updated once everything is official and his actual structure is known.

Updated Friday 3/16

Here is what the structure looks laid out in chart form:

It gives him a 2018 cap hit of $15M, it could have been constructed with a lower ’18 cap hit, but the team doesn’t seem too concerned about that, but after his $15M hits the books and the other moves the Broncos have made this year including the Von Miller restructuring it gives the Broncos roughly $20M in cap space.

Should the Broncos wish to walk away from the deal after one year, it would give them $10M of dead money that would have to be addressed.

Version 1

We will stick with the $36M as the basis of this and tweak it as needed and for the sake of simplicity let’s leave out incentives, workout and roster bonuses and let’s guarantee half of it. In the end, it might look comparable to the Mike Glennon deal that he signed with the Bears last year, and is now a year later shopping for a new team.

The simple approach $18M each year.

Back-loaded reflecting more year 1 cap savings.

There are pros and cons to each approach. The first scenario comes with a higher cap hit, but if the move is for a bridge to a QB drafted at #5, then the team can walk away without any form of a dead cap. If the contract contains any dollar guarantee in year 2, then there would be some dead $.  This will be discussed in more detail after things become official.

In scenario 2, it creates more year 1 cap space, and  again should they wish to move on after year 1, then the remaining prorated amount of $8.5M would be dead money but if he’s treated as a June 1st cut, then it would be split between ’19 and ’20.    It could be tweaked even more to lower the year 1 cap outlay with a lower signing bonus, which would then likely lead into adding more guarantees into year 2.

His contract in the end might look different, might contain incentives, that may or may not be reached. They can be simple. They can be complicated.

It will be interesting to learn the structure.    One thing though that is clear, with the Broncos not being “FLUSH” in cap dollars like say the Browns or the 49ers, they aren’t going to give up a chunk of what they do have as an experiment. Case Keenum was brought in to be QB1.

 

 

 

 

Why the Blake Bortles 3 year $54M deal works for all parties involved

Last night, it was announced that Jacksonville Jaguars quarterback Blake Bortles signed a contract extension that replaced his 5th year option he received from the Jaguars last spring. He was on the 2018 books for $19M and change. Year one of this extension replaces the 5th year option and he’s under contract until 2020. It is a reported 3 year deal totaling $54M with $26.5M in guarantees and could reach $66.5M if his incentives are maxed out.

Based on these reports, here is what his contract likely looks like.

Unofficial look based on reported numbers.

Why it works for Bortles?

He was due to be paid $19M and change for 2018 and received $26.5M in guarantees. The guaranteed portion is made up of a $15M signing bonus, a $5M base salary and a base salary that includes $6.5M guaranteed in 2019. It pays him quicker than it would have, and quite frankly, had they chose to go in a different direction and cut him, while he might have recouped that type of money with another team, it would have easily added some risk to that equation. He keeps playing for the team that drafted him #3 overall, and gives him more of a comfort zone than approaching life with a second team.  This isn’t a long term deal by any sense of the term, but if he plays it out, he can parlay it into another extension or hit free agency at 29/30 years old.

Why it works for the Jaguars?

First and foremost, it created $9M and change in 2018 cap space, which is opposite of the result the last two times teams extended a quarterback while holding a 5th year option. When the Colts/Raiders extended Andrew Luck & Derek Carr, their year 1 cap hits exceeded the 5th year option amount, thus flushing those cap dollars down the proverbial toilet. The Jaguars, at least structured it in a way for some immediate cap savings, and should they decide to go in a different direction in the future, the dead cap money will be manageable without offset language. If it includes offset language it’s even better for the franchise should they part ways.

Update 2/26: As you can see, the contract does have offset language in it, so the $6.5M guaranteed in 2019 would be absorbed by whatever team he is on in 2019, assuming he made more than $6.5M in year one of a new deal, otherwise the Jaguars would be on the hook for the difference.

Bortles has been up and down over his career, he threw 35 TD passes in his 2nd year in 2015, but he is 21-40 over the four years(10-6 in’17) but had a decent playoff run in ’17 while going 2-1. One could easily argue that some of the Jacksonville success and Division Championship is due to injuries to Deshaun Watson and Andrew Luck which easily stunted the production of the Texans & the Colts.

It secures a Quarterback they are comfortable with, and one that they know, one that helped lead them to the AFC Championship game this past season. Could they have gone in a different direction? Sure, they could have easily cut him, moving their available cap space to approximately  $40M, and then chased a free agent QB and with a proper structure, could have had plenty of money to chase other free agents. Oh and that is before any tweaking or massaging of contracts of players that are currently under contract.

