Dallas Cowboys

Kyle Orton, the Cowboys, and Retirement

Posted on by Jason Fitzgerald

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I’ve received a few questions concerning Kyle Orton’s potential retirement from the Dallas Cowboys. It is definitely an interesting situation in that Dallas clearly want’s Orton to play and is holding it over his head that they will invoke their rights under the CBA to recover forfeiture provisions of his prior signing bonus money if he retires.

When a player receives a signing bonus it is essentially a prepayment of salary that is contingent upon the player fulfilling his contract. If released from that contract he keeps the signing bonus because he fulfilled his obligation and the team chose to terminate the deal. This is common in the NFL. However in some instances a player chooses to walk away from the NFL and not fulfill his obligation to the team. When this occurs a team has the right to demand repayment of the remaining salary cap charges attributed to signing bonus money for the current league year as well as all future league years covered by the contract.

Usually teams do not go after bonus money when a player retires. Most of the time they know that the player could retire when they sign him and thus the bonus is looked at as the cost of doing business. Brett Favre, when traded to the New York Jets, tweaked his contract to protect himself from any forfeiture. While the Packers never would have looked to recover money the Jets were an entirely new situation for him so he wanted protection. His outlook may have been molded in part due to Jake Plummer being traded to the Tampa Bay Buccaneers the year before and refusing to play for the team, opting instead for retirement. Tampa Bay immediately wanted to recover money.

Dallas would have never suspected Orton to be considering retirement when they signed him to a three year contract in 2012. Orton was just 30 years old at the time and, as a backup, the physical workload should be minimal barring injury to starter Tony Romo.  Orton was to be the highest paid backup in the NFL, making this a very lucrative situation for Orton. Nothing would point towards a potential retirement.

For Dallas this might not be an issue if Romo was healthy, but he isn’t. Romo is coming off another back operation and while all signs point to him being ready the realization is there that they need another viable option to keep the offense moving. This is the exact situation they signed Orton for and they do not want to see him bail out. If Orton walks away the Cowboys are left with Brandon Weeden, a bust with the Browns, as perhaps the best option to play the position. So Dallas will flex whatever power they can to force Orton to earn that money they paid him in the past.

Due to the Cowboys salary cap situation they often use high signing bonuses for their players to reduce cap hits. This was no different for Orton who received $5.9 million in salary in 2012 of which $5 million came in the form of a signing bonus. Overall 47.6% of Orton’s entire contract was paid in that 2012 bonus. While the contract was initially panned as overspending just for the sake of overspending, Dallas may have assumed that in the worst case scenario Orton would be called into action for one full year. The $10.5 million total contract value would have been on par with signing a lower level starter like Ryan Fitzpatrick, so one season of play justified the entire three year investment. They expected him to be a Cowboy for three years for that purpose.

In addition to the $5 million bonus, Orton also converted $510,000 of his 2013 salary into a signing bonus to provide the Cowboys cap relief. As far as I know this bonus, which was paid as a signing rather than a guaranteed roster bonus, should be subject to forfeiture as well.  If so that was a mistake by his agents to not receive the bonus using a different mechanism. Other types of prorated signing bonuses are usually only subject to forfeiture in the year they are earned rather than in the future years as well. Perhaps this bonus was protected but for the sake of this we will assume it is not.

Had this been a standard contract, Orton would have been deemed to have “earned” $3,588,332 of his bonus money. If he retired he would then be forced to repay the Cowboys $1,921,668, which is a pretty large sum of money. That number would represent about 26.5% of his earnings for the last two years. However, Dallas often does not use standard contracts and, for cap purposes, uses void seasons which are used as placeholders for signing bonus prorations.

Even though Orton would technically be a free agent in 2015, his contract is valid through 2016. The way the forfeiture rules are written Dallas should be able to recover money attributed to 2014, 2015, and 2016. That number is a whopping $3,382,500, or about 46.7% of his earnings over the last two seasons. If forced to repay back that money he would essentially have played the last two seasons for $1.9 million a year, which is a low wage for a capable veteran backup.

