Cap to the Cap

[Midwest]

Hey, I have been lurking around here for a couple of weeks. I'm a member of the Bills' official site, but I have enjoyed peeking in around here for more knowledge than what actually is often offered there. Anyway, I have a couple of questions pertaining to Levy's press conference, the first of which is what this means regarding our draft selections. I don't believe our 'cash to the cap' philosophy affects draft picks. It doesn't, right? Last year, the 12th pick in the draft, Haloti Ngata, received $9.3 million in guaranteed money, and that figure should be expected to rise 10% to over $10 million one year later. So... my question is, does this further decimate the amount of money we're going to spend this off-season? $10 million, or the allocation of guaranteed money that we will have to give to whomever we draft at #12, would cut our total spending money and total spending power of $30 million by 1/3rd if the 'cash to the cap' philosophy is applicable towards our draft pick, too. Chris Brown, a beat writer for the Bills on their website (as if you didn't know that, LOL) said in a related article that the Bills' had already reserved their money for draft-picks, but it was written in an enigmatic and unclear way, so I'm confused.

 

I don't think that the $30 million includes draft picks, but even assuming it doesn't, I'm still confused. My new understanding was this. First of all, the Bills' must spend at least $93 million (85% of the cap) to meet the minimum NFL salary cap threshold and receive the lum sum of $109; we are $30-33 million under the cap, and $14-17 million from the minimum cap. Secondly, the 'cap to the cash' of $30 million dollars is obviously self-imposed and I had thought before I came on here today that the figure doesn't combine base salaries with signing bonuses. In other words, if we're going to spend $30 million, that just includes signing bonuses and NOT annual, base salaries. And we wouldn't exceed the cap with those two totals because the NFL doesn't let entire signing bonuses be absorbed by teams in one year; by league rules, it always has to amortized, or spread out evenly. So our front-office may think they're paying $30 million in signing bonuses, but $30 million in signing bonuses won't be absorbed by the salary cap. League rules don't allow it. But to be superfluous, I read a post today by Kelly the Fair Dog, and he said that the $30 million self-imposed limits DOES includes signing bonus and salary. So if we signed Derrick Dockery (5 years, $23 million; $8 million dollar signing bonus), he would potentially count nearly $12.6 million against the our self-imposed cap, depending on whether or not the annual, base salaries would be escalating. There goes 42% of the money we're allowing ourselves to spend.

 

[billybob]

The whole thing is just stupid- they should have just said they're not going to spend a lot of money FA- which I could agree with cause there is an huge amount of money chasing a very limited pool of talent- Instead they make up a new term "cash to cap" to try to confuse people - the smartest thing the Bills could do is extend their own key players and front load as many contract as possible to provide more cap room in up coming years where there may be better talent and less overall money so that the Bills money is worth more- of course that means 2007 is really another building year which no one wants to hear.

[YOOOOOO]

The whole thing is just stupid- they should have just said they're not going to spend a lot of money FA- which I could agree with cause there is an huge amount of money chasing a very limited pool of talent- Instead they make up a new term "cash to cap" to try to confuse people - the smartest thing the Bills could do is extend their own key players and front load as many contract as possible to provide more cap room in up coming years where there may be better talent and less overall money so that the Bills money is worth more- of course that means 2007 is really another building year which no one wants to hear.

 

 

 

But I think that what Marv was saying in his presser.....

He said a couple times that resigning your own guys is key and that they would only be bringing in 4-5 guys in FA....

 

If they resign Clements and sign a starting G...then bring in 3-4 fillers & resign our key depth....I would be happy going into the draft....

[Dibs]

......There goes 42% of the money we're allowing ourselves to spend.

Not if 'cash for cap' means that we spend(in actual dollars) up to the cap figure(this year $109mil). Apparently of the existing $69mil that is counted towards the cap with existing player contracts, only around $49mil is actually coming out of the coffers. This leaves an additional $20mil which we therefore could spend.

