What NFL Teams Consider Before They Cut Players
Salary Cap, Contacts, Dead Money, The Quick Gist
Each franchise is given the same challenge each year, build and maintain a Super Bowl caliber team.
To spice things up, every NFL franchise is held to a standard, and in the 2020- 2021 season it is $198.2 million.
In this post I will be going over three important factors teams consider when acquiring and keeping players on the roster.
· Salary Cap
· Player Contracts
· Dead Money
Salary Cap
The salary cap as a lot of you know, is the sum of all money allowed to be paid out to each player.
Typically, the majority is the current season’s wages in salary, plus signing bonus, (or prorated signing bonus) and any miscellaneous incentives. (x number of sacks, touchdowns, interceptions, workouts, etc.)
This hard cap enforced by the NFL exists to level the playing field between the most competitive teams and the ones that are ‘rebuilding’, to in all create competitive balance within the league.
With the looming Covid pandemic, the NFL and NFLPA have come to a temporary agreement for the 2021 Salary Cap, setting a ceiling of $175 million. Roughly $35 million lower than anticipated. Luckily, the blow made by the lower cap can be cushioned by the ‘Rollover Rule’. Where teams that do not use all their cap space can roll it over into the next years maximum.
Player Contracts
Each team is compelled to form strategies to maximize the amount of value they can get from each dollar spent on a player.
One of the ways to do this is to write up contracts that span over a period, and often pay out more to the player in later years. The idea behind this is to lower the initial impact on the salary cap, while still filling the roster with top talent. This strategy, called back loading, makes up most of the contracts in the NFL because the pros heavily outweigh the cons.
Example: The New England Patriots sign John Handcock to a four year $20 million-dollar deal. With $15 million dollars guaranteed, and an $8 million-dollar signing bonus. This contract, if back loaded, might look something like this.
Dead Money
This term is fitted to a situation where a player is traded, or cut, before the ‘guaranteed’ portion of their contract has been satisfied. This number is calculated by adding the (total paid) plus (outstanding guarantees) less (total accrued cap hit).
A recent example of the night and day outcomes of dead money is the trade between the Los Angeles Rams, and the Houston Texans regarding Brandin Cooks.
The Rams exiled Brandin Cooks for a second-round draft pick, but at the time, Cooks was still guaranteed part of his five year $81 million-dollar contract that he signed with the LA Rams in 2018.
The deal left the Rams with a whopping $21.8 million dollars in dead money, which came directly off their cap space, without even having the player on their roster.
The Texans however, walked away with a quality receiver, with all his guarantees paid by the Rams, and only 8 million in base salary owed in 2020. The Texans are now in full control of his contract with no bonuses owed, and the ability to trade with little liability.
To sum up, each franchise has to balance their books to remain competitive, keep players happy, motivated, and performing, while not overstepping guidelines set by the National Football League. All in all negotiating contracts, managing the cap, and trying to keep their money working for them, rather than other teams.