For salary cap purposes the retirement of Orton would work just like a cut. Once placed on the Reserve/Retired list Orton’s bonus money will accelerate onto the salary cap. Considering this would not occur until after June 1 the resulting cap charges would be $1,127,500 charge in 2014 and $2,255,000 charge in 2015. Orton’s current cap charge is $4,377,500 so in no way would a retirement hurt the Cowboys cap.

Following his retirement Dallas can seek repayment of his money tied to this season and the next two voidable seasons. Future money would not actually be repaid until the following June and once repaid Dallas will receive salary cap credits. Usually there is a one year delay in these credits so they would receive a $1.1275 million increase in their available cap space in 2015, 2016, and 2017 rather than 2014, 2015, and 2016. If Orton retires and refuses to pay the money back to the Cowboys the Cowboys can take the case through the Arbitration process. I’m not really sure what defense Orton could have other than the fact that money attributed to 2015 and 2016 should not be recollected from Dallas.

Orton has not attended workouts this offseason so his base salary will reduce by $75,000 in 2014 if he honors his contract.  Supposedly both sides are talking and I would imagine that he will receive the $75,000 if he can be convinced to return. Other discussion points are likely concerning the size of the forfeiture, which Dallas will consider non-negotiable as long as they want Orton to be on the team.

The timing of Orton’s retirement is certainly odd. While Orton was not necessarily a winning quarterback in Kansas City and Denver he put up numbers that would land someone in a spot to either compete for a job (similar to Mike Vick)  or take a placeholder job with some upside incentives (Chad Henne). Instead he opted for a safe situation with good pay and an entrenched starter. With Romo injured this would seem to be his big chance to get back on the field and make himself more money in free agency in 2015. Perhaps all along Orton was playing things safe and doing all he could to protect his body while earning a very good living. There is nothing wrong with that but it certainly is a question that some might ask about his decision in 2012.

It is possible as well that this is posturing for a new contract in 2014. While I stated that Dallas might view this contract as a $10.5 million one year deal to cover for emergency, Orton probably sees himself having earned good backup money for two years and he fulfilled all his obligations. With Romo hurt the situation has changed and the risks go up for him.  Maybe the salary he has his not worth the job. Maybe his opinions will change if you throw in incentives for games started, wins, yards, etc… He may want a chance to earn that $10.5 million for just this year if he has to play 16 games on a playoff contender. Maybe that is the only way to chance the injuries that happen in the NFL.

I’d imagine nothing will be resolved with this until training camp begins. Dallas can carry him on the roster and Orton should keep things status quo while trying to work out a financial settlement, whether on forfeiture or a raise for 2014. Orton will need to attend the mandatory upcoming camp to avoid fines, but again those are things that can be negotiable. I don’t think either side will make a rash move other than reiterating their points through the media in a relatively harmless manner, but odds are the financial ramifications for Orton will be pretty steep if he opts to walk away from the NFL.

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Free Agency Thoughts: Dallas Cowboys

Posted on by Jason Fitzgerald

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Key Additions: Henry Melton ($6.9M per year), Jeremy Mincey ($1.5M), Terrell McClain ($1M)

Key Re-Signings: None

Key Losses: Jason Hatcher (Redskins)

Major Cuts: DeMarcus Ware ($7.4M cap savings), Miles Austin ($5.5M- June 1)

Free Agency Thoughts:

While it was a relatively quiet offseason for Dallas, at the same time I think it proved to be a smart one. Dallas came into 2014 with the worst salary cap situation in the NFL but was able to begin the process of turning that around when they released DE/OLB DeMarcus Ware. It was a difficult decision to part ways with Ware and one that I don’t think many expected Dallas to make. My contention has been that the decisions made on Ware were the most important to the long term health of their roster and they gained significantly over the long term with the release.

