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A little clarification on the DW situation, cut designations, and how it affects the cap


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#1 Frash Brastard

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Posted 24 February 2013 - 03:54 AM

http://overthecap.co...st-designation/

What we are talking about here deals strictly with the acceleration of prorated bonus money onto the current years salary cap. The NFL essentially breaks up its salary cap accounting for bonuses into two periods with June 1 being the trigger date. When a player is removed from a players roster prior to June 1st all his remaining unamortized bonus money immediately accelerates onto the salary cap. To illustrate this we see how the Kansas City Chiefs gave Steve Breaston a $5 million dollar signing bonus in 2011, which was accounted as $1 million in yearly expenses over the course of his 5 year contract. When he was released just the other day he had only completed 2 years of his 5 year contract meaning the Chiefs salary cap had only accounted for $2 million of the $5 million paid in 2011. The balance of $3 million dollars immediately accelerates onto the Chiefs 2013 salary cap.
After June 1 the NFL changes the way the acceleration works. After June 1st only the current years expense remains on the books after the player is released. The balance accelerates onto the following years salary cap. So in Breastons case had the Chiefs waited until June 1st to release him his salary cap charge in 2013 would have been $1 million and in 2014 he still would be on the books at $2 million dollars.


Anyway we go we're on the hook for Williams' 9.6 million in remaining signing bonus money, which is not money he will be paid in the future but money that Hurney went in his DeLorean and drove into the future to borrow when he re-signed DeAngelo.

This rule is really another way in which the league holds tremendous power over the players. In some cases the acceleration of bonus money could throw a teams salary cap into chaos, if higher than the players current cap charge as an active player. Since teams need to remain under the cap at all times once the League Year begins the potential of the acceleration onto the current years cap would prevent a players release and allow them to continue earning their salary for the year. Instead they are thrust into a pool of summertime free agents when most teams are strapped for cap space and have made many of the decisions about their roster.

I think where many people get confused, though, is when they hear that “player x” could be designated a June 1 cut and immediately jump to conclusions that it means a spending spree in March. The league allows each team to designate up to two players per year as a June 1 cut for cap purposes prior to June 1. It’s the one concession that was given to the players as it allows a player to be cut in March and have time to explore free agency but have his cap hit spread out over two seasons, thus creating more cap space in the current year. The issue though is the mechanism by which this works.

When you designate someone as a June 1 cut the player and his current contract remain on the books until June 1. Going back to the Breaston example has he been designated a June 1 cut his cap charge today would not be $1 million with $2 million on the books in 2014. His cap charge would be $5 million dollars, the same cap charge as if they never cut him at all. When June 1st hits his cap then moves down to $1 million and the other $2 million accelerate into the 2014 season. By that point in time free agency is finished and the extra cap room does not do the team much good. They would have been in a far better cap position during the important time of free agency by releasing Breaston outright as the Chiefs did.


spotrac has this charted here

a more local example of this which best illustrates this point is how they worked Wharton's release last year. He was designated as a June 1st cut.

In our current case, just dealing with signing bonus money, even if we designate Williams as a June 1st cut, his cap hit is still at least 9.6 million (vs. the status quo 8.2 for 2013) until the rollover happens, at which point it gets split up between 2013 and 2014. Even better news is that there's no commitment in 2015, and even though we can delay Cam's contract extension even further than that, it certainly helps to have that flexibility to be able to utilize on contracts you would otherwise have to borrow future monies to pull off. Based on this article and the contract numbers for Williams on spotrac, cutting him this year and designating him as a June 1st cut possibly opens up 5 million of the 8.2 million currently on the books as soon as that day hits. however, at any point prior to that his cap hit will actually be 9.6 million.

The remaining 6.4 million signing bonus money is then allocated to 2014, where Williams would be due to make even more money. His cap hit then is 6.4 million for 2014 instead of the 9.2 million he would've made had he still been on the roster. If you can find a mid-round draft pick that can duplicate a paltry 700 yard season, that still leaves you with $2 million in change to play around with that big void we have called Free Safety for instance. In other words, for about 7 million, you've already replaced Williams' production and can then spend more money on other positions that need help. But wait! What if I told you we already had someone who at one point had proven he could do that very thing? A really favorable proportion of rookie mid-round and later RBs from 2012 ran for more than 300 yards. And if that sounds too anecdotal for you then let's go back to the 2011 season, where DeMarco Murray, Stevan Ridley, Roy Helu, Kendall Hunter, Delone Carter, and Evan Royster all eclipsed that mark. And they were all rookies drafted round 3 or later that year.

In our case, this basically means that this is an ongoing decision, not a finalized one. Depending on what happens in the next three months, it may set us up to make Williams expendable. Barring any kind of contract activity specifically dealing with DeAngelo, I think the probability of him being cut off goes up after June 1st, unless the Panthers find a way to really create some cap room, at which point it could happen even sooner. It's a no brainer that he'd be designated as a June 1st cut if he was cut.

