OFFICIAL CBA Q & A THREAD (Cap Status Link)...Please post all CBA/CAP questions here!

[playit12]

A roster bonus is what a player gets paid for being on the team on a certain date (the first day of the league year, June 3, July 15, etc.). Roster bonuses are charged against the cap entirely in the year they're paid, unless they're guaranteed, in which case they're prorated. The special master's ruling said that prorated roster bonuses aren't part of the 30 percent rule calculations, which is exactly what the CBA says.

An option bonus is what a team pays to exercise some sort of option in a contract -- usually to extend the contract. Option bonuses often are "protected," meaning that if the option isn't exercised and the option bonus isn't paid, either there's a penalty fee that the team must pay the player or higher base salaries are triggered. Option bonuses are prorated against the cap, starting in the year the option can be exercised. Option bonus prorations ARE included in the 30 percent rule calculations.

Thanks for the clarification Adam... Seems like, according to what you wrote above, the Colts could just rename the roster bonuses an option bonus and be done with it. Doesn't sound like there is any advantage to calling it an option bonus. I guess you could add some bogus year to the end that the "option" is purchasing... or more likely have it purchase real years and thus gaurentee it's excersize.

Seems like I could just write up a contract of 1 million base salaries for 3 years... in year two I'll include a roster bonus of 0.6 million that I will prorate for the remaining years (0.3 each). Colts style...

Then to change over to an option bonus, I'll again start with 1 million base for 3 years. In year two I'll have an option bonus of 0.6 million that is gaurenteed and spread out over the remaining years of the contract. If the option is not excersized the base salaries jump by 0.3 million a year in years 2 and 3. (Basically the same either way).

Since neither the option bonus or roster bonus are paid out in year one (or gaurenteed at that point) neither are prorated starting in year one, thus lowering the initial cap charge. However both serve to add upfront money in year two that can be spread out over the remaining life of the contract thereafter. And both pass 30% muster, or at least the latter does according to the ruling.

So what is really the difference other than names?

 

[playit12]

Is this a way the Commanders "mortgaged" their salary cap? It seems like they structure contracts so that most are backloaded and that every few years they hand out extensions and prorate the Signing bonuses out even longer. Am I somewhat close?

They also cut people and eat the dead money (Coles, B. Smith, ect...) Seems like they are always pushing back some bonuses and eating others. I guess if you are breaking even in that regard (if you cash above cap is 0) then you could do it forever.

 

[AdamJT13]

Thanks for the clarification Adam... Seems like, according to what you wrote above, the Colts could just rename the roster bonuses an option bonus and be done with it. Doesn't sound like there is any advantage to calling it an option bonus. I guess you could add some bogus year to the end that the "option" is purchasing... or more likely have it purchase real years and thus gaurentee it's excersize.

Seems like I could just write up a contract of 1 million base salaries for 3 years... in year two I'll include a roster bonus of 0.6 million that I will prorate for the remaining years (0.3 each). Colts style...

Then to change over to an option bonus, I'll again start with 1 million base for 3 years. In year two I'll have an option bonus of 0.6 million that is gaurenteed and spread out over the remaining years of the contract. If the option is not excersized the base salaries jump by 0.3 million a year in years 2 and 3. (Basically the same either way).

Since neither the option bonus or roster bonus are paid out in year one (or gaurenteed at that point) neither are prorated starting in year one, thus lowering the initial cap charge. However both serve to add upfront money in year two that can be spread out over the remaining life of the contract thereafter. And both pass 30% muster, or at least the latter does according to the ruling.

So what is really the difference other than names?

Let's say you have a player with a $6 million roster bonus scheduled for 2006, with base salaries of $1 million, $2 million, $4 million and $6 million, for a total of $19 million over the next four years. That contract would be perfectly legal right now, since the largest increase ($2 million) is less than 30 percent of the 2006 total salary (30 percent of $7 million is $2.1 million).

But suppose the team wanted to lower that $7 million cap number. If the CBA gets extended and the 30 percent rule no longer applies, the team can guarantee and prorate the $6 million roster bonus, cutting the 2006 cap number to $2.5 million ($1 million base salary plus $1.5 million bonus proration). But with the 30 percent rule applying to 2006, that would be illegal. If you guaranteed the roster bonus, you'd have to make his base salary in 2006 at least $2,241,380 in order to give him a total of $13 million in salaries and still comply with the 30 percent rule. That would give him a 2006 cap number of $3,741,380 million.

By making it an option bonus, though, the team could get his 2006 cap number down to $3,275,865 and still give the player his $13 million in salaries over the next four years. (Including the option bonus proration in the 30 percent calculations raises the maximum year-to-year increase by $450,000, allowing the first-year salary to be lower.) So making it an option bonus saved the team $465,515 of cap room.

 

[playit12]

Let's say you have a player with a $6 million roster bonus scheduled for 2006, with base salaries of $1 million, $2 million, $4 million and $6 million, for a total of $19 million over the next four years. That contract would be perfectly legal right now, since the largest increase ($2 million) is less than 30 percent of the 2006 total salary (30 percent of $7 million is $2.1 million).