That would mean.....in your Dockery example......it would be $12.6mil out of around $50mil.....or 25% That would mean we could sign around 4 decent players.....& when you consider we need to replace NC($7mil salary)....LF($4mil salary).....& we have a very young team with only McGee($4.4mil), Schobel($5mil) & Spikes($6.4mil) with decent cap hit numbers.....and even then they are not exactly upper echelon......we should have a few new good FA acquisitions this off season.

 

I don't understand where the logic leap from......'only spending a cash amount equal to the cap limit'......became.......'only spend a cash amount equal to what you have left under the cap'. It just makes no sense the way some people here at TSW are assuming it is.

 

EDIT NOTE:-

I figured where this erroneous figure of $30mil has come from......it came from this article. Basically, MARK GAUGHAN got it wrong.....and everybody assumed the figures he gives are the true ones.

[Midwest]

But I think that what Marv was saying in his presser.....

He said a couple times that resigning your own guys is key and that they would only be bringing in 4-5 guys in FA....

 

If they resign Clements and sign a starting G...then bring in 3-4 fillers & resign our key depth....I would be happy going into the draft....

 

If I have this correctly, Clements is essentially unrealistic. If he signed a contract with us: 7 years, $60 million with an $18 million signing bonus, even if the base salarly was escalating, his contract would be absorbing $20-22 our of self-imposed ceiling of $30 million. Considering that our needs are too numerous to tackle in the draft alone, we need to sign more than one or two players in FA. Unfortunately, this is tantamount to declaring that Clements is already on the next plane to the Jets, Browns, 49ers, Redskins, Rams, Saints, etc., etc.

 

You know, for all of those who talk about building through the draft and not FA, isn't the key component that you retain the players that you drafted? Even if a CB in the Cover 2 is deemed expndable and interchangeable, I sure hope to God that there's no way in hades we lose Evans and Losman. I don't think we will lose them because the moment our team can't afford its (still early, but it's promising) franchise QB and its #1 stud receiver, is the moment we pack our things for Toronto or Los Angeles; the Buffalonian fans would rather have no team.

[Midwest]

Not if 'cash for cap' means that we spend(in actual dollars) up to the cap figure(this year $109mil). Apparently of the existing $69mil that is counted towards the cap with existing player contracts, only around $49mil is actually coming out of the coffers. This leaves an additional $20mil which we therefore could spend.

That would mean.....in your Dockery example......it would be $12.6mil out of around $50mil.....or 25% That would mean we could sign around 4 decent players.....& when you consider we need to replace NC($7mil salary)....LF($4mil salary).....& we have a very young team with only McGee($4.4mil), Schobel($5mil) & Spikes($6.4mil) with decent cap hit numbers.....and even then they are not exactly upper echelon......we should have a few new good FA acquisitions this off season.

 

I don't understand where the logic leap from......'only spending a cash amount equal to the cap limit'......became.......'only spend a cash amount equal to what you have left under the cap'. It just makes no sense the way some people here at TSW are assuming it is.

 

So you're saying that all the articles that state that 'cash to the cap' means we're going to only spend $30 million dollars (approximately the amount we're under the cap) have the figure wrong to begin with? I don't believe Levy explicitly said $30 million dollars, but I still need either corroboration that what you're saying is right and what everyone else is writing is wrong. Thanks for the reply.

[Dibs]

So you're saying that all the articles that state that 'cash to the cap' means we're going to only spend $30 million dollars (approximately the amount we're under the cap) have the figure wrong to begin with? I don't believe Levy explicitly said $30 million dollars, but I still need either corroboration that what you're saying is right and what everyone else is writing is wrong. Thanks for the reply.

It's not just me.....there have been several posters pointing out the logic of the situation in pretty much all the threads.

I've never been too impressed with the medias ability to understand mathematical principles.....especially when it is thrust upon them all of a sudden. The journalists got it wrong.......if 'cash for cap' is not spending cash up to the cap figure......what is it?

 

I guess we'll find out soon enough who is correct.....I just find it frustrating that this is causing the sky to fall.

[Midwest]

It's not just me.....there have been several posters pointing out the logic of the situation in pretty much all the threads.