Williams at this point in his career is a 750 yardish back with a 1,500 yard rusher's name. And all this crap about how it's the Oline's fault or the system's fault is giving me the dry heaves. If Williams was the calibre of player he's getting paid to be, he could've easily worked out at least 4 digits from behind the LOS with what he had out there. If Williams' success is that dependent on his teammates, he really isn't this cornerstone many people are making him out to be.

The question is not why would you let all that dead money go, but instead what you can do with those savings in the long run. Alfred Morris, a rookie 6th round pick who made about $421,000 in 2012 between salary and signing bonus ranked top 5 in rushing and ran with more consistency than DeAngelo has shown in at least 4 years. Productive backs are a dime a dozen in this league, and with Cam Newton going into his third year as a full-time starter (a banner year for productivity among several QBs in this league), it makes the urgency to have 2 expensive backs on the books much less prevalent than it artificially was inflated to at the time he was drafted with all the hysteria going on here over how successful he could be.

#2 panthers55

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Posted 24 February 2013 - 07:04 AM

This whole post just screams for a restructure which is what I suspect they are pursuing. If we can figure out how to restructure him which doesn't necessarily mean just give him his money up front but could mean change the terms of how he is paid to give us cap relief right now as well as keep the cap hit reasonable moving forward.

The question is absolutely why you would let all that dead cap money go for no production. Sure we can all look at Alfred Morris who was a 6th rounder who played much better than expected and say that those guys are everywhere but how is it that we never seem to find that guy. Exactly how many guys have we drafted outside of the first round who have become big rushing stars for us. Sure there is always the exception to the rule but you don't expect to find them all the time. Using that logic we should have passed on Newton and went with a 6th round guy because Brady was a 6th rounder that did well and we could always hit a home run like New England did.

At this point we haven't shown that we have a back who can run for 16 games with no problem and have had to resort to a 2 back system. I would have hated to watch us struggle last year with no Stewart or Williams. There is no reason we have to do the same thing this year. Sure if you were making this decision with no dead cap space going forward you likely would do what the OP is suggesting which is look for a cheaper option with Stewart already restructured. But that isn't the situation at all. It is dump him and eat 9.6 million through much of the free agency period even if you designate him a June 1st cut, keep him and have 1.4 million less of a cap hit until June 1st and then decide what to do, or restructure him and save cap space now which allows you to use him this year for a reduced cap hit and face no more in dead cap space next year. You would have dead cap space in 2015 but given the dead cap space goes down by 3.4 million each year we keep him, the effect on the cap wouldn't be worse than dumping him now but you have him to use.

It isn't that hard to figure out.

#3 CRA

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Posted 24 February 2013 - 07:26 AM

Restructuring a 30 yr old RB also sets you to screw your team in the near future.....bc RBs like that often have there wheels fall completely off overnight.

Restructure normally means more throwing guaranteed cash at him that can turn around and immediately haunt you.....when you then need to cut the 31 yr old broken down guy the next year.

Old or injured makes restructures more risky....unfortunately that applies to a couple guys

#4 panthers55

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Posted 24 February 2013 - 07:35 AM

Restructuring a 30 yr old RB also sets you to screw your team in the near future.....bc RBs like that often have there wheels fall completely off overnight.

Restructure normally means more throwing guaranteed cash at him that can turn around and immediately haunt you

Is that what we did with Nakamura? You assume that any restructure is simply throwing money at him and that isn't always the case.
Secondly we are already screwed for 9.6 million in dead cap space no matter what we do. That doesn't go away unless we figure out how to restructure him creatively. You keep talking about not keeping 2 backs as if the situation is just occurring. What you and the OP fail to see is that the damage is already done. Now the issue is to do the best thing you can with the cards you are dealt. I think that they can restructure a deal which keeps Williams a Panther, reduce the cap hit this year and keeps us from cap hell in the future since there is a reducing dead cap hit of 3.4 for each year going forward. No doubt he doesn't get all the money in the contract going forward, I doubt he even thought he would see all that. The issue is that there is no advantage to dumping him before June 1st we all agree. I think there will be ways to restructure him so we can save now and not push all the cap hit down the road.

#5 CRA

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Posted 24 February 2013 - 07:43 AM

Is that what we did with Nakamura? You assume that any restructure is simply throwing money at him and that isn't always the case.
Secondly we are already screwed for 9.6 million in dead cap space no matter what we do. That doesn't go away unless we figure out how to restructure him creatively. You keep talking about not keeping 2 backs as if the situation is just occurring. What you and the OP fail to see is that the damage is already done. Now the issue is to do the best thing you can with the cards you are dealt. I think that they can restructure a deal which keeps Williams a Panther, reduce the cap hit this year and keeps us from cap hell in the future since there is a reducing dead cap hit of 3.4 for each year going forward. No doubt he doesn't get all the money in the contract going forward, I doubt he even thought he would see all that. The issue is that there is no advantage to dumping him before June 1st we all agree. I think there will be ways to restructure him so we can save now and not push all the cap hit down the road.

