Cooley Restructures

[SBXVII]

Originally Posted by QBall

We do it every year. Seems like this year more and more star players want to do this because there is a feeling at Redskins Park we're contenders and very close to something special.

SO ALL THE DOOMSDAY SKINS FANS JUST SIT BACK AND WATCH

I'm not one of the doomsday guys, however I think we shall see if your theory is right...hopefully soon enough. If they can talk Springs in to helping out (because he refused last yr) then you can tell the future. lol.

[Slingin Sammy 33]

Originally Posted by itvnetop

So if I understand this correctly, an owner has the option to slash salary cap by converting cap money into guaranteed up front? If this is the case, what's the point of a salary cap? Not that I'm complaining (since this helps us) but theoretically, the cap can be loopholed as deep as an owner's pockets go... correct? I wonder why more owners don't do this... I guess Danny boy is just too rich to even care about parting with guaranteed money.

Sort of.....NFL contracts are not guaranteed. The only guarantee is the signing bonus and the current year's salary. What a restructure does is "guarantee" (by paying the player up front) money that would have been due in later years of his contract. However if the player is released or traded this "guaranteed" money must be accounted for against the next year's salary cap. This is the "dead cap" cost or release fee.

What it boils down to is; if you have confidence the team will not be releasing the player and he is a solid performer a restructure is a good strategy. Where it kills you is if you pay a large signing bonus or restructure a player and he gets injured or his production declines (Brandon Lloyd, Arch last year) and you want to get rid of the player the cost against that year's salary cap hurts you. For example to release Brandon Lloyd it will cost about $ 7M against the 2008 cap. He'll be gone but the guaranteed money he was paid has to be accounted for in the salary cap.

I may be off on a couple of details but that is pretty much how it works. Schneed & Crazy Canuck do some great work on salary cap info. If you search the site there is a link to our current salary cap sheets.

[Schneed10]

Originally Posted by GTripp0012

4 million ish in the red.

Has Todd Wade been released already?

No he's still on the books as of right now.

[Schneed10]

Originally Posted by Slingin Sammy 33

So if we make the below moves we should be $ 14M under the cap, correct?

That's right, you've got the math.

[Schneed10]

Originally Posted by itvnetop

So if I understand this correctly, an owner has the option to slash salary cap by converting cap money into guaranteed up front? If this is the case, what's the point of a salary cap? Not that I'm complaining (since this helps us) but theoretically, the cap can be loopholed as deep as an owner's pockets go... correct? I wonder why more owners don't do this... I guess Danny boy is just too rich to even care about parting with guaranteed money.

There's definitely a point to the cap, it's just not a straightforward cap on the amount of money you're paying players in a given season.

You can pay your players $120 million one year, and the cap can be $100 million, and it still be perfectly legal.

Signing bonuses get spread over the life of the contract. So if I give you $10 million to sign for a five year deal (congrats, you're rich), even though I'm paying you all $10 million of your bonus this year, I can spread it over the life of your contract, meaning that signing bonus counts for $2 million in each of your five years.

If you play three years and then I decide you suck and I cut you, then I still have two years worth of signing bonus to recognize on my cap books. I already recognized the first 3 years, but I've got to carry your last two years as dead cap.

But even though I'm carrying your deadcap bonus money, I don't have to pay you the base salary for this season (base salaries aren't guaranteed), so that's where the cap savings come from. If the cap savings on the base salaries are greater than the cap hit from the dead bonus money, then I'll save cap money by cutting you (Phillip Daniels, Todd Wade). If the dead bonus money is greater than the savings on base salary, I eat a cap hit on you (Brandon Lloyd).

So there's a cost to handing out big bonuses. If the player ends up sucking (Lloyd), it's tough to get rid of him without crippling your cap. You usually need to let the guy play halfway through his contract or so before it becomes feasible to cut him.

[BrunellMVP?]

Originally Posted by Buster

With Dan Snyder taking care of the cash, we're NEVER in cap trouble.

Thanks Cooley, for being a team guy.

what's "team" about getting more money guaranteed?

