Salary Cap Question

[IBTG81]

We keep seeing that the cap is going to drop to $175. This is based off of revenue the NFL makes, correct?

The question is, does the NFL have to choose a lower number and can they go up to the $200 that was projected? I would think the players certainly want it, and for some (most), it would give them a better chance to win. 

[Hapless Bills Fan]

2 minutes ago, IBTG81 said:

We keep seeing that the cap is going to drop to $175. This is based off of revenue the NFL makes, correct?

The question is, does the NFL have to choose a lower number and can they go up to the $200 that was projected? I would think the players certainly want it, and for some (most), it would give them a better chance to win. 

 

As far as I know, the $175M is the floor, and nothing stops the NFL from making it higher.

[thenorthremembers]

This just came out a few hours ago from SI.  Looks like some owners arent super keen on having to cut a bunch of players to make up for missing revenue.  

 

The Cap May Not Crash Afterall

[Rochesterfan]

10 minutes ago, IBTG81 said:

We keep seeing that the cap is going to drop to $175. This is based off of revenue the NFL makes, correct?

The question is, does the NFL have to choose a lower number and can they go up to the $200 that was projected? I would think the players certainly want it, and for some (most), it would give them a better chance to win. 

 

Based upon the NFL/NFLPA agreement - they set 175 million as a floor with the ability to offset additional losses in the next couple of years.

 

The NFL and NFLPA can agree on a higher value, but they also have to agree to offsets to make up the difference - it will need to be negotiated.

 

The players want the higher salary cap sooner, but the NFL has to balance how much they are losing to ensure that every team can maintain and be competitive.

 

It will be interesting to see where they land and how much below 175 million the cap would have been and how much offset the teams need to cover now before getting the extra profit later.  Especially for teams like the Rams and Raiders that built new stadiums, but got a year with no fans - just added costs.

[Buffalo_Stampede]

I think the low number is most likely a worst case scenario. I bet it'll be near $200 million. 

 

Also you have to remember the NFL wants 17 games. The players want no OTA or mini camps. So maybe the low cap is just a negotiating tactic. 

[BillsFanThru-N-Thru]

The Bills can free up $25,250,000 easily and  without any real ramifications to the team but releasing 4 players and it would only be a  $2,600,000 cap hit,
 

Player            Cap Number    Dead Money    Cap Savings
------            ----------    ----------    -----------
John Brown        $9,750,000    $1,600,000    $8,150,000
Vernon Butler        $7,850,000    $1,000,000    $6,850,000
Quint Jefferson        $8,000,000    $0000000    $8,000,000
Lee Smith        $2,250,000    $0000000    $2,250,000
 

[BigdaddyinOrlando]

I can see the owners pushing for the TV rights ASAP to get monies in now to push up the cap. Incentive on both players and owners to find a way to raise it if possible. 

[Rc2catch]

51 minutes ago, BillsFanThru-N-Thru said:

The Bills can free up $25,250,000 easily and  without any real ramifications to the team but releasing 4 players and it would only be a  $2,600,000 cap hit,
 

Player            Cap Number    Dead Money    Cap Savings
------            ----------    ----------    -----------
John Brown        $9,750,000    $1,600,000    $8,150,000
Vernon Butler        $7,850,000    $1,000,000    $6,850,000
Quint Jefferson        $8,000,000    $0000000    $8,000,000
Lee Smith        $2,250,000    $0000000    $2,250,000
 

Lol wrong thread I hope. This didn’t have to do with buffalo or their savings 

[Tuco]

5 hours ago, IBTG81 said:

We keep seeing that the cap is going to drop to $175. This is based off of revenue the NFL makes, correct?

The question is, does the NFL have to choose a lower number and can they go up to the $200 that was projected? I would think the players certainly want it, and for some (most), it would give them a better chance to win. 

Technically the cap is derived from the players percentage of all NFL revenue for a year. One caveat to that system is that the cap for a season is based on projected revenue for the season, which can wind up being higher or lower as the season plays out. So what really happens every year is they project the revenue for the season, come up with the cap number, then make an adjustment up or down to reflect the difference of projected revenue vs. actual revenue from the year before. This ensures the percentage the players get always equals the amount they're supposed to get per the CBA.

