We must draft better...

Still waiting for that cap hell...

:sleep:

Still waiting for that cap hell...

:sleep:

How come this is hard to understand? We avoid every year by reworking contracts. Further moving the cap hits later in years. eventually you have to pay the contracts. Here is another article from a cap person



Teams also gain a degree of flexibility from the contract length and the early cheap years. This means that a player who in effect is being paid five or six million per year has less of an impact on the salary cap his first couple of seasons than in the outyears. Of course eventually you have to pay the piper. Often the length of the contract extends beyond the likely career of a given player, or the latter year salary levels are so high its obvious the player will be cut rather retained.

Such contracts are virtually certain to lead to “dead money” at some future date. Obviously we can only estimate what that will be for a given contract, but it’s still very real. This is what I mean by “cap overhang”: unamortized bonus money likely to become dead money in the future. In effect, teams are trading off the future for the present.

How come this is hard to understand? We avoid every year by reworking contracts. Further moving the cap hits later in years. eventually you have to pay the contracts. Here is another article from a cap person

Like I said, still waiting.

Snyder has been running the team for 5 years now. Shouldn't we be paying the piper already? Where is this cap hell that is supposed to ruin the team?

Snyder knows how to massage the cap better than just about anyone. Why is that so hard to understand??

What the Skins do isn't exclusive to them. Every team re-works deals, every team backloads deals, etc. Why is that so hard to understand?

How come this is hard to understand? We avoid every year by reworking contracts. Further moving the cap hits later in years. eventually you have to pay the contracts. Here is another article from a cap person



Teams also gain a degree of flexibility from the contract length and the early cheap years. This means that a player who in effect is being paid five or six million per year has less of an impact on the salary cap his first couple of seasons than in the outyears. Of course eventually you have to pay the piper. Often the length of the contract extends beyond the likely career of a given player, or the latter year salary levels are so high its obvious the player will be cut rather retained.

Such contracts are virtually certain to lead to “dead money” at some future date. Obviously we can only estimate what that will be for a given contract, but it’s still very real. This is what I mean by “cap overhang”: unamortized bonus money likely to become dead money in the future. In effect, teams are trading off the future for the present.

I think it would help if you specify your sources-link and person, just so you know whou you're referring to.

Like I said, still waiting.

Snyder has been running the team for 5 years now. Shouldn't we be paying the piper already? Where is this cap hell that is supposed to ruin the team?

Snyder knows how to massage the cap better than just about anyone. Why is that so hard to understand??

What the Skins do isn't exclusive to them. Every team re-works deals, every team backloads deals, etc. Why is that so hard to understand?

HELLO!!! McFly, the constant turnover, cutting of players here or there, restructing of contracts, reworking bonuses, this is how we avoid it. No it isn't exclusive to them. Teams have cap troubles. Remember the 49ers, Cowboys who reworked all those deals, bonuses , contracts , free agent signings, once the players were too old and diminished talent they had to cut them, trade em what ever. How long did it take the Cowboys to get out of there mess, 3 to 4 years, the 49 ers just recently got out of their cap trouble. Titans, after all the years of stuff they did to compete are in it now. I am done with this. I have provided two articles regarding cap implications, how these thing work and people still question not necessarily me, but what the articles are saying. Better yet, why dont the people saying we will not have cap problems find articles supporting there version of the cap and how it works. Like I said, I supplied 2 showing exactly what I have been saying.

I guess we're just arguing to which the degree this supposed cap hell is.

I'm saying we're never going to see the Redskins have a firesale like the Titans did last offseason, where their hands are tied and they are forced to part ways with key players.

The Skins have managed to avoid major problems by re-working deals and getting rid of excess baggage along the way (Trotter, Coles, etc.)

I'm well aware the potential is there with this method of cap mgmt., but again, I doubt we'll ever see "cap hell" to the degree that some other teams have faced.

Snyder always has a 3-year revolving cap plan in place, and therefore they are able to avoid many common mistakes other teams make. They take into account the dead cap space available and use it almost as a tool when calculating their cap space.

