The 2011 CBA brought about a new spending rule that pegged actual cash spending to the salary cap. While we can argue about the changes made regarding the way that the cap is calculated compared to the past, this change clearly increased spending relative to the cap by about 5%. There are two cash requirements in the current CBA. The first is a league wide spending requirement of 95% of the NFL salary cap over two four year periods (2013-2016 and 2017-2020). The second is that each team must spend to a minimum of at least 89% of the salary cap to make certain that the 95% number is not being met by a minority of teams.
These numbers should not only be raised but they must be raised significantly. Our gut feeling is that as part of the next negotiating process, the NFL will likely propose a raise for both of these numbers as a way to try to show they are conceding on certain items but that the actual impact of the raise will be meaningless.
Based on the estimates we have in cash spending here is how much we estimate each team to have spent from the 2015 through 2018 seasons, as a percentage of the salary cap.
(% of Unadj. Cap)
There are two things that stick out to us here. First, is the average spending in the NFL is way above the 95% number at 101%. This number should immediately be a starting point for where the floor is for spending since the league is already there on it’s own. Accepting a raise from 95% to 98% or 99% isn’t moving the needle for anyone. The second thing is that no team is even close to the 89% level. The lowest spending team is closer to 93%. There are 20 teams spending up to the salary cap. Moving from 89% to 93% doesn’t actually impact anyone. It’s just something that sounds good on a piece of paper more so that doing something positive for the players.
Just from a logical standpoint placing cash spending below the salary cap threshold is plain and simple wrong. The salary cap is an “accounting system”. The accounting system is designed such that you defer salary cap dollars to future seasons meaning teams should always be able to spend cash over cap and have no trouble fitting in under the yearly salary cap. Look no further than the way the Philadelphia Eagles currently operate to see this.
By allowing teams to spend under the cap the league has been able to move off of using signing bonuses which can help protect a player’s roster spot and, because of such low requirements and a four year timeframe, to go into a “tank mode” for a season and dramatically cut payroll knowing they can make it up at a later date. While in a sense that “tank mode” strategy evens out in the long run, it is always more beneficial to players to have a robust market every year rather than having one or two teams that are positioned to go crazy spending, every few seasons.
A true movement by the NFL should be to come up from 95% league wide spending to 103%. That number is only a 2% jump from where the NFL is right now and 12 or 13 teams are already within striking distance of that number. Every team should be required to spend at least 100% of the salary cap in cash to bring those bottom teams up. If those 12 teams that were under 100% in the last four years were forced to spend 100% the league would pretty much meet that 103% number without much trouble. While the NFL would argue that this is too big a jump from 95% the fact is all it is requiring is for teams to spend about an extra $3.3 million per year from where they are now to hit the number.
We don’t even think this is that big of a jump. The league the last time went about 5% above where they were in spending vs the cap in the prior CBA and an equal move would be to 105% here. To us, 103% is a pretty reasonable ask.
We think it would also be worth proposing to scrap the set in stone four year period and move to a running four year average. This would prevent teams from being able to do any type of long term tanking when it comes to spending. This may require some creative thinking as to how to bridge the gap between two CBAs or simply not have anything other than a league wide number for the first three years, but would likely keep the market for players stronger overall than it is now.