Why Roseman isn't concerned about millions in dead money

 

 

 

Reuben Frank

EAGLES INSIDER

The dead money keeps piling up, and Howie Roseman couldn't care less.

It's all part of the plan.

Roseman, speaking Monday at the NFL owner’s meetings in Palm Beach, Fla., explained why the Eagles’ growing stack of salary cap dead money actually makes sense.

As of now, the Eagles have $36,149,164 in dead money counting against their adjusted 2022 cap figure of $224 million, according to Spotrac. Some of this is accidental dead money - from players they released or traded before their contract was up (Zach Ertz, Malik Jackson, etc.) - and some is intentional dead money - from players who had void years written into their contract for the sole purpose of spreading out their cap hit (Alshon Jeffery, Derek Barnett, etc.).

What is dead money? In simplest terms, base salary in a player contract counts entirely against the cap in the year it’s paid, but the signing bonus is spread out equally over the life of the contract.

Using salary cap trickery, teams have the ability to carve out current cap space by adding void years to contracts, which moves money from the current cap to future caps.

So teams end up with significant cap hits in future years from players who have long since left the team.

Why does this make sense?

Roseman for the first time ever went into great detail explaining the team’s thinking in regard to dead money.

He used home ownership to help illustrate his point.

"It’s no different than – and I’m stealing this from Bryce [Johnston], our cap guy, so I’m not taking ownership of it – but it’s no different than when you’re trying to buy a house,” Roseman said. "If you have the opportunity to buy a house and put all the cash down or the interest rates are really good and you’re going to pay it over time, why wouldn’t you use that money now and understand that as it goes forward you’re going to be able to do that? 

"It’s the same money. If I give somebody $10 and I decide to prorate it, it’s the same $10 that’s going to affect my cap the same way, but if I’m doing it where the value of the cap is not $100 but now it’s $150, why wouldn’t I want to take it in those times?”

In other words, a $10 cap hit when the cap is $100 represents 10 percent of your available cap space. The exact same $10 cap hit when the cap is $150 represents only 6.7 percent of your available cap space.

So move the cap hit forward and the same amount is a lower percentage of your total cap.

Even with a temporary drop in 2020 because of COVID, the NFL’s unadjusted cap has increased from $123.6 million in 2013 to $208.2 million this year, an average increase of about 7 ½ percent. Current estimates – based on projected TV revenue increases - are that the cap will increase to $328.2 million by 2027, which would be an 11 ½ percent increase over the next five years.

"It’s all the same amount of money,” Roseman said. "It’s just when you choose to do it. From our perspective, it felt like the way the cap is going to go going forward, it made sense to have the option to take it in future years.”

The Eagles found themselves in serious cap trouble in 2021, mainly because COVID affected revenues so much in 2020 that the cap unexpectedly dropped from about $198 million in 2020 to just over $182 million in 2021.

"One of the reasons we were so aggressive with (Darius) Slay and (Javon) Hargrave was because we felt like the cap was going to up,” Roseman said. "Definitely did not think there was going to be a pandemic in the world. My fault. Definitely my bad. So that kind of set us back a little.”

Those were some seriously extenuating circumstances. Roseman is confident the Eagles’ policy of kicking the can forward will never hurt the product on the field.

Because even with all their dead money, the Eagles usually wind up with more cap space than most teams, not less.

According to Spotrac, the Eagles currently have the 5th-most 2022 dead money of any NFL team. But they have the 3rd-most cap space at $22.12 million.

"Coming out of (2017 and 2018), trying to be aggressive, we knew at some point we were going to have to take a step back, we were going to pay it, but I would do that 100 times out of 100 times,” Roseman said.

"If you said to me in the next five years we’re going to go to the playoffs four of the five years, we’re going to win one World Championship and then we’re going to have a horrible, (crappy) year, would I sign up for that? Yes? Where do I sign up for that?"

https://www.nbcsports.com/philadelphia/eagles/why-eagles-gm-howie-roseman-isnt-concerned-about-massive-salary-cap-dead-money

Very interesting. Shows there are two sides to a story and hopefully helps some of those Howie haters understand "kicking the can down the road" is not incompetence, it' a strategy. Whether any of us agrees or disagrees with it, this article shows there is thought behind what the Eagles do and are doing. 

Finally, it'snice to see a very balanced article from a Philly writer. Hats off to Roob. 