I've never been too impressed with the medias ability to understand mathematical principles.....especially when it is thrust upon them all of a sudden. The journalists got it wrong.......if 'cash for cap' is not spending cash up to the cap figure......what is it?

 

I guess we'll find out soon enough who is correct.....I just find it frustrating that this is causing the sky to fall.

 

Yeah, we will find out soon enough... yet paradoxically not soon enough, too. I am ready to get this off-season started, but we're still twelve days away. Then again, once it begins, who knows? I might be hoping as strong that it hadn't started. But if what you are saying is what is true, then I am little relieved...

 

[Kelly the Dog]

It's not just me.....there have been several posters pointing out the logic of the situation in pretty much all the threads.

I've never been too impressed with the medias ability to understand mathematical principles.....especially when it is thrust upon them all of a sudden. The journalists got it wrong.......if 'cash for cap' is not spending cash up to the cap figure......what is it?

 

I guess we'll find out soon enough who is correct.....I just find it frustrating that this is causing the sky to fall.

What you're forgetting or disregarding is what Marv actually said, and where the term comes from. What he actually said was "cash to the cap". Where that term comes from is a relatively new phrase in NFL nomenclature of "cash over the cap". Cash over the cap is somewhat of a misnomer itself, but what it means is how much in actual dollars a player is paid that exceeds the salary cap in that same year. So if a player signs for 25 million for five years and gets a 10 million bonus and has a salary of 3 million a year, his cap figure for year one would 5 million, and his "cash over the cap" figure for year one would be 13 million.

 

http://www.thehogs.net/content/story.php?id=672

 

When used in team terms, "cash over the cap" refers to how much money a team in total is spending in cash and bonuses for year one, but it, misleadingly, includes bonuses from previous years counting towards the cap. Sometimes a team will spend a lot of cash and actually go over the salary cap limit in actual dollars for one year but it isn't much over, in real dollars, and they pay less in future years because of it.

 

Look at the Redskins. They don't even have any stars on their team, except perhaps Clinton Portis. They have a no big name QB or WRs unless you count Santana Moss, a couple good linemen, and a few decent defenders, with their biggest name Sean Taylor being a #1 draft pick. The idea of them throwing around so much cash they do for foolish players and then let them go. A lot of their cap money is in dead money and already paid bonuses, so their actual dollar figure in salary is relatively low.

[Kelly the Dog]

Hey, I have been lurking around here for a couple of weeks. I'm a member of the Bills' official site, but I have enjoyed peeking in around here for more knowledge than what actually is often offered there. Anyway, I have a couple of questions pertaining to Levy's press conference, the first of which is what this means regarding our draft selections. I don't believe our 'cash to the cap' philosophy affects draft picks. It doesn't, right? Last year, the 12th pick in the draft, Haloti Ngata, received $9.3 million in guaranteed money, and that figure should be expected to rise 10% to over $10 million one year later. So... my question is, does this further decimate the amount of money we're going to spend this off-season? $10 million, or the allocation of guaranteed money that we will have to give to whomever we draft at #12, would cut our total spending money and total spending power of $30 million by 1/3rd if the 'cash to the cap' philosophy is applicable towards our draft pick, too. Chris Brown, a beat writer for the Bills on their website (as if you didn't know that, LOL) said in a related article that the Bills' had already reserved their money for draft-picks, but it was written in an enigmatic and unclear way, so I'm confused.

 

I don't think that the $30 million includes draft picks, but even assuming it doesn't, I'm still confused. My new understanding was this. First of all, the Bills' must spend at least $93 million (85% of the cap) to meet the minimum NFL salary cap threshold and receive the lum sum of $109; we are $30-33 million under the cap, and $14-17 million from the minimum cap. Secondly, the 'cap to the cash' of $30 million dollars is obviously self-imposed and I had thought before I came on here today that the figure doesn't combine base salaries with signing bonuses. In other words, if we're going to spend $30 million, that just includes signing bonuses and NOT annual, base salaries. And we wouldn't exceed the cap with those two totals because the NFL doesn't let entire signing bonuses be absorbed by teams in one year; by league rules, it always has to amortized, or spread out evenly. So our front-office may think they're paying $30 million in signing bonuses, but $30 million in signing bonuses won't be absorbed by the salary cap. League rules don't allow it. But to be superfluous, I read a post today by Kelly the Fair Dog, and he said that the $30 million self-imposed limits DOES includes signing bonus and salary. So if we signed Derrick Dockery (5 years, $23 million; $8 million dollar signing bonus), he would potentially count nearly $12.6 million against the our self-imposed cap, depending on whether or not the annual, base salaries would be escalating. There goes 42% of the money we're allowing ourselves to spend.

