The Salary Cap Issue

[Billsfan4588]

I stumbled past this post on twitter today:

 

 

I'm by no means a cap guru. I don't understand the purpose of a "salary cap" if you're going to allow teams to manipulate it to this extent anyway. It shouldn't be this complicated, either have the salary cap as a simple number that teams under no circumstances may surpass on a yearly basis, or get rid of it completely. 

 

I don't fully understand the void years tactic, I've heard from others that it involves more risk because you may end up with a lot of dead cap in the future. I don't understand this (mainly as an arguement/defense from eagles fans here in downstate NY). 

 

It seems to me that this tactic could just as easily be exploited by teams with owners willing to shell out more $, which again, sort of defeats the purpose of a salary cap. Today, joe burrow was mentioning along the lines of him wanting the Bengals to do the same thing this year (spend lots of $ and use void years) citing the Eagles as the example so they can keep both Tee Higgins and Trey Hendrickson. 

 

 

What say you all, join the fun and manipulate the cap, try to buy a chip or stay the course? I'm personally shocked by how few teams are willing to exploit this tactic to the extent the Eagles do. I imagine it's not as rosey as it seems if you know how these financials work,  or else everyone would be doing it! 

 

Signed,

Salty Bills Fan surrounded by annoying Eagles fans

 

 

 

[Bob Chandler's Hands]

It's a complex world sometimes. 

[JPL7]

Void years are contract years the player will never play for a team (unless an extension or restructuring occurs). They are essentially placeholders for prorating signing bonus money up to five seasons. At some point all that money will have to be accounted for towards the Eagles salary cap.

 

They went all in and it worked. Good on them. They’ll pay for it eventually but I’d take that trade for the bills. 

[Miyagi-Do Karate]

I feel like the Saints are still paying for Jairus Byrd!

[mushypeaches]

17 minutes ago, Miyagi-Do Karate said:

I feel like the Saints are still paying for Jairus Byrd!

 

Well duh... everybody knows that the Byrd is the word!

[Low Positive]

19 minutes ago, Billsfan4588 said:

I stumbled past this post on twitter today:

 

 

I'm by no means a cap guru. I don't understand the purpose of a "salary cap" if you're going to allow teams to manipulate it to this extent anyway. It shouldn't be this complicated, either have the salary cap as a simple number that teams under no circumstances may surpass on a yearly basis, or get rid of it completely. 

 

I don't fully understand the void years tactic, I've heard from others that it involves more risk because you may end up with a lot of dead cap in the future. I don't understand this (mainly as an arguement/defense from eagles fans here in downstate NY). 

 

It seems to me that this tactic could just as easily be exploited by teams with owners willing to shell out more $, which again, sort of defeats the purpose of a salary cap. Today, joe burrow was mentioning along the lines of him wanting the Bengals to do the same thing this year (spend lots of $ and use void years) citing the Eagles as the example so they can keep both Tee Higgins and Trey Hendrickson. 

 

 

What say you all, join the fun and manipulate the cap, try to buy a chip or stay the course? I'm personally shocked by how few teams are willing to exploit this tactic to the extent the Eagles do. I imagine it's not as rosey as it seems if you know how these financials work,  or else everyone would be doing it! 

 

Signed,

Salty Bills Fan surrounded by annoying Eagles fans

 

 

 

Joe Burrow is so cute, pretending that Mike Brown has the cash to convert salary to signing bonuses. But really, it takes upfront cash and there is a price to pay cap-wise down the line when the run is over. 

[BarleyNY]

Teams like the Eagles can outspend teams with a more traditional cap structure by 15-18%. That’s a huge advantage. The mechanism is to push out as much cap space as possible by using signing bonuses and void years rather than salary and roster bonuses. I’ll explain how that works in another post. 

Just remember that the most important factor is cash spending. Teams have cash budgets for each year and the cap structuring follows that. There are some drawbacks and risks with the Eagles approach:

- It is aggressive and sustainable, but it’s even keeled. There is no room to push “all in” and spike spending for a season or two. 

- You need an owner willing to spend that much extra. There are actually very few of those. Most would rather pocket the money. Mike Brown has always pocketed what he can.

- Teams have to bet on the right players because it is difficult to move on from the expensive ones if things sour. Myles Garrett is a good example. The Browns operate with the same cap management style as the Eagles. It’s nearly impossible for them to trade MG this offseason.

- And the big one. The cap must co time to rise at a fairly predictable rate. If we have another Covid year where the cap falls, then there could be very big negative repercussions. 

 

So Cincy could keep both Higgins and Chase if they wanted to, but they don’t want to spend that much money. They will be compliant with the spending floor and structure their contracts so that it looks like they don’t have much space. That gives them a story to tell their fans when they let a Tee Higgins leave. Owners like Mike Brown love this structure for that reason and they don’t care if the Eagles outspend them and get a competitive advantage. 

[BarleyNY]

Cap basics:

- The cap hits for salary and roster bonuses hit in the year they are paid. 

- Signing bonus cap hits are prorated over the life of the contract for up to 5 seasons total. 

- Void years are fake contract years used to push out cap hits from signing bonuses. 

