Free Agency Thoughts: Miami Dolphins

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Key Additions: Branden Albert ($9.4M per year), Cortland Finnegan($5.5M),  Earl Mitchell($4M), Knowshon Moreno($3M), Shelly Smith($2.75M), Louis Delmas($2.25M)

Key Re-Signings: Randy Starks ($5M per year)

Key Losses: Paul Soliai (Falcons)

Major Cuts: Dimitri Patterson($5.4M cap savings)

Free Agency Thoughts:

For the second year in a row the Dolphins have been big spenders in free agency. The Dolphins more or less neglected any long term vision for a few years under Jeff Ireland before they began throwing money around last offseason, with the most notable acquisition being WR Mike Wallace, who signed a ridiculous contract he could almost never live up to.  They did not bring in anyone as high priced this year, but certainly did make their share of noteworthy moves.

There were a lot of divided opinions on the signing of Branden Albert to a contract with $20 million fully guaranteed at the soon to be age of 30. His eventual future could be right tackle, which would make him the most expensive right tackle in the NFL on the backend of his contract by a wide margin.  I take the other approach on this one and feel the Dolphins really had no choice. Their offensive line was a mess in 2013 and Ireland probably lost his job because he failed to pull the trigger last year on Albert via trade. While you can’t fix things in the future this was the best, most proven option they could find and it really is a move they had no choice to make and could not risk haggling over cost

On the other end of the spectrum was a two year deal for CB Cortland Finnegan for which there is no argument- it’s a terrible contract. Finnegan was awful with the Rams, who opted to pay him $3 million to go away in hopes another team would sign him and eat some of the cost. The Dolphins not just ate the cost but gave him a raise. The Dolphins are making the assumption that by pairing him with Brent Grimes, who was extended about a week before free agency began, that they will take the pressure off him that he had with the Rams.

The decision that will come under some scrutiny will be the signing of Earl Mitchell over the retention of Paul Soliai. Mitchell is cheaper and younger but he is not as consistent a player as Soliai has been.  From the Dolphins perspective I think they assumed that Soliai does not play enough to warrant the extra money and retaining Randy Starks, who is very good, and pairing him with a lower cost talent made more sense.

Bringing in RB Knowshon Moreno at just $3 million for one season was a solid move. Moreno I think fell victim to overestimating his own worth and had no suitors remaining by the time he signed.  There is almost no downside to this as even at his worst he is a talent upgrade for the team. I think it does bring into question why they just did not keep Reggie Bush last year at $4 million a season, however.

Overall Grade: B

I guess the grade for Miami comes down to how much you like the Albert signing. If you dislike it then it’s an average or worse grade. If you like it then I think you give them a B. Last years spending spree was far worse than this years. Last year they grossly overpaid for three players. This year they didn’t grossly overpay for anyone and many of the contracts are reasonable. In my opinion they improved greatly at left tackle and improved at running back and safety while likely remaining constant at defensive tackle. I don’t understand the Finnegan move and they should have targeted more players on the offensive line, but the Dolphins should get better provided their QB develops this season.

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Philip Wheeler and the June 1 Cut

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With most of the NFL world congregating in Indianapolis for the NFL combine, the rumors are starting to pick up.  While most of the talk is focused on whispers of which teams are looking to strike in free agency, there are a few more subtle storylines lingering.  One of these was this little nugget from @VicTafur, who covers the Oakland Raiders and NFL for the San Francisco Chronicle. 

Screen shot 2014-02-24 at 1.33.42 PM

I haven’t discussed my background yet on the site, but this may explain why I found this rumor more interesting than most others.  I am a native of Miami, Florida and grew up a fan of the Dolphins.  The linebacker swap of Karlos Dansby and Kevin Burnett for Dannell Ellerbe and Philip Wheeler has remained a hot topic among Dolphins fans since last year’s free agency. While Ellerbe and Wheeler both struggled mightily, Wheeler has caught significantly more criticism and become the focal point for explaining what is wrong with the Dolphins’ defense among fans. With rumblings of Wheeler’s future being uncertain I wanted to clear up some confusion I have been encountering regarding “how” Wheeler should be cut if the Dolphins choose to move on. 

Wheeler signed a 5-year/$26 million dollar last offseason, and below is the breakdown of the remaining 4 years.

