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Thread: SALARY CAP dept. ~ ~ ~

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    SALARY CAP dept. ~ ~ ~

    Salary Cap Update 9.0 – Rookie Contracts Edition

    When I last did a salary cap update, the Jets were about $7.7m under the salary cap before taking account the likely cost of signing their rookies. This will change slightly based on the release of Ropati Pitoitua ($700K approximate net saving) and the Josh Brown signing (which I don’t have details of yet, but it will use up at least $75K of cap room even if it’s a minimum salary deal with no bonus money…which I doubt). We’ll get back to that in a future cap update, but for now let’s focus on those costs associated with signing the rookies, which we can now model and be pretty confident about how accurate we are.

    The Rookie Cap Timebomb

    Jason (of NYJetsCap.com) identified a potential issue months ago with the rookie cap (or rookie allocation). He noted that the rookie allocation – the proportion of teams’ salary cap that must be allocated towards rookie salaries – is supposed to increase in line with the cap, whereas the level of minimum salaries have already been announced for the next ten years. This year, the cap only rose by 0.3% but minumum salaries went up by 4% which would have meant that by the time teams had paid a minimum salary to all their low picks – which you HAVE to do because releasing them just means your rookie allocation reduces accordingly – there wouldn’t be enough money to pay the high picks an amount anywhere near what the player picked in the same spot the previous year would have got. That could have caused major issues, but we now have details of the rookie allocations for each team and it’s clear the NFL has fudged the numbers in order to ensure teams can afford the increase in minimum salaries for rookies. The rookie allocation seems to have increased by 2.3% which should give teams enough scope to at least match those contracts at the top end. According to the CBA, that’s not the way it should have worked (the rookie allocation should have increased by the same percentage as the cap did), but the NFL has obviously reallocated some things to make the numbers work.It should be noted that the minimum salaries are going to continue to increase by 3-to-5% per year, whereas the cap is supposedly expected to remain flat. We are aware that restructuring deals to defer charges into the future can land you in cap hell, but who would have expected that to happen to the NFL itself? Whether they can continue to “borrow from Peter to pay Paul” remains to be seen, otherwise we could see some pretty unhappy rookies next season – unless they catch wind of it and this intices most of the best underclassmen to stay in school. From a fans’ perspective, it’s great that we’re locked into the CBA for ten years, but if players start realizing they didn’t get the deal they thought they would, it might be harder to strike a deal when this CBA is set to expire. That’s if things don’t get really messy before then…

    Still that’s nine years away. Let’s not worry about it for now. After the jump, I’ll set out the basics behind the rookie allocation and project the contracts for each of the Jets draft picks and the effect on the Jets’ current cap situation.

    Rookie Contracts – The Basics

    I’m going to list out the main rules behind the rookie allocation and rookie contracts, together with any assumptions that leads me to make when I’m trying to project their deals in parentheses.

    - Each team has to fit all of their rookie contracts under a total rookie allocation (which is included within the total salary cap) and a year one rookie allocation. (Due to the way salaries are slotted, it should be easy enough to comply with the total allocation, so we’ll just be concerning ourselves with the year one allocations).
    - The team cannot spend more than the rookie allocation and cannot use any unused rookie allocation on non-rookies.
    - The allocation amount is based on the draft picks you made. If a player is off the team before you sign him, the allocation is reduced accordingly. If he holds out, you have to leave enough of your allocation remaining to be able to sign him.
    - Undrafted rookies do not count, unless you pay them more than the minimum in salary. (I’m assuming the Jets won’t do this).
    - You do get (approximately) $25,000 of your rookie cap set aside for undrated rookie bonuses and you are not allowed to exceed this or spend any unused amount on non-UDFA’s. The Jets have paid as much as $7,500 in recent years to a single UDFA, but we’re expecting them to give most of their UDFAs a signing bonus of about $2,000 each.
    - All incentives are likely to be earned and salary advances, option bonuses, buybacks, voidable years and renegotiating in the first three years are all prohibited under the new CBA, so you can’t use loopholes to get around the rookie allocation.
    - There are special rules to restrict how you can guarantee future salaries to prevent teams using that as a device to effectively guarantee upfront money and just defer the payment thereof.
    - There are special rules for the fourth year of the contract for players selected in the 3rd, 4th, 5th, 6th and 7th round and special rules for a fifth year option for first round picks. (I’ll explain these as we go along).