The team only touched the contracts of Tony Romo and Sean Lee for cap relief, both of which were moves that were essentially built into the contracts when they were signed last year. Importantly they did not touch the deals of Brandon Carr or Jason Witten. Miles Austin was designated a June 1 release, which will give the Cowboys ample breathing room during the season to function and potentially work out an extension with WR Dez Bryant. Starting G Mackenzy Bernadeau also took a pay cut to remain a Cowboy.

The tradeoff of Jason Hatcher for Henry Melton was an excellent decision. Melton is coming off injury but is five years younger and has been much more consistent than Hatcher, who had a career season in 2013. Hatcher signed for ridiculous money in Washington while the Cowboys crafted a contract with Melton that can be escaped after one season if Melton does not play at a high level.

The remainder of the signings are what could be expected with the salary cap constraints as they added players who may be rotational players. The Cowboys also signed QB Brandon Weeden as an insurance policy if Kyle Orton was to opt for retirement. Weeden only costs the minimum.

Overall Grade: C

Nobody expected much but I think the Cowboys come out of this in a good enough position. The release of Ware and lack of renegotiated deals was a big positive for Dallas and should begin the process of freeing their salary cap up over the next two years so that they can add more in free agency. I can’t say the Cowboys are any better this year following the loss of Ware but they should be much better off long term and that’s a successful offseason.

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2014 Dallas Cowboys Offseason Salary Cap and Financial Report

Posted on by Jason Fitzgerald

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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 third report and will break down some thoughts on the Dallas Cowboys. 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 and Texans.

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.

Cowboys Financial

Click to Open or Download the Cowboys Salary Cap Report




 

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Thoughts on Sean Lee’s $42 Million Dollar Extension

Posted on by Jason Fitzgerald

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Per his agent Mike McCartney, Sean Lee has signed a six year extension with the Dallas Cowboys. According to multiple sources the contract is worth anywhere from $42 to $51 million dollars depending on playing time.  That would put Lee, at the low end, at the same value as the Dolphins’ Dannell Ellerbe. If he hits his playtime escalators, reported by Albert Breer to be at 80% defensive playtime, his value jumps to just below that of the 49ers’ NaVorro Bowman.

Andrew Brandt has tweeted out the initial cash flows of the contract which are very strong for Lee. Lee will earn $10 million in new money in 2013 and what seems to be another $5.5 million in 2014. That money will be guaranteed, along with his $630,000 salary already on the books for this season. Both are important numbers for Lee. If fully guaranteed, which they likely are, the contract contains more guaranteed money than all of the second tier inside linebackers, which capped out at $14 million for Ellerbe and D’Qwell Jackson of the Browns.

Because the contract extension technically does not start until 2014, the one year takehome for Lee would be considered to be $15.5 million which is a strong contract in a time when teams are often pulling back. The two year payout would be $18.02 million if no escalators are reached. Jackson earned $16.8 million over two years and Ellerbe $14.05 million.

Lee should receive a $10 million dollar signing bonus which would make his cap charge in 2013 rise by only $2 million. His new salary cap figure should be (though this is not confirmed) $2.93 million in 2013. Dallas had about $8 million in cap room prior to the extension so a $2 million dollar raise should not impact the Cowboys decision making in 2013 in regards to the cap.

If given that signing bonus, Lee’s cap charge in 2014 will most likely be $7.5 million. Dallas rarely includes option bonuses so the reported second year cash flow should be in the form of P5 salary. Like most Cowboys contract extensions I never read into the second year cap total. As is standard for the Cowboys there are many additional years at the end of the contract which are placeholders for eventual restructures of the contract to make them more salary cap friendly. It is probably reasonable to view Lee’s cap charge to be $3.684 million after reducing his salary to the league minimum and prorating the remainder.

Such cap charges are significantly better than the alternative of applying the franchise tag on Lee. With a low third year salary Dallas should not have to worry about salary cap charges for some time with him, making it a very good signing for a team that has a reputation of doing a poor job with the financials for their team. The fact that the escalators are legit at 80% just further strengthens the need for performance from Lee. If Lee’s play was to drop off significantly this season Dallas does have outs in the contract to escape by 2015, not often the case in their contracts.