 

P5 Salary

Signing Bonus Proration

Workout Bonus

Cap Number

2014

$5,000,000

$1,400,000

$0

$6,400,000

2015

$2,900,000

$1,400,000

$100,000

$4,400,000

2016

$4,900,000

$1,400,000

$100,000

$6,400,000

2017

$4,900,000

$1,400,000

$100,000

$6,400,000

The simple fact is that this deal was not designed to be a one-year deal, or even a two-year deal for that matter.  And because of this, the notion of moving on from him after one year is costly.  Many fans, mistakenly, try to justify cutting Wheeler by throwing out the idea of using the June 1st Designation as some form of “money-saver”.  I found this contract situation to be a great illustration of what the June 1 Designation is designed to do, what it is not designed to do, and how it affects Wheeler.

The June 1 Designation is a mechanism to defer the acceleration of prorated signing bonus money for one year.  The NFL has decided that June 1 is somewhat of a dividing line between Salary Cap years.  When you cut a player outright before June 1st, the remaining guarantees in P5 (base) salary and outstanding prorated signing bonus money accelerates on to the current season’s cap.  After June 1st, only the current year’s expense stays on the books.  The June 1st designation allows a team to cut up to two players prior to the June 1st deadline that are to be treated as if they were cut after June 1st.  One misconception here is that many believe designating a player a June 1st cut allows you to spend more money in Free Agency in March when in fact it does not.  When a player is designated a June 1st cut, they must remain on the books until June 1st, at which point the relief is granted, enabling a team to create space to sign their rookies or to have some breathing room in their cap for the season.  The real benefit of using the June 1st cut is for teams that are very tight against the cap in the current season and simply cannot afford to take the lump sum of accelerations in the current year.  By using the June 1st cut, it defers the later guarantees and prorations until the following season.  The team does not “save” this money, but rather pushes the payment back one year.

How does this affect Wheeler?  Well once the misconception that the June 1st designation somehow saves money over a regular cut is put to rest, and it is understood that it is only a deferment of payments, Wheeler’s future becomes clearer.  I think the best way to illustrate this will be to just show what it looks like to keep Wheeler, cut him outright and cut him as a June 1st cut.

 

Keep Wheeler For the 2014 Season

 

P5 Salary

Signing Bonus Proration

Workout Bonus

Cap Number

2014

$5,000,000

$1,400,000

$0

$6,400,000

As you can see above, if Wheeler plays the 2014 season on his current contract, he will count $6,400,000 against the cap.

Standard Cut Prior to June 1st

 

P5 Salary

Signing Bonus Proration

Workout Bonus

Cap Number

2014

$5,000,000

$1,400,000

$0

$6,400,000

2015

$2,900,000

$1,400,000

$100,000

$4,400,000

2016

$4,900,000

$1,400,000

$100,000

$6,400,000

2017

$4,900,000

$1,400,000

$100,000

$6,400,000

What I have done above is show what the remaining four years of Wheelers contract looks like but crossed out all the money that would be wiped clean if he is cut.  As you can see, only Wheelers 2014 P5 (base) salary of $5,000,000, which is guaranteed, and the remaining prorations of his signing bonus would need to be accounted for in the cap.  Because a standard cut accelerates all of the remaining guarantees in P5 (base) salary (there are none remaining for Wheeler) and remaining signing bonus prorations, Wheeler’s 2014 cap hit would look like this.

 

P5 Salary

Signing Bonus Proration

Workout Bonus

Cap Number

2014

$5,000,000

$5,600,000

$0

$10,600,000

Total cap spending on Wheeler for 2014-2015 = $10,600,000

There are two important factors to remember here.  First is that this would clear the Dolphins of any future commitments to Wheeler, they would be biting the entire bullet in 2014.  The second thing to remember is that now Wheeler’s roster spot has to be replaced and effectively the total cost of his roster spot for 2014 would be $10.6m PLUS the cost of his replacement.

June 1st Designation Cut

 

P5 Salary

Signing Bonus Proration

Workout Bonus

Cap Number

2014

$5,000,000

$1,400,000

$0

$6,400,000

2015

$2,900,000

$4,200,000

$100,000

$4,200,000

2016

$4,900,000

$0

$100,000

$0

2017

$4,900,000

$0

$100,000

$0

Total cap spending on Wheeler for 2014-2015 = $10,600,000 (same as standard cut)

Above is what the June 1st Cut would look like.  Here the 2014 cap commitment is only his guaranteed $5,000,000 P5 (base) salary and his 2014 prorated signing bonus of $1,400,000.  Unlike the standard cut, the Dolphins are still cap committed for the 2015 season, which is the remaining $4,200,000 (1.4×3) of signing bonus money that needed to be accounted for.  As you can see, the only difference between the standard cut and the June 1st cut is not whether or not Wheeler saves any more or less money on the cap, but rather WHEN the money has to be accounted for.  Again, the June 1st Cut is a deferral mechanism, not a money saver.  You save the exact same amount of money whether you cut a player normally or with the June 1st cut, it’s only a question of how you want the payment plan to be.