But suppose the team wanted to lower that $7 million cap number. If the CBA gets extended and the 30 percent rule no longer applies, the team can guarantee and prorate the $6 million roster bonus, cutting the 2006 cap number to $2.5 million ($1 million base salary plus $1.5 million bonus proration). But with the 30 percent rule applying to 2006, that would be illegal. If you guaranteed the roster bonus, you'd have to make his base salary in 2006 at least $2,241,380 in order to give him a total of $13 million in salaries and still comply with the 30 percent rule. That would give him a 2006 cap number of $3,741,380 million.

By making it an option bonus, though, the team could get his 2006 cap number down to $3,275,865 and still give the player his $13 million in salaries over the next four years. (Including the option bonus proration in the 30 percent calculations raises the maximum year-to-year increase by $450,000, allowing the first-year salary to be lower.) So making it an option bonus saved the team $465,515 of cap room.

Yeah I think we are on the same page now, thanks again for all the information. I still think however, that the difference between an option bonus and roster bonus seems to be in name only (or at least it can be applied the same way if desired) except for the Special Master's ruling against the application of prorated Roster bonus money into the salary for 30% reasons. This is one of those great examples where I think the CBA is unecessarily complex. They could have just as easily defined, for the purposes of the 30% rule, yearly salary as the combination of all non-incentive based salary as it counts against the cap in that calender year. The end result would have been far less confusing.

Thanks again though Adam.

 

[AdamJT13]

Here's some good news -- we had enough cap room left over in 2005 that when Gurode's contract voided, the majority of his accelerated signing bonuses hit the 2005 cap (using up our remaining cap room) instead of the 2006 cap. So instead of having $749,788 of dead money for him this season, we'll have only $179,734. That raises my projected cap room without a CBA extension to $14.95 million, pending the status of Bledsoe's incentives. (We had no cap adjustment from 2005, so our cap is $94.513 million.)

 

[cb4ever]

Adam,
So it is possible that we could have $25 mil + in cap room if a CBA is reached with the $14.95mil we currently have + the possible $10 to $15 mil additional from the added cap room but we would still have the $14.95 either way right?

Would that put us in the top 5-10 teams with available cap room?

For comparison, how much room did we have at the begining of the 05' season?

Thanks.

 

[Cajuncowboy]

So let's say the worst case scenario plays out and they don't get a deal done by Sunday at midnight. And let's say all the cuts come down. Can you come back say a few weeks later and have a deal done or is it locked in that nothing can happen until after the year is over? Also, if they do get a deal done, do the cuts stay and can other teams go out and sign the FA's?

 

[conner01]

i would think they could do it at any time although i suspect if it's not done by monday night then it will be after the season before it would kick in even if a deal is done

 

[sago1]

See Nick Eatman's 3 March article -- http://forums.prospero.com/n/mb/message.asp?webtag=kr-strtelsports&msg=55097.1&ctx=128 --
which states Cowboys' ready for FA. Says Cowboys $15M under the cap after budgeting to sign draft picks, restricted and exclusive rights free agents & even PS players. Then goes on to break it down.

 

[Nors]

Was just listening on the local radio sports talk to someone who was pretty in tune with the whole cap thing that made an interesting point.

I had been told that the real battleground here is not players versus owners. It was really the "have" high rev owners versus the "have not" less rev owners.

Media is going gaga over 60-56 rev share split. I was told thats not real issue - but moreso a fight over throwing teams "other local rev" streams into this. The have's don't want this - the have nots do. Notice Jones and Kraft in media all week sating deal was as good as done!!!! Have's want as is hammered through....NFLPA playing into have nots and trying to force this divide that so far is portrayed as "solidarity" amongst owners?

Now to the question - Is there a hard Salary minimum? Are teams FORCED to spend the salary cap? Say Cap goes to $105M - are the Cards allowed to spend only $60M and pocket the rest of the "shared" revenues that in effect the "have's" generate?

Is it true the players are more concerned that the teams spend these $ on players and not circumvent cap and have nots just pocket the cash? Ala Cards and Vikes have. Kinda the baseball version of small markets pocketing Yankess rev share money?

Your expertise valued on this topic and impact on impasse.

 

[big dog cowboy]

The NFL's cap is a so-called "hard cap", which no team can exceed for any reason under penalty from the league. A lesser-known fact is that the NFL also has a hard salary floor—a minimum team payroll that no team can drop beneath for any reason. The cap was introduced for the 1994 season and was set at $34.6 million initially. Both the cap & floor are increased annually based on growth of the league's revenues. As of 2005 the NFL salary cap is approximately 85 million US dollars per team, while the salary floor is roughly USD 75 million per team. This number has increased annually and will likely increase after a new collective bargaining agreement is signed.

http://en.wikipedia.org/wiki/Salary_cap#Salary_cap_in_the_NFL

 

[Nors]

The NFL's cap is a so-called "hard cap", which no team can exceed for any reason under penalty from the league. A lesser-known fact is that the NFL also has a hard salary floor—a minimum team payroll that no team can drop beneath for any reason. The cap was introduced for the 1994 season and was set at $34.6 million initially. Both the cap & floor are increased annually based on growth of the league's revenues. As of 2005 the NFL salary cap is approximately 85 million US dollars per team, while the salary floor is roughly USD 75 million per team. This number has increased annually and will likely increase after a new collective bargaining agreement is signed.

http://en.wikipedia.org/wiki/Salary_cap#Salary_cap_in_the_NFL

Good stuff - but what about teams like Vike's playing games with all these various "bonus" clauses and "defering$20M into future years?