 

The problem, as we all know, is the cap was set for 2020 using projected revenue for 2020. Then all Hell broke loose, and the actual revenue for 2020 wound up being much less than the projection. If nothing was done there would have to be a huge drop in the 2021 cap to make the correct adjustment. The CBA, however, specifies that in a case such as this, both sides should get together to agree on what to do.

 

So they did, back in July. They didn't make any changes to the agreed percentage, they just agreed on how to make the adjustment starting in 2021. The league's initial proposal was to start the adjustment by dropping the cap $8 million in 2020, while making the cap floor $165 mil in 2021. The original proposal from the players was to spread the whole thing out for 10 years. The NFL wasn't real big on that idea. For one thing, NFL owners already paid the players more than their actual share for the 2020 season. And as businessmen they're not inclined to wait 10 years to recoup all that money. For another thing, not that probably either side cares, but doing so would actually penalize every young player coming into the league for the next 10 years because the current players didn't want to lose their fair share. I lost money in 2020 due to COVID because my company lost money. So did a lot of people all over the country. NFL players were trying to push their share of losses onto players who haven't started shaving yet.

 

Anyway, the agreement was made that the players wouldn't give up any money in 2020. They would accept a cap floor of $175 million in 2021, with any amount beyond that cap floor that is required to be adjusted being spread out evenly for the next 3 years beyond that. 

 

Getting to your original question, yes, the owners have to use the $175 number (floor) as it was agreed to in a modified CBA. If revenues aren't as bad as they thought, the number can be higher by whatever amount the adjustment calls for it to be. Yes, they can go above that number too if they want, but if they do it would require a new agreement with the players. And you can rest assured if they find a way to do it it won't be by giving the players a higher percentage than they're already due. Meaning they will recoup the money they paid the players this year that was above and beyond their agreed to percentage.

 

While I'm sure there are owners who won't be happy cutting players left and right. Those owners knew what they were doing and that the cap floor was going to be $175 mil back in July when they voted and agreed to it. But all might not be lost. As a group, the owners are pretty good businessmen, and there's no doubt the current cap number was based on them covering their asses in a mostly worst case scenario. Put another way, they know better than to count their chickens before they hatch.

 

What that means is, it's possible, with the season going to 17 games, and if the anticipated new TV deals bring in more money starting in 2021, the cap may not be as low as $175 million. But as said, the owners no doubt moved forward back in July under the worst case scenario. Meaning they had to plan for not only huge losses, but the fact that they can't count on new TV money until it's actually there to be counted. So maybe just maybe it won't be the doomsday scenario. Although a cap of $200 million would still have the Saints trying to dump only $75 million instead of $100 million - oh well, that's their problem - it would be a welcome relief for most teams.

 

But there's a lot of ifs. Will the TV deals get done in time for their revenue projection to be part of the 2021 season? Will the COVID be considered under control enough they can project full stadiums, food stands and parking lots for 2021? They generally announce the official cap number early on because teams have to be under it by the first league day in early March. That's not a lot of time.

[Richard Noggin]

16 minutes ago, Tuco said:

Technically the cap is derived from the players percentage of all NFL revenue for a year. One caveat to that system is that the cap for a season is based on projected revenue for the season, which can wind up being higher or lower as the season plays out. So what really happens every year is they project the revenue for the season, come up with the cap number, then make an adjustment up or down to reflect the difference of projected revenue vs. actual revenue from the year before. This ensures the percentage the players get always equals the amount they're supposed to get per the CBA.

 

The problem, as we all know, is the cap was set for 2020 using projected revenue for 2020. Then all Hell broke loose, and the actual revenue for 2020 wound up being much less than the projection. If nothing was done there would have to be a huge drop in the 2021 cap to make the correct adjustment. The CBA, however, specifies that in a case such as this, both sides should get together to agree on what to do.