Again, because Wheeler is no longer on the roster, the cost of a replacement player has to be accounted for as well.

With the breakdown above, I have one fundamental question.  Even if you believe Wheeler is going to play as poorly as he did last year, or even worse, what benefit do the Dolphins get from cutting him, either outright or as a June 1st?  An open roster spot at the end of the bench?  At the very worst, he should be the best backup linebacker, on your team because there is no benefit to cutting him.  Even though he will be being grossly overpaid, you are either going to be accounting for him on the cap whether he is in a Dolphins uniform or not.  There is one other option –a trade.  Much like the Cardinals and Jaguars did last year with Levi Brown and Eugene Monroe; the Dolphins could pay a portion of the money owed to Wheeler to a willing trade partner, which would mitigate some of the damage of moving on from Wheeler.  If he improves, now that’s just an added bonus.  But because of all this, I would be shocked if the Dolphins chose to cut Wheeler, with either designation, or find a willing trade partner and expect him to be on the Dolphins roster in 2014. 

 
Ryan Feder
Tulane University Law School
J.D. Candidate 2015
@RyanFeder
rfeder1@tulane.edu

2014 Miami Dolphins Offseason Salary Cap and Financial Report

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Welcome to one of the newest additions to the Over the Cap website: the offseason Financial Scouting Report, which should help serve as a guide to a teams’ offseason planning for the 2014 season.  This will be our fourth report and will break down some thoughts on the Miami Dolphins, though it was finished up right before GM Jeff Ireland was fired. Each report will contain a breakdown of the current roster, a look at performance from 2013, salary cap outlooks, free agents, salary cap cuts, draft costs, extension candidates, and possible free agent targets. The hope is to do a report for all 32 teams by the start of Free Agency, if time allows. Thus far we have covered the Jets, Texans, and Cowboys.

Because the report contains some graphs and charts and over 4,000 words it is available for download as an Adobe PDF file that you can read at your leisure offline and keep for a handy reference during the year rather than as a blog post. The report is free for download and reading, but if you find the report useful and would like to help OTC continue to grow and add content like this we would appreciate the “purchase” of the report for just $1.00 by clicking the Paypal link below or the one within the report. Also if using any of the graphs or salary data please just add a reference to OTC when doing so.

dolphins report




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The Dolphins Options With Jonathan Martin and the Dollars Involved

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We’ve discussed a bit on the Incognito side of the Jonthan Martin situation, but with Dolphins teammates jumping to the defense of Incognito and wondering why Martin is taking such actions, we should also examine what Martin has to lose by leaving the team.

In the NFL players such as Martin are given guaranteed portions of a contract as well as moderate signing bonuses. All of the money involved in the contract is contingent on the player making a good faith effort to honor his contract. While we often consider a signing bonus to simply be earned once paid, in reality it is not. The league provides for forfeiture provisions of bonus money already paid for almost any occurrence that impairs a players’ ability to honor such contract.

While many have speculated that he could be placed on a Non-Football Illness list, there needs to be a reason to do that. For instance when the 49ers Aldon Smith was placed on NFI a few weeks ago he checked himself into rehab, a legitimate reason to go on NFI. There had been stories that Martin checked himself into a hospital for a very brief stay due to emotional distress. If true that may have been advised as a manner to be placed on NFI rather than being charged with leaving the team. The reason I say advised is because it seems that the situation had been coming to a head for weeks based on a report by Pro Football Talk.

Per my understanding of the NFL roster rules a player who leaves the team for an extended period during the regular season severely limits what his team can do. The Dolphins options at this stage, unless NFI is an option, are to either place Martin on the Reserve/Retired list, keep him on the active roster, or release him. This could explain why Miami has kept him active. Once placed on the Retired list Martins contract tolls under a left squad provision and he is unable to play in the NFL for the balance of the season. Once on this list he is also going to be subject to forfeiture provisions and will not earn a salary, something he may earn on NFI, especially considering the public outcry in favor of Martin. If they released Martin the Dolphins would have no recourse to recover any money paid or owed under his guarantee.

Martin had signed a four year contract with the Dolphins following the 2012 draft. His 2013 salary was guaranteed and he received a signing bonus of $1,919,468. If Martin fails to return to the Dolphins Miami can take actions to recover all of the money remaining on his bonus. If he goes onto a retirement list this week he would lose $285,866 of his $607,466 salary remaining this year and could stand to lose $225,841 in signing bonus money, for a total loss of $511,707.  If he was to fail to return to the NFL he would lose $959,824 in 2014 and 2015 bonus allocations. He would have an opportunity to re-earn that money if he ever returned and honored his contract.