It should be noted, that while it did create immediate cap space, it could have been structured in a slightly different way that would have given the Jaguars, even more ’18 cap space, but I’m sure they are happy with it as it is.

Broncos

From a Broncos perspective, it is one less team that is in the market for a 2018 QB1, so that is certainly a good thing.

Bortles Stats via NFL.com

http://www.nfl.com/player/blakebortles/2543477/careerstats

 

Why Structure is the key to the NFL Salary Cap

I mentioned on twitter and possibly another post that structure is the name of the game when it comes to an NFL Contract and the Salary Cap

Here is a look at Jimmy “Seven Starts” Garoppolo’s contract he recently signed with the 49ers via overthecap.com:

Jimmy Garoppolo signed a 5 year, $137.5 million contract with the 49ers on February 8, 2019. All contract details come via a report by ESPN’s Adam Schefter and please credit accordingly. Garoppolo received a $7 million signing bonus and $28 million roster bonus as part of his first year salary. His 2018 and $7.5 million of his 2019 salary are fully guaranteed bringing the full guarantee to $48.7 million. $74.1 million of the contract is guaranteed for injury. There are annual per game roster bonuses of $800,000.

The key components are the guaranteed dollars of the deal and the Cash Flow (meaning how quickly does the player get paid).

The 49ers had the luxury of “front-loading” the contract by allocating $37M in cap dollars in year 1. For the Broncos while “mathematically possible, via some moves, it would not be logical for the Broncos to set up a contract for a QB or anyone in this nature at this point.  When the Broncos signed Peyton Manning they were in a better cap situation than they are now and that afforded them to essentially treat Manning’s contract from a cap perspective as more of a year to year format with the bulk of the cap # coming from his base salary each year.  Had they been in their current situation his contract would have looked a bit different and likely a bit more like the hypothetical contract below.

Hypothetical 5 year $137.5 M deal with $48.7M+ guaranteed.

The biggest difference is that the 49ers are paying JG a $28.8M roster bonus, a $7M signing bonus and  higher base salary, while the hypothetical, is paying a $41.2M signing bonus, and a smaller base salary. The signing bonus allows for proration over the 5 years of the contract, while the 49ers are choosing to absorb more of a hit in year 1.

At the end of the day, this contract pays the player the same amount of money that the 49ers are paying Garoppolo, and I made sure to structure it so that the cash per year payout was identical to Garoppolo’s current deal, but gave him a tiny bit more of a guarantee just to make it “better”

Cash vs Cash

The cash payout in year 1 consists of Signing Bonus + Base Salary + Roster/Workout Bonus. In Years 2-5 it is simply Base Salary + Roster/Workout Bonus.

Cap vs. Cap is where the key differences come in.

Again, the 49ers had the luxury of being able to allocate 26.9% of the total contract in year 1. The Broncos for example, would prefer a smaller cap hit in year 1, and the $9.6M that the hypothetical provides is a vast difference between the 49ers structure.

The 49ers are paying more up front and have lower cap hits in year 2-5, but they can afford to do so.  A team like the Broncos would prefer the smaller/climbing structure so that there is an immediate impact on the cap that allows them to look at other free agents as well.  Down the road, should Jimmy G, not shine like the 49ers think he will, it would be easier for them to get out of the contract than if the contract was structured the way the hypothetical is because money comes off the books quicker from a cap perspective. There are Pros and Cons to everything, and in the NFL there isn’t a perfect contract when it comes to a high end acquisitions.

The AAV (Annaual Average Value) of both deals is $27.5M, but the two structures provide two entirely different  looking contracts from a cap perspective, but at the end of the day, It’s the same $, same years, same amount of guaranteed dollars.

 

 

 

What can the Broncos do in Free Agency with their Salary Cap Situation?

I won’t paraphrase that Vietnamese hooker in “Full Metal Jacket” by saying “anything they want”, but Kirk Cousins(or free agent QB of your choice) “ain’t too goddamned beaucoup.”

If a player is cut, traded, or moved on from, then there are a number of reasons involved as opposed to simply being a salary cap necessity to sign Kirk Cousins.  Can the Broncos keep their core group of players and sign Cousins to a high end contract? Yes.  Anyone suggesting otherwise is simply ignorant of the NFL Salary Cap.

The Broncos via overthecap.com/sportrac.com have roughly 25-26M in cap space. That # could increase when the cap is officially set likely within  the next 20-30 days(more on that later).

