Cap Strapped?

[philfree]

I keep seeing posts saying that because we resigned all the same players that we will be handicapped by the cap in the 2005 offseason. I don't remember any numbers but I don't remember any of those guys getting a cap busting signing bonus. Just who is it that got such a big signing bonus?

PhilFree :arrow:

[tk13]

Well nobody got a HUGE bonus in theory, but since so many of them were signed recently you'd be cutting almost the entire contract and eating the entire signing bonus.... Jerome Woods for instance signed a 5 year contract with a $5 million bonus. If we cut him we'd take a 4 million dollar hit against next year's cap, unless we do it after June 1st, then it'd be something like 1 million against next year's cap and then 3 million against 2006's cap... of course by then you never know if any really good players will come available, it's just something you'd have to plan for in advance when you're signing free agents in March.

[Coach]

If you know who, you can easy look up web reports on each one from when they re-upped.

Signing bonus is prorated over life of the deal. So take the bonus & divide by number of years.

The salaries are where you have to watch for spikes.

[Phobia]

It's not necessarily the bonuses. A lot of the veterans have extremely high salaries for 2005.

Shields $4.3 Mill
Roaf $3 Mill
Green $4.7 Mill
Gonzo $3 Mill
TRich $1.25 Mill
Holmes $2.415 Mill
Warfield $3.3 Mill
Kennison $1.6 Mill
Barber $2.2
Holliday $2.2
Morton $3.0
McClegone $1.5

[tk13]

It's not necessarily the bonuses. A lot of the veterans have extremely high salaries for 2005.

Shields $4.3 Mill
Roaf $3 Mill
Green $4.7 Mill
Gonzo $3 Mill
TRich $1.25 Mill
Holmes $2.415 Mill
Warfield $3.3 Mill
Kennison $1.6 Mill
Barber $2.2
Holliday $2.2
Morton $3.0
McClegone $1.5
Yeah, if those numbers on the NFLPA site are right, we do have some players whose salaries increase substantially next year... hard telling though with all these other rules and incentives and whatnot. In reality as much as people complain about the cap and contracts nobody really knows the truth except Carl and his people....

[philfree]

Well nobody got a HUGE bonus in theory, but since so many of them were signed recently you'd be cutting almost the entire contract and eating the entire signing bonus.... Jerome Woods for instance signed a 5 year contract with a $5 million bonus. If we cut him we'd take a 4 million dollar hit against next year's cap, unless we do it after June 1st, then it'd be something like 1 million against next year's cap and then 3 million against 2006's cap... of course by then you never know if any really good players will come available, it's just something you'd have to plan for in advance when you're signing free agents in March.

I know how it works I don't think we strapped ourselves though. I wonder if Woods bonus was 2 teired. Seems alot of bonuses are done that way these days.


PhilFree :arrow:

[Coach]

here's LJ's deal: RB Larry Johnson, Penn State (No. 27 overall): Signing bonus: $3,310,000. Base salaries: $452,000 (2003); $515,000 (2004, plus $50,000 workout bonus); $628,000 (2005, plus $50,000 workout bonus); $741,000 (2006, plus $50,000 workout bonus); $854,000 (2007, plus $50,000 workout bonus); $967,000 (2008, voidable, plus $50,000 workout bonus); $1,080,000 (2009, voidable, plus $50,000 workout bonus). Total: seven years, $8,847,000 or five years, $6,700,000.

[tk13]

Yeah, sorry, I wasn't saying you didn't know how it works... I was just providing an example in general that we were going to have to possibly eat signing bonuses that we'd just given out....

Holliday will probably be cut, I don't know what they're going to do with Barber since he won't be healthy... it's kinda sad that the players we need to cut and bring FA's in for are the guys we got when we spent money on D two years ago....

[Coach]

Yeah, sorry, I wasn't saying you didn't know how it works... I was just providing an example in general that we were going to have to possibly eat signing bonuses that we'd just given out....