When full details come in I’ll do a better comparison with some of the other relevant contracts, but for now it looks like a solid contract for both sides.

EDIT: Per Todd Archer of ESPN the breakdown of the contract is exactly what described above. He has a full breakdown of the contract on ESPN. 

Based on that information I have updated Lee’s contract page.

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Today and Tomorrow: The Cowboys Salary Cap Woes

Posted on by Jason Fitzgerald

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I had a question/request from Scott last week in regards to the Dallas Cowboys. I planned to do a podcast on the topic but just didn’t have time to do it so instead we’ll write this out and examine some of the harsh criticism I have and others have for the Cowboys handling of their salary cap. I’ll break it up into two parts, one of which deals with a cap violation and the other of which deals with future cap issues.

The Cap Penalties

First of all I should state that I don’t think either team really deserved the penalties that they received. There were plenty of teams that took advantage of the uncapped year in ways that may not have been exactly “within the spirit” of the rules, but the Cowboys and Redskins I believe got singled out because of who their owners are. It should be noted that two other teams received semi-penalties- the Saints and the Raiders. While their cap was not adjusted downward they did not receive any of the prize of the Cowboy/Redskins troubles. The Saints many of us always felt was because of the use of something called a completion bonus and the Raiders due to their handling of JaMarcus Russell, plus the fact that the league I think was done with Al Davis at that point. In hindsight I now question whether or not this was the first slap on the wrist for the bounty scandal in New Orleans, but that’s another topic.

The question here was why I often discuss the Redskins penalty, but rarely discuss the Cowboys one as a reason for the cap issues.  The basic reason I discuss the penalty for the Redskins is because the number itself was so high that it has a material impact on any cap planning that a team can do. The Redskins never tried to “band aid” the team together to deal with the penalties, at least not to the extent the Cowboys have, but really it just comes down to overall cost. An $18 million downward adjustment kills your team. A $5 million one doesn’t come close to that. That said the actual penalties themselves were overblown for both organizations. Had the NFL done the right thing and not allowed the deals to be accepted, the actual cap charges would be very close to the penalty amounts.  The penalties kind of brought the salary caps back to where they should have been had no violation occurred.

The damage that happened to both teams was not the penalty itself but the fact that they never could have planned on receiving them. The league allowed the contracts in question to be approved and then waited a full season before hurting both teams. That is not right. If the league informed the teams in 2011 that they would be taking action against them they could have planned accordingly, but instead they were blindsided by the decision.

Playing the “what if” game we can see how the penalties are not so severe in reality had they been able to plan for the penalties. The Redskins most likely never would have traded Albert Hayesworth if the league had not allowed them to make the change in his contract. IMO, the Redskins would have voided his guarantees in 2011 and designated him a June 1 cut.

No Contract Change

Actual Charges

Gain/(Loss)

2011

$5,200,000

$0

$5,200,000

2012

$14,600,000

$10,500,000

$4,100,000

2013

$0

$10,500,000

($10,500,000)

2014

$0

$0

$0

Total

$19,800,000

$21,000,000

($1,200,000)

All in all the Redskins only lost about $1.2 million in cap room due to the penalties, assuming that his guarantees would have voided due to his personal conduct. Had they been aware of this in 2011 it would not have been nearly as tough a blow.

DeAngelo Hall likely would have been a June 1 cut this year or at the very least would see his prorations charged that way since he ended up back with Washington on a minimum salary deal. Here are the differences with his deal:

No Contract Change

Actual Charges

Gain/(Loss)

2011

$8,300,000

$5,000,000

$3,300,000

2012

$9,800,000

$14,000,000

($4,200,000)

2013

$3,300,000

$7,500,000

($4,200,000)

2014

$3,000,000

$0

$3,000,000

Total

$24,400,000

$27,400,000

($2,100,000)

Again the actual loss is not as great as people believe, but these charges greatly impacted the way the Redskins could plan for the cap taking far more losses in 2012 and 2013 than they would have had the void provisions not be accepted by the NFL. In this respect the penalty for Hall was much more severe than the one for Haynesworth despite Haynesworth’s deal being larger.

