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Feb 11

Looking at the Salary Cap Implications of Michael Sam’s Announcement

On Sunday night we learned that Michael Sam is gay. In a perfect world, this would not affect his draft stock. But unfortunately we don’t live in a perfect world.

The job of NFL front-office-men is to win football games; assembling a locker room that meshes well together is an important component of this.  If guys in the locker room have an issue with a gay player, the locker room is more likely to be divided and the team is less likely to succeed.

And it would be naïve to think that no NFL player would take issue with a gay player in the locker room.  In the past year alone we saw Dolphins WR Mike Wallace post an incredibly insensitive, uneducated tweet in regards to NBA-er Jason Collins coming out of the closet; there was also 49ers CB Chris Culliver’s anti-gay remarks at Super Bowl XLVII media day, as well as Panthers WR Steve Smith adamantly insisting that he wasn’t in Kerry Rhodes’ circle this past September when broached on the possibility of the free agent Rhodes—who is rumored to be gay in NFL circles—signing with Carolina.

On top of the inevitable disapproval that Sam will face from some of his peers in the locker room, there is also the media circus that will follow him to whichever team drafts him.

So what will happen with Michael Sam? He was an All-American as well as the SEC Defensive Player of the Year, so it would be shocking if he wasn’t drafted. Below I explain the economics that any interested team will take into account.

 

Michael Sam & the Salary Cap

The implementation of the “Total Rookie Allocation” and “Year One Rookie Allocation” pools in the 2011 CBA has greatly simplified the negotiating process associated with rookie contracts.  In essence, this new rookie wage scale pre-sets the contracts of all incoming rookies.

What’s important to note about all of this in Michael Sam’s situation is the differentiation in guaranteed money in accordance to where a player is drafted.

 

 Contract Details of First/Last Selection from Rounds 1-2 (2012-2013)

NAMEPICKLENGTHSINGNING BONUSTOTAL CONTRACT AMOUNTGUARANTEED MONEY
Eric Fischer (2013)1.1 (1st overall)4$14,518,544$22,190,498
$16,678,544

 

Matt Elam (2013)1.32 (32nd overall)4$3,301,456$6,767,002$5,439,229
John Cyprien (2013)2.1 (33rd overall)4$2,357,528$5,469,104$3,916,124
Christine Michael (2013)2.30 (62nd overall)4$834,132$3,374,432$1,007,132
Andrew Luck (2012)1.1 (1st overall)4$14,518,544$22,107,998$22,107,998
David Wilson (2012)1.32 (32nd overall)4$3,301,456$6,683,979$5,382,979
Brian Quick (2012)2.1 (33rd overall)4$2,357,000$5,386,599$3,822,373
Rueben Randle (2012) 2.31 (61st overall)4$834,132$3,291,930$1,397,132

 

1st & 2nd Round Selections: The guaranteed money given to both 1st and most 2nd round selections goes beyond just their signing bonuses.  Along with getting large signing bonuses, 1st and 2nd round draft picks get some or all of their total contract amount guaranteed as well.

 

 Contract Details of First/Last Selection from Rounds 3-7 (2012)

NAMEPICKLENGTHSINGNING BONUSTOTAL CONTRACT AMOUNTGUARANTEED MONEY
Travis Kelce (2013)3.1 (63rd overall)4

$703,304

$3,126,304

$703,304

Zaviar Gooden (2013)3.35 (97th overall)4

$506,016

$2,816,016

$506,016

Matt Barkley (2013)4.1 (98th overall)4

$497,028

$2,737,028

$497,028

Levine Toilolo (2013)4.36 (133rdoverall)4

$300,584

$2,460,584

$300,584

Sanders Commings (2013)5.1 (134th overall)4

$215,512

$2,400,512

$215,512

Ricky Wagner (2013)5.35 (168th overall)4

$144,560

$2,304,560

$144,560

Josh Evans (2013)6.1 (169th overall)4

$128,820

$2,288,820

$128,820

Vince Williams (2013)6.39 (206th overall)4

$78,680

 $2,238,680

$78,680

Mike Catapano (2013)7.1 (207th overall)4

$69,124

$2,254,124

$69,124

Justice Cunningham  (2013) 7.48 (254 overall)4

$45,896

2,205,896

$45,896

 

Even before Michael Sam publicly announced that he was gay, many scouts questioned his ability. At 6’1 or 6’2 and 250-260 lbs, he is likely not big enough to play DE in the NFL and may lack a true position. Though “expert draft projections” in February are often way off, early signs pointed to it being unlikely that Sam would have been a 1st or 2nd rounder even before his announcement. With all the extra-curricular stuff that this announcement carries with it, the scenario where Sam is taken in the 1st or 2nd round  now becomes nearly impossible.

3rd-7th Round Selections: However, when dealing with players drafted in rounds 3-7, only their signing bonuses are guaranteed in just about all cases. (Out of 34 3rd round picks in 2013, just one had more than his signing bonus guaranteed—Marcus Wheaton of PIT).

For example, if Brian Quick–the 1st pick of the 2nd round & 33rd overall selection in the 2012 draft–was cut by St. Louis before he had ever played a down, he would still have been guaranteed to make $3,822,373.  But if Justin Anderson—the 1st pick of the 7th round & 208th overall selection in the 2012 draft—was cut by Indianapolis before having ever played a down, all he would have been guaranteed to make was his $69,000 signing bonus.

And of course whenever there is guaranteed money in a contract, there is also dead money associated with it. So again using Brian Quick as an example, if the Rams had cut him before he ever played a down they would have absorbed a $3,821,690 dead money hit.  If they cut him after he played one season, the dead money hit would have been $2,842,991.

But with a guy drafted in rounds 3-7 (where there is no guaranteed money aside from the signing bonus), the dead money hit is simply the unearned amount of the player’s signing bonus at the time he was released.

Anything after round 2 is fair game. If a team values Sam and they think he’s a steal in round 3, they could take a chance on him with a relatively small financial risk tied to the pick. And if Sam shows well at the combine later this month, this scenario is certainly conceivable.

 
Andrew Cohen
@ajcohen03
ajcohen3@gmail.com