 

So they did, back in July. They didn't make any changes to the agreed percentage, they just agreed on how to make the adjustment starting in 2021. The league's initial proposal was to start the adjustment by dropping the cap $8 million in 2020, while making the cap floor $165 mil in 2021. The original proposal from the players was to spread the whole thing out for 10 years. The NFL wasn't real big on that idea. For one thing, NFL owners already paid the players more than their actual share for the 2020 season. And as businessmen they're not inclined to wait 10 years to recoup all that money. For another thing, not that probably either side cares, but doing so would actually penalize every young player coming into the league for the next 10 years because the current players didn't want to lose their fair share. I lost money in 2020 due to COVID because my company lost money. So did a lot of people all over the country. NFL players were trying to push their share of losses onto players who haven't started shaving yet.

 

Anyway, the agreement was made that the players wouldn't give up any money in 2020. They would accept a cap floor of $175 million in 2021, with any amount beyond that cap floor that is required to be adjusted being spread out evenly for the next 3 years beyond that. 

 

Getting to your original question, yes, the owners have to use the $175 number (floor) as it was agreed to in a modified CBA. If revenues aren't as bad as they thought, the number can be higher by whatever amount the adjustment calls for it to be. Yes, they can go above that number too if they want, but if they do it would require a new agreement with the players. And you can rest assured if they find a way to do it it won't be by giving the players a higher percentage than they're already due. Meaning they will recoup the money they paid the players this year that was above and beyond their agreed to percentage.

 

While I'm sure there are owners who won't be happy cutting players left and right. Those owners knew what they were doing and that the cap floor was going to be $175 mil back in July when they voted and agreed to it. But all might not be lost. As a group, the owners are pretty good businessmen, and there's no doubt the current cap number was based on them covering their asses in a mostly worst case scenario. Put another way, they know better than to count their chickens before they hatch.

 

What that means is, it's possible, with the season going to 17 games, and if the anticipated new TV deals bring in more money starting in 2021, the cap may not be as low as $175 million. But as said, the owners no doubt moved forward back in July under the worst case scenario. Meaning they had to plan for not only huge losses, but the fact that they can't count on new TV money until it's actually there to be counted. So maybe just maybe it won't be the doomsday scenario. Although a cap of $200 million would still have the Saints trying to dump only $75 million instead of $100 million - oh well, that's their problem - it would be a welcome relief for most teams.

 

But there's a lot of ifs. Will the TV deals get done in time for their revenue projection to be part of the 2021 season? Will the COVID be considered under control enough they can project full stadiums, food stands and parking lots for 2021? They generally announce the official cap number early on because teams have to be under it by the first league day in early March. That's not a lot of time.

 

You might want to cite this articulate and helpful article; I'd especially like to know whose perspective this is I'm reading and mostly agreeing with. The author has a slightly less bullish outlook on the cap than the author of that Green Bay piece linked above somewhere, but his projection is nonetheless rosier than the coming roster purges of a salary cap bottoming out at a depth of $175 million. 

 

For the majority of us, typing or reading about fears of "austerity" due to abysmal $175 million budgets is...well, ridiculous. Especially over the last 13 years of financial squeezing in so many sectors...but um, sorry. Back to our regularly scheduled football talk.

 

More fun than discussing our own lives amiright.

[strive_for_five_guy]

I question whether players would be cut left and right, as opposed to there being a lot more contract restructuring.  If certain players are faced with taking a little to moderate pay cut versus hitting the open market and potentially taking a substantial pay cut, they might accept the former.

[co_springs_billsfan]

I'm interested to see how this affects mid level free agents (Milano?). I think the top ones will still make bank and low tier are already low. I think this will put the squeeze on the middle.

Edited January 28, 2021 by co_springs_billsfan

[Tuco]

6 hours ago, strive_for_five_guy said:

I question whether players would be cut left and right, as opposed to there being a lot more contract restructuring.  If certain players are faced with taking a little to moderate pay cut versus hitting the open market and potentially taking a substantial pay cut, they might accept the former.

I expect a lot of restructuring too. But for teams that are $100 million over the cap, they will be cutting players left and right.

