Salary cap question, Leonard Floyd’s dead cap

[Big Turk]

53 minutes ago, Virgil said:

I don’t get this.  Didn’t he sign a one year deal?  How is there a cap hit this year?

 

void years to spread out the salary cap hit

[Alphadawg7]

"But the cap isn't real" lol

[BarleyNY]

8 minutes ago, BBFL said:

100%. I just don’t know why they’d do it that way. 

 

They were trying to be competitive in 2023. The Bills had (and still have) a large amount of cap tied up in unproductive defenders. This - and several other contracts - were their work around to mitigate some of that.

 

In general, it is advantageous to kick the can down the road as long as the cap rises. Every cap dollar kicked into a future year is discounted by the percentage the cap has increased. If a team staggers parting ways with high contract players, then they can structure contracts like this indefinitely. Unfortunately the Bills have a logjam of such players. 

 

[JerseyBills]

51 minutes ago, BBFL said:

They split the $7m over two years instead of paying it all in one season. Might have been because they believed he was going to hit the contact incentives built in? I don’t know why they chose to do it that way. Pretty rough either way though as that $4.3m is a decent chunk of change. 
 

 

Thanks, very interesting,  didn'tevenknowthis was a thing,  wasn't aware of this, Hyde too 🙄 but at the same time allows Beane to sign guys by manipulating the cap

[BillsFanForever19]

Did everyone in here think we got a Free Agent DE the caliber of Leonard Floyd on a 1 year deal at just a 1.16m salary, a 1.45m signing bonus, and a 2.6m cap hit? 

 

Every year people look at our cap situation and say there's things we can do to finesse it and make certain signings happen. And in the moment, they don't care what it takes. "Add void years" is a common refrain amongst posters who want to make a deal happen with someone. 

 

But then when we do and those void years come where we're paying for a player who isn't here, now they don't like it. This is why I'm always saying "it's not that simple" when people want to do these things.

 

"Void years" don't void the numbers attached in those years. It's always great in the moment to fit a player in when we don't have room. But the bill always comes due and it's not fun when it does.

Edited February 19 by BillsFanForever19

[Billsflyer12]

What exactly are the “cap is not real” people mean when they say that constantly?

 

There are always real consequences for cap maneuvering, some just come sooner then later.
 

[Buffalo_Stampede]

22 minutes ago, Alphadawg7 said:

"But the cap isn't real" lol

It’s real, but very flexible. You have to be careful pushing back money on players you don’t view as multiple year players.

[Aussie Joe]

12 minutes ago, Billsflyer12 said:

What exactly are the “cap is not real” people mean when they say that constantly?

 

They mean it as a way of justifying risky and even unwise contract decisions ..

Edited February 19 by Aussie Joe

[BuffaloBillyG]

54 minutes ago, Buffalo_Stampede said:

The $4.3 with Floyd hurts most because he’s actually a player many thought would return. I don’t think the Bills would take on $4 million and then sign him later. 

I'm pretty sure they did that with Jordan Phillips last year. Wasn't as big of a dead cap hit, maybe half of Floyd IIRC.

53 minutes ago, Sweats said:

Anybody still think Beane is a number wizard?!?

 Never did. Beane isn't the numbers guy. That's Overdorf from what I understand.

[BuffaloRebound]

As long as you don’t push too much into the future, it’s smart cap management that every team does.  You get to push current liabilities at today’s prices onto future cap years that are growing 7-10% every year.  It’s borrowing at 0% when you know your salary goes up every year.  

[GASabresIUFan]

1 hour ago, Virgil said:

I don’t get this.  Didn’t he sign a one year deal?  How is there a cap hit this year?

It's called a void year.  Yes, we signed him to a one-year deal, but on paper, it was a 2-year deal so that Floyd could get the money he wanted and the Bills could limit the cap hit in 2023.  

[Buffalo_Stampede]

11 minutes ago, BuffaloRebound said:

As long as you don’t push too much into the future, it’s smart cap management that every team does.  You get to push current liabilities at today’s prices onto future cap years that are growing 7-10% every year.  It’s borrowing at 0% when you know your salary goes up every year.  

It’s a great way to manipulate the cap but there’s no way Beane is re-signing Leonard Floyd. If he does he literally wasted $4.3 million.

 

My guess is Von Miller will get Floyd’s snaps and they will draft depth. 

[strive_for_five_guy]

36 minutes ago, Billsflyer12 said:

What exactly are the “cap is not real” people mean when they say that constantly?

 

There are always real consequences for cap maneuvering, some just come sooner then later.
 

