FanPost

Money… It’s a Gas

Do you think Roger Waters of Pink Floyd was thinking about NFL free agency when he wrote this ...

Money, it's a gas

Grab that cash with both hands and make a stash

New car, caviar, four star daydream

Think I'll buy me a football team

Hmmm... maybe

In Chris Hoffman's Way-To-Early BROP (https://www.buffalorumblings.com/2019/1/17/18186835/way-too-early-2019-brop ), Chris, Bozzman, and I had a discussion about free agent contract spending and the impacts on the cap in future years. It was an interesting discussion, once they set me straight on some details of the cap. J Since this discussion, I have thought a lot about our cap and free agency and I thought that this might be a good topic to shed some more light on given the Bills' looming offseason decisions.

The main question that we were trying to solve was... "Can the Bills spend aggressively this offseason without putting themselves into a bad cap situation?"

So I did some reading up on the cap and created some scenarios that can hopefully help answer that question. I am certainly not an expert in all of the nuances of the cap, but I think I have a basic enough understanding to do some high-level analysis. However, keep me honest. If you see a mistake let me know.

Some Cap Basics and Assumptions...

  • What you don't spend in one year can be carried over to the next year
  • The cap goes up every year. The average is about 7% increase each year
  • Similarly the spending goes up every year
  • The Top-51 rule: This is the rule that by the beginning of the league year (March 13th) every team needs their top-51 salaries to be below the cap
  • The Final-53 Rule: In August before the season starts, each team needs to be down to 53 players and all of their salaries count against the cap.

Cap Snapshot:

Here are the cap numbers at this point in the offseason (according to Spotrac. Over-the-Cap is slightly different, but they are close)...

ipb6t_UW9_.0.png

The Dreaded Dead Cap:

Dead Cap is basically money that counts against your salary cap for any players that are currently on your roster. There is a good article on BleacherReport (https://bleacherreport.com/articles/1566775-nfl-free-agency-a-basic-expliantion-of-the-complex-concept-of-dead-money) that lays out a typical example of how dead cap $ is created. I won't go into the details here, but basically Dead Cap is caused when a player's contract is terminated before the original contract is complete. If there is any guaranteed money in the contract (e.g. bonuses) that has not been accounted for in a current or previous year's cap, then that amount will be assessed as dead cap once the transaction is complete. A typical scenario is with signing bonuses. The signing bonus may be paid the day that the contract is signed, but the cap hit may be dispersed across the life of the contract. The typical causes of dead cap are...

  • Trading players away before their contract is up. Yes. Even though you are trading the player away, their dead cap still impacts the team trading them away. The new team does not assume that dead cap. That's why the Steelers will be hosed when they trade away Antonio Brown.
  • Cutting players before their contract is up
  • A player retires. Yep. The player retires and the team still has to take the hit.

You Can't Have it All:

Before we can truly answer the question on whether we can spend aggressively in 2019 free agency, we need reserve money for non-free agent spending. Here are the 3 main categories of non-free agent spending that needs to be reserved.

1. Rookies: We need to reserve money for signing the new draft class. Typically this is $8-$10 million depending on the number of picks you have and what round/position they were drafted. I think this year will be on the high-side. Over-the-cap predicts that the Bills draft class will be $9,752,498. The depth on the Bills is weak, so I think there is a chance that all of the 2019 draft picks make the final-53.

2. Off-Season Moves: During the offseason every team makes roster moves that impact the dead cap (e.g. trades, cuts, etc...). You need to reserve a cushion for these moves. It will happen. In order to improve your team and depth in free agency, you will end up cutting some players under contract. I am assuming that they will spend $4.7 million in cutting players that are on contract in 2019. For example, cutting Charles Clay will save us $4.5 million in salary, but it will also cost $4.5 million in dead cap. Going forward in future years, I will assume that it will be about $5 million per off-season.

3. In-Season Moves: Going into the season you cannot have $0. If you do then you cannot make roster moves. If someone gets injured, or retires, or you want to make a trade, then you have to have a cushion to make those moves. Last year the Bills spent about $3 million for in-season moves. Going forward, I will assume $4 million per year, but note that in-season moves typically impact the cap for the following year. Either way you need to reserve cap space for these moves. If you don't use it, then it carries over to next year.

So if we look at 2019, that leaves...

CWov_w_PV4.0.png

The Approach:

So now that we know how much money we really have to spend on free agents, we can look at different scenarios to see how future years are impacted. I will do a scenario where we spend all of the $57 million and then a scenario where we don't spend it all. However, in each scenario we have to consider paying or replacing guys like Tre'davious (2022), Allen (2023), Edmunds (2023), Milano (2021), Poyer (2021), Hyde (2022), Lorenzo (2020) and Hughes (2020). Some of these guys are older, so they won't be re-signed. Some of these guys will be replaced by draft picks. However, the key point is that they all play important roles on the team and they need to be replaced.

