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Interesting Salary Cap Article

weymouthst

By weymouthst,
in Carolina Panthers

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weymouthst Newbie

weymouthst

Posted
Posted

Article Here

Explains some of the new Salary Cap measures. As well as the NFL having a "soft" cap, some things about "cash over cap," and the "minimum myth."

Quick quotes:

We hear about a “hard Cap” in labor disputes, with NBA Owners desperately trying to “harden” their Cap, even pointing to the NFL as a model. However, while thought not as “soft” as the NBA version, the NFL is still a soft cap -- a “yarmulke”, if you will.

How soft? In the last capped year, 2009, while never being “over the Cap” of $123 million, teams like the Cowboys and Raiders had cash spending of over $150 million!

How does this happen? Signing bonuses are treated in different ways for cash and Cap: (1) for cash purposes, they are treated as fully paid, regardless of deferrals; and (2) for Cap purposes, they are prorated through the life of the contract.

As an example, Charles Johnson of the Panthers received a $30 million signing bonus on a six-year deal. It is treated as $30 million for cash purposes in 2011, yet due to Cap proration of signing bonuses, only $5 million for Cap purposes in each year between 2011 and 2016. Were Johnson to be released or traded prior to 2016, the $5 million of annual Cap charges would accelerate immediately into the then-existing Cap.

^We better not get rid of CJ.

Decent read, thought some of you would be interested.

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