[Ruhskins]

Originally Posted by BrunellMVP?

what's "team" about getting more money guaranteed?

Changing his contract to get under the cap so the team can get more players. I know it's no sacrifice or anything like that, but not all players do it.

[CrazyCanuck]

I just updated the cap sheets. Matty will post them in the next day or two when he's done locking duplicate threads.

I included the restructures of Thomas, ARE, and Carter. I've already accounted for Cooley's restructure but my numbers may be slightly off.

I have us at $8.75M in the red, but I still have Brunell on the roster and cutting him will save about $3.5M, bringing us to about $5.25M over the 2008 cap.

We can still restructure about $25M in salary and another $5M in roster bonuses, so I think it's safe to say we are not in cap hell for 2008.

In fact... bring on free agency.

[itvnetop]

Thanks 33 and Schneed... now it makes sense to me.

[CrazyCanuck]

Fantastic posts by Schneed and 33.

The Skins used another trick with the resturcutures of ARE, Thomas, and Carter - the extra year.

All 3 of them got an extra year (2013) added to their contracts. So not only did the Skins push money into the future, they extended the future.

It's unlikely that Randy Thomas will be playing here in 2013 in what would be his 14th NFL season, but by adding the extra year the Skins can push some of the new signing bonus money to 2013. This allows the $4.65M restructured amount to be divided by 6 remaining years of the contract instead of 5, which helps the cap in 2008 (though only slightly).

When Thomas likely restructures next year they can push some of that money to 2013, or even add another year and repeat the process.

[Schneed10]

Nice, CC. By the way, from a glance it looks like Brunell is the difference between you and PCinOZ at the moment. He has Brunell off his books, you have him on yours. If we add Brunell to his books and incorporate the Cooley restructures in his, the two of you pretty much tie out.

And yours is more correct, Brunell's not off our payroll yet (though he will be March 1). JLC should be coming to you instead of always referencing PC!

[Monkeydad]

Originally Posted by Ruhskins

Changing his contract to get under the cap so the team can get more players. I know it's no sacrifice or anything like that, but not all players do it.

Exactly. I don't understand why it's so hard to figure out.

He's helping the team out, not just himself.

[Campbell17]

COOOOOOOOOOOOLLLLEEEYYY! A true team player, more importantly a true Redskin.

[MTK]

Originally Posted by CrazyCanuck

I just updated the cap sheets. Matty will post them in the next day or two when he's done locking duplicate threads.

I included the restructures of Thomas, ARE, and Carter. I've already accounted for Cooley's restructure but my numbers may be slightly off.

I have us at $8.75M in the red, but I still have Brunell on the roster and cutting him will save about $3.5M, bringing us to about $5.25M over the 2008 cap.

We can still restructure about $25M in salary and another $5M in roster bonuses, so I think it's safe to say we are not in cap hell for 2008.

In fact... bring on free agency.

The latest cap sheets are up, thanks CC

[freddyg12]

Originally Posted by CrazyCanuck

Fantastic posts by Schneed and 33.

The Skins used another trick with the resturcutures of ARE, Thomas, and Carter - the extra year.

All 3 of them got an extra year (2013) added to their contracts. So not only did the Skins push money into the future, they extended the future.

It's unlikely that Randy Thomas will be playing here in 2013 in what would be his 14th NFL season, but by adding the extra year the Skins can push some of the new signing bonus money to 2013. This allows the $4.65M restructured amount to be divided by 6 remaining years of the contract instead of 5, which helps the cap in 2008 (though only slightly).

When Thomas likely restructures next year they can push some of that money to 2013, or even add another year and repeat the process.

At the end of the collective bargaining agreement, all bonuses have to be accounted for in one year, correct? That was the situation in the 06 offseason when for a period, we were in cap hell, or maybe cap purgatory better explains it.

W/the cba set to expire & no new deal in place, all of those deals come due essentially. Am I right on this generally? From what I read in 06 that's the way I understand it.

My point is simply that while there isn't a 'ceiling' for these extensions, the whole strategy is dependent upon a cba being agreed to. If the cba expires w/out a new one in place, the Skins would face cap hell for real.