Here's some interesting quotes from a Vinny C. interview on extremeskins:

http://www.extremeskins.com/forums/showthread.php?t=114278

On the salary cap is it a process where Snyder does that or where you and the coaches are involved with that?



Vinny Cerrato

Everybody's involved because everybody has to understand it because it impacts so much of what we do because it's all about choices. If you sign this guy then how does that hurt you in the future.

Had we signed, say, Fred Smoot, how does that effect you this year, the next year and the following year? Everything we do is planned out three years. It's budgeted out three years. If you do this thing right now and it's budgeted this way and the cap numbers are this, then in the future you can't do this or you can do that.

Everything you do kind of drives the other things you can and can't do.




Follow question

With everything being budgeted out three years, how does that work where you have somewhat surprising moves with Coles? The release of Trotter the year before? How does the budgeting plan than you have in place work with the changes in systems and philsophies recently?



Vinny Cerrato

You have to stay somewhat flexible.

That's why if you sign guys like that (Coles and Trotter) and you're so tight against the cap you have no flexibility to do anything. In the case like Tennessee this past year they couldn't even dress their full allotment of players on game day because they had no cap room.

How is it that every year the "media" tells the world that the Redskins will be in cap hell, but yet it never comes about...Do they not understand the basics behind the cap or is the cap as difficult to understand as the tax system?



Vinny Cerrato

It's about planning and it's about budgeting. It's about knowing what you can and can't do. The thing that we have an advantage of over most teams is that cash creates cap. Our owner allows us to spend cash which creates cap room. What we do historically is we give big signing bonuses and then small Paragraph 5s, which makes the cap number smaller, which allows you to have more players.

When you see these big signing bonuses they are spread out over seven years. What we've learned over the years is not to overpay older guys. If you'll notice all the guys we're paying larger signing bonuses to are young guys who can play out the contract so their cap burns off every year.

In a situation like Coles, which is not normal, we took a big cap hit, but by getting Chris Samuels done it allowed us to take his whole hit this year. After this year we have zero left of Laveranues' cap. We're taking over a $9 million cap hit this year, but after this season we have no more cap room of Laveraneus.

We weren't allowed to do certain things because of this. It limited some of the things we could and couldn't do, but it was all planned and budgeted out.

I think it would help if you specify your sources-link and person, just so you know whou you're referring to.

This one came from falcfans.com / salary cap tutorial & faq.



In our example, let's say the Falcons need to save some extra space so they need to restructure some contracts. Say it is the offseason prior to Year 3 of Ed's contract, so it would not be a good idea to cut him (would add an extra $1 million to the Falcons cap). So they decide to restructure Ed's contract. A common form of restructuring is lowering the player's base salary. In this case, the Falcons can lower Ed's base salary of $1.5 million to $500,000. Now the Falcons have cleared $1 million off Ed's contract. But now what happens to that $1 million? Usually teams treat it as a signing bonus. In that way, it becomes prorated over the remaining years of his contract just like a normal signing bonus. That means that there will be a $333,333 cap hit ($1 million / 3 years) in Years 3, 4, and 5. Although this frees up $666,667 in cap space in Year 3, it adds an additional $333,333 to the Falcons cap in Years 4 and 5.
So although restructuring is a quick way to gain cap space without losing a player, but it also can hurt a team down the road. When you begin to restructure contracts with large bonuses, it can be very detrimental to the salary cap in future years.

2nd one came from football outsiders.com Capanomics II cap management strategies.

I’d like to introduce another term: “Cap Overhang”. These are bonus payments that will not be amortized over the life of the contracts of players currently with the team. We all know that NFL teams sign players to very long contracts that include up front bonuses, and to measure the value of the contract against the salary cap, those bonuses are amortized (evenly spread on an annual basis) over the length of the contract. These contracts typically have very low salary levels in the early years, escalate to “normal” levels in the middle (say the third and fourth years), and then typically include some very high salary years at the end. These last years are not intended to be paid — the players are usually cut instead — but exist in order to extend the amortization period to lower the immediate cap impact.

