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May 08

Explaining the Minimum Salary Benefit

Imagine for a minute that you are an NFL GM who knows that cap dollars are limited when building a roster. On one hand you can sign a veteran who is likely on the downside of his career, perhaps well on the downside, for around $1 million or instead sign a relatively unproven young player for around $500,000. The young player has more upside and can play special teams but could also be a total flop. In many cases the deciding factor is simply money. The $500,000 gamble on the older player still being capable isn’t really worth the time of the NFL team.

Veterans at the end of their career would likely play for less money just to get a chance to keep playing but the CBA mandates that they make a minimum salary level, ranging in 2013 anywhere from $715,000 to $940,000. Essentially the veteran is hurt by the CBA. To try to level the playing field, the NFL and NFLPA agreed on a clause called the Minimum Salary Benefit (MSB), essentially taking the salary cap consideration out of the equation. What the MSB does is bring the veteran players salary cap charge attributed to his CBA mandated P5 base salary down to that of a player who has been in the NFL for just two seasons with the difference being charged to Player Benefits.

All players with at least 4 credited seasons are eligible for the MSB. However, to qualify for MSB treatment your contract has to meet specific criteria, explained as follows:

  1. The contract must only be 1 year in length
  2. Additional compensation can not exceed $65,000 in 2013 (this number rises by $15,000 every 3 years, with the next increase set for 2015), and that includes bonuses from other teams
  3. P5 guarantees can not exceed the P5 salary of a 2nd year player, which is $555,000 in 2013

Now there are some more technical rules as well in regards to being cut and re-signing with your old team but very rarely (if at all) does that come into play. A player can also sign multiple MSB contracts over the course of his career and even within a season with multiple clubs if he is cut. Most MSB players in 2013 will have a salary cap count of $620,000 as its pretty standard for the players to receive $65,000 in bonus money, but cap hits vary.

So how many teams are using the MSB?  Whil I don’t have an exact count I have a pretty good estimate from my records as to how many MSB players and how much money is being saved in the teams current top 51s. The Giants look to lead the way with 10 players and over $2.5 million in cap savings with the Saints lose behind with 8 players and just over $2 million in savings. Neither should be a surprise as both teams have cap problems but view themselves as win now teams.

Really lack of cap room is a major factor in signing such players. Of the top 8 teams all were teams with cap issues heading into free agency. The Chiefs who I ranked 9th created their own cap issues and need these players to fill out their roster. Of the teams in the top 10 I would say only the Jets and Bears are teams that are likely using the MSB not just for cap relief but because they don’t want to add multi-year contracts to teams in the need of a makeover. The other squads all think they can win now.

On the other side of the spectrum, surprisingly I don’t have any records of the 49ers or Falcons, both win now teams very tight on cap room, using it for any players. Overall I have 104 players qualifying, which is likely a few players off, but I’d say its safe to say the MSB saved around 100 jobs this year. Here is the full listing per my estimates which should be close but by no means will be perfect.

 

Team

Players

Savings

Giants

10

$2,525,000

Saints

8

$2,005,000

Bears

8

$1,690,000

Lions

6

$1,435,000

Steelers

5

$1,375,000

Panthers

6

$1,275,000

Jets

5

$1,275,000

Redskins

4

$1,240,000

Chiefs

6

$960,000

Vikings

5

$925,000

Buccaneers

4

$890,000

Seahawks

4

$765,000

Patriots

3

$730,000

Cardinals

3

$730,000

Titans

3

$670,000

Chargers

3

$605,000

Bengals

4

$605,000

Ravens

3

$605,000

Raiders

3

$605,000

Cowboys

2

$570,000

Bills

2

$545,000

Browns

2

$545,000

Texans

2

$445,000

Eagles

1

$285,000

Rams

1

$285,000

Colts

1

$160,000

49ers

0

$0

Broncos

0

$0

Packers

0

$0

Dolphins

0

$0

Falcons

0

$0

Jaguars

0

$0

Total

104

23,745,000

Average

3

742,031