The Cowboys were assessed a $10 million dollar penalty, which I would assume was the determination of what past history said they should have paid Miles Austin in a signing bonus.  Going back to his original untouched contract you would get the following cap changes.

No Contract ChangeActual ChargesGain/(Loss)

2011

$10,540,000

$8,540,000

$2,000,000

2012

$3,150,000

$6,150,000

($3,000,000)

2013

$8,732,000

$11,732,000

($3,000,000)

2014

$2,000,000

$0

$2,000,000

Total

$24,422,000

$26,422,000

($2,000,000)

Its actually more of a penalty than the Haynesworth deal and pretty close to the Hall one. It is not as bad on the front end as the Hall penalty, specifically in 2013, but the overall impact is close.

All told the effect of the penalties is actually small on both teams, with the disclaimer being that they had some idea of them coming in 2011. The Redskins have made noticeable changes in their contracts and negotiations due to the penalties in order to be cap compliant. The Cowboys have not, which is another reason why I often avoid the Dallas penalty effect.

Overblown Cap Problems

Scott also pointed me to a link over at Blogging the Boys, going over the Cowboys salary cap. It’s a good article and worth a read so please read it if you get an opportunity. That said one of the difficulties in working with the salary cap is thinking short term. Decisions made in 2013 and 2014 impact you years down the line. The Cowboys 2014 salary cap is a problem but not as much of a problem as the 2015 one. Really when I talk about “paying the piper” or “bills coming due” that is the period of time we should be looking at, not the immediate future.

So since I’m not as familiar with the Cowboys roster as I am the teams of say the AFC East, I decided to use the BTB articles roster decisions to look ahead at Dallas’ salary cap for the upcoming years. Based on the projections made the Cowboys should enter the 2013 season with around $10.5 million in cap room. You would need to adjust for the Practice Squad ($1 million) and some misc costs ($1 million) to come up with the final cap total which we can guess to be $8.5 million if they avoid the injury bug.

While the original article mentioned signing Sean Lee we’ll just leave that be for the time being. In 2014 the suggestion was to cut Mackenzy Bernadeau and Justin Durant so I did that.  We would then restructure Tony Romo’s and DeMarcus Ware’s contracts. I just assumed a reduction to a minimal type salary of $1 million with $12.5 million being prorated over 5 years for Romo and $11.25 million over 4 years for Ware. That creates $18.4 million in cap room. All of those savings now become potential dead money in future seasons. Assuming the cap rises to $124 million and they carry over the $8.5 million, the Cowboys will have around $18 million in cap room going into the 2014 League Year.

That assumes Dallas signs no futures contract players as the $18 million is for a 41 man roster. The team needs to get to 53. If we earmark a rookie class of 7 that counts for around $4.5 million (right about the Cowboys total this season) and take into account the workout bonus money the Cowboys are looking at spending $13 million for 3 players to reach the 51 man limit. I’m not sure what Lee would cost (7 mil or so a year with a low year 1 cap?) but he will eat into that total a bit. Still I would call that a workable number after going further in on Romo (which is planned) and Ware (which likely is not).

The problem is as we turn into 2015. In 2015 Doug Free and Kyle Orton will have their contracts void, immediately jumping into the dead money pool. I also made the assumption that the team will cut Jay Ratliff. If we throw the 7 rookies in the mix from the year before and assume they all stick at $5.5 million we have a roster with a $122.4 million dollar payroll with only 29 players under contract.  The Cowboys would likely be about $10 million below the cap limit after the 2014 carryover and need to sign 24 players with that money. The minimum salary in 2015 is $435,000, meaning they would not even have enough to sign 24 undrafted free agents to complete the roster.