It’s a similar principle as losing non-conference games helps your playoff odds 😇

Edited February 19 by strive_for_five_guy

[ControllerOfPlanetX]

1 hour ago, Sweats said:

Anybody still think Beane is a number wizard?!?

just more cap space wasted not getting past the Chiefs.

[BuffaloRebound]

6 minutes ago, Buffalo_Stampede said:

It’s a great way to manipulate the cap but there’s no way Beane is re-signing Leonard Floyd. If he does he literally wasted $4.3 million.

 

My guess is Von Miller will get Floyd’s snaps and they will draft depth. 

Not following that logic.  It’s cap money, not real money.  That $4.3m dead cap is less than 2% of $243m and it doesn’t matter where it came from at this point.  Floyd clearly prefers the 1 year contract thing and if McBeane decides to bring him back the $4.3m dead cap will have no bearing on that decision.  

[NoSaint]

2 hours ago, Buffalo_Stampede said:

Yikes. So technically whatever we sign him to later you can basically add $4.3 million to it. That would be terrible cap management by Brandon Beane. Doubt they’ll extend him today.

 

Im guessing they won’t be bringing Floyd back. Should’ve extended him.

Whoever we sign will be in addition. It’s simply accounting for bonus money paid last year. 

1 hour ago, BarleyNY said:

 

They were trying to be competitive in 2023. The Bills had (and still have) a large amount of cap tied up in unproductive defenders. This - and several other contracts - were their work around to mitigate some of that.

 

In general, it is advantageous to kick the can down the road as long as the cap rises. Every cap dollar kicked into a future year is discounted by the percentage the cap has increased. If a team staggers parting ways with high contract players, then they can structure contracts like this indefinitely. Unfortunately the Bills have a logjam of such players. 

 

And also if you don’t spend the money saved, you just roll over the extra cap space to cover it the following year 

[jwhit34]

From the beyondthesteelcurtain website, as good an explanation as I've seen:

 

Void Years

Sometimes teams add void years onto a contract in order to spread out the salary cap hit of the initial signing bonus. A void year is simply fake years on a contract just to spread out the signing bonus but the player does not have a base salary for those years and are set to become a free agent once the contract voids. If a player has void years in their contract and they are not re-signed before the contract voids, all of the remaining money from any of the void years gets transferred into dead money for the next season.

 

Unless any of the 5 re-signed today, it all goes to dead cap in '24. Also of note per Spotrac it lists the Bills as having 58 signed players, once these all void then they are down to 53. That money is all accounted for in the amount over the cap so shifting from void years to dead cap has no impact on the cap status. 

 

This is just one of the cap work-arounds that most/all teams use. 

[SoonerBillsFan]

1 hour ago, DCofNC said:

Pretty much it, the contract was set up to allow them an extra player they couldn’t afford last year, now you eat it.   It’s a pretty common practice, just kicks the can down the road.  The Bills have to hit re-set here soon and eat ***** for a year or continue to be just good enough to disappoint.

That's why I say take the cap hits this year, draft well amd do nothing FA wise until after June 1st.  At some point we have to do this, I say get it over with now.

[Buffalo_Stampede]

31 minutes ago, BuffaloRebound said:

Not following that logic.  It’s cap money, not real money.  That $4.3m dead cap is less than 2% of $243m and it doesn’t matter where it came from at this point.  Floyd clearly prefers the 1 year contract thing and if McBeane decides to bring him back the $4.3m dead cap will have no bearing on that decision.  

I spent a few minutes looking it up and realized Floyd only had about $3 million cap hit in 2023. So the remaining cap hit was just his 2023 salary. It makes more sense now.

 

That $4.3 should actually be looked at as savings from last years cap. It was just pushed to this year.

 

They could/will probably do the same thing this year. Sign a veteran with a cap hit of around $3 million and push 4-5 million into 2025.

30 minutes ago, NoSaint said:

Whoever we sign will be in addition. It’s simply accounting for bonus money paid last year. 

And also if you don’t spend the money saved, you just roll over the extra cap space to cover it the following year 

Yes realize that now. Beane’s job is safe.

Edited February 19 by Buffalo_Stampede

[JoPoy88]

1 hour ago, Billsflyer12 said:

What exactly are the “cap is not real” people mean when they say that constantly?

 

There are always real consequences for cap maneuvering, some just come sooner then later.
 

It’s hyperbole obviously, but it means that the cap is easily negotiated with some planning and utilization of various creative (and allowed) accounting and contracting practices, void years being just one.