 

Your figure for Dockery in "cash to the cap" money would be 11 million (8 mil for bonus in cash, and 3 mil for this year's salary for cash). The cash to the cap number is the cash they pay out this year, which is the total bonus and the first year's salary.

[Midwest]

Your figure for Dockery in "cash to the cap" money would be 11 million (8 mil for bonus in cash, and 3 mil for this year's salary for cash). The cash to the cap number is the cash they pay out this year, which is the total bonus and the first year's salary.

 

You're right: $23 million - $8 million = $15 million/5 years = $3 million per year (assuming the salary isn't escalating) + $8 million for the signing bonus = $11 million against the self-imposed ceiling of $30 million.

 

Sorry for the oversight, but thanks!

[obie_wan]

Your figure for Dockery in "cash to the cap" money would be 11 million (8 mil for bonus in cash, and 3 mil for this year's salary for cash). The cash to the cap number is the cash they pay out this year, which is the total bonus and the first year's salary.

 

Except fpr 2 things;

 

1. In the first year, theh base salary would be the minimum allowed under the CBA, not $3 mil.

 

2. It is likely unlikely that the Bills would pay the the entire bonus in year 1. They would guarantee the entire bonus, and maybe have to up to cover the time value of money, but would pay out the cash over 2 years. With a $23 mil contract over 6 years, the Bills would attempt to equalize the cash payments over the life of the contract more than a typical back loaded contract designed solely to maximize current cap space.

[Dibs]

What you're forgetting or disregarding is what Marv actually said, and where the term comes from. What he actually said was "cash to the cap". Where that term comes from is a relatively new phrase in NFL nomenclature of "cash over the cap". Cash over the cap is somewhat of a misnomer itself, but what it means is how much in actual dollars a player is paid that exceeds the salary cap in that same year.......

Exactly.....so 'cash over the cap' for the whole team would be how much in actual dollars the team is paid that exceeds the salary cap.

'cash to the cap' means that you don't let the actual dollars exceed the cap......you spend to the caps limit.

 

 

When used in team terms, "cash over the cap" refers to how much money a team in total is spending in cash and bonuses for year one, but it, misleadingly, includes bonuses from previous years counting towards the cap........

This is the part which you & others are assuming. Somebody made this assumption & stated it as fact.....now it is being assumed to be fact. Where.....anywhere......does it show this to be the case?

[BuffaloRebound]

In an effort to make things clearer, here was my question to Chris Brown: "In response to your cash to cap explanation, I believe you left out the other side of the amortized bonuses that are hitting the cap in 2007, which I would guess amount to $20m or so. If the Bills are truly going to be using a cash to cap philosophy, that would add $20m to the $30m figure under the cap. If the Bills are truly committed to paying $105m or so in cash to players in 2007, they will have to spend $50m more. Also, is the cap floor (I believe 85.2% in 2007) at all a concern to the Bills front office?"

 

Here's his response: "No the Bills have already factored those other amortized bonuses from previous years, and I didn't want to convolute the explanation. It's difficult enough as it is. Talking to Jim Overdorf, they are not concerned about meeting the minimum requirement for NFL teams to spend.

And no they don't have to spend $50 million more. They are spending $30M at most this year and that's it.

The best way to look at this is ignore the salary cap rules and amortized bonuses and everything and just know that when the Bills reach $30 million in base salary for 2007 and bonuses they will be done signing free agents. Hope that helps."

