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Salary Cap Hell v2006

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Every year the Washington Redskins head into the off-season with one mission, find a way to retain their top players. This is according to the national media and the talking heads at that four letter network. Right before Free Agency starts the Redskins are linked to every big name free agent expected to hit the market, by these same experts and analysts.

2006 brought uncertainty to the NFL and how the cap would play out. One thing was for sure, the Washington Redskins had finally run out of time. Even a new CBA wouldn’t save “the Danny” from his past years of free spending, not even teaming with owner of that team in Texas would prevent him from calling the guy who doesn’t understand free agency anyway and telling him, “you’re going to have to field 20 rookies and let most of the starters go.”

The Redskins were $20 million over the projected cap and with the new CBA the cap went up almost $10 million to $102 million.

A week and a half into free agency and no starters have been released. The Redskins have cut a 3rd corner, a backup safety and a reserve offensive lineman, as well as two guys that were injured most – if not all – of last year. Lavar Arrington brought out the remainder of his contract and Ramsey was traded. The rest of the team is intact and the Cap Hell bound Washington Redskins are sitting $2.5 million under the Cap.

How?

Simple. It’s called Cap management. The easiest way to manage the cap is to include what is known as “Cash over Cap” in your projections, prior to going “shopping” for the player they feel will help the team. Cash over cap refers to the total amount a player is given in a year that exceeds the salary cap for that year. Through signing bonus pro-rations, roster bonuses and incentives, teams can pay players more actual dollars than the cap limit for that year, while at the same time staying under the cap. The Redskins are the masters of this.

As I mentioned above, the Redskins are roughly $2.5 million under the cap. This number doesn’t include any saving the team would receive from restructuring the contracts of Brunell, Jansen, and Thomas (they could save millions if needed). What I failed to mention above, was that the Redskins did indeed go on that Shopping spree that the aforementioned talking heads said had been canceled.

The Redskins signed a couple of smaller name free agents, in tight end Christian Fauria and backup quarterback Todd Collins. Both signed contracts reportedly worth $810,000 in base salary and signing bonuses less than a million dollars combined.

More important to this discussion are the big name acquisitions. Redskin One came home with a big name D-lineman, a bigger named Safety and the biggest name coming out of Super Bowl weekend. After the plane landed, “the Danny” thumbed his nose at all his doomsayers and gave each guy a big payday to go with their big names.

Adam Archuleta, Randle El and Andre Carter received deals worth roughly $30 million over six years, with a $5 million signing bonus; their deals are nearly identical. So lets look at what Randle El got

The deal:

$31M over 7 years including $11.5M in guaranteed money.

So with about a third of the monies guaranteed, there is about $20M that needs to be accounted for, and that’s 7 years worth of salary. I’ll get back to the guaranteed money in a minute; there is more money in the salary so I’ll deal with that first.

Rumor has it that A.R.E.’s yearly base will be:

$585,000.00 in 2006
$595,000.00 in 2007
$820,000.00 in 2008
$4,000,000.00 in 2009
$4,250,000.00 in 2010
$4,500,000.00 in 2011
$5,000,000.00 in 2012

The yearly base would count each year towards the cap, so we see here Randle El’s base is under a million dollars the first 3 years then skyrockets in year 4. Remember this number will only affect the cap if he is on the team.

Now back to the Bonus money. He got $11.5M right?

$5M signing bonus – $1.5M Roster bonus (to be paid in 2009) and $5M in a option bonus (to be paid in 2007 and this will allow 2012 to be voided)

So the only guaranteed money being paid or counted against the cap this year appears to be $5M. With the New CBA that will be pro-rated over 5 years meaning $1M against the cap years.

In other words Randle El’s cap hit looks to be about $1,585,000.00 in 2006 or should I say, “NOT MUCH.”

In 2007 his salary jumps $10K but he’ll be due another $5M of that original $11.5M Bonus (there is still $6.5 unpaid). This money will be pro-rated over 6 years because the CBA allows it. That’s another $833,333.00 added to the 2007 cap. Once again, the words “NOT MUCH” come to mind, as Randle El’s cap number works out to be $2,428,333.00.

In 2008 it’ll be $2,653,333.00, but then it will get crazy with a $4M base and the last of the guaranteed money ($1.5M Roster Bonus). I’m not going to get into what will happen here. I could see 2 years being added to his contract (2012 was voided, so I’m talking though 2013), most of the base and all of the roster bonus being converted to signing bonus (because of the 2 year extension) then prorated over the 5 years. To be honest, at this point my answer to the original question would be I have no clue what the cap impact will be in 2009.

The contract is structured so the cap hit is minimum or “Cap friendly” but with the use of cash over the cap the contract is also player friendly.

You can say that no NFL contract is what it appears to be. Players sit down with their agents and they talk about the real numbers. The numbers that make fans scream, “we paid too much for insert player’s name,” and the numbers reported on the network websites are not the numbers that they discuss. They discuss what do I get now, not what may I get (they cross those bridges if they get to them).

If any of these players are let go before their respective Roster Bonuses are due in 2009, the cap hit would be about $5 million. If that player is on the roster, his cap hit would be $7 million.

After three years, if “the Danny” isn’t getting his money’s worth, he has a contract structured in a way that he can cut his losses. As for the players, they get a lot up front but have the opportunity to make a whole lot more if they play as expected.

Edit: This blog was archived in May of 2016 from our original articles database.It was originally posted by Bernie Marshall

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