 

 

Reports  have it that Kirk Cousins could seek a $25-30M per year deal, but that doesn’t mean it has to be $25-30M across the board in each year. It can be structured as such, and it can be structured in various other ways too.  San Francisco had the luxury of being able to front-load much of Jimmy Seven Starts contract that was announced last week.  Denver doesn’t have that luxury. If anything, they would be more likely to back end the contract meaning lower cap totals up front that grow higher each year.

 

Cap Growth

I went with a fairly conservative estimate of 7%, an even more conservative example of 5% is shown a little bit lower.

Broncos Recent Spending on the QB position

As you can see, the Broncos have shopped at the bargain bin ever since Peyton Manning retired.  The Broncos have spent the fewest $’s in the NFL over the  past two years on the Quarterback position and it is not relatively close.   The lack of development from the QBs that are on the roster is a main reason forcing John Elway and the front office to look at  every option. Kirk Cousins is an attractive option and thankfully Washington shit the bed in how they handled him by tagging him two years in a row and not investing that money in a contract extension.

I won’t pretend to say that this is the contract that Kirk Cousins will sign with Denver, or that they will even offer him a contract structured in this way, or anything along those lines.  It is simply being presented as an option available to them. It is simply one option that a) allows the Broncos to sign the top free agent QB to hit the market since Peyton Manning (Drew Brees is a free agent, but he’s said he’s a Saint for life). b) it is structured in  way that would give Cousins a 2018 cap hit under $10M, and a 2019 cap hit under $17M and more importantly allows them to keep players in place. It comes at a secondary cost as  that it pushes money down the road, but the cap has historically grown, and with the new Thursday Night TV deal, I would be surprised if that the estimated cap of $178M, doesn’t end up in the $182-185M + range.

Hypothetical Kirk Cousins contract proposals

Contract 1

It is a pretty generic. 5 year $135M. It can be tweaked here and there.  It gives him a workout bonus. As structured, it comes with $87M guaranteed and set up to convert his 2019 base salary into a 2nd bonus, thus  generating cap space in 2019 as well.

Contract 2

A second option would be to ignore the conversion of the 2019 base salary and simply pay the $30M base salary.  If they felt comfortable with accounting for it all in that year It would increase the  year 2 cap hit drastically, but would lower the cap #’s in the last three years of the contract when compared to the first hypothetical proposal

Other Options

They could go with an initial 3-4 year deal that comes with a year 3 or 4 team option bonus that if the marriage is working it allows the team to tack on some years, but that can become to look complicated, so we will stick with the simplicity above, but the team has options.

Again, this is not suggesting this will be a deal offered or signed, but it would be a viable option.  It provides a very affordable deal over the first two years and doesn’t obscenely or grossly compromise the future like some suggest. It’s not ideal but it can be done.

 

Cousins’ $/% of Future Cap Years

If you scroll up to the first chart, the Salary Cap has increased at a 7.7% rate over the past four years, so the 7% and 5% increases in the chart directly above are pretty  much lowball estimates, and even with the ballooning $35,36,37M cap hits in ’20-’22 they are still at  16-18% of the cap.  If the Cousins deal is more evenly distributed, then those numbers would be higher in first two years and lower in the last 3.  It’s all about the structure.

Oh and this is done without touching or massaging a current contract or cutting a current player. Imagine that. /Sarcasm

So if this deal were signed, and Kirk Cousins is under contract for 2018 with a $9.2M dollar cap hit. The Broncos would have 14M-15M left to spend on other free agents.  That’s not a ton of space, the rookie class could take $8-10M on their own. You’d like to improve other positions, have the ability to go shopping.

But guess what?  They can easily manufacture cap space.

Roster Turnover

Some players from the 2017 team will not be in Denver in 2018. It happens every year. There is turnover, it happens for various reasons. Age/ability/not a good schematic fit/etc. Some guys that are free agents won’t even be offered a contract, I’m looking at you Eric Decker.  A prime example. They didn’t even talk #’s. Malik Jackson?  He likely fits that example as well. Maybe they would have took less to stay with the only team they ever knew at that point. Who knows.  The guys that were on the ’17 team that currently don’t have a contract some know their time in Denver is done.  It happens.

Creating Cap Space

Here are 5 moves that retain key pieces and create $35M which would push the available total after signing Cousins to contract(if structured in that way) to $49-50M in cap space without cutting a single player. It’s not presented as a fact that it will happen, just as potential options.   These are not all or nothing type deals, the total listed is just a cumulative total of the moves. Any one could be done as  single move.