    2012 Projection

    To come up with an accurate projection for 2012, I’ve looked at the contracts for the players who were drafted in 2011 in the same spot in the draft as each of the players the Jets selected. So, for example, to come up with an estimate for Quinton Coples, my starting point was Ryan Kerrigan – the 16th pick last year. At certain points, I’ve identified an outlier and therefore used the next pick up or the next pick down as my starting point. For example, the 2011 43rd pick (Kevin Rudolph) received a low amount compared to where he was slotted, perhaps because the Vikings overspent on one of their other picks. I therefore used the 42nd pick Brooks Reed’s deal instead. For simplicity, I’ve stuck to a basic signing bonus with base salary structure to model the numbers, but the Jets would probably work in some workout bonuses for certain people which might throw off the numbers slightly.After running the numbers, it became clear that there would be a very slight shortfall if the Jets attempted to pay the same bonus money as each player’s equivalent selection got last year, so I rounded down to make the numbers work. The overall size of each contract will still work out slightly higher based on the higher minimum salaries (and, where applicable, the annual increases from there – which cannot exceed 25% of the first year cap hit).

    Quinton Coples

    Based on my calculations, Coples can expect to get a four-year deal in the region of $8.8m with a $4.84m signing bonus. That’s a lower signing bonus than Kerrigan got, but Kerrigan’s total deal was worth $8.7m so that’s a slight increase. It’s possible they could make everybody else’s bonus lower than their 2011 counterpart so more money is available to give to Coples (or Hill, or both), but there isn’t a great deal of scope to do so. For those of you concerned that Coples could be another Gholston, you can be certain it won’t have the same kind of financial impact. Gholston ended up collecting $17m over three years as a Jet.The Jets will also have a fifth year option where they can retain him for one more year with a salary equivalent to the average of the top 25 salaries (excluding the two highest) at his position.

    Stephen Hill

    Hill looks set to receive a four-year, $4.7m deal with a $1.86m signing bonus. He ends up with a pretty similar deal to the one Reed got. Reed’s guaranteed money amounted to $2.8m. There is no fifth year option or fourth year escalator for second rounders.

    DeMario Davis

    Davis should get just under $3m over four years with a signing bonus of just over $600K. Jurrell Casey, drafted in the same spot last year got a slightly higher signing bonus but his deal totalled just over $2.7m. In the fourth year, Davis will have an escalator which could increase his base salary to the same amount as the lowest RFA tender. That was $1.26m this year, so by then it will probably be over $1.5m. That could boost his total contract value to almost $4m. The escalator is set in stone: You need to play 35% of the snaps, either cumulatively or in two of the first three years of the deal.

    Josh Bush

    Into the sixth round, contract values and bonuses are much lower, barely more than the minimum. Bush should get $2.2m and a $100K signing bonus. The contract value could rise to about $3m if he earns the playing time escalator.

    Terrence Ganaway and Robert T. Griffin

    Consecutive picks would often still see the higher pick get a slightly higher signing bonus, but it doesn’t work that way for compensatory picks. Expect these two to get the same deal as each other, for approximately $25,000 less than Bush over the four years.

    Antonio Allen and Jordan White

    Once again, these should receive the same deal. You’re looking at about $50,000 less than Bush over the four years. All four compensatory picks could earn the fourth year escalator if they receive enough playing time.

    Conclusion

    As we’ve set them out, these deals should just about fit into the Jets’ Year One Rookie Allocation which has been set at $5,060,000. However, that’s not the cap space that will be required should all of them make the team. If all eight make the team, we need to remove eight salaries from the top 51 to arrive at a current estimate for their available cap room. Currently, the Jets have over 51 players earning at least $465,000 so removing eight salaries of that amount would make the net cap cost of adding these eight to the active roster just $1.34m.The Jets have some flexibility to allocate that $5.06m differently, but not much. With such narrow parameters, we can be pretty confident that these projections should be pretty accurate. It remains to be seen whether that will mean there’s a problem-free negotiation period as they strive to get the deals done. I see no reason why they wouldn’t have everyone in camp on time.