Nakamura? He didn't have the comical guaranteed money complicating it.

Makes more sense to ask the 30 yr old RB to rip up his horrible contract or be cut.

Find out if he wants to stay where he is. That IMO is what this situation screams.

From what I have read about how restructures, I don't see how we can do when that still doesn't have remaining in a horrible spot with him.

#6 chknwing

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Posted 24 February 2013 - 07:47 AM

hmm, out of curiosity, does anyone else think Deangelo was limited last season in an attempt to make him look like he was not worth the salary he was going to be paid the following year as a way to get him to restructure in the off season. Crazy I Know.

#7 CRA

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Posted 24 February 2013 - 07:51 AM

hmm, out of curiosity, does anyone else think Deangelo was limited last season in an attempt to make him look like he was not worth the salary he was going to be paid the following year as a way to get him to restructure in the off season. Crazy I Know.


I think he was limited bc Cam, Stewart, Tolbert are on the roster and we like to pass the ball as we develop a real QB.

He took a backseat in 2011 which was the first year of his mega deal.


#8 CRA

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Posted 24 February 2013 - 07:51 AM

hmm, out of curiosity, does anyone else think Deangelo was limited last season in an attempt to make him look like he was not worth the salary he was going to be paid the following year as a way to get him to restructure in the off season. Crazy I Know.


I think he was limited bc Cam, Stewart, Tolbert are on the roster and we like to pass the ball as we develop a real QB.

He took a backseat in 2011 which was the first year of his mega deal.


#9 panthers55

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Posted 24 February 2013 - 07:55 AM

Makes more sense to ask the 30 yr old RB to rip up his horrible contract or be cut.

Find out if he wants to stay where he is. That IMO is what this situation screams.

From what I have read about how restructures, I don't see how we can do when that still doesn't have remaining in a horrible spot with him.

Don't think they will be ripping it up but I am no cap expert either. I figure that they have already approached Williams about the restructure and when they talk about decisions have to be made they are talking about what Williams is going to do based on what they have offered. As mentioned above there is no chance to get released before June 1 but there is quite a bit they can do to make the number go down. I could think of several scenarios on my own but I doubt they would be better than what they could do knowing the CBA as I am sure they do.

#10 CRA

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Posted 24 February 2013 - 08:12 AM

But what is the negative of asking him to rip up his deal or be cut?

Carolina actually has leverage in that talk.

1. They don't need him
2. If cut June 1, they gain cap space
3. Williams could elect to move on....only to make probably the same as what Carolina would pay him in a new deal.

Williams has no leverage if they ask him to rip it up or be cut.

#11 panthers55

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Posted 24 February 2013 - 08:49 AM

But what is the negative of asking him to restructure or be cut?

Carolina actually has leverage in that talk.

1. They don't need him
2. If cut June 1, they gain cap space
3. Williams could elect to move on....only to make probably the same as what Carolina would pay him in a new deal.

Williams has no leverage if they ask him to rip it up or be cut.


I think they already have approached him about restructuring. I just don't know what that looks like at this point.

#12 CRA

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Posted 24 February 2013 - 09:10 AM

I think they already have approached him about restructuring. I just don't know what that looks like at this point.


That post should of said what is the negative of asking him to rip up his deal.

Carolina has all the leverage and it makes the most sense IMO

#13 panthers55

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Posted 24 February 2013 - 09:14 AM

That post should of said what is the negative of asking him to rip up his deal


Since I am not DeAngelo, that is not a question for me to answer but him. He has to agree to whatever based on what he thinks his current value is.

#14 CRA

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Posted 24 February 2013 - 09:19 AM

Since I am not DeAngelo, that is not a question for me to answer but him. He has to agree to whatever based on what he thinks his current value is.


Obviously he wants money...

But does he want to move his family and start fresh at 30 simply to get it? Worth playing that card IMO if you are Carolina. He wouldn't get it in a new deal....if he is that money hungry he would accept the cut to get the guaranteed Carolina would still owe.

#15 panther4life

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Posted 24 February 2013 - 09:47 AM

Somebody correct if I am wrong but here is why we can't restructure Williams.

No matter what we have to take the cap hit of 9.6 million over the next 3 years even in the event of a restructure.

Remember, you cannot “refinance” how to amortize a signing bonus. You can’t continue to split it into smaller and smaller pieces over longer time frames. Even when you renegotiate a contract how a signing bonus was previously amortized remains on the salary cap books as originally planned.
http://deljzc.blogsp...system-101.html

He has already been paid that money so we then have to give him at least close to what he thinks he'll make on the open market in base salary in addition to that 9.6 over the next 3 years. Anywhere else he goes he can also likely get even more guaranteed money.


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