I know 2 years ago we played that game with a Romo $5M bonus.


But good stuff - there is a floor or Cap Min. Something you don't hear much.

 

[Nors]

Dooms 81:

yep - a bold call to be sure, so we'll see!
and its almost 2 days later and the done deal on CBA you broke here appears to have fallen apart AND WAS FRAUDULENT SPECULATION AND NOT FACT AS REPORTED?

Can you clarify from the inside why it wasn't announced as you said it would be? And also an update on status and latest developments?

 

[VirusX]

Dooms 81:

yep - a bold call to be sure, so we'll see!
and its almost 2 days later and the done deal on CBA you broke here appears to have fallen apart AND WAS FRAUDULENT SPECULATION AND NOT FACT AS REPORTED?

Can you clarify from the inside why it wasn't announced as you said it would be? And also an update on status and latest developments?

They could have had a deal done and just want to get more exposure on the NFL / NFL Network and drag this out for rating. I for one have it on NFL Network all the time incase something happens lol.

 

[HDC]

Well, unless there's another extension, cuts must be made in the next 45 min. This is almost as suspenseful as an NFL game!

 

[Silverstar]

CBA talks have been extended to 10pm EST....according to ESPN.

FA period will still start at 12:01AM.

 

[The30YardSlant]

So if the CBA is not extended by 10 o'clock, what is our official cap number?

 

[Nors]

Talks break off again in NFL labor dispute


NFL.com wire reports

NEW YORK (March 5, 2006) --The NFL and its players union broke off talks again, leaving dozens of veterans in danger of becoming salary cap casualties before free agency begins a minute after midnight Monday.

The breakdown was typical of the topsy-turvy negotiations -- just when things seemed darkest, they got brighter. And when it looked optimistic a deal could be struck, as it seemed early Sunday, talks broke down.

"They're off," NFL vice president Joe Browne said after a day of bargaining that seemed to provide hope of an agreement. Earlier, the league had pushed back the deadline for teams to get under the salary cap from 6 p.m. ET to 10 p.m.

NFL spokesman Greg Aiello said the union broke off the talks and had no further explanation. Union officials could not immediately be reached for comment.

One of the endangered veterans went immediately -- center Kevin Mawae was cut by the New York Jets, although he probably would have been gone anyway because he is 35 and missed the final 10 games of last season with a triceps injury.

Other potential big names to go with a cap at $94.5 million instead of one as much as $10 million higher could be guard Will Shields of Kansas City and linebacker Derrick Brooks of Tampa Bay. Yet another in that category, Jets quarterback Chad Pennington, restructured his contract just before the midnight deadline, to ensure that he would stay with the team.

Most teams had contingency plans for the smaller cap and the larger one. Several, including Washington, the Jets and Tampa Bay were far over the cap.

These negotiations were by far the most difficult since the NFL and the NFL Players Association first agreed to free agency and a salary cap in 1992, ending years of labor unrest that included player strikes in 1982 and 1987. The contract has been extended several times since then, most of the time with ease.

But this time, the players asked for a change in the system.

Until now, they received their money primarily from television and ticket revenues. This time, they requested their share from all team revenues, including outside money generated by everything from parking to stadium naming rights.

That led to difficult negotiations, in part because the teams themselves are having their own dispute over that money because of the disparity in outside income made by low-revenue and high-revenue teams. Union leaders had suggested that it would be hard to reach agreement on a labor contract until the owners settled their own differences.

Both sides had seemed ready to compromise, largely because of the pressure of impending free agency.

It was supposed to begin last Friday but was put off for three days so the sides could continue talking. The talks appeared to be at a standstill last Thursday, when the owners took just 57 minutes to reject the union's last offer.

But seven hours later, the sides reversed course, agreeing to delay the start of free agency for three days so they could continue bargaining. That came as teams who had planned for a larger salary cap were preparing to cut large numbers of veterans.

"Many of those players would have been cut anyway," executive director of the union Gene Upshaw said Saturday, noting that veterans are cut every year but find jobs with other teams. This year, however, the extra cuts could glut the market, causing players to get less money even if they find jobs.

 

[big dog cowboy]

This year, however, the extra cuts could glut the market, causing players to get less money even if they find jobs.

I still can't believe the older vets are allowing this to happen. Outside of Birk I have not heard a peep from any of them.

 

[david_jackson]

There has been some talk of the Skins just not complying with the cap and accepting the fines and draft choice losses given out by the league. My question is this if they were to try a scheme like this, wouldn't they be unable to get any contracts approved by the league (until under the cap).......so they couldn't get any additon camp bodies until they got under the cap?!?!