So I will build a set of scenarios out to 2022. In 2019 I will replace some players under contract in order to use my 10 draft picks. After that I will try to minimize the dead cap and try to replace players that have expiring contracts. For salaries, I will use a rough slotting of FA groups: Top, High, Mid, Low, Backup and for each Round: 1, 2, etc... I will also adjust up projected FA salaries by 7% each year.

Scenario: Spend It All!

My FA cap numbers above assume that I already have the 52 players on my roster. But if I am going to draft 10 players and use my cap to spend on some top free agents, then I need to do some adjustments. So let's just say that I am adding 10 draft picks and 7 free agents. However, that means I need to drop 16 players from the current roster because there was already 1 roster spot is already open. However, dropping players creates dead cap, so I need to adjust the cap numbers accordingly. Here are the future replacements/re-signings...

2019 Offseason:

f4KZ5xJz5k.0.png

That was hard to spend all of that money, but it was fun. It is also not very realistic to get that many top free agents to one team.

2020 Offseason:

fp7oZ972_V.0.png

We have lots of roster spots to fill in 2020. But the good news is that we only have a handful of starters that are free agents. We will have to rely on the draft picks to replace guys like Lorenzo Alexander, Lesean McCoy and Jerry Hughes. 2020 is also the year that we have to decide on whether to extend the 5th year option on Shaq Lawson or not. If we do it will cost somewhere around $10-$11 million/yr (the average between the 3rd highest and 25th highest DT in the league). I'm not sure he is worth that and I would not extend it to him. But we still need to replace him with a decent player. I need to save cap for 2022, so we can afford a Mid-Level FA.

2021 Offseason:

KkIttVdStw.0.png

Tre'davious and Milano are the big free agents in 2021. This is the year we have to go with the 5th year option for Tre'davious. He deserves and the 5th year is still probably going to be below his market value it, so we do it. But it looks like re-signing Milano at risk. We can only afford a Mid-Level contract. It is too far out to say whether that will be enough to keep him or not, but is seems reasonable to me. Time will tell.

2022 Offseason:

U0qA_w3F19.0.png

OK. This is where it all comes down to. We have to resign Tre'davious to an extension and Josh Allen and Tremaine Edmunds are up for their 5th year option. I'm predicting Josh's 5th year option will be in the $30 million range and Tremaine's will be around $18 million. Yikes! That is a lot of money. I am going to assume that they are worth it and give it to them. Most of the other spots can be covered by draft picks, but it puts these picks need to hit. They are replacing some important positions.

The Results:

Based on the above scenario, then here are the resulting cap numbers. It is very tight...

7_Li5jmriS.0.png

Does It Work?

What this proved to me is that you can theoretically spend aggressively this offseason and still manage to pay some of the future free agents. So yes, it is theoretically possible.

What Could Go Wrong?

This is a fairly ideal situation. Sure. I have reserved $9 million for dead cap each year. If they stay under that number then we are good. However, bad things can happen. It happens to even the best GMs and the best teams. Where this model starts to crumble is when players retire, players get injured, you miss on a couple of FA picks, a couple of draft picks are busts, players get lazy on their contracts and the team feels compelled to trade them or cut them. If too many of these things happen, then a team is stuck with 1 of 2 options: the team either starts accumulating dead cap and it ties their hands in future years or the team gets stuck with what I call under-performing cap. With under-performing cap, the team under performs because they have dead weight at starting positions. I don't know which is worse. Both are bad.

So What Does It Mean?

Well, this data is going to mean something different to each person. Depending on your definition of "cap jail", some would say this is "cap jail". While others would say that the Bills just had to "tighten the belt" in future years.

This analysis showed that the Bills can spend fairly aggressively, but they will have to pay the piper in future years and they may have to make some hard/creative choices.

Ultimately it may be a moot point. I don't think money will be the limiting factor for the Bills in 2019 free agency. The real limiting factor will be reality. In this scenario I picked up 4 Top free agents, 1 high-level free agent, 1 mid-level free agent, and 1 lower-level free agent in 2019. It is highly unlikely that the Bills would be able to do this. They would be the first team in the history of the NFL if they were able to pull off a year like 2019.

What this analysis also tells me is that spending is not the main concern. The main concern is choosing wisely. If the Bills choose draft picks and free agents wisely then an aggressive strategy has a chance to work. Once you botch a couple of high-priced free agents or top draft picks, then it starts going bad quickly.

Personally, I would not be as aggressive as this scenario. In general, aggressive strategies like this work if your team is already good and you can afford take some risks. But I would not be timid either. You don't get awards for accumulating cap space. It is all about balance and assessing the talent. If a player is truly transcendent or will put you over the top, then I would consider over-spending. If not, I would look for value to build up the core of my team.

My strategy for the Bills would be to spend less in 2019: 1 or 2 Top FAs and then some Mid-Level FAs. And then spend slightly more in 2020. This strategy would give the Bills more money going into 2022 when Josh and Tremaine are due for new deals. This strategy would also give us a cushion so that if a Khalil Mack-type trade came along, we could jump on it.

That's how I would "buy me a football team".

What would you do?

Just another great fan opinion shared on the pages of BuffaloRumblings.com.