Minimum Cash Spending in 2020

With free agency rapidly approaching one of the questions I am getting pretty often these days is about the spending requirements in the CBA. For those unfamiliar with the NFL CBA there is a rule that requires teams to spend at least 89% of the salary cap over a four year period. The current period, which began in 2017, ends this league year and could give some idea as to who will spend this year on contracts.

Though our cash numbers that we trace are not going to be 100% accurate they should give us a pretty strong estimate of the teams that are in danger of not meeting the 89% threshold. Through last season we did not have any teams that were under $473.9M in spending, which was the mark required to be on pace to hit the 89% mark. The teams that were closest, the Cowboys, Ravens, Colts, and Chargers were all between $477M and $485M. There is a quirk in the rules that could impact teams in cap trouble (spending on bonuses in contracts in February of 2017 should not count towards spending but we track them as cash for the year)  which means maybe the Cowboys and Ravens were slightly under but if it’s the case it should not be by much.

Assuming the cap reaches $200 million this year the four year spending number will jump to $651.8M. Per our estimates we have 11 teams that are under that mark. Of those 11, six should be compliant just by signing their draft picks. Those teams are the Cardinals, Buccaneers, Patriots, Giants, Broncos, and Dolphins. That should leave us with six teams that may have little choice but to spend in free agency this year. Let’s take a look at those teams.

Colts, $43M under– The Colts have pretty much avoided spending in free agency the last few years even with a huge surplus of cap space.  Last year when the unexpected retirement of Andrew Luck came down and the team surprisingly did not ask him to repay millions in bonuses paid just months before the retirement and then followed it up by a seemingly crazy decision to agree to a one year, $28 million extension for Jacoby Brissett I surmised that the team was going to be so far under the spending limit that both decisions were in part driven by this. Seeing how far under they are now I think backs that up. Indianapolis will likely make up half of their shortage in the draft but they will most likely have to finally go out and spend at least a bit in free agency this year especially if they do not keep tackle Anthony Castonzo. The Colts may not want to get tied down to anyone for too long so this may wind up being the landing spot for “rehab” projects that take a one year deal in the hope of improving their stock.

Cowboys, $45 million under- Despite what most people think of the Cowboys they have basically managed a low cost roster for years now. They have a reputation for spending wildly but the fact is they have not really signed a notable free agent in ages. They should hit this number with two tags this year on Dak Prescott and Amari Cooper. Even if Cooper signs elsewhere just the tag for Prescott should be enough since they have other free agents to sign plus $14 million in draft pick bonuses to pay out. So I would not expect them to be forced into anything in free agency.

Ravens, $47 million under– Between a tight salary cap and a cautious approach to extensions and free agency the Ravens have been one of the lowest cost teams in the NFL. Certainly this year they got the most bang for the buck with a low cost team that outperformed all expectations going into the season. The team will probably spend around $15 million on draft picks so they are still well under. This is likely part of the reason why rumors are circulating that the team is considering franchising Matt Judon. A tag for Judon would cost around $16 million and put them much closer to the number. Even if the tag was simply just to trade him part of that logic I am sure is that the most they could receive as compensation is a 3 and that would require extra care in free agency something they couldn’t pull off last year with Za’Darius Smith.  The Ravens did increase payroll last year (they went from being close to the lowest spending team in the NFL for 17 and 18  to around 20th in 2019) and did sign Earl Thomas and Mark Ingram but if there was a year for this team to be even more active in free agency this is probably the year. This is probably a logical spot for some veteran players to chase a ring.

Chargers, $48 million under– The Chargers have more or less been resigned to the fact that they were not going to be a legit competitor last year only adding veteran Thomas Davis and backup QB Tyrod Taylor as UFA’s last season. The team will spend $25 million on their first two draft picks alone so its around $20 million they need to spend. I could see this going one of two ways. Either the team signs a few veterans and someone like Marcus Mariota to just hit the minimum spending number or they try to make a splash for their move and go after either Tom Brady or Drew Brees (I personally cant see Brees leaving the Saints but you never know) , tag tight end Hunter Henry, and actually spend quite a bit in free agency to compete. I see this as one of the more fascinating teams in free agency this year that could stun some people with their decisions.

Bills, $53 million under– Buffalo had to go into a spending freeze due to the mess that the roster was a few years ago and just started to spend a bit last year as they came out from it. The team will only cover around $16M in draft pick spending so the Bills look to be a hit destination for free agents. The team has a huge surplus in cap space so they can probably structure a number of contracts favorably to maintain flexibility after 2021. Buffalo hasn’t signed a notable free agent in ages and I could see that changing this year. While I don’t think anyone is sold on Josh Allen as the guy this is the window to take advantage of his contract so if there is a time to take more risks its 2020 for Buffalo.

There are a few other considerations this year for some of these teams. If they were to extend or restructure players after the season (February 2021) or late in the season signing bonuses should count to help teams meet the number. If the CBA is not extended there are rules that would make it more difficult to do (i.e. extending a Josh Allen in February might not be the easiest thing to accomplish) but it is another route to hit the necessary spending.

The other big question is how do teams approach contracts now that the CBA could expire? I think this year’s free agent group is very strong and we should see a record number of double digit annual contract values being signed but since most teams don’t need to spend will they see this as an opportunity to try to break the union? 

The last time the CBA was set to expire spending hit record lows relative to the salary cap. In part that was because of rules (free agency was more restrictive in 2010 with a number of UFA’s being classified as restricted) but if you want to break any potential strike one of the ways to do that is to not be aggressive in free agency. This week we have seen reports of the NFLPA attempting to advise the players as to how much it would really cost to strike and if there is a thought that this could occur teams may “independently” come to the same conclusion that overspending in 2020 is not wise which could make for a very different free agent period.