Post by Purple Pain on Mar 24, 2019 17:18:30 GMT -6
How Eagles are using fake contract years to create cap space by Reuben Frank
Rest at the link:
www.nbcsports.com/philadelphia/eagles/how-eagles-are-using-fake-contract-years-create-cap-space
When the Eagles announced the Malik Jackson, Brandon Graham and DeSean Jackson contracts, they were referred to as three-year deals. When the Ronald Darby contract was announced, it was announced as a one-year deal.
Take a look at any of them and they’re actually five-year contracts.
Until they aren’t.
Confused yet?
We’re here to help!
The odd structure of Eagles contracts
In the often-baffling world of NFL contracts, Eagles vice president of football operations and salary cap guru Howie Roseman has been designing contracts with fake years, a tool that spreads out cap hit into contract years that are guaranteed to never exist.
It’s kind of cheating.
But according to the CBA, the collective bargaining agreement between the NFLPA, the players’ union, and ownership, it’s completely legal.
NFL contracts can be very complicated, but in simple terms, a player’s salary cap figure for a specific year is determined by adding together three components:
1. The player’s base salary
2. The pro-rated amount of his signing bonus, which is derived by dividing the amount of the bonus by the number of years in the contract (up to five years)
3, All so-called “likely-to-be-earned” incentives, which are generally speaking performance and playing-time milestones the player reached the previous year
The longer the contract, the more years the signing bonus is spread out over and the less the cap hit.
The Ronald Darby contract
But what if you have a player like Darby, who has been hurt the last two years, and you’re reluctant to sign him to a long-term deal because of injury concerns?
Let’s take a look at Darby’s contract.
At first glance, it’s a five-year deal with base salaries of $1 million in 2019 and $15 million in 2020, 2021, 2022 and 2023.
Yes, $15 MILLION per year.
The deal also includes a $3.5 million signing bonus that he received when he signed on March 19 and a roster bonus worth as much as $2 million in the form of $125,000 weekly bonuses for each game that Darby dresses for in 2019.
The cap hit for 2019 is a modest $2.825 million — that’s the $1 million base salary, $700,000 of the signing bonus (the first 20 percent of the $3.5 million pro-rated over five years) and an additional $1.125 million representing the likely-to-be-earned portion of the roster bonus.
What about those $15 million annual salaries from 2020 through 2023?
That’s a ton of money!
The small print in Darby’s contract states simply that the 2020 through 2023 seasons “void automatically” if Darby is on the Eagles’ roster 23 days before the start of the official 2020 league year, which would be sometime in late February.
In other words, if he’s on the team, he’s no longer on the team.
And the $60 million base salaries? They evaporate. They disappear.
All that remains is the $2.8 million remaining pro-rated portion of Darby’s signing bonus, which accelerates into dead money under the Eagles’ 2020 cap.
What’s the point of all this?
Howie Roseman is clearing as much room under the Eagles’ 2019 cap as possible, presumably to give the team flexibility for the inevitable signing of Carson Wentz to a massive, $30 million-per-year ballpark contract.
Take a look at any of them and they’re actually five-year contracts.
Until they aren’t.
Confused yet?
We’re here to help!
The odd structure of Eagles contracts
In the often-baffling world of NFL contracts, Eagles vice president of football operations and salary cap guru Howie Roseman has been designing contracts with fake years, a tool that spreads out cap hit into contract years that are guaranteed to never exist.
It’s kind of cheating.
But according to the CBA, the collective bargaining agreement between the NFLPA, the players’ union, and ownership, it’s completely legal.
NFL contracts can be very complicated, but in simple terms, a player’s salary cap figure for a specific year is determined by adding together three components:
1. The player’s base salary
2. The pro-rated amount of his signing bonus, which is derived by dividing the amount of the bonus by the number of years in the contract (up to five years)
3, All so-called “likely-to-be-earned” incentives, which are generally speaking performance and playing-time milestones the player reached the previous year
The longer the contract, the more years the signing bonus is spread out over and the less the cap hit.
The Ronald Darby contract
But what if you have a player like Darby, who has been hurt the last two years, and you’re reluctant to sign him to a long-term deal because of injury concerns?
Let’s take a look at Darby’s contract.
At first glance, it’s a five-year deal with base salaries of $1 million in 2019 and $15 million in 2020, 2021, 2022 and 2023.
Yes, $15 MILLION per year.
The deal also includes a $3.5 million signing bonus that he received when he signed on March 19 and a roster bonus worth as much as $2 million in the form of $125,000 weekly bonuses for each game that Darby dresses for in 2019.
The cap hit for 2019 is a modest $2.825 million — that’s the $1 million base salary, $700,000 of the signing bonus (the first 20 percent of the $3.5 million pro-rated over five years) and an additional $1.125 million representing the likely-to-be-earned portion of the roster bonus.
What about those $15 million annual salaries from 2020 through 2023?
That’s a ton of money!
The small print in Darby’s contract states simply that the 2020 through 2023 seasons “void automatically” if Darby is on the Eagles’ roster 23 days before the start of the official 2020 league year, which would be sometime in late February.
In other words, if he’s on the team, he’s no longer on the team.
And the $60 million base salaries? They evaporate. They disappear.
All that remains is the $2.8 million remaining pro-rated portion of Darby’s signing bonus, which accelerates into dead money under the Eagles’ 2020 cap.
What’s the point of all this?
Howie Roseman is clearing as much room under the Eagles’ 2019 cap as possible, presumably to give the team flexibility for the inevitable signing of Carson Wentz to a massive, $30 million-per-year ballpark contract.
Rest at the link:
www.nbcsports.com/philadelphia/eagles/how-eagles-are-using-fake-contract-years-create-cap-space
... and neither is this Chris guy.