Scenario 1

 

movesscenarioA1Out of these five, two are more questionable than others(Talib/Thomas).  If Talib doesn’t accept the deal that extends his stay in Denver, then they cut/trade him and his cap savings increases(more on that below).  Thomas has the last years of his deal replaced with a portion of his ’19 contract guaranteed and paying him the cash he would receive in 2018 anyway.  The other 3 are simply converting all but the league minimum of their base salary which would lower their current cap hits. Again, the pros of these moves is it keeps players in place, it creates immediate cap room and and the con is that it pushes the savings down the road.   This defense is built to win now and has wasted two years on Quarterbacks that have not developed.

Scenario 2

Option 2 creates more space, but you lose a 1,000 yard rusher, a pair of wide receivers and two key defenders and that would make Denver less attractive to free agents whether they are quarterbacks or not.

This is more blow everything up and start over scenario, but quite frankly without upgrading the Quarterback position there is not much need to spend $22M on wide receivers. The status quo sucks. They are a dynamic pair and are great players and I am certainly not advocating this scenario in any way shape or form, but with the quarterbacks currently on the roster they are being wasted and they are expensive. It’s like putting a set of $500.00 racing tires on a wrecked 1990 Ford Escort.

There are likely players that are currently under contract that John Elway wants to move on from, whether they go after a high end QB or not. Some will spin it as blah blah blah Kirk Cousins blah blah blah. There are guys that Elway will likely talk to and say “we need to talk about your cap #”, so of those might find employment elsewhere, some can restructure. The examples above, like Wolfe, it’s just an option that might present itself.  With his injury, #7 might make that decision for him.

Other options that could be in play would be to extend a couple of the younger guys, guys that you know that are going to be in Denver over the next three to four years barring a catastrophic injury.  If structured the right way that can create space. There are many tools available to Elway and Mike Sullivan and his staff have more knowledge about the salary cap than I do, but I know enough about it to know that the things documented here are possible.

This was simply a post to show that Kirk Cousins can be obtained without cutting every player but #58 and that it can be structured in a way that does not totally sacrifice the future. There has simply been too much misinformation spewed that taints this subject.

He might go to New York, or Cleveland for more money than anyone has even suggested he will get. Good for him. He might take less than the $27M that has been tossed around so much to go to a Minnesota, a Jacksonville or a Denver. Again, this  was  based on Kirk  Cousins since  he’s at the top of the list, but the same concepts could be used with lower sets of #’s for say a Case Keenum or other free agent QBs, or even if they traded draft capital and extended a QB like Nick “I just beat the Patriots Ass” Foles, but that can involve other scenarios.

Can Cousins come to Denver? Easily.  Will he come to Denver? Time will tell. Time always tells.

Von Miller’s contract

It’s been reported that last month that Miller and the Broncos agreed to the terms of 6 years and 114.5 million deal. With the main issue being the amount of money guaranteed and when it’s guaranteed. 

Below you will see 4 generic options that shows how the money can be laid out.

The reports were that 30-35 million was guaranteed and that he wanted closer to 60.

So in keeping with the 6/114.5 structure you can see how it can be shifted from year to year by both cap dollars. When a contract dollar is guaranteed but not paid immediately.  It has to be funded into a form of escrow so the player is protected. 

A players base salary is paid out in 17 weekly game checks.

When the pair do come to terms, the 6/114.5 might change. But the chart above is a realistic set of options.  It follows a similar structure that was given to Demaryius Thomas last season.  It’s set up in a way where the base salary can be guaranteed as a bonus in any given year and can create space if it’s needed.

The key to it being any form of accurate is the reports of 6/114.5 being accurate.  A lot of people and the media included don’t have a grasp of the salary cap, and argue that Von’s being greedy or Elway’s being cheap.   If they’ve come to general terms then it’s not either.  The more dollars guaranteed the better for the player. The less dollars guaranteed the better for the team. The signing bonus could be lower, with a higher guaranteed base salary in year 1. This is just to lay options out on paper(if you will), so you can see that dollar amount structured over 6 years.

It’s a matter of finding something in the middle.

For the Broncos fans that are suggesting the team should cut injured Ryan Clady and put his money towards signing Demaryius Thomas to an extension. The thought has its merits, but it would be counter productive.

Clady’s contract became guaranteed on the 5th day of the new league year, so cutting him would actually hurt the team, because those dollars and the dollars prorated over the final  two years of his contract would accelerate and count against the cap sooner than it should. Which would take away cap space as opposed to creating it. Had the 2015 base salary not been guaranteed, then the proposal would be more viable. 

Cutting him after the season and before the new league year will likely be a consideration, because if it is done, then they can remove his ‘16 & ‘17 base salaries from the books.