Holliday will probably be cut, I don't know what they're going to do with Barber since he won't be healthy... it's kinda sad that the players we need to cut and bring FA's in for are the guys we got when we spent money on D two years ago....

As for Barber, maybe an injury settlement.

[philfree]

It's not necessarily the bonuses. A lot of the veterans have extremely high salaries for 2005.

Shields $4.3 Mill
Roaf $3 Mill
Green $4.7 Mill
Gonzo $3 Mill
TRich $1.25 Mill
Holmes $2.415 Mill
Warfield $3.3 Mill
Kennison $1.6 Mill
Barber $2.2
Holliday $2.2
Morton $3.0
McClegone $1.5



So is Warfield our highest paid defensive player? $3.3 mil don't seem like much if that's the case. Besides we can always re-do contracts and cut players like Holliday who are in the last year of their contract.

Are there any cap projections out there for NFL teams for 2005?

PhilFree :arrow:

[Coach]

So is Warfield our highest paid defensive player? $3.3 mil don't seem like much if that's the case. Besides we can always re-do contracts and cut players like Holliday who are in the last year of their contract.

Are there any cap projections out there for NFL teams for 2005?

PhilFree :arrow:

The former Green Bay Packer signed a five-year contract worth $20 million. He'll get a $3 million signing bonus. This was in 2003. So he has 3 years left I think after the end of 2004 season.

[Coach]

Here's the interesting note though. Every NFL team salary cap is at $80,582,000 for the 2004 season. Odds are that in 2005, should be higher based on the TV deal extensions that the NFL is getting. how much, I don't know right now.

[philfree]

The former Green Bay Packer signed a five-year contract worth $20 million. He'll get a $3 million signing bonus. This was in 2003. So he has 3 years left I think after the end of 2004 season.

Not the 1st time I've mis-spoke. What do you mean he'll get a $3mill signing bonus? Or did you mean to say he got a $3mill bonus?


PhilFree :arrow:

[Coach]

Not the 1st time I've mis-spoke. What do you mean he'll get a $3mill signing bonus? Or did you mean to say he got a $3mill bonus?


PhilFree :arrow:

When he signed, he gets the 3 million, no matter what happens. The rest, it can be salavaged back to our salary cap.

The tricky part is though, how do we cut him. For example, he signed in the 2003 season, 5 years for 3 million take 3,000,000 divide by 5 = 600,000 a year. He already played last year and let's assume he'll finish out the season this year. Already he gained 1.2 million. There's 1.8 million left on his contract. If we cut him AFTER June the first, I am guessing between 600,000 this year's hit, and 1.2 million for the 2006 cap room.

Hopefully you understood what I meant.

[Coach]

Also, for some people who might be curious about team cap numbers.

$80,582,000 in 2004
$75,007,000 in 2003
$71,101,000 in 2002
$67,400,000 in 2001

And that's as far back as I can go. So odds are that it will be between 4-6 million jump for next year cap number. (Roughly around 84-85 million)

[2bikemike]

here's LJ's deal: RB Larry Johnson, Penn State (No. 27 overall): Signing bonus: $3,310,000. Base salaries: $452,000 (2003); $515,000 (2004, plus $50,000 workout bonus); $628,000 (2005, plus $50,000 workout bonus); $741,000 (2006, plus $50,000 workout bonus); $854,000 (2007, plus $50,000 workout bonus); $967,000 (2008, voidable, plus $50,000 workout bonus); $1,080,000 (2009, voidable, plus $50,000 workout bonus). Total: seven years, $8,847,000 or five years, $6,700,000.

Damn I wish my employer would give me a $50k work out bonus.

[Alphaman]

It's not necessarily the bonuses. A lot of the veterans have extremely high salaries for 2005.