[Kelly the Dog]

In an effort to make things clearer, here was my question to Chris Brown: "In response to your cash to cap explanation, I believe you left out the other side of the amortized bonuses that are hitting the cap in 2007, which I would guess amount to $20m or so. If the Bills are truly going to be using a cash to cap philosophy, that would add $20m to the $30m figure under the cap. If the Bills are truly committed to paying $105m or so in cash to players in 2007, they will have to spend $50m more. Also, is the cap floor (I believe 85.2% in 2007) at all a concern to the Bills front office?"

 

Here's his response: "No the Bills have already factored those other amortized bonuses from previous years, and I didn't want to convolute the explanation. It's difficult enough as it is. Talking to Jim Overdorf, they are not concerned about meeting the minimum requirement for NFL teams to spend.

And no they don't have to spend $50 million more. They are spending $30M at most this year and that's it.

The best way to look at this is ignore the salary cap rules and amortized bonuses and everything and just know that when the Bills reach $30 million in base salary for 2007 and bonuses they will be done signing free agents. Hope that helps."

Thank you. It includes bonuses and base salary for 2007.

[DeLuca1967]

In an effort to make things clearer, here was my question to Chris Brown: "In response to your cash to cap explanation, I believe you left out the other side of the amortized bonuses that are hitting the cap in 2007, which I would guess amount to $20m or so. If the Bills are truly going to be using a cash to cap philosophy, that would add $20m to the $30m figure under the cap. If the Bills are truly committed to paying $105m or so in cash to players in 2007, they will have to spend $50m more. Also, is the cap floor (I believe 85.2% in 2007) at all a concern to the Bills front office?"

 

Here's his response: "No the Bills have already factored those other amortized bonuses from previous years, and I didn't want to convolute the explanation. It's difficult enough as it is. Talking to Jim Overdorf, they are not concerned about meeting the minimum requirement for NFL teams to spend.

And no they don't have to spend $50 million more. They are spending $30M at most this year and that's it.

The best way to look at this is ignore the salary cap rules and amortized bonuses and everything and just know that when the Bills reach $30 million in base salary for 2007 and bonuses they will be done signing free agents. Hope that helps."

 

That would be free agents (their own restricted and any unrestricted) and draft picks? Wouldn't it?

 

Also,

 

Wouldn't veterans like Spikes lower that starting $30 million dollar figure if they were released or would it raise it?

[Kelly the Dog]

That would be free agents (their own restricted and any unrestricted) and draft picks? Wouldn't it?

 

Also,

 

Wouldn't veterans like Spikes lower that starting $30 million dollar figure if they were released or would it raise it?

There is no chance it includes draft picks. Draft picks in this "cash to the cap" idea would be about 10 million of the 30 million. They said they already accounted for the draft picks. He is talking our own and other teams free agents. It counts their bonuses, and THIS YEARS salary.

[Dibs]

Talking to Jim Overdorf, they are not concerned about meeting the minimum requirement for NFL teams to spend.

I wonder what the penalty for not covering the minimum is.

[Kelly the Dog]

I wonder what the penalty for not covering the minimum is.

My guess is that they will reach it easily because they will give the free agents guaranteed money in salary and roster bonuses instead of signing bonuses. So all of the quote unquote "signing bonus" will count in cap dollars not amortized dollars like it is for all other teams. In other words, a normal contract of 3-year 12 million deal with a 6 million of it as a signing bonus and 2 mil a year salary would be, for other teams, 4 mil against the cap (2 years amortized bonus and 2 mil first year salary). For the Bills, it will be 8 mil against the cap (6 mil in roster bonus and 2 mil first year salary). They will get to the 85% figure easily this way.

[DeLuca1967]

There is no chance it includes draft picks. Draft picks in this "cash to the cap" idea would be about 10 million of the 30 million. They said they already accounted for the draft picks. He is talking our own and other teams free agents. It counts their bonuses, and THIS YEARS salary.

 

Is this fact or just your opinion?

 

Going by some unofficial numbers at BillsZone. The Bills have :

 

$46.8 is salaries

$20.1 amortized

$6.8 in other bonuses

$2.4 in what they call dead cap space.

 

Which leaves $32.1 left under the cap.

 

If these numbers are close where is the rookie money accounted for?