Those totals don’t include Lee or WR Dez Bryant, who would be a free agent in 2015. It also doesn’t include the Cowboys 2011 first round pick who will either be on an option season or need to be re-signed. You can go to a 35 year old Romo for more cap relief (again his deal is designed that way) but where else are you going?  A 33 year old Ware?  Doubtful, though through all the restructures you are now at a $20.3 million dollar hit so maybe it’s a must. You can cut Austin and Orlando Scandrick to save $8 million. That’s still not enough to do anything but at least you can begin to field a team. Most likely the team is stuck reworking Romo’s deal again to free up $12.8 million or so. That gives you $30 million, give or take a little, to sign 26 players to the team. With at least three big free agents not counted in that figure that is a tall order to overcome.

The one constant in all of this is that there is never a point where I can look at Dallas thru 2015 and simply say “they can leave things alone”. Every season it’s reworking contracts for stars or deciding players that can save some money by being released. Even all the way out into 2016 the base roster would still have $72 million in cap charges for just 14 players. Throw in a Bryant and Lee and you may be looking $87 million for just 16. The 2014 and 2015 rookie classes can bring that up 28 players for $102 million. It is just not that much to work with.

There are few, if any teams, that have these issues year after year. Usually every team has a breakdown year. One year where you see a number of players come off the books with little or no dead money. The average dead money per club this year is $9 million. Just in our base assumptions that number is a starting point in three of the next four seasons just to “get by”.  That is going to put the Cowboys at a competitive disadvantage relative to the NFL each year. The lack of money to spend doesn’t allow them to get much better via any mechanism besides the draft. They will only be getting older on the top.

Maybe that’s not as bad as it sounds since successful drafting teams will be better than the teams built thru free agency, but it is often nice to be able to add some parts to complete the puzzle. I cant see ways for Dallas to do that.

That’s not to say Dallas is the only team in a bad cap position- the Panthers, Saints, and Lions are all a mess for various reasons as well- but Dallas is consistently in the worst position. They have also been a team that had various ways to avoid some of these charges. Franchising Anthony Spencer will cost Dallas over $10 million in cap that they could have put to better use. Signing Orton to a contract nobody in the NFL would have signed him to adds to the problems.  Adding void years onto players contracts with no regard for the future have led to unnecessary excessive cap charges. Overpaying Austin as a one year wonder and extending an old defensive tackle to a league high contract when he had two years remaining on an existing deal are typical of the Cowboys woes.Did the cap penalties hurt the team?  Sure but almost any other team would have made choices to take that into account. Dallas just kept on going as if nothing happened.

It might be one thing if this strategy ever worked, but the last time Dallas truly had a successful season Wade Phillips was the head coach. The last time people regarded Dallas as a legit threat for a title Terrell Owens was catching passes from a 27 year old QB with great potential. That 27 year old QB is now looked at as an overpriced failure more in part because of the Cowboys poor cap management and failure to surround him with a cohesive team than anything he has done to deserve that label.

If Dallas wins this year, and barring a game changing home run in the draft this to me is the year they have the best chance, it’s going to be in spite of the way they run their franchise. It’s not a sustainable business model and I’m not sure you could find one NFL executive outside of Dallas that would recommend running the franchise this way. Right now they are either on the path to having a Raiders like implosion in a few years or fielding the oldest team in the NFL.

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Best & Worst Contracts: The Dallas Cowboys

Posted on by Jason Fitzgerald

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A few weeks ago Jason LaCanfora published a list of best and worst contracts in the NFL so I thought it might make a good idea for us to do the same here at OTC, with a team by team approach. I’ll try to be a bit more analytical in terms of why money was paid and how it fits in the market, but the general premise is the same. The one key difference is outside of restructured rookie contracts under the old CBA we will only use veteran contracts as there is a big difference between best draft picks and best contracts.  Please note that there is a difference between a bad player and a bad contract when discussing some of the selections. Clicking on a players name will take you to his salary cap page.