Shields $4.3 Mill
Roaf $3 Mill
Green $4.7 Mill
Gonzo $3 Mill
TRich $1.25 Mill
Holmes $2.415 Mill
Warfield $3.3 Mill
Kennison $1.6 Mill
Barber $2.2
Holliday $2.2
Morton $3.0
McClegone $1.5


This isn't bad. Cutting Kennison, Barber, Holliday, Morton, and Mcleon would save $10.5M against the cap, offset by accelerated bonuses. Holliday is due a big roster bonus, so cutting him saves even more. Shields, Green, Gonzo, Holmes and Warfield could be restructured to save about $8M. We'd have some good money to go after free agents....2 defensive playmakers and 2 2nd tier WRs who are ascending (Porter and Givens).

[tk13]

Also, for some people who might be curious about team cap numbers.

$80,582,000 in 2004
$75,007,000 in 2003
$71,101,000 in 2002
$67,400,000 in 2001

And that's as far back as I can go. So odds are that it will be between 4-6 million jump for next year cap number. (Roughly around 84-85 million)
Well it runs a little deeper than that. Not to confuse everybody much further but is credit given for the cap from what are called "Not likely to be earned" bonuses. They usually incentives put into contracts that are outlandish but if done correctly can be counted as "credit" against the next year's cap if they are not achieved. The Chiefs had the second highest total of NLTBE bonuses, and in essence had around 85 million of cap space this season to use "technically", which is the second highest amount of cap space in the league. The Vikings had the ability to spend up to around 93-94 million I believe...

If we do a lot of that again we could exceed 90 million in potential cap space, meaning we could spend more than almost anybody in the league....

[BigRedChief]

all these salaries make it even more of a fuk up to leave 6 million under this years cap.

[jspchief]

When he signed, he gets the 3 million, no matter what happens. The rest, it can be salavaged back to our salary cap.

The tricky part is though, how do we cut him. For example, he signed in the 2003 season, 5 years for 3 million take 3,000,000 divide by 5 = 600,000 a year. He already played last year and let's assume he'll finish out the season this year. Already he gained 1.2 million. There's 1.8 million left on his contract. If we cut him AFTER June the first, I am guessing between 600,000 this year's hit, and 1.2 million for the 2006 cap room.

Hopefully you understood what I meant.

It's not as difficult as you're making it. If we were to cut him this offseason, we'd take a 1.8 million dollar hit to the cap (the remaining 3/5ths of his sigining bonus). However, I believe he's due to make a large increase in salary this year. Let's say it's 1.8 million for the sake of keeping it simple. That means any "cap hit" that the team suffers is offset by the money we would save by not paying him. Sure we still have 1.8 less under the cap, but we didn't spend the 1.8 on his increased salary so it's freed up in another area.

[jspchief]

OK, I found the skinny on Holliday's contract here: http://espn.go.com/nfl/columns/clayton_john/1535114.html

He received a 4 mil bonus, the contract was for 6.3 over the first two years, then 5 mil year option in 2005.

That means his base was about 3.15 million this year. His salary would go up to 5 mil next year for an increase of 1.85 million in 2005 on his base salary. We still have 2.4 million worth of cap space owed on his pro-rated bonus.

That means if we cut him we only take a net cap hit of 550,000. If we keep him, our cap is hit with an additional 1.85 million. Looks like a no brainer to me. We better start thinking about trades or cutting him. He's certainly not worth paying 5 mil a year to avoid a one year cap hit of .55 million.

It's actually a very well designed contract. We got a two year trial period where we really didn't pay that much and it was set up to be cap friendly in the event that he didn't work out.

[Coach]

OK, I found the skinny on Holliday's contract here: http://espn.go.com/nfl/columns/clayton_john/1535114.html

He received a 4 mil bonus, the contract was for 6.3 over the first two years, then 5 mil year option in 2005.

That means his base was about 3.15 million this year. His salary would go up to 5 mil next year for an increase of 1.85 million in 2005 on his base salary. We still have 2.4 million worth of cap space owed on his pro-rated bonus.

That means if we cut him we only take a net cap hit of 550,000. If we keep him, our cap is hit with an additional 1.85 million. Looks like a no brainer to me. We better start thinking about trades or cutting him. He's certainly not worth paying 5 mil a year to avoid a one year cap hit of .55 million.