- When a player is cut or traded then all remaining cap hits from a signing bonus accelerate into the current year (or following year if after 6/1).

 

Example of two players paid the same amount for a 1 season contract:

- Player with a 1 year contract with $2M signing bonus and $10M salary. Cap hit is $12M in Y1. 

- Player with a 1 year contract with 4 added void years, $2M salary and $10M signing bonus. Cap hits would be $4M in Y1 and $8M in Y2. This is because the signing bonus is $2M/season for 5 seasons. Then since the contract voids the remaining 4 seasons of signing bonus money accelerates into year 2. 

 

It’s worth noting that if a player is extended before his contract voids, then the cap hits would not accelerate at that time. 

 

So you can see how it helps when you factor in a historic 8% increase in the cap. Just structuring the contract above like that is a cap savings of $8Mx.08=$640k. For nothing really. And those numbers get large when you go out 4 seasons on longer term contracts. Players don’t even get cash early anymore. It’s guaranteed, but is usually just paid out as if it were salary. 

[Buffalo_Stampede]

Owners have to be willing to pay huge cash payments.

[gregmo]

17 minutes ago, BarleyNY said:

 

It’s worth noting that if a player is extended before his contract voids, then the cap hits would not accelerate at that time. 

So the remaining cap hit is averaged across the new contract term until completed or voided?  (rinse, repeat)

 

Edited 5 hours ago by gregmo

[ColoradoBills]

6 minutes ago, BarleyNY said:

It’s worth noting that if a player is extended before his contract voids, then the cap hits would not accelerate at that time. 

 

I agree with your post on how the void years' work.

 

The downside is when contracts are not extended, whether by FA, traded or retire.

 

Example for the Eagles this coming year, Kelce and Cox retired, and they have a $25M dead cap hit.

The day does come when you have to pay for players NOT on your team anymore.

 

The Eagles have taken on this risk and so far, they have done pretty well with it.

The Browns, on the other hand, have done the same thing BUT are facing a horrible result.

I see the "Void Year" option as a useful tool but not a panacea for the cap.

[BarleyNY]

Just now, gregmo said:

So the remaining cap hit is averaged across the new contract term until completed or voided? 

 

Yes. That’s all void years do. The only other thing about them to note is that they do not impact compensatory picks. If a team had to write extra years into a contract to push out cap hits and then cut the player, they wouldn’t get a comp pick. But if they use void years they would be eligible for one. 

[GunnerBill]

It is why cash rich owners matter in the NFL.

[DapperCam]

57 minutes ago, Billsfan4588 said:

I stumbled past this post on twitter today:

 

 

I'm by no means a cap guru. I don't understand the purpose of a "salary cap" if you're going to allow teams to manipulate it to this extent anyway. It shouldn't be this complicated, either have the salary cap as a simple number that teams under no circumstances may surpass on a yearly basis, or get rid of it completely. 

 

I don't fully understand the void years tactic, I've heard from others that it involves more risk because you may end up with a lot of dead cap in the future. I don't understand this (mainly as an arguement/defense from eagles fans here in downstate NY). 

 

It seems to me that this tactic could just as easily be exploited by teams with owners willing to shell out more $, which again, sort of defeats the purpose of a salary cap. Today, joe burrow was mentioning along the lines of him wanting the Bengals to do the same thing this year (spend lots of $ and use void years) citing the Eagles as the example so they can keep both Tee Higgins and Trey Hendrickson. 

 

 

What say you all, join the fun and manipulate the cap, try to buy a chip or stay the course? I'm personally shocked by how few teams are willing to exploit this tactic to the extent the Eagles do. I imagine it's not as rosey as it seems if you know how these financials work,  or else everyone would be doing it! 

 

Signed,

Salty Bills Fan surrounded by annoying Eagles fans

 

 

 

There is no infinite cap glitch. The Eagles will have to account for these guys with void years on their cap even when they aren’t playing for them anymore. Just like we are doing with Von Miller after he gets cut this offseason.

 

Rams and Saints are two teams that have recently played this cap game and now they are sort of in limbo. Bills and Chiefs have largely avoided it to keep their windows open. We’ll see what the Eagles can cook up, but they have big contributions right now on defense from players on rookie contracts (pretty much all their best players on D).

[Big Turk]

1 hour ago, Billsfan4588 said:

I stumbled past this post on twitter today:

 

 

I'm by no means a cap guru. I don't understand the purpose of a "salary cap" if you're going to allow teams to manipulate it to this extent anyway. It shouldn't be this complicated, either have the salary cap as a simple number that teams under no circumstances may surpass on a yearly basis, or get rid of it completely. 

 

I don't fully understand the void years tactic, I've heard from others that it involves more risk because you may end up with a lot of dead cap in the future. I don't understand this (mainly as an arguement/defense from eagles fans here in downstate NY). 

 

It seems to me that this tactic could just as easily be exploited by teams with owners willing to shell out more $, which again, sort of defeats the purpose of a salary cap. Today, joe burrow was mentioning along the lines of him wanting the Bengals to do the same thing this year (spend lots of $ and use void years) citing the Eagles as the example so they can keep both Tee Higgins and Trey Hendrickson. 