[Tuco]

7 hours ago, Richard Noggin said:

 

You might want to cite this articulate and helpful article; I'd especially like to know whose perspective this is I'm reading and mostly agreeing with. The author has a slightly less bullish outlook on the cap than the author of that Green Bay piece linked above somewhere, but his projection is nonetheless rosier than the coming roster purges of a salary cap bottoming out at a depth of $175 million. 

 

For the majority of us, typing or reading about fears of "austerity" due to abysmal $175 million budgets is...well, ridiculous. Especially over the last 13 years of financial squeezing in so many sectors...but um, sorry. Back to our regularly scheduled football talk.

 

More fun than discussing our own lives amiright.

 

 

I'll do my best to cite everything. The author of this article is known only on this message board as Tuco. The article was originally published on this message board about 7 hours ago.

 

Technically the cap is derived from the players percentage of all NFL revenue for a year. One caveat to that system is that the cap for a season is based on projected revenue for the season, which can wind up being higher or lower as the season plays out. So what really happens every year is they project the revenue for the season, come up with the cap number, then make an adjustment up or down to reflect the difference of projected revenue vs. actual revenue from the year before. This ensures the percentage the players get always equals the amount they're supposed to get per the CBA.

 

The problem, as we all know, is the cap was set for 2020 using projected revenue for 2020. Then all Hell broke loose, and the actual revenue for 2020 wound up being much less than the projection. If nothing was done there would have to be a huge drop in the 2021 cap to make the correct adjustment. The CBA, however, specifies that in a case such as this, both sides should get together to agree on what to do.

 

The above information is widely available and can be found by typing "NFL CBA 2020" into a Google search (6,980,000 results in .72 seconds).

 

So they did, back in July. They didn't make any changes to the agreed percentage, they just agreed on how to make the adjustment starting in 2021. The league's initial proposal was to start the adjustment by dropping the cap $8 million in 2020, while making the cap floor $165 mil in 2021. The original proposal from the players was to spread the whole thing out for 10 years. The NFL wasn't real big on that idea. For one thing, NFL owners already paid the players more than their actual share for the 2020 season. And as businessmen they're not inclined to wait 10 years to recoup all that money. For another thing, not that probably either side cares, but doing so would actually penalize every young player coming into the league for the next 10 years because the current players didn't want to lose their fair share. I lost money in 2020 due to COVID because my company lost money. So did a lot of people all over the country. NFL players were trying to push their share of losses onto players who haven't started shaving yet.

 

Anyway, the agreement was made that the players wouldn't give up any money in 2020. They would accept a cap floor of $175 million in 2021, with any amount beyond that cap floor that is required to be adjusted being spread out evenly for the next 3 years beyond that. 

 

The above information can be find through numerous news articles, mostly dated in late July of 2020, by typing "NFLPA agrees to $175 Million cap" into a Google search (31,000 results in .46 seconds). The part about the owners not wanting to wait 10 years to regain their losses is the author's opinion. Though it seems likely given that they refused to entertain the idea during the negotiation.

 

Getting to your original question, yes, the owners have to use the $175 number (floor) as it was agreed to in a modified CBA. If revenues aren't as bad as they thought, the number can be higher by whatever amount the adjustment calls for it to be. Yes, they can go above that number too if they want, but if they do it would require a new agreement with the players. And you can rest assured if they find a way to do it it won't be by giving the players a higher percentage than they're already due. Meaning they will recoup the money they paid the players this year that was above and beyond their agreed to percentage.

 

The information in the beginning of this paragraph can also be found with the above CBA Google search. The part about the owners not changing the percentage they will give to the players just to gain cap relief is the author's opinion.

 

While I'm sure there are owners who won't be happy cutting players left and right, those owners knew what they were doing and that the cap floor was going to be $175 mil back in July when they voted and agreed to it. But all might not be lost. As a group, the owners are pretty good businessmen, and there's no doubt the current cap number was based on them covering their asses in a mostly worst case scenario. Put another way, they know better than to count their chickens before they hatch.

 

This paragraph is also the author's opinion. Though he likes to think it's based on common sense.