It's actually a very well designed contract. We got a two year trial period where we really didn't pay that much and it was set up to be cap friendly in the event that he didn't work out.

Ah thank you for the link. Now I have a better understanding of it. I first think of signing bonuses as even per year. Yes, it is a very well designed contract, and it's not as bad as we first feared it was. Bye bye Holliday! (or so I'm hoping)

[DaWolf]

I remember a quote in an article during the offseason, It was Vermeil or the writer of the article who said it, that basically said we were in good shape under the cap for the next couple of years and had room to maneuver.

Regardless, with restructuring and all the other tricks that can be done, there is ALWAYS enough cap room...

[BigRedChief]

But the bottom line is that with King Carl making the moves in the draft or FA we have no realistic hope that he's going to become a better talent evaluator in the off season.

[BigChiefFan]

I would love to see Carl get aggressive in FA and the draft. This is Dick Vermeil's final season coming up and I'm sure he wants some quality players, I know I do. Kendrell Bell and Rolle would do wonders for my attitude about the upcoming season.

[kc rush]

I would love to see Carl get aggressive in FA and the draft. This is Dick Vermeil's final season coming up and I'm sure he wants some quality players, I know I do. Kendrell Bell and Rolle would do wonders for my attitude about the upcoming season.

You know that they will go on a big FA spree so they can justify raising ticket and parking prices 10-15% next year.

[Alphaman]

OK, I found the skinny on Holliday's contract here: http://espn.go.com/nfl/columns/clayton_john/1535114.html

He received a 4 mil bonus, the contract was for 6.3 over the first two years, then 5 mil year option in 2005.

That means his base was about 3.15 million this year. His salary would go up to 5 mil next year for an increase of 1.85 million in 2005 on his base salary. We still have 2.4 million worth of cap space owed on his pro-rated bonus.

That means if we cut him we only take a net cap hit of 550,000. If we keep him, our cap is hit with an additional 1.85 million. Looks like a no brainer to me. We better start thinking about trades or cutting him. He's certainly not worth paying 5 mil a year to avoid a one year cap hit of .55 million.

It's actually a very well designed contract. We got a two year trial period where we really didn't pay that much and it was set up to be cap friendly in the event that he didn't work out.

Help me understand your math. I get the 2.4 worth of signing bonus to be accounted for. However, if he's due a $5M roster bonus, that is counting against our cap for next year plus $800K in signing bonus for next years proration, plus lets assume the league minimum for his salary next year. That means that right now he's counting about $6.3M against the cap next year. Cutting him actually saves about $3.9M on the cap next year. That my friend is a NO-BRAINER!!!

[Alphaman]

I would love to see Carl get aggressive in FA and the draft. This is Dick Vermeil's final season coming up and I'm sure he wants some quality players, I know I do. Kendrell Bell and Rolle would do wonders for my attitude about the upcoming season.
:toast: :clap:

We are on the same page. Kendrell Bell and a top flight CB (Rolle is not a FA next year, but if he should get cut, he'd be a great selection) like Woodson or Smoot.

Rolle is due a salary of $5.5M next year, which means a cap hit of around $6.0M for him. He could be released because of the Titans cap woes.

[jspchief]

Help me understand your math. I get the 2.4 worth of signing bonus to be accounted for. However, if he's due a $5M roster bonus, that is counting against our cap for next year plus $800K in signing bonus for next years proration, plus lets assume the league minimum for his salary next year. That means that right now he's counting about $6.3M against the cap next year. Cutting him actually saves about $3.9M on the cap next year. That my friend is a NO-BRAINER!!!

First off, he's not due a roster bonus. He's due a pay raise. The difference in the pay raise and what we already pay him would be 1.85 mil.

So essentially, ignoring signing bonuses, he's going to hit our cap for an extra 1.85 mil. (beyond what we already pay him) in 2005 if we keep him.