    > [url]http://www.thejetsblog.com/2012/05/03/salary-cap-update-9-0-rookie-contracts-edition/[/url]

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    BGA: Salary Cap Update 10.0

    When I last did a salary cap update, the Jets stood at approximately $7.7m under the cap and I gave you some projections for the Jets rookie deals. Today, just a quick update on the rookie situation and how the cap situation has moved given some recent moves.

    Rookie Update

    As reported on TJB the other day, Stephen Hill signed a $5m deal over four years and $2.8m guaranteed, which is right in line with our projection. Sixth round pick Josh Bush signed too and Jason’s site has the details. As we predicted, he got $2.2m over four years with a signing bonus of about $100K – with a fourth year escalator that potentially raises the contract value to about $3m. Quinton Coples could get his deal soon, now that Bruce Irvin (selected one place ahead of him) has signed with Seattle. We were projecting a deal of around $9m for Coples with $4.8m as a signing bonus and Irvin got $9.3m with a $5m bonus, so that prediction should be accurate too.

    Other Transactions

    When the Jets released Ropati Pitoitua, this gave rise to a net cap saving of approximately $700K. Kicker Josh Brown’s deal will have a small cap effect too. Brian Costello got details of his base salary of $825,000 but I anticipate he’d also have got the maximum signing ($50K) and workout bonuses ($15K) to still qualify that deal for a vested veterans exemption. So overall, he’ll get $890,000 and the cap hit will be limited to $605,000. Therefore, there’s an overall net cap effect of approximately $140K. Obviously it’s unlikely that both Brown and Nick Folk make the roster, so there’s a guaranteed $140K cap saving in respect of one of them coming later on anyway.Cutting Logan Payne, Kris O’Dowd and Trevor Canfield has no cap effect and signing Freddy Kotolo, Matt Simms and Royce Pollard will also have no cap effect, other than maybe a small (couple of thousand) in respect of bonus money.

    Summary

    Following these moves, the Jets should have approximately $8.3m of cap room. Since the rookie deals all seem to be falling in line with our projections, that should mean that the net cap cost of signing the rookies should still only be about $1.34m if they all make the team. Ultimately, that leaves the Jets with approximately $7m left over to sign veterans and to give themselves a buffer for injuries/waiver claims or contract extensions. Any balance remaining can of course be carried over to 2013.

    > [url]http://www.thejetsblog.com/2012/05/07/bga-salary-cap-update-10-0/[/url]

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    Mike DeVito Restructures Contract

    I could go over the numbers in my own words, but I can't say it any better than Jenny Vrentas, so :

    DeVito had been scheduled to earn $2.26 million in the final year of the extension he signed in 2009. In a restructured deal he agreed to last week, he will earn a base salary of $700,000, fully guaranteed, according to NFL Players Association records.The $500,000 roster bonus he already received this offseason, as well as his $350,000 workout bonus, are intact in his restructured deal. He also received a $950,000 signing bonus, making his total compensation this year $2.5 million.His cap number, and total compensation, reduced by about $600,000. Since he is due a guaranteed $2.5 million, it is essentially assured that the team will not cut him. However, the contract also includes a $750,000 escalator, based on playing time, so DeVito has the opportunity to earn his money back.

    This was a logical move by Mike. His name has been batted around as potential trade bait, so helping the Jets out and restructuring to lower his cap number increases his chances of being a Jets player at the start of the season. He really kick started his career under Rex Ryan and he has been a valuable asset in the run game over the last couple of seasons. I like depth on the defensive line and DeVito has played a big role, starting 11 games last season.He is coming off shoulder surgery and of course we have just added more depth to that defensive front in Coples. I like Mike as a player, he is never going to be that superstar, but he is a guy that you are glad you have when he is called upon.

    > [url]http://www.ganggreennation.com/2012/5/8/3007383/mike-devito-restructures-contract[/url]

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    [QUOTE=kelly;4462815]BGA: Salary Cap Update 10.0

    When I last did a salary cap update, the Jets stood at approximately $7.7m under the cap and I gave you some projections for the Jets rookie deals. Today, just a quick update on the rookie situation and how the cap situation has moved given some recent moves.