 

What that means is, it's possible, with the season going to 17 games, and if the anticipated new TV deals bring in more money starting in 2021, the cap may not be as low as $175 million. But as said, the owners no doubt moved forward back in July under the worst case scenario. Meaning they had to plan for not only huge losses, but the fact that they can't count on new TV money until it's actually there to be counted. So maybe just maybe it won't be the doomsday scenario. Although a cap of $200 million would still have the Saints trying to dump only $75 million instead of $100 million - oh well, that's their problem - it would be a welcome relief for most teams.

 

This paragraph is mostly factual, with the information found through a combination of the above mentioned Google searches. The part about the owners having planned for the worst case scenario is subjective, and is the author's own opinion. Though he likes to think it's based on common sense.

 

But there's a lot of ifs. Will the TV deals get done in time for their revenue projection to be part of the 2021 season? Will the COVID be considered under control enough they can project full stadiums, food stands and parking lots for 2021? They generally announce the official cap number early on because teams have to be under it by the first league day in early March. That's not a lot of time.

 

This paragraph is subjective. Although there are news reports that the NFL expects to get at least one new TV agreement in place before the start of the 2021 season. The part about the cap being announced before the start of the season is factual, based on past practice and experience - and the need for teams to know what the cap is so they can abide by the CBA and be under it at that time.

 

Thanks for reading.

 

And for what it's worth, while the author has cited some reasons why the cap might not be as low as $175 million next year, the author doesn't feel all that rosy about next year's cap situation. A lot remains to be seen. And while it may well be that the cap doesn't go all the way down to $175, next year, the author doesn't think it will be $200 million either.

Edited January 28, 2021 by Tuco

[GunnerBill]

51 minutes ago, Tuco said:

 

And for what it's worth, while the author has cited some reasons why the cap might not be as low as $175 million next year, the author doesn't feel all that rosy about next year's cap situation. A lot remains to be seen. And while it may well be that the cap doesn't go all the way down to $175, next year, the author doesn't think it will be $200 million either.

 

I feel slightly more rosy than the Author..... though I agree it isn't staying at $195m or whatever it is now..... I suspect they end up a little above the agreed floor and are somewhere in the $180m-$185m range. 

[machine gun kelly]

14 hours ago, BillsFanThru-N-Thru said:

The Bills can free up $25,250,000 easily and  without any real ramifications to the team but releasing 4 players and it would only be a  $2,600,000 cap hit,
 

Player            Cap Number    Dead Money    Cap Savings
------            ----------    ----------    -----------
John Brown        $9,750,000    $1,600,000    $8,150,000
Vernon Butler        $7,850,000    $1,000,000    $6,850,000
Quint Jefferson        $8,000,000    $0000000    $8,000,000
Lee Smith        $2,250,000    $0000000    $2,250,000
 

So who and at what cost are picking up two defensive linemen, blocking TE, and speed WR?  If anyone suggest cuts which will happen, they’ll need to be replaced, so who they and what is the cost to each one?  Remember there currently are only 8 draft picks, and you need at minimum $7 mil. For the draft, then another $5 mil.  for an emergency fund in case of injuries.  That’s $12 mil. there and we just came up in Spotrac as $6 mil. over.  I don’t know why the flip from being $2.6 under just two days ago.

 

Brown didn’t look healthy when he came back from his injuries.  Only staff truly knows if he is still battling the knee/ankle injuries?  I’m not a big fan of cutting a player who were as valuable in 2019 with over 1,000 yards, and we don’t know if he can get back to form in 2021 with rest and rehab.

 

Ill grant you the others are just guys.  I had high hopes for Jefferson, but I’ll grant you both were just guys.  The coaches seemed to think there is value in Smith, although I don’t see it.  I wholeheartedly agree an improvement from our TE grouping is needed to get to the next level.  
 

I appreciate the thoughtfulness, and I wasn’t picking on you, it’s just cut someone you have to replace them.  Don’t worry, there will be 25 other guys doing something similar.  I’d love if someone wants to cut people, the place in who they would add tha t are free agents, the potential costs as you can easily find on otc or spotrac, and what is the net cap as a result.  
 

I know I can’t do it, nor would I spend the time, and if I did it would get picked apart.  You made a nice effort though so I appreciate it.