 

 

What say you all, join the fun and manipulate the cap, try to buy a chip or stay the course? I'm personally shocked by how few teams are willing to exploit this tactic to the extent the Eagles do. I imagine it's not as rosey as it seems if you know how these financials work,  or else everyone would be doing it! 

 

Signed,

Salty Bills Fan surrounded by annoying Eagles fans

 

 

 

 

Essentially void years allow them to spread cap hits out over extra years even tho that player will not be playing for the team...it's like signing a 5 year deal with $100 million guaranteed, but 2 are void years, meaning instead of having to pay a cap hit of $33 million over a 3 year contract, you can pay a cap hit of $20 million over 5 years.

 

However those void years then have to be accounted for with the player not on the team.

[Buffalo_Stampede]

3 minutes ago, DapperCam said:

There is no infinite cap glitch. The Eagles will have to account for these guys with void years on their cap even when they aren’t playing for them anymore. Just like we are doing with Von Miller after he gets cut this offseason.

 

Rams and Saints are two teams that have recently played this cap game and now they are sort of in limbo. Bills and Chiefs have largely avoided it to keep their windows open. We’ll see what the Eagles can cook up, but they have big contributions right now on defense from players on rookie contracts (pretty much all their best players on D).

Yeah, but I think it’s worth it. Josh Allen probably has 5 more prime years. Spend as much as you can and kick the can down the road as long as you can.

 

The Bills have to realize they have to do this because they missed that rookie QB contract window. Now they have to kick the can down the road. They have to!! 

Edited 5 hours ago by Buffalo_Stampede

[Stenbar]

2 minutes ago, DapperCam said:

There is no infinite cap glitch. The Eagles will have to account for these guys with void years on their cap even when they aren’t playing for them anymore. Just like we are doing with Von Miller after he gets cut this offseason.

 

Rams and Saints are two teams that have recently played this cap game and now they are sort of in limbo. Bills and Chiefs have largely avoided it to keep their windows open. We’ll see what the Eagles can cook up, but they have big contributions right now on defense from players on rookie contracts (pretty much all their best players on D).

Are we sure they are going to cut Miller this offseason? 

[BarleyNY]

2 minutes ago, ColoradoBills said:

 

I agree with your post on how the void years' work.

 

The downside is when contracts are not extended, whether by FA, traded or retire.

 

Example for the Eagles this coming year, Kelce and Cox retired, and they have a $25M dead cap hit.

The day does come when you have to pay for players NOT on your team anymore.

 

The Eagles have taken on this risk and so far, they have done pretty well with it.

The Browns, on the other hand, have done the same thing BUT are facing a horrible result.

I see the "Void Year" option as a useful tool but not a panacea for the cap.

Agreed. It’s a risk in some instances. But the extra space does allow for some mistakes to be made and they can plan for retirements.

 

The Browns messed their team up with the Watson debacle. It severely screwed up that locker room this year. They changed their offense to try to make it work with him and that caused issues. Then Winston outperformed him in camp, but they had to trot Watson out as starter due to the stupid guaranteed contract. That angered many because they knew he didn’t give them the best chance to win. Eventually the locker room fell apart. I don’t think Watson ever takes another snap for them. 

 

The counter example is the 2023 Browns. That locker room was tight and their cap management allowed them to do well enough to make the playoffs despite poor QB play overall.

 

Moving forward it’ll be interesting to see what that team can do if they can find a good QB somehow. 

[Buffalo_Stampede]

Just now, Stenbar said:

Are we sure they are going to cut Miller this offseason? 

They save about the same amount cutting him as they would with a restructure.

 

So I guess it’s not imminent like I thought.

[ColoradoBills]

2 minutes ago, BarleyNY said:

Agreed. It’s a risk in some instances. But the extra space does allow for some mistakes to be made and they can plan for retirements.

 

The Browns messed their team up with the Watson debacle. It severely screwed up that locker room this year. They changed their offense to try to make it work with him and that caused issues. Then Winston outperformed him in camp, but they had to trot Watson out as starter due to the stupid guaranteed contract. That angered many because they knew he didn’t give them the best chance to win. Eventually the locker room fell apart. I don’t think Watson ever takes another snap for them. 

 

The counter example is the 2023 Browns. That locker room was tight and their cap management allowed them to do well enough to make the playoffs despite poor QB play overall.

 

Moving forward it’ll be interesting to see what that team can do if they can find a good QB somehow. 

 

Watson surely caused a problem.  The Browns went all in with other players.

They "made the playoffs" but were not going to threaten a SB.

If that's the goal of the team, well that's up to them.

 

Next year (2026) the Brown have 8 players hitting FA with a total over $80M in void year dead cap.

Every one of those 8 players are over 30 years of age.  3 are 35 years old.

Add in Watson at $73M, they are F'd.

 

They made bad decisions, followed by bad decisions.

Look at what I'm talking about in the Spotrac link.

https://www.spotrac.com/nfl/cleveland-browns/overview/_/year/2026/sort/contract_free_agent_year/dir/asc