'Dead money' could come back to haunt Redskins
The War Room /
Posted: 18 minutes ago
Another year, another spending spree by Daniel Snyder.
His current haul includes Clinton Portis, Mark Brunell and Shawn Springs, with the signing bonus tab coming to $45.5 million on five players. Somehow, the Redskins seem to be able to spend endlessly, the salary cap be damned.
What does Snyder know that the other NFL owners don't? Nothing. It's what he doesn't know — or fails to acknowledge — that eventually will be exposed.
Daniel Snyder started his off-season shopping spree by luring Joe Gibbs out of retirement. For a detailed look at the Redskins' salary situation, see Charting the Redskins.
Associated Press
What Snyder does know is that players are for sale. And for them, it's all about the cha-ching — signing bonuses, cash money, guaranteed. That bit about winning the thing that rhymes with cha-ching — the ring — is secondary. If not, why wouldn't all free-agent visits start and end in New England?
Snyder wants to win, and he's not afraid to spend like George Steinbrenner to do it. It takes players to win, and Snyder, like Steinbrenner, is buying them. The difference is that, in baseball, an owner can spend freely as long as he's willing to pay a luxury tax. The NFL, however, has a hard salary cap, and the time will come when a team's "cap credit" maxes out. It's just a matter of when.
NFL teams can get away with big spending in the short term. For instance, of the $45.5 million the Redskins have spent on new signing bonuses this year, only $7.6 million is being charged against the 2004 salary cap of $80.6 million. They spent $20 million in signing bonuses on two free agents a year ago and were charged only $3 million against the 2003 cap.
So where did the $37.9 million in 2004 and the $17 million in 2003 that wasn't charged against their cap go? It went into future years, deferred through the proration of signing bonuses.
Consider Brunell, who was obtained in a trade with Jacksonville and signed to a seven-year, $43 million contract. That deal affects Washington's salary cap in two general ways — allocatable bonuses and current-year cap charges.
Brunell's signing bonus was $8.6 million. That amount is prorated equally over the years of his contract, although there are limits to the bonus allocation. His contract is for seven years, but his bonus can be allocated for only six years (through 2009), because that's the number of years allowed under the terms of the NFL collective bargaining agreement. Next year, bonus allocations will be limited to five years, and so on. This shrinking allocation period will give teams less room to maneuver in future years, but for now the Redskins can get away with taking only a $1.433 million hit this year on Brunell's signing bonus.
Current-year cap charge items include base salary, roster bonuses, workout bonuses and report bonuses. There are no cap deferments with this money; these amounts are charged in full each year, as specified in the contract. Because of Brunell's large signing bonus, the team was able to pay him a cap-friendly base salary and roster bonuses in the first two years. Brunell will receive only $760,000 in 2004 and $2 million in 2005.
Brunell's total take in cash from the Redskins will be $9.36 million in 2004, but his cap charge will be only $2.193 million (signing bonus allocation of $1.433 million, plus base salary of $760,000). His deal remains cap-friendly in 2005 with a charge of $3.433 million ($1.433 million plus $2 million). The cap problems will begin in 2006, when his base salary jumps to $4 million, creating a cap number of $5.433 million. Due to base increases, his cap numbers will climb to $6.6, $7.8 and $9 million in the next three years through 2009. However, if the Redskins terminate his contract before it expires, he'll never see the base salaries or roster bonuses for the remaining years, and the team will take no salary-cap hit for these items.
It's the bonus allocations that cause trouble when a player is released or traded. That money automatically is accelerated into the current cap fiscal year. (The acceleration may be allocated over two years if contract termination occurs after June 1 of any given year.) Either way, the team's salary cap is saddled with "dead money." If the Redskins were to cut Brunell after this season — certainly a possibility considering he will be 34 in September and has a history of injuries — he would count $7.2 million against the Redskins' 2005 cap in dead money. If they were to terminate his contract before the 2006 season, he would count $5.8 million against the 2006 cap in dead money.
And that's just Brunell. Snyder has been signing players to similarly structured deals the past several years, essentially acquiring today's free agents with tomorrow's cap space. This "cash-over-cap" approach was used heavily in the past by teams that felt they were close to winning and made a push to get over the top. Deion Sanders was part of such plans on three occasions — with the 49ers, Cowboys and Snyder's Redskins. In each case, Sanders was given a large signing bonus that was allocated over a greater number of years than he was on the team's roster. And in each case his contract termination, dictated by a salary-cap roster purge, left behind large amounts of dead money.
Apparently, Snyder hasn't learned his lesson. The Redskins, already stuck with $7.2 million in dead money for 2004 that was spent on such players as Dan Wilkinson and Bruce Smith, are locked into paying the signing bonuses of Brunell, Portis and Co. The excessive prorations ensure the Redskins will be capped out in three to four years — and the process will be accelerated if any of their new players' contracts are terminated early because of injury or erosion of skill.
There's nothing wrong with Snyder's goal of winning a championship right away. But his window of opportunity is small. It won't be long before he'll lack the cap room to keep his own players, much less add new ones, and he'll be forced into a major dismantling of his roster.
Can you say Deadskins?
How professional is that? The "War Room" calling us the deadskins. How original!
http://www.foxsports.com/content/view?contentId=2232640
) ... They transitioned to DC (and in some respects, rightfully so) due to the spending sprees with no results on the field. He!!, even Jay Leno made jokes about the Burgundy and Gold last season. It's gonna be hard for them to let it go esp. since ON THE SURFACE it looks like the team is par for the course with the free agent spending.
