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With the Saints recent release of C.J. Spiller, they will now carry over $40 million in dead money, cap space allocated to players whose contracts were terminated by the team. That figure is about $12 million greater than the next closest team and four times the NFL average.
New Orleans has become an habitual offender when it comes to dead money. Last year they also led the NFL in dead money, with $35 million in charges and they already have the early lead in 2017 with about $8 million on the books. Over the three-year period they have allocated nearly $35 million more in wasted cap dollars than the next closest team and the number is growing. When people wonder why the Saints are struggling, a good place to start looking is at the decisions that are causing them to basically waste 25 percent of their salary cap each season.
Watch This
The Saints' salary cap problems began a few years ago when they started using large signing bonuses to maintain most of their roster from their 2010 Super Bowl team, while at the same time showing little financial restraint in free agency. If there was a free agent available, the Saints needed to find a way to make it happen. To do that they would convert salary, which counts in full on the cap in a given year, to a prorated signing bonus that is spread out over the contract. When a player is released, all the prorated money assigned to the future accelerates onto the cap. The decisions made by the Saints' front office were minimizing the ways in which the team can manage their roster.
MORE: 25 highest-paid NFL players
By 2013 it was apparent to those who study contracts that the Saints were on a bad path, even if the numbers in 2012 and 2013 didn’t reflect that. The money committed to future contracts was obscene and the flexibility non-existent. As things began to come to a head, they doubled down in their strategy by going even further into finding ways to create cap space.
They began using a salary cap trick to further reduce cap charges for the current season by adding voidable years to a contract. The void years can be used to spread bonus money charges over a longer period of time, even though the player is not going to be under contract in those seasons. When the contract voids the cap, charges from the bonus money assigned to those void years hits the books.
This year alone the Saints used that type of contract to sign Paul Kruger and Nick Fairley, as well as to extend Drew Brees. The Saints deferred nearly $2.9 million for Kruger and Fairley to 2017. For Brees it is an $18 million deferment to 2018. The “buy now, pay later” philosophy has locked them into millions of dead money for the longhaul.
MORE: How Drew Brees reached incredible milestone
While there can be a time and place for such aggressive cap moves, the Saints' need for these should be called into question. The type of players that they have created cap room to sign have been those like Spiller, Brandon Browner and Dannell Ellerbe. These have all been, for the most part, non-impact players, many of whom are released or will be released after a season or two.
While everyone in the NFL makes contractual missteps, the Saints situation seems more compromised by the lack of any long-term vision or planning. Many teams are very deliberate in their roster planning strategy. The Saints are arguably the most haphazard team in the NFL.
MORE: Browner says he took Saints' millions and 'ran with it'
In 2014 they struggled to come to terms with star tight end Jimmy Graham, who was under contract for one year at $7 million. Eventually they negotiated a four-year contract that paid him $13 million in 2014 and reduced his cap charge to $4 million. The other $9 million would be spread out over the final three seasons. Less than a year later they decided to trade Graham. Rather than just taking a $7 million charge by allowing his contract to play out, they took on $13 million. In this case, at least they received a first-round pick and center Max Unger in return, but they may have had an avenue to do that anyway by using the franchise tag a second time. That would have cost them nothing beyond the $7 million.
More egregious was the decision to give Junior Galette to a huge extension in 2014, even though they still held his rights for just $4 million thru 2015. They added millions of guaranteed money to his contract. Months later they decided they wanted to release him. The charge to do so — $17.5 million. Had they just held firm in 2014, the cost to cut him in 2015 would have been just $900,000.
STEELE: Drew Brees gets the contract he deserves
These same types of moves were made with lesser players as well. Keenan Lewis, signed as a free agent in 2013, had grown unhappy with his contract by 2015, and wanted to see some type of change that would show him more commitment. Most teams would never entertain an offer with so many years remaining on a contract, especially for a player not considered a superstar. But, the Saints converted more salary to bonus money and also guaranteed his 2016 salary to show the commitment, except they weren’t committed. By 2016 they released him, adding a few extra million to their salary cap that they never needed to add in the first place.
The cycle just continues with the Saints every year. Most teams have one year like this when they decide to rebuild, but the Saints are looking at a three- or four-year hole because they just can’t help themselves.
The strategy hasn’t worked.
In three of the last four years, the team has won seven games despite having one of the best quarterbacks in the NFL. Players like Brees aren’t supposed to miss the playoffs, but even he can’t make up for the millions in potential talent that the team misses out on every year because of their wasted cap dollars. Eventually the Saints are going to come to a time when Brees is no longer on the team and people will look back at all the waste and wonder what could have been had the Saints been more responsible with their salary cap.
Jason Fitzgerald is an NFL salary expert and contributor for Sporting News. Read more of his writing at OverTheCap.com and follow him on Twitter: @Jason_OTC.
