joesz Posted February 18, 2007 Posted February 18, 2007 If I understand the "Cash to Cap" concept, the total dollars from saleries and bonuses spent this year will not exceed $109 million, even though bonus monies are amortized over the life of player's contract years. So let me pose this question regarding the $20.7 million that is allocated to amortized bonuses from previous years in the Bill's 2007 Salery Cap. I got this figure for the BillsZone 2007 Salery Cap Page (link below) http://www.billszone.com/mtlog/archives/20...ry_cap_page.php Technically, this $20.7 million was already paid in the previous years of "Cash to Cap". So don't they have this year's $33 million of cap space PLUS the $20.7 million of amortized equals $50.7 million in Cash to Cap dollars to spend? The only care they would have to take is to make sure thay they balance salery and bonus dollars in such a way that it doesn't exceed $33 million in Cap Space. What is wrong with my reasoning?
jahnyc Posted February 18, 2007 Posted February 18, 2007 Your reasoning is correct. Unfortunately, my sense is that this cash to cap concept is being implemented for this year without giving effect to prior years. The Bills will end up significantly under this year's cap (and in future years as well) if ithey implement and adhere to cash to cap spending.
Dibs Posted February 18, 2007 Posted February 18, 2007 Your reasoning is correct. Unfortunately, my sense is that this cash to cap concept is being implemented for this year without giving effect to prior years. The Bills will end up significantly under this year's cap (and in future years as well) if ithey implement and adhere to cash to cap spending. Only if they implement it how you are speculating. I'd think that if the did.....you would be spot on that we would spend well below the cap limit......however, since teams are required to cover 85% of the limit ($92.5mil.....or $16.5mil under), I don't think your(& many, many others) speculation that RW & ML will spend as little as possible will hold up. e.g. We are $30mil under the cap(after rookies etc) If we were to sign players with combined $30mil signing bonuses & salaries but only counted $10mil towards this seasons cap figures(which is a very low signing bonus ratio)......we would be $20mil under the cap....which is not allowed. What joesz said in the first post is not only the only logical way of interpreting this but is also the most likely thing to occur due to the 85% rule.
jahnyc Posted February 18, 2007 Posted February 18, 2007 We will see how this plays out, but I suppose the Bills could pay a free agent player a guaranteed base for 2007 instead of a bonus (or structure it in a way that the bonus counts for 2007). This would allow them to count the full amount for 2007 and likely exceed the minimum salary cap number without much difficulty. If the Bills pay a bonus in any particular year, are those amounts required to be amortized over the life of the contract or is it optional?
Dibs Posted February 18, 2007 Posted February 18, 2007 We will see how this plays out, but I suppose the Bills could pay a free agent player a guaranteed base for 2007 instead of a bonus (or structure it in a way that the bonus counts for 2007). This would allow them to count the full amount for 2007 and likely exceed the minimum salary cap number without much difficulty. If the Bills pay a bonus in any particular year, are those amounts required to be amortized over the life of the contract or is it optional? Why jump to the assumption that instead of instigating this as a measure to ensure we continually stay out of cap trouble, they are instigating this to try & pay as little money as possible? They have said "Cash to Cap". That means basically what joesz posted unless they are trying to mislead. Why assume the latter & not the logical former?
LevysEraII Posted February 18, 2007 Posted February 18, 2007 We will see how this plays out, but I suppose the Bills could pay a free agent player a guaranteed base for 2007 instead of a bonus (or structure it in a way that the bonus counts for 2007). This would allow them to count the full amount for 2007 and likely exceed the minimum salary cap number without much difficulty. If the Bills pay a bonus in any particular year, are those amounts required to be amortized over the life of the contract or is it optional? The signing bonus doesn't have to be spread out over the life of the contract and that is exactly what the Bills are going to do.
jahnyc Posted February 18, 2007 Posted February 18, 2007 As I said, we need to see how this plays out (and is implemented). Joesz's email suggests that the Bills really have $50 million to spend, but none of the press coverage seems to support this view. As to staying out of "cap hell," the Bills are more than $30 million under the cap this year. Even if they paid significant bonuses this offseason and such bonuses were amortized, it would not necessarily mean that they will have cap problems in the future. If the Bills implement cash to cap, then some or all bonus amounts will count towards this year's cap. That means little (if any) of bonus amounts paid will amortized. If the cap goes up next year and there are no amortized bonus amounts counting from the prior year, then the team will be significantly under the cap (again). I am not a cap expert, but I expect that the Bills will use roster bonuses and LTBE incentives to ensure that such amounts count for the current year.
Dibs Posted February 18, 2007 Posted February 18, 2007 ......If the cap goes up next year and there are no amortized bonus amounts counting from the prior year, then the team will be significantly under the cap (again)....... I think that may well be one of the reasons for doing it.
Pyrite Gal Posted February 18, 2007 Posted February 18, 2007 A lot of this a question of how you budget this rather an absolute amount. The Bills will maintain the right to amortize or not based on how they decide to pay out the money. For example MN signed Winfield abd they had a lot of room under the cap and rather than paying him his money as bonus they simply paid it as base salary and thus applied it to the cap for one single year rather than amortizing it over several years. My guess is that the Bills will follow cash as cap as a budgeting tool, however, if an opportunity such as Lawyer Milloy suddenly hitting the market appears, my guess is that the Bills will do what it is necessary to acquire a player they have a football need to acquire.