Jason HatcherBest Contract: Jason Hatcher

Dallas took a rare cautious approach to re-signing one of their own when they came to terms with Hatcher in 2011 after he could not find another home in free agency. Hatcher played out 2010 on the RFA tag and had the potential to be a decent rotational player on a team filled with high priced talent. Dallas more or less matched the production with his salary, guaranteeing him $1.8 million over three years on a $6 million dollar contract. Hatcher would expand his role in 2011 after signing his deal and show flashes of being a very vital player in their defensive scheme.

At a $2.1 million dollar cap charge in 2012 Hatcher was priced very reasonably, especially for a veteran starter. It paid huge dividends as Hatcher started 16 games and was arguably the best defensive player on the team, turning him from a reasonable value to one of the best bargains in the league. Had Hatcher never grown into the starting role Dallas was protected with just $1.2 million in dead money charges and $900,000 in cap savings, one of the few contracts on their team with failsafe provisions. His $2.6 million dollar cap charge in 2013 remains one of the best bargains in the NFL for a starter.

Of course the tricky part with Hatcher will be what Dallas does if he continues to excel. Dallas wisely only signed him for 3 years on this past deal, locking him up thru his 31st birthday, but they have to be cautious beyond this season no matter how good he may look. Hatcher does not have a lot of wear and tear on his body, but sometimes just age alone can begin to break a player down. The last thing the Cowboys need is one of the best deals on their team becoming one of the worst, a subject we will talk about in the next section.

Jay RatliffWorst Contract: Jay Ratliff

There are a number of places to go with this pick, but of all the bad, player friendly deals on the Cowboys none was worse than 2011 contract extension given to Ratliff. The extension of Ratliff typifies the good of Jerry Jones the owner and the bad of Jerry Jones the GM.  As a player there is little worse than outperforming your contract, seeing inferior players getting paid, and knowing there is nothing you can do to help the situation.  Jones doesn’t hold his players to those deals, generously opening the wallet to compensate his players for their performance. It is why players like playing in Dallas so much and why they will always be an attractive destination for free agents. Unfortunately in a salary cap league a GM that operates that way does nothing but dig a hole for his team that gets deeper and deeper every season, culminating in the bubble bursting and having a Raiders like purge of $50 million in dead money.

At the age of 30, Ratliff still had two seasons of cap friendly dollars left on his contract. The rule of thumb for a team in that situation is to have the player play out the contract and then begin to enter into a series of short term lower cost contracts when the player is 32 years old. This is the same strategy the Dolphins are likely employing with Randy Starks. At most you would give a token short term extension that gives the player a small raise without greatly affecting the cap. The Cowboys stunned the football world by paying Ratliff $8 million a season, with $17.5 million guaranteed, that would keep Ratliff in Dallas thru the age of 36.

Since 1970 only 22 DT’s have made a Pro Bowl over the age of 31 and only six were named All Pro. Since 1986 it has only been eight and two. Dallas should have prepared for the inevitable much in the way the Patriots never touched Vince Wilfork’s contract as he approached 30.  Ratliff’s deal was more or less cap neutral in 2011 and 2012 but made it impossible to cut Ratliff in 2013 and would have left the team with $4 million in dead money in 2014 when they moved on.

Ratliff struggled throughout 2012 his body breaking down and his owner questioning why he was not on the field. Making matters worse Ratliff was arrested in early 2013 for a DUI. Yet somehow despite all of that the Cowboys went deeper in on Ratliff, converting $3.66 million of his salary into a prorated bonus. Dallas saved $2.928 in cap dollars in 2013 with the move, and increased his dead money to $6.928 million in 2014 making the pain of cutting him next season that much worse. Ratliff’s 2014 salary cap charge is now $8.232 million. Had the Cowboys played things by the book Ratliff would have been gone already and some of the Cowboys cap pain would be alleviated.  But they didn’t, and they will continue to scramble to adjust cap charges to maintain their roster next season.