I get Howie's point about the proportional impact being reduced as the hit is moved forward, and it does reduce the hit, but the best strategy is not accumulating a pile of dead money in the first place. I'd rather they front load long term contracts. That way, they can add more great players on top of their franchise guys, as the natural increase in the cap accounts for the first player's diminishing cap hit. It's a great way to construct a dominant roster, especially during a rebuilding phase like this one they're currently in. Also, if they do have to let a guy go, his cap hit is minimal.

8 minutes ago, PoconoDon said:

the best strategy is not accumulating a pile of dead money in the first place.

This. Howie must read these boards, he's making excuses for his poor contracts.

 

I actually do agree with Howie here. It is, to some extent, logical. The cap goes up so prorating a cap hit makes sense as in the future it'll make up less of your overall cap. It is logical but what we are looking at here is a dead cap that is very high and just keeps going up. And Howie restructures older guys who we end up paying for who aren't on the roster. That's my issue with it. 

And look at our position this year. We have 3 first round picks. Let's assume we make all 3 in the first round. In 4-5 years time those guys hopefully have worked out and we want to extend them. Plus hopefully we will have a franchise QB by then. That's a whole lot of cap needed. 

3 hours ago, UK_EaglesFan89 said:

I actually do agree with Howie here. It is, to some extent, logical. The cap goes up so prorating a cap hit makes sense as in the future it'll make up less of your overall cap. It is logical but what we are looking at here is a dead cap that is very high and just keeps going up. And Howie restructures older guys who we end up paying for who aren't on the roster. That's my issue with it. 

And look at our position this year. We have 3 first round picks. Let's assume we make all 3 in the first round. In 4-5 years time those guys hopefully have worked out and we want to extend them. Plus hopefully we will have a franchise QB by then. That's a whole lot of cap needed. 

you heard it here first folks the world is ending 

8 hours ago, Cheesteakitis said:

you heard it here first folks the world is ending 

You better believe it!

Dead money on Fletcher Cox, Zach Ertz, Hargrave, Slay...I get.  Those guys needed to be signed to their 2nd deals, traded, etc.  If you want to get clever with spreading that out, feel free to kick that can.

Dead money on Wentz, Brooks, Jeffery, the Jacksons...that's just paying the price for terrible decisions.

48 minutes ago, eagle45 said:

Dead money on Fletcher Cox, Zach Ertz, Hargrave, Slay...I get.  Those guys needed to be signed to their 2nd deals, traded, etc.  If you want to get clever with spreading that out, feel free to kick that can.

Dead money on Wentz, Brooks, Jeffery, the Jacksons...that's just paying the price for terrible decisions.

I wonder how the volume of those terrible decisions compare to other teams ... are they about the same and as fans we tend to blow out of proportion how bad of a job he is doing or is he performing much worse than many of the other GMs.   

On 3/30/2022 at 7:15 AM, time2rock said:

"It’s the same money. If I give somebody $10 and I decide to prorate it, it’s the same $10 that’s going to affect my cap the same way, but if I’m doing it where the value of the cap is not $100 but now it’s $150, why wouldn’t I want to take it in those times?”

In other words, a $10 cap hit when the cap is $100 represents 10 percent of your available cap space. The exact same $10 cap hit when the cap is $150 represents only 6.7 percent of your available cap space.

I don't care what anybody says here, this is kind of a deviously brilliant plan.  The salary cap should keep going up, so what looks like a lot of dead cap ends up not being nearly as bad as you'd think.  Some baseball teams do this with deferred money, like I will give you all of your money but it is going to take some time.  I think it's a great move, and I also don't care about dead cap.

18 hours ago, PoconoDon said:

I get Howie's point about the proportional impact being reduced as the hit is moved forward, and it does reduce the hit, but the best strategy is not accumulating a pile of dead money in the first place. I'd rather they front load long term contracts. That way, they can add more great players on top of their franchise guys, as the natural increase in the cap accounts for the first player's diminishing cap hit. It's a great way to construct a dominant roster, especially during a rebuilding phase like this one they're currently in. Also, if they do have to let a guy go, his cap hit is minimal.

Of course, but if you don't have a ton of cap space this year, but you have a pretty good team with somebody that you think can put you over the top, why not use this as another way of making your team better?   Or,  on the flip side, if you have a guy like Jason Kelce and you want to pay him what he's worth but can't afford that under the cap, why not use it?  I don't think Howie uses this recklessly, but he does use it to make sure we keep and pay our own players.  Howie has been consistent about that.  If you play well, you will be rewarded.