Proving for an unsafe work environment could give Martin a reason to file a grievance if the Dolphins were to attempt to take his salaries and bonus allocations away from him.  I would imagine that this becomes a matter of workplace safety and he could not be expected to come to work in an unsafe environment. The Dolphins failure to provide a safe workplace might mean that he is entitled to his bonus money since it would be the Dolphins failures to act that did not allow Martin to honor his contract. In a roundabout way this was no different than Miami cutting the player from the roster.

This all seems to be uncharted territory for the NFL so they and the Dolphins will likely proceed cautiously. The NFL has come under scrutiny this year due a wide variety of topics ranging from a player accused of murder to an increased focus on head trauma to changing the name of a football team. It seems as if in this situation the general public pressure and opinion is much different than the in-football opinion, where many people have quietly backed the Dolphins until yesterday when the players overtly seemed to side with Incognito in the dispute. We’ll see how it shakes out in the coming days.

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John Denney Becomes Highest Paid LS…By $87

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Last week the Dolphins signed Long Snapper John Denney to a three year contract extension that would, according to his agent Ian Greengross, make him the highest paid player at his position in the NFL. Per a league source we learned of the full details of the contract which confirmed the statement (if we do not include players on tenders). Normally this would not merit a post, but I thought that this was interesting enough to write about to illustrate how pretty small amounts (meaning dollars not thousands or millions) in a contract can help both sides feel good about a contract.

Prior to Denney’s extension the highest compensated LS in terms of annual value was the Giants Zak DeOssie at $1.15 million a year. His total contract was worth $3,450,000. In order to surpass that amount Denney receives a Paragraph 5 salary in 2014 of a pretty quirky amount of $865,087, which pushed the total value of his contract to $3,450,087, enough to lay claim to being the highest paid in the game. Denney’s APY is $1,150,029.

Denney received a $400,000 signing bonus which is the only portion of his contract that is guaranteed. That figure is not at the top of the league, but at 34 years old it would be hard to imagine the Dolphins guaranteeing future salaries. The guarantee works out to be about 11.6% of the total contract value which is close to the figure the Eagles Jon Dorenbos received. Dorenbos is 33.

Miami only increased their cap commitment to Denney in 2013 by $80,000.

View John Denney’s Contract and Salary Cap Page

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PFT Report: Dolphins Release CB Richard Marshall

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According to Mike Florio of ProFootballTalk.com the Miami Dolphins have released starting CB Richard Marshall. Marshall was set to count for over $5 million against the 2013 salary cap and Miami will save about $4 million in net cap room following his release. Miami should now have slight over $20 million in cap room which most likely is being allocated for carry over to the 2014 season where a number of starters are set to become free agents.

The release of Marshall illustrates the negatives for players in regards to the June 1 rule for acceleration. When August rolls around and teams get a full look at other players the cash aspect of a contract plays a major role in the decision making process. When you release a player after June 1 acceleration from future contract years is allocated to the following NFL season rather than the current league year. Unless a player has guaranteed salary in his contract a team will save his entire salary and in no manner compromise the teams cap.

When they know the player has little long term value to the club the decision becomes quite simple in August once they realize his replacement is on the roster. Cutting him in August or next March has the same dead money charge in 2014. If the player is close to equal with a lower cost player the team is better off saving the base salary for the current league year than playing him and cutting him the following season. In the next two weeks many veterans will likely fall victim to the same circumstances. Most will be offered substantial pay cuts to keep their positions, a difficult decision to make. .

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Dolphins Gain Cap Room With Release of K Dan Carpenter

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The Miami Dolphins have released K Dan Carpenter which really should came as no surprise. Carpenter struggled at times in 2012 and the Dolphins drafted his replacement, Caleb Sturgis, in the 5th round of the 2013 NFL Draft. Carpenter was in the final year of his contract and carried a salary of $2,675,000. His cash compensation ranked 4th at the position this season making him a pretty clear candidate for release. It was somewhat surprising that the move did not happen earlier, but with only $25,000 in offseason bonus money and the Dolphins not hurting for cap room, Miami could afford to bring Carpenter to camp as insurance in the event their draft pick did not perform well.

Miami will create $2,195,000 in cap space with the release once we factor in a player to replace Carpenter on the roster. That should leave the Dolphins with slightly over $16 million in cap space which the team will likely have earmarked for carryover to 2014 to allow them the salary cap flexibility to re-sign their own  free agents and potentially be active again in free agency.

Carpenter will carry a dead money charge in 2013 of $337,500.

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