If we cut him, we will be hit with the remainder of his signing bonus (the 2.4 that you said that you understand), but he won't cost us the additional 1.85 above what he cost in 2004.

2.4 minus the 1.85 extra that he would have cost (and affected our cap with) gives us a difference of the .55 million that will be the net cap hit. That still leaves us room to sign his replacement at the 3.6 we were paying him.

The literal cap hit is still 2.4 million to cut him, while the literal cap hit to keep him is 5.8

I was just trying to give an example of the hit while allowing for us to pay his replacement the same salary that we currently pay him.

[Alphaman]

First off, he's not due a roster bonus. He's due a pay raise.

Uh...no.

Here's the quote from the Clayton article:

For Holliday, 27, he receives the short-term security of a $4 million signing bonus. He'll make $6.3 million over the first two years of the contract. In 2005, the Chiefs have a $5 million option on Holliday that would keep him through 2007.

The Chiefs having an option is a roster bonus.

[jspchief]

Uh...no.

Here's the quote from the Clayton article:

For Holliday, 27, he receives the short-term security of a $4 million signing bonus. He'll make $6.3 million over the first two years of the contract. In 2005, the Chiefs have a $5 million option on Holliday that would keep him through 2007.

The Chiefs having an option is a roster bonus.

We're obviously reading it different ways. I see it as a $21.3 million dollar contract plus a $4 million bonus. 6.3 for the first two years, plus 5$ million per year for the remaining three adds up to 21.3 million.

I'm not sure how you get that "option" means "roster bonus". I understand it as the Chiefs have the option of keeping him for three more years, but his base salary goes up to 5 million a year.

Explain where the number 21.3 comes from using your method.

[Alphaman]

We're obviously reading it different ways. I see it as a $21.3 million dollar contract plus a $4 million bonus. 6.3 for the first two years, plus 5$ million per year for the remaining three adds up to 21.3 million.

I'm not sure how you get that "option" means "roster bonus". I understand it as the Chiefs have the option of keeping him for three more years, but his base salary goes up to 5 million a year.

Explain where the number 21.3 comes from using your method.

$5M roster bonus in 2005 with a league minimum in salary (around $500K), $4.75 in salary in 2006 and 2007. That's $15M in the final 3 years plus the $6.3M in the first 2 years.

Explain how you get a base salary of $3.15M this year if he got a $4M signing bonus and he got $6.3M the first 2 years.

Holliday got $1.45M this year per NFLPA.org. The cap savings from cutting him is still $3.8M.

[jspchief]

$5M roster bonus in 2005 with a league minimum in salary (around $500K), $4.75 in salary in 2006 and 2007. That's $15M in the final 3 years plus the $6.3M in the first 2 years.

Explain how you get a base salary of $3.15M this year if he got a $4M signing bonus and he got $6.3M the first 2 years.

Holliday got $1.45M this year per NFLPA.org. The cap savings from cutting him is still $3.8M.

I got 3.15 by dividing 6.3 by two (as in two years). Base salary means salary not including bonuses. He got 6.3 in base, plus the 4 million bonus up front.

He's not getting a league minimum base salary. No veteran starter is. Especially in the back end of a contract.

[Alphaman]

Here's his salary breakdown from NFLPA.org:

2003 1250000.00
2004 1450000.00
2005 2200000.00
2006 2760000.00
2007 3640000.00

That's a total of $11.3M in salary. That leaves $10M in bonus. So a $4M or $5M signing bonus and a $5M or $6M in roster bonus gets you to $21.3M.

So in actuality it gets even better: His cap hit in 2005 will be $5M (roster bonus) plus $2.2M salary + $800K prorated signing bonus, for a total of $8M. Cutting him now equates to a cap hit of $2.4M, so we save $5.6M by cutting him.

[Alphaman]

I got 3.15 by dividing 6.3 by two (as in two years). Base salary means salary not including bonuses. He got 6.3 in base, plus the 4 million bonus up front.

He's not getting a league minimum base salary. No veteran starter is. Especially in the back end of a contract.