With the Saints recent release of C.J. Spiller, they will now carry over $40 million in dead money, cap space allocated to players whose contracts were terminated by the team. That figure is about $12 million greater than the next closest team and four times the NFL average.
New Orleans has become an habitual offender when it comes to dead money. Last year they also led the NFL in dead money, with $35 million in charges and they already have the early lead in 2017 with about $8 million on the books. Over the three-year period they have allocated nearly $35 million more in wasted cap dollars than the next closest team and the number is growing. When people wonder why the Saints are struggling, a good place to start looking is at the decisions that are causing them to basically waste 25 percent of their salary cap each season.
Watch This
The Saints' salary cap problems began a few years ago when they started using large signing bonuses to maintain most of their roster from their 2010 Super Bowl team, while at the same time showing little financial restraint in free agency. If there was a free agent available, the Saints needed to find a way to make it happen. To do that they would convert salary, which counts in full on the cap in a given year, to a prorated signing bonus that is spread out over the contract. When a player is released, all the prorated money assigned to the future accelerates onto the cap. The decisions made by the Saints' front office were minimizing the ways in which the team can manage their roster.
MORE: 25 highest-paid NFL players
By 2013 it was apparent to those who study contracts that the Saints were on a bad path, even if the numbers in 2012 and 2013 didn’t reflect that. The money committed to future contracts was obscene and the flexibility non-existent. As things began to come to a head, they doubled down in their strategy by going even further into finding ways to create cap space.
They began using a salary cap trick to further reduce cap charges for the current season by adding voidable years to a contract. The void years can be used to spread bonus money charges over a longer period of time, even though the player is not going to be under contract in those seasons. When the contract voids the cap, charges from the bonus money assigned to those void years hits the books.
This year alone the Saints used that type of contract to sign Paul Kruger and Nick Fairley, as well as to extend Drew Brees. The Saints deferred nearly $2.9 million for Kruger and Fairley to 2017. For Brees it is an $18 million deferment to 2018. The “buy now, pay later” philosophy has locked them into millions of dead money for the longhaul.
MORE: How Drew Brees reached incredible milestone
While there can be a time and place for such aggressive cap moves, the Saints' need for these should be called into question. The type of players that they have created cap room to sign have been those like Spiller, Brandon Browner and Dannell Ellerbe. These have all been, for the most part, non-impact players, many of whom are released or will be released after a season or two.
While everyone in the NFL makes contractual missteps, the Saints situation seems more compromised by the lack of any long-term vision or planning. Many teams are very deliberate in their roster planning strategy. The Saints are arguably the most haphazard team in the NFL.
MORE: Browner says he took Saints' millions and 'ran with it'
In 2014 they struggled to come to terms with star tight end Jimmy Graham, who was under contract for one year at $7 million. Eventually they negotiated a four-year contract that paid him $13 million in 2014 and reduced his cap charge to $4 million. The other $9 million would be spread out over the final three seasons. Less than a year later they decided to trade Graham. Rather than just taking a $7 million charge by allowing his contract to play out, they took on $13 million. In this case, at least they received a first-round pick and center Max Unger in return, but they may have had an avenue to do that anyway by using the franchise tag a second time. That would have cost them nothing beyond the $7 million.
More egregious was the decision to give Junior Galette to a huge extension in 2014, even though they still held his rights for just $4 million thru 2015. They added millions of guaranteed money to his contract. Months later they decided they wanted to release him. The charge to do so — $17.5 million. Had they just held firm in 2014, the cost to cut him in 2015 would have been just $900,000.
STEELE: Drew Brees gets the contract he deserves
These same types of moves were made with lesser players as well. Keenan Lewis, signed as a free agent in 2013, had grown unhappy with his contract by 2015, and wanted to see some type of change that would show him more commitment. Most teams would never entertain an offer with so many years remaining on a contract, especially for a player not considered a superstar. But, the Saints converted more salary to bonus money and also guaranteed his 2016 salary to show the commitment, except they weren’t committed. By 2016 they released him, adding a few extra million to their salary cap that they never needed to add in the first place.
The cycle just continues with the Saints every year. Most teams have one year like this when they decide to rebuild, but the Saints are looking at a three- or four-year hole because they just can’t help themselves.
The strategy hasn’t worked.
In three of the last four years, the team has won seven games despite having one of the best quarterbacks in the NFL. Players like Brees aren’t supposed to miss the playoffs, but even he can’t make up for the millions in potential talent that the team misses out on every year because of their wasted cap dollars. Eventually the Saints are going to come to a time when Brees is no longer on the team and people will look back at all the waste and wonder what could have been had the Saints been more responsible with their salary cap.
Jason Fitzgerald is an NFL salary expert and contributor for Sporting News. Read more of his writing at OverTheCap.com and follow him on Twitter: @Jason_OTC.
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