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Originally Posted by King_Chief_Fan
You can do a little research on the site and find the numerous threads and conversations. If I am not mistaken, didn't the league take some action against the Donk's on this subject?
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Yeah, but it wasn't for salary cap violations in the way you would think. Most people think of it as having given Denver some sort of competitive advantage - in other words, they cheated the cap, so they were able to sign X more players.
It really was all about Pat Bowlen's cash. He had made arrangements with a few players - John Elway and Terrell Davis, the most notable - to defer some of the cash he would normally pay them in their weekly checks, with interest, into the future. The deferred payments did not affect the salary cap, per se, because they were for salaries that fully counted against the cap. The Broncos were getting a new stadium (Invesco), and Bowlen had to pay for a chunk of that stadium. The arrangement allowed Bowlen to use his available cash for the stadium, and then pay the players their deferred cash once the stadium issue was settled, and the new stadium was generating more cash than Mile High Stadium had been generating.
It's Bowlen's business, right? As long as it doesn't affect the competitive balance of the league, he should be able to do with his money as he pleases. Well, the NFL doesn't allow deferred compensation with its teams in the way Bowlen was trying to do it, and they are right in not allowing it. The worry around the NFL is that you get an aggressive owner who thinks, "I can mortgage my team's financial future by deferring these cash payments. It'll all work out in the end." When it doesn't work out, the league is put in the tough position of either suffering the embarrassment of letting a team fold, or having a cash call among all the owners to help an insolvent team pay its bills. The NFL's rule, as it pertains to cash, is basically to avoid "credit card spending." The salary cap is in place to force competitive balance (i.e. MLB's Yankees vs. the rest of baseball = BAD, VERY BAD!), but it is also in place to force owners to run their businesses wisely.
Deferred salary is something that happens every year on nearly every team in MLB. An example of where this could get ugly is the Arizona Diamondbacks. They have salary that is deferred as much as 25 years into the future. On at least two or three occasions in the last three years, they have had to make cash calls to their shareholders, just to be able to budget for the season.
So, back to the Broncos - they had an agreement with the players involved to defer the cash payments. The NFL warned them about it, and asked them to comply. They didn't comply in a way that the NFL was comfortable, and the NFL nailed them for it - twice (the first time was a $1 million fine, and the second time was with a draft pick).
Sorry for the long explanation. But I hear the thing about "cheating" all the time, and it makes me crazy. It had nothing to do with cheating.