Samuels In-depth

[CrazyCanuck]

I've been trying to figure out what the Skins will do with Samuels, so I decided to do some analysis.

Here's Samuels' current situation:

................2005...2006
Salary..........$6M....$7.7M
Bonus...........$690K..$690K
Signing Bonus...$2.9M..$2.9M

Total Cap Hit...$9.6M..$11.3M

Scenario A - Samuels voids 2006:

................2005
Salary..........$6M
Bonus...........$690K
Signing Bonus...$5.8M

Total Cap Hit...$12.5M

As we can see, Samuels has a lot of leverage. He can really screw the Skins in 2005 by voiding his final year. If he doesn't void 2006 or restructure, he stands to pocket $15.1M (salary + bonus) over the next 2 years under his current contract. Of course if the Skins dump him he sees nothing. IMO a 6th-year-Samuels-caliber OL is not worth $7.5M/year on the open market, but it's probably not far off. So if the Skins did dump him he'd probably lose some $, but not much.

While I don't think Samuels has much financial incentive to restructure, let's assume he really likes Gibbs and wants to stay a Skin. What would the restructured deal look like?

For starters we'll have to give him that $15M he was due to make right away or very soon. Let's say we give him a $12M signing bonus, plus $2M roster bonuses in 2007 and 2008, for a total of $16M short-term bonus money (STBM).

To compare:
Champ $23M STBM (in Denver deal)
Lavar $20M STBM (in his new deal)
Portis $17M STBM
Coles $15.5M STBM
Springs $13.3M STBM
Taylor $11.3M STBM
Griffin $10.8M STBM
Washington $9.5M STBM
Brunell $9.1M STBM
Jansen $7.4M STBM
Thomas $7M STBM

In exchange, Samuels takes the league minimum salary over the next 2 years, and then his salary gradually increases throughout the term of a 7-year contract. So what does the final deal look like in terms of the cap?

Scenario B - Samuels restructures (extends)

................2005...2006...2007...2008...2009.. .2010...2011
Salary..........$535K..$535K..$2M....$3.5M..$5M... .$6M....$7M
Bonus...........$0.....$0.....$2M....$2M....$0.... .$0.....$0
Signing Bonus...$2M....$2M....$2M....$2M....$2M....$2M.... $0
Dead Cap.........$5.8M...$0...$0...$0...$0...$0...$0

Total Cap Hit...$8.3M..$2.5M....$6M....$7.5M....$7M....$8M.. ..$7M

Notice how the restructure helps everyone. Samuels gets his money, including a big chunk right away. In exchange, the Skins get some much needed cap relief especially in 2006.

The headline would read "Samuels signs 7-year, $40.5M extension with Skins".

Of course this is all speculation, and we all have our own opinions about Samuels' worth. The extension shown above is just an example, so don't get all crazy about the numbers. I just thought it's interesting to look at it from everyone's point of view.

I hope Samuels restructures. If not, my guess is they trade him this offseason and eat the entire $5.8M deadcap in 2005. It'll still be a $3.8M net savings on the 2005 cap.

Note - I've edited this a few times to fix mistakes.

SORRY FOR THE LONG POST!

[SmootSmack]

Very nice post Canuck. Way to back up your opinion. I think these next several weeks with him protecting Ramsey's blindside will be instrumental in determining Samuels' worth

[Sheriff Gonna Getcha]

Excellent post Canuck. You've earned your stripes as our capologist and then some.

[JWsleep]

Great post. I'm sure they want to keep him, but the squeeze will be on soon, especailly in 2006. Now what do we do about Brunell? And is Gardner out of here or what?

[JWsleep]

Oops. Just saw your other great post on the cap thread. Man, Canuck, you dig that cap madness! Keep it up!!!

[Sheriff Gonna Getcha]

According to ESPN.com, the Redskins are $4.8 million under the salary cap. Can we use that space to say, re-sign Samuels late in the season and give him a $4 million roster bonus against this years cap in order to reduce his signing bonus by $4 million (part of which would count against the 2005 cap)? I think we did something like this with Bruce Smith last season and I know the Vikings do something like this each year.

[CrazyCanuck]

Originally Posted by Ramseyfan

According to ESPN.com, the Redskins are $4.8 million under the salary cap. Can we use that space to say, re-sign Samuels late in the season and give him a $4 million roster bonus against this years cap in order to reduce his signing bonus by $4 million.

I calculate we're about $1M under the 2004 cap, but I'm sure ESPN knows more than me. I count the IR guys in my cap calculation, maybe that's the discrepency. I'll have to look into it.

As for your idea, it's a good one, and I think you're right. We can stick some of the money of a new Samuels (or Smoot) deal under the 2004 cap. :thumb:

[FRPLG]

I know the deadline to extend contracts has passed. Not that they can't sign an extension but that anything they sign goes toward the cap in the future. Not sure about rolling a bonus in for this year though. Seems like a significant loop hole though.

I am somewhat confused on your analysis Canuck.

Samuels has already received the signing bonus. So no matter what we do that 5.8 goes somewhere on the cap. But if an extension is signed doesn't it get prorated just like any new signing bonus would? Meaning that if he signs a 7 year restructure then the original 5.8 goes over the 7 years...not just on first year of a new deal.