I 90 Posted February 18, 2007 Posted February 18, 2007 Why jump to the assumption that instead of instigating this as a measure to ensure we continually stay out of cap trouble, they are instigating this to try & pay as little money as possible? Even the best case doesn't inspire confidence. At some point Ralph will be forced to spend NFL money (if he likes Losman, Evans and Mcgahee) so why not do it now with cap room advantage on 27 or so teams. It sends an odd message to players and agents (and fans). Continually staying out of cap trouble and winning has to be a tough act.
DeLuca1967 Posted February 18, 2007 Posted February 18, 2007 As I said, we need to see how this plays out (and is implemented). Joesz's email suggests that the Bills really have $50 million to spend, but none of the press coverage seems to support this view. As to staying out of "cap hell," the Bills are more than $30 million under the cap this year. Even if they paid significant bonuses this offseason and such bonuses were amortized, it would not necessarily mean that they will have cap problems in the future. If the Bills implement cash to cap, then some or all bonus amounts will count towards this year's cap. That means little (if any) of bonus amounts paid will amortized. If the cap goes up next year and there are no amortized bonus amounts counting from the prior year, then the team will be significantly under the cap (again). I am not a cap expert, but I expect that the Bills will use roster bonuses and LTBE incentives to ensure that such amounts count for the current year. I don't think this is correct. I don't think the Bills can choose how the amortization works. If the Bills choose to count an entire $10 million dollar signing bonus in the 2007 cap figure. I believe in the NFL eyes that number will still be spread over the length of the contract and the balance will not hit until th player is released. In other words the Bills will be keeping their set of books that differ than the NFL's. In the NFL's eyes they will have so much money available under the cap but on the Bills books they will have less. To put it in it's simplest form. If the money is not covered by the TV revenue it's not being spent.
keepthefaith Posted February 18, 2007 Posted February 18, 2007 I don't think this is correct. I don't think the Bills can choose how the amortization works. If the Bills choose to count an entire $10 million dollar signing bonus in the 2007 cap figure. I believe in the NFL eyes that number will still be spread over the length of the contract and the balance will not hit until th player is released. In other words the Bills will be keeping their set of books that differ than the NFL's. In the NFL's eyes they will have so much money available under the cap but on the Bills books they will have less. To put it in it's simplest form. If the money is not covered by the TV revenue it's not being spent. If what you say is correct they can simply pay a player like NC a small bonus and a large salary in the first year of his new contract in order to apply most of the contract to this year's cap. There are all kinds of ways to structure these deals in terms of up front bonus, salary, term length, roster bonuses, option years, renewals and the timing of bonuses, etc in order to drop the dollars anywhere you want along the life of the deal (cap-wise). I do expect the Bills to make a big effort to resign Clements, Kelsay and Thomas. A little creative structure will go a long way to getting the job done and the Bills with a lot of money to spend even with the "cash to cap" approach are in a good position to compete for these players. I won't be critical of the organization now as it remains to be seen who will get signed this off-season.
Ozymandius Posted February 18, 2007 Posted February 18, 2007 If what you say is correct they can simply pay a player like NC a small bonus and a large salary in the first year of his new contract Nate won't accept a small bonus. No player would. The bonus is what matters in an NFL contract.
Ozymandius Posted February 18, 2007 Posted February 18, 2007 Question -- what is the penalty for not spending 85% of the cap? If it's a slap on the wrist, then Ralph might just elect to stay at 70% of the cap or so.
keepthefaith Posted February 18, 2007 Posted February 18, 2007 Nate won't accept a small bonus. No player would. The bonus is what matters in an NFL contract. Sure he would if the first year salary is very high because that would be guaranteed once he is rostered.
DeLuca1967 Posted February 18, 2007 Posted February 18, 2007 Sure he would if the first year salary is very high because that would be guaranteed once he is rostered. Any idea on how much 'dead cap space' the Bills are carrying into this year? If the cap is $109 million and that is covered by the TV revenue. If the Bills have lets say $20 million in dead cap space? That $20 million goes back into Ralph's pocket to cover the bonuses he paid out in earlier years. Is this wrong?
Ozymandius Posted February 18, 2007 Posted February 18, 2007 Sure he would if the first year salary is very high because that would be guaranteed once he is rostered. Even if that's true (is it?), it's still an unacceptable risk to the player. What if he gets injured (say, an auto accident or something) between March and September and the Bills cut him? Buh-bye, money.
Dibs Posted February 18, 2007 Posted February 18, 2007 Any idea on how much 'dead cap space' the Bills are carrying into this year? If the cap is $109 million and that is covered by the TV revenue. If the Bills have lets say $20 million in dead cap space? That $20 million goes back into Ralph's pocket to cover the bonuses he paid out in earlier years. Is this wrong? No.....you are correct......and as far as I'm aware the figure is around $20mil. The media(or more likely the guy who wrote the first article that all others copied) didn't figure that, made a mistake & quoted the wrong figure.
DeLuca1967 Posted February 18, 2007 Posted February 18, 2007 No.....you are correct......and as far as I'm aware the figure is around $20mil.The media(or more likely the guy who wrote the first article that all others copied) didn't figure that, made a mistake & quoted the wrong figure. If the Bills Salary amount to about let's say $95 million this year. That's $14 under the cap + $20 million dead cap space. So Ralph is pocketing $34 million this year based on those numbers? Man, I wish I was that poor.
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