[BillsFanThru-N-Thru]

1 hour ago, machine gun kelly said:

So who and at what cost are picking up two defensive linemen, blocking TE, and speed WR?  If anyone suggest cuts which will happen, they’ll need to be replaced, so who they and what is the cost to each one?  Remember there currently are only 8 draft picks, and you need at minimum $7 mil. For the draft, then another $5 mil.  for an emergency fund in case of injuries.  That’s $12 mil. there and we just came up in Spotrac as $6 mil. over.  I don’t know why the flip from being $2.6 under just two days ago.

 

Brown didn’t look healthy when he came back from his injuries.  Only staff truly knows if he is still battling the knee/ankle injuries?  I’m not a big fan of cutting a player who were as valuable in 2019 with over 1,000 yards, and we don’t know if he can get back to form in 2021 with rest and rehab.

 

Ill grant you the others are just guys.  I had high hopes for Jefferson, but I’ll grant you both were just guys.  The coaches seemed to think there is value in Smith, although I don’t see it.  I wholeheartedly agree an improvement from our TE grouping is needed to get to the next level.  
 

I appreciate the thoughtfulness, and I wasn’t picking on you, it’s just cut someone you have to replace them.  Don’t worry, there will be 25 other guys doing something similar.  I’d love if someone wants to cut people, the place in who they would add tha t are free agents, the potential costs as you can easily find on otc or spotrac, and what is the net cap as a result.  
 

I know I can’t do it, nor would I spend the time, and if I did it would get picked apart.  You made a nice effort though so I appreciate it.

I agree about the speed needed at receiver but evaluating what Brown did this year I just don't see the justification for the almost $10,000,000 salary.  The offense didn't seem to be hindered that much with him out,  so while he's a good receiver he's not a $10,000,000 receiver.  With Diggs, Beasley, Davis, MacKenzie, and Isiah Hodgins on IR  all year they should be fine.  As for the rest, like you said they were just guys.  For me to lose the Brown contract to sign a Matt Milano is a no brainer

Edited January 28, 2021 by BillsFanThru-N-Thru

[machine gun kelly]

1 minute ago, BillsFanThru-N-Thru said:

I agree about the speed needed at receiver but evaluating what Brown did this year I just don't see the justification for the almost $10,000,000 salary.  The offense didn't seem to be hindered that much with him out,  so while he's a good receiver he's not a $10,000,000 receiver.  With Diggs, Beasley, Davis, MacKenzie, and Isiah Hopkins on IR  all year they should be fine.  As for the rest, like you said they were just guys.  For me to lose the Brown contract to sign a Matt Milano is a no brainer

Ok, sound point.  It’s too bad Hodgins wasn’t faster, but we will add him to the mix next season, so a second tall possession WR like Davis.  I’ve seen some mocks as I always pledge never to look at that stuff until we’re out for this season about us taking a WR.  I’m sure if we do and we are after speed, you’re wish may happen.  We definitely need speed both at WR and RB, but I doubt they go for another RB in the draft unless it’s late in the draft.  We have too many other needs to build on for the draft.   I’ll tell you bud, the draft will determine who we cut.  Once we see that, bodies will fall.

[Rochesterfan]

2 hours ago, GunnerBill said:

 

I feel slightly more rosy than the Author..... though I agree it isn't staying at $195m or whatever it is now..... I suspect they end up a little above the agreed floor and are somewhere in the $180m-$185m range. 

 

I agree and I think the fact the NFL got in all the games and even had some fans will help more than their worst case scenario.

 

I also would not be shocked if they come to an agreement to push up slightly this year and artificially lower next years money trying to balance it out - as long as each ownership group has enough solvent cash to move forward.

 

 

[SoCal Deek]

Even if the cap goes down, which I assume it will. I’m pretty sure that every team will be able to adjust by either cutting some dead weight or restructuring contracts for players they want to keep. After all, where are those players going to go? It’s not like the cap doesn’t apply to EVERY team in the league. Sure, there are a couple of teams in better cap shape than others but those teams can’t take on ALL of the supposedly soon to be available refugees from the rest of the league.