Did Elvis Dumervil Take Less Money to Play in Baltimore?

Mike Klis of the Denver Post had some really good insight into the Broncos offer for Elvis Dumervil vs the Raven’s offer. Mike believes that Denver had a slightly better offer that Dumervil turned down, which I don’t think I totally agree with so lets look a bit more in depth.

Now most of the time when I write I often write from a team perspective. I think that’s pretty logical since at heart Im a fan and a fan wants his team to get the best deal possible to maintain flexibility and be able to improve the team. But if I try and put my agent hat on for a minute there are a ton of factors that go into a deal beyond just the face value of a contract. One of the first things I want to look at if I am repping a player is what deal is likely going to earn my player the most money in real terms not on a piece of paper. Using the information in Klis’ article we can break down the Dumervil offer’s as follows:

 

Denver Offer

Base Salary

Signing Bonus

Option Bonus

Cap Figure

Dead Money

Cap Savings

Cash Flow

2013

$5,000,000

$1,000,000

$0

$6,000,000

$10,000,000

-$4,000,000

$8,000,000

2014

$5,000,000

$1,000,000

$0

$6,000,000

$4,000,000

$2,000,000

$5,000,000

2015

$5,000,000

$1,000,000

$0

$6,000,000

$1,000,000

$5,000,000

$5,000,000

Ravens Offer

Base Salary

Signing Bonus

Option Bonus

Cap Figure

Dead Money

Cap Savings

Cash Flow

2013

$1,000,000

$1,500,000

$0

$2,500,000

$8,500,000

-$6,000,000

$8,500,000

2014

$1,000,000

$1,500,000

$875,000

$3,375,000

$6,000,000

-$2,625,000

$4,500,000

2015

$4,000,000

$1,500,000

$875,000

$6,375,000

$7,125,000

-$750,000

$4,000,000

 

While on its face the Broncos offer presents more money over the three year period the important thing we need to consider is the Dead Money/Cap Savings column. Under the Broncos’ format Dumervil saves the team $2 million in cap room if he is cut in 2014. That assumes that the guaranteed salary contained a no offset condition, if there are offsets it could be more.  Denver has already shown a willingness to move on once from Dumervil and would likely be inclined to do so again. If cut he would earn $10 million in cash and have to look for a new home in 2014.

Baltimore, if they fail to pick up the option in 2014, would still take on a $6 million dollar dead money charge if they released Dumervil. That would actually lead to a loss of just over $2.6 million in cap room over his projected total. That makes the release from the Ravens much more unlikely. As we move into 2015 the Ravens still stand to lose cap room by releasing Dumervil due to the proration from both bonuses. Denver gains $5 million in cap room, making the 2015 season likely for the Ravens and not likely for the Broncos. Looking at the two deals I would peg Dumervil at earning the full $17 million in Baltimore but likely not coming close in Denver.

Secondly we need to consider some options with the incentive and escalator structure. The one thing to always consider is that there is a major difference between an escalator (perform now maybe get paid later) and incentive (perform now get paid now). According to the article Denver offered at least $2 million in escalators, meaning if he hits a performance level his salary the following year increases. Unless that escalator is guaranteed there is nothing preventing the team from going to the player and saying we like you, but at your original salary not this one you are going to earn. The player is stuck between getting released or accepting a paycut. In the incentive, which is what the Ravens offer contained (along with escalators), you earn pay for performing. So if Dumervil hits his sack threshold he earns his $1-2 million in incentives from the Ravens. It’s no guarantee out in Denver.

Team situations are also important. Denver has a somewhat convoluted salary cap over the next two years. My estimates with Dumervil would have the Broncos at $117 million committed to 2014 but for only 34 players under contract. Older players such as Champ Bailey and Wes Welker could be released to create cap room, but I have to know anyone is fair game. The Broncos have a short window and could conceivably begin to tear things down in 2014 and prepare for the post-Manning era. The Broncos have a younger and more dynamic pass rusher in Von Miller.  Combining that with the cap savings of a release and I have to be worried about Dumervil lasting for 2 seasons as he can be expendable.

Baltimore has a bad salary cap situation. $107 million in estimates for just 33 players (including Dumervil), but no flexibility. There are no $10 plus million in savings by releasing a player.  There are not numerous players who save me between $4 and $6 million if cut. Quite frankly they can’t afford to release Dumervil on their salary cap. More so their biggest cap savings, $7.2 million, comes from releasing Terrell Suggs, who happens to play the same position Dumervil plays. Unlike in Denver I know my guy is the younger and probably more dynamic player. Suggs could be forced to go as a cap casualty in 2014. That is going to save my guy a roster spot for 2014 and probably 2015 as well, if not longer.

I think if you take a much wider view of the contract than just focusing on the 3 year totals and fully guaranteed dollars you see that this was as much about money as it was anything else. Baltimore’s offer provided significantly more protection via prorated bonus money consequences if cut. The Ravens situation provides much more opportunity to Dumervil to play out at least three years and earn the full $17 million plus an incentive possibility to earn more. Denver is not going to present that opportunity. It’s the better opportunity for Dumervil in Baltimore and he was smart to take the offer even if the basic numbers state that he could earn less money.

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