    Rookie Update

    As reported on TJB the other day, Stephen Hill signed a $5m deal over four years and $2.8m guaranteed, which is right in line with our projection. Sixth round pick Josh Bush signed too and Jason’s site has the details. As we predicted, he got $2.2m over four years with a signing bonus of about $100K – with a fourth year escalator that potentially raises the contract value to about $3m. Quinton Coples could get his deal soon, now that Bruce Irvin (selected one place ahead of him) has signed with Seattle. We were projecting a deal of around $9m for Coples with $4.8m as a signing bonus and Irvin got $9.3m with a $5m bonus, so that prediction should be accurate too.

    Other Transactions

    When the Jets released Ropati Pitoitua, this gave rise to a net cap saving of approximately $700K. Kicker Josh Brown’s deal will have a small cap effect too. Brian Costello got details of his base salary of $825,000 but I anticipate he’d also have got the maximum signing ($50K) and workout bonuses ($15K) to still qualify that deal for a vested veterans exemption. So overall, he’ll get $890,000 and the cap hit will be limited to $605,000. Therefore, there’s an overall net cap effect of approximately $140K. Obviously it’s unlikely that both Brown and Nick Folk make the roster, so there’s a guaranteed $140K cap saving in respect of one of them coming later on anyway.Cutting Logan Payne, Kris O’Dowd and Trevor Canfield has no cap effect and signing Freddy Kotolo, Matt Simms and Royce Pollard will also have no cap effect, other than maybe a small (couple of thousand) in respect of bonus money.

    Summary

    Following these moves, the Jets should have approximately $8.3m of cap room. Since the rookie deals all seem to be falling in line with our projections, that should mean that the net cap cost of signing the rookies should still only be about $1.34m if they all make the team. Ultimately, that leaves the Jets with approximately $7m left over to sign veterans and to give themselves a buffer for injuries/waiver claims or contract extensions. Any balance remaining can of course be carried over to 2013.

    > [url]http://www.thejetsblog.com/2012/05/07/bga-salary-cap-update-10-0/[/url][/QUOTE]

    we need to bring in a RT with some experience, i dont care how much faith people have in Vlad or Hunter, we cannot get caught with our pants down again in case these guys stink...

  5. #5
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    [QUOTE=kelly;4462823]Mike DeVito Restructures Contract

    I could go over the numbers in my own words, but I can't say it any better than Jenny Vrentas, so :

    DeVito had been scheduled to earn $2.26 million in the final year of the extension he signed in 2009. In a restructured deal he agreed to last week, he will earn a base salary of $700,000, fully guaranteed, according to NFL Players Association records.The $500,000 roster bonus he already received this offseason, as well as his $350,000 workout bonus, are intact in his restructured deal. He also received a $950,000 signing bonus, making his total compensation this year $2.5 million.His cap number, and total compensation, reduced by about $600,000. Since he is due a guaranteed $2.5 million, it is essentially assured that the team will not cut him. However, the contract also includes a $750,000 escalator, based on playing time, so DeVito has the opportunity to earn his money back.

    This was a logical move by Mike. His name has been batted around as potential trade bait, so helping the Jets out and restructuring to lower his cap number increases his chances of being a Jets player at the start of the season. He really kick started his career under Rex Ryan and he has been a valuable asset in the run game over the last couple of seasons. I like depth on the defensive line and DeVito has played a big role, starting 11 games last season.He is coming off shoulder surgery and of course we have just added more depth to that defensive front in Coples. I like Mike as a player, he is never going to be that superstar, but he is a guy that you are glad you have when he is called upon.

    > [url]http://www.ganggreennation.com/2012/5/8/3007383/mike-devito-restructures-contract[/url][/QUOTE]...thx for the info fella...

  6. #6
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    [QUOTE=2foolish197;4462898]...thx for the info fella...[/QUOTE]you're welcome twisted-sister ! !

    :rockon:

  7. #7
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    > [url]http://www.thejetsblog.com/2012/05/08/coples-figures-to-land-close-to-9-million/[/url]

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