Check out Our Other Best & Worst Contract Articles

AFC East: Buffalo Bills, Miami Dolphins, New England Patriots, New York Jets

AFC North: Baltimore Ravens, Cincinnati Bengals, Cleveland Browns, Pittsburgh Steelers

AFC South: Houston Texans, Indianapolis Colts, Jacksonville Jaguars, Tennessee Titans

AFC West: Denver Broncos, Kansas City Chiefs, Oakland Raiders, San Diego Chargers

NFC East: Dallas Cowboys, New York Giants (July 13)

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Dead Money and the San Diego Chargers

Posted on by Andrew

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A few weeks back, I wrote an article summing up the dead money totals the Dallas Cowboys may have hit their salary cap over the next few years (that post can be found here – however it is not updated to update Tony Romo’s new dead money totals). After writing that post, I thought it would be fun to take a similar look at different teams. Choosing a team at random for this one, I ended up going with the San Diego Chargers. For an explanation on the concept of dead money and its effect on a team’s salary cap, check out the second paragraph of the Cowboys post. Since Dallas is the only other team I’ve done a dead money post on, that’s the only team I can compare the Chargers to as of now (so don’t get too mad Cowboys fans!). Keep in mind that these costs are going to go up in the near future as draft picks sign their deals. Here’s how the Chargers’ dead money future looks:

2013

Not much of a point in going in detail about the Chargers’ 2013 dead money count since the majority of these players will be on the roster anyway, thus meaning most of these players won’t actually result in dead money this year. For what its worth, San Diego currently has 37 players that would account for a total of $100,083,637. The average age of these players is 27.05 while the average age of the top 5 potential dead money hits (Robert Meachem, Derek Cox, Eric Weddle, Malcom Floyd and Antonio Gates) is 29.4.

2014

In 2014, the Chargers currently have 31 total players that could accumulate for a total of $55,321,917. Of those 31 players, 16 of them would have dead money totals of over $1,000,000 (the total dead money for those 16 together would be $50,062,186). The good news for San Diego is that of the 7 with the highest potential dead money hits, 5 of them will be under 30 that season:

Derek Cox (Age 27): $8,150,000

Eric Weddle (29): $5,200,000

Malcom Floyd (33): $5,083,334

Antonio Gates (34): $4,725,000

Melvin Ingram (25): $4,212,600

Robert Meachem (29): $3,750,000

Ryan Mathews (26): $3,267,000

2015: 

In 2015, the Chargers have 17 players with potential dead money hits for a total of $19,382,920. The average age of these 17 players is 29.24. Once again, age is on the team’s side here as of the top 5 players, 4 are ages 30 and under (the oldest is Antonio Gates, 35). Here are the 5 highest potential dead money hits:

Derek Cox (Age 28): $2,600,000

Eric Weddle (30): $2,600,000

Antonio Gates (35): $2,362,500

Melvin Ingram (26): $1,922,169

Robert Meachem (30): $1,875,000

Compare that to the Cowboys’  20 players for $56,492,180 (prior to the Romo extension), with 8 of the top 11 potential dead money hits being age 31 and over, safe to say at this point the Chargers have done a better job with cap management.

2016

The Chargers only have 4 players with potential dead money hits in 2014, for a total of $2,387,500. Those players are:

Derek Cox (Age 29): $1,300,000

Mike Scifres (35): $600,000

Nick Novak (35): $375,000

Mike Windt (30): $112,500

You really couldn’t ask to be in a much better situation dead money-wise down the road, so kudos to the Chargers for doing a great job of managing their potential accelerated costs. Just to compare further, the Cowboys have 13 players with potential dead money hits in 2016 for a total of $32,079,050 (again, prior to Romo’s deal), with only 3 of those players under 30. Of course, this in no way means the Chargers will be fielding championship, or even competitive teams in these upcoming seasons. It just means the Chargers will have a bit more flexibility since a large portion of their dead money is tied into younger players (meaning these players are less likely to be cut and as such, will not result in dead money acceleration). This is a great example of how some teams manage their cap well by giving themselves flexibility down the line, while others, well, just don’t.

To check out the Chargers’ salary cap projections, click here.

Twitter: @AndrewOTC