Uh...no again. Let me explain:

A 5 year contract of $21.3M includes bonuses and salary.

$6.3M in the first 2 years includes bonuses and salary. Again, according to NFLPA.org, his first 2 years salaries were $1.25M and $1.45M. That's $2.7M in salary. Add a $4M signing bonus and he gets about $6.7M in salary the first 2 years.


Finally, vets get minimum salaries all the time, usually in the year they sign a new deal. A player gets a $12M signing bonus over 8 years, but his first year salary of the minimum ($500K). That means he gets $12.5M in the first year, but only has a cap hit of $2M that first year.

[BigChiefFan]

:toast: :clap:

We are on the same page. Kendrell Bell and a top flight CB (Rolle is not a FA next year, but if he should get cut, he'd be a great selection) like Woodson or Smoot.

Rolle is due a salary of $5.5M next year, which means a cap hit of around $6.0M for him. He could be released because of the Titans cap woes.
I'm glad we are on the same page. One small correction though, when I mentioned ROLLE, I was referring to the COLLEGE player for the university of Miami, Antrel Rolle in the draft.

[Alphaman]

I'm glad we are on the same page. One small correction though, when I mentioned ROLLE, I was referring to the COLLEGE player for the university of Miami, Antrel Rolle in the draft.

My bad....My choice is Bell and a top free agent CB. Derrick Johnson (best defensive player in college football) LB from Texas in the 1st round and DE Christ Canty from Virginia in the 2nd round.

[BigChiefFan]

My bad....My choice is Bell and a top free agent CB. Derrick Johnson (best defensive player in college football) LB from Texas in the 1st round and DE Christ Canty from Virginia in the 2nd round.
Bell is a bad-ass, but I'm not sure Pittsburg will let him go. Any idea what the Steelers cap room is next year? I really hope Carl makes a valiant effort to put the team over the top and starting with a player like Bell would be a huge up for the Chiefs, IMO.

[jspchief]

Uh...no again. Let me explain:

A 5 year contract of $21.3M includes bonuses and salary.

$6.3M in the first 2 years includes bonuses and salary. Again, according to NFLPA.org, his first 2 years salaries were $1.25M and $1.45M. That's $2.7M in salary. Add a $4M signing bonus and he gets about $6.7M in salary the first 2 years.


Finally, vets get minimum salaries all the time, usually in the year they sign a new deal. A player gets a $12M signing bonus over 8 years, but his first year salary of the minimum ($500K). That means he gets $12.5M in the first year, but only has a cap hit of $2M that first year.

Okay. That works for me. Either way, we were making the same point...that it will affect the cap much less to cut him than to keep him.

[Alphaman]

Bell is a bad-ass, but I'm not sure Pittsburg will let him go. Any idea what the Steelers cap room is next year? I really hope Carl makes a valiant effort to put the team over the top and starting with a player like Bell would be a huge up for the Chiefs, IMO.

Reading what Steeler fans are saying, they don't think they'll keep Bell. He's been injured this entire season and they think he'll ask for too much money. As matter of fact, I read today that he may be out for the rest of the season.

I would still sign him. He should be healed by the beginning of the OTAs next year (groin tear). I agree he would bring an attitude and better tackling to the D. Bell and Johnson at OLB would be very strong.

[Alphaman]

Okay. That works for me. Either way, we were making the same point...that it will affect the cap much less to cut him than to keep him.

I think it helps the cap to cut him.

[Alphaman]

Reading what Steeler fans are saying, they don't think they'll keep Bell. He's been injured this entire season and they think he'll ask for too much money. As matter of fact, I read today that he may be out for the rest of the season.

I would still sign him. He should be healed by the beginning of the OTAs next year (groin tear). I agree he would bring an attitude and better tackling to the D. Bell and Johnson at OLB would be very strong.

I'd also go after 2 WRs (at least one if that's all the cap will handle) in FA. Jerry Porter and David Givens are my current choices (I'm assuming we can't spend major money on Harrison if we are to get a top flight CB.