This is really a pretty efficient form for a contract in the NFL. It gives the player what he needs most, guaranteed cash, and gives the team a high degree of flexibility to cut the player rather than pay him if his skills decline through age or injury. Of course they’re left with dead cap money, but at least they’re not forced to throw good money after bad as per baseball contracts.

Teams also gain a degree of flexibility from the contract length and the early cheap years. This means that a player who in effect is being paid five or six million per year has less of an impact on the salary cap his first couple of seasons than in the outyears. Of course eventually you have to pay the piper. Often the length of the contract extends beyond the likely career of a given player, or the latter year salary levels are so high its obvious the player will be cut rather retained.

Here are some quotes from CBS sportsline.com regarding cap numbers :


In recent years, the 49ers, Packers, Steelers and Cowboys have all seen juggernauts torn apart because their front offices planned for today with little regard for tomorrow.

Here is another article from the post-gazette.com regarding the steelers pending cap problems by doing the same thing we do.



http://www.post-gazette.com/includes/images/120x90bgisignup.gif (http://www.post-gazette.com/insider/)
http://www.post-gazette.com/includes/images/120x30bglogin.gif (http://www.post-gazette.com/insider/bg)
http://www.post-gazette.com/includes/images/120x90steelersbars.gif (http://www.post-gazette.com/steelers/steelerbars.asp)
http://www.post-gazette.com/includes/images/120x60salarygeneric.gif (http://post-gazette.salary.com/)
http://www.post-gazette.com/includes/images/blank.gif http://www.post-gazette.com/includes/wider/images/468X40maststeelersnfl.gif Cap games costly in long run

Friday, March 04, 2005

By Ed Bouchette, Pittsburgh Post-Gazette


Are the Steelers mortgaging their future to try to keep their team together?

That's the opinion of some NFL executives, and maybe one of their own, as the Steelers voraciously restructure contracts to retrofit their salary cap.

They reworked at least four contracts the past week to clear $5 million worth of salary cap room for 2005. But in the NFL's world of the hard salary cap, that room doesn't magically appear -- or disappear.

The room created today must be made up tomorrow, which reduces their salary caps in future years. Once begun, it's a vicious cycle that ultimately must be confronted, like paying the minimum on a credit-card bill.

Despite $5 million in restructured savings, the Steelers were only $1.7 million under the NFL's $85.5 million salary cap. They might have to restructure more contracts as they sign their draft picks, possible free agents and extend contracts to such players as Hines Ward and Casey Hampton, who enter the final year of their deals.

The Steelers, who once stood steadfast against such tactics, began restructuring contracts to create immediate salary cap relief about three years ago and have routinely done so since then. Dan Rooney, their chairman, long opposed the strategy, believing it to be an unsound way to operate under the salary cap. Nevertheless, they continue to do it.

"You're pushing your problems into the future," an executive from another NFL team said. "It's not a solid way to do it. You can avoid it for a while, but eventually it will catch up to you." Other NFL teams have done it, some wholly embracing the idea as a way to keep a good team together. But their financial judgment day arrived, and it forced them to dump players in order to comply with the salary cap. An example of that this year is Tennessee. Jacksonville, San Francisco and Baltimore are teams that also had to purge players in recent years because of contract restructures that ultimately caught up to them. "They're going to get into trouble," said one team financial officer. "You can't keep pushing it on to other years. It's going to catch up with you."





Now, there is 3 to 4 different people, atricles, executives, capologists, experts that say what we do will eventually catch up to us. Not in a year two years, eventually. As long as we continue to restructure, renegoiate, whatever, we just keep putting it off until the future.

Do you need anymore proof?

see above

see above


saw it. This is getting a bit out of hand. Skins are creating cap room by negotiating contract or renegotiating contracts, and turning roster bonuses and insentives into signing bonuses. When all this comes to fruition you will all see what I am talking about and everyone else is talking about. I am done with it. Its a never ending argument.