[CrazyCanuck]

Originally Posted by FRPLG

I know the deadline to extend contracts has passed. Not that they can't sign an extension but that anything they sign goes toward the cap in the future. Not sure about rolling a bonus in for this year though. Seems like a significant loop hole though.

I didn't know the deadline to extend has passed. I'm pretty sure they can still extend anytime, but you may be right that any new extensions will not be able to stick money under 2004, only the future. Hard to keep track of all the rules.

Originally Posted by FRPLG

Samuels has already received the signing bonus. So no matter what we do that 5.8 goes somewhere on the cap. But if an extension is signed doesn't it get prorated just like any new signing bonus would? Meaning that if he signs a 7 year restructure then the original 5.8 goes over the 7 years...not just on first year of a new deal.

Right now the $5.8M is split evenly over 2005 and 2006. If Samuels voids 2006, the entire $5.8M counts against 2005. If Samuels renegotiates a new deal, I'm pretty sure that any "old" signing bonus comes due immediately, so the $5.8M all counts against 2005. I showed this in my "scenario B" calculation under "deadcap".

PS - Thanks to all for the positive feedback!

[Redskins_P]

Fire Cerrato! Hire Crazy Canuck!

[Drift Reality]

Great post Canuck,

I think the salary cap is a pretty interesting topic and you obviously know your stuff.

[LongTimeSkinsFan]

Nice post Canuck. I wouldn't have had the patience to research all that and I'm only familiar with the financial end of football from what I read in the papers. I do have a couple of questions regarding the extension scenario though. My first question is would the Washington FO go for an extension that long with a lineman? What's the average length of a lineman's career? And what would happen if the extension was agreed upon and Samuel's has a career ending injury in say, 2008? (Now you really know how ignorant I am!)

[CrazyCanuck]

Originally Posted by LongTimeSkinsFan

I do have a couple of questions regarding the extension scenario though. My first question is would the Washington FO go for an extension that long with a lineman? What's the average length of a lineman's career?

This question raises a good issue - the length of the deal. My proposed scenario was a 7-year deal. But if you look closely at the numbers (scenario B) you'll notice that in 3-4 years we'll be right back where we are now. Take 2008 for example. We'll be facing a $7.5 cap hit for Samuels vs. $6M in deadcap if we cut him. Sound familiar? Restructuring is truly a revolving door.

Originally Posted by LongTimeSkinsFan

And what would happen if the extension was agreed upon and Samuel's has a career ending injury in say, 2008? (Now you really know how ignorant I am!)

It would be the same as if we released him outright - lose the player - eat the deadcap.

[FRPLG]

Yeah pretty much the length of the deal doesn't mean much. What matters is the length of the deal versus the signing bonus and then any roster bonuses. Most teams have followed the Skins's lead in giving big time signing bonuses with long contracts lengths so they money can be spread out better. This works great if you can keep a guy on your team and playing productively for 4 or 5 more years. Then if you need to dump them or they retire the cap hit is easier. I think the structure of the plan Canuck proposed is sound but the numbers are a little of. Something more like this seems to be the SOP for the Skins lately.
I would think with a 7 year deal they'd go bigger on the SB say to 14M with roster bonuses just like Canuck said except smaller.
Also the salary may not grow so precipitously but will jump all of a sudden.
.......................2005...2006...2007...2008.. .2009.. .2010...2011
Salary.............$535K...$535K..$1.5M...$3M..$6M ... .$7M....$8M
Bonus.............$0........$0......$1M...$1M....$ 0.... ..$0.......$0
Signing Bonus...$2M.....$2M.....$2M....$2M....$2M....$2M.. .. $2M
Dead Cap........$5.8M...$0.......$0......$0......$0.... ..$0.......$0

Total Cap Hit...$8.3M..$2.5M....$4.5M....$6M....$8M....$9M.. ..$10M

Of course this doesn't take into consideration any CBA rules as to salary reqs for veterans and such but I am not even going to begin trying to parse that gooblygook.

Also I think there are rules as to the max length of contracts. I always wondered why teams didn't sign guys to 30 year contracts to spread out the SB even more. Max length rules are the reason

This shows that the "7 year" deal is really more of a 4 year deal. If he lasts 4 years and gets cut, retires, or traded then 2009 cap hit ends up at $6M with a savings of $2M.

Remember the Skins really brought this style of contarcting into fashion with Stephen Davis's "10 year" deal that was really only a 3 year deal.

I love how the Media harps on how structuring stuff this way "mortages" the future when it really doesn't. With some luck (which everyone needs and depends on) you get your guys to the point in the contract where it is an easy decision to dump 'em or restructure. See the Skins are in that position this year with Samuels. It won't be the end of the world to cut him since the cap hit won't be hideous versus what it would be to keep him. But he is still a quality player so they'll go down the restructure road since money wise it makes no sense to get rid of him unless his demands are asanine.

[That Guy]

retirement means all remaining pro-rated bonus money becomes due immediately (towards the cap)...

and last year we used our remaining space for lavar's contract. I believe unused cap gets split evenly among your roster if you don't use it... (to encourage owners not to be the clippers).