This week’s salary cap column continues with answering OBR reader questions. This week, the question comes from reader battershell, who asks:
I’d like to read a short overview of what the average day fan should look for in the salary cap, and why it is important. This could help as the article progresses to the more nuts and boltsnstuff which effects the Browns directly. Sometimes I think (such as was the case with Alex Mack) why should I really care how much money the Browns spend when I read their cap is huge.
Thanks for asking, battershell. First, if you want to read an admittedly not-short overview of the Browns’ basic salary cap situation and what goes into the salary cap in general, you can read this column from April. What I’d really like to address about your question is the “why should I really care” part. It’s a very good question, considering the Browns have not been and aren’t expected to be among the teams struggling with the salary cap, either to spend to meet the cap floor or to have enough money on hand to remain under the cap. It’s easy to ignore the Browns’ financial situation because nothing seems immediately compelling or concerning about it. But there is one thing about Cleveland’s salary cap and the way they spend it that should be of interest to every fan.
1. Where are the Browns spending their money? No matter how much or how little an NFL team spends in a given year, they need to be spending that money wisely. If the Browns have invested a significant amount of money in positions that aren’t performing up to their contracts, it’s a waste. Similarly, if a position is under-performing and is underpaid, are the Browns at least aware that the players at that position aren’t worth the money? Or did the Browns fail to attract talented players who could command more money?
For example, the Browns have the most money dedicated to the defensive side of the ball this year, with $86,406,073 being spent—$5 million more than the Seattle Seahawks, who have the second-highest defensive payroll. Of that, the safeties are paid least, at $12,231,002, though that could change at any time if Tashaun Gipson has his way. The defensive line, linebackers and cornerbacks all are costing the team a similar amount, in the $23 million to $25 million range. For cornerbacks, that makes sense—they are paying Joe Haden, after all, and veteran free agent signing Tramon Williams is also counting $6.5 million against the cap this year as well.
For defensive line, a group that is deep but hasn’t done much to correct the Browns’ longstanding issues stopping the run, over $25 million for 2015 seems like a lot of money. However, 12 teams have devoted more money to their defensive lines this year, and their results have been mixed in those areas as well—teams like the New York Giants, Tampa Bay Buccaneers and Chicago Bears, for example, weren’t entirely paragons of front-seven toughness in 2014.
Unsurprisingly, the Browns are one of the lowest spenders on offense this year, with a total of $60,550,673 in cap hit from that side of the ball. With three young running backs on the roster, just under $3 million is devoted to the position this year. The majority of Cleveland’s offensive cap commitments this year falls to the offensive line, accounting for nearly $29 million—and it’s money well-spent.
Knowing where the money is going is important for fans of every team, not just the ones that are cash-strapped. It’s about knowing whether the team is spending their money wisely. That also means having an understanding of the contract terms and lengths of some of the key players.
As I detailed in the article linked above, contracts need to be both team- and player-friendly, though in admittedly team-skewed league like the NFL that doesn’t offer fully guaranteed contracts, most deals are increasingly team-friendly. No team, not even ones like the Browns who have excess money to spend, want to offer one year too many to a player, nor one dollar too much. The key is to balance out the cost of a contract with the amount of time a team reasonably considers the player is able to contribute to warrant such a payout. Let’s use linebacker Paul Kruger as an example.
Kruger has one of the Browns’ highest-value contracts, having been given a five-year, $40.5 million deal in 2013 as a free agent. $13 million of this deal was fully guaranteed—his $6 million signing bonus, which has been prorated to $1.2 million per year, as well as his base salaries in 2013 ($715,000) and 2014 ($7 million). Because he was on the roster after the 2013 Super Bowl, his base salary for 2015 (another $7 million) became fully guaranteed.
Like many high-value NFL contracts, Kruger’s deal was front-loaded with guaranteed salaries. The remaining two years of his deal, though, are not guaranteed beyond the $2.4 million remaining in prorated signing bonus. This means that after the 2015 season, if the Browns aren’t interested in paying Kruger what would amount to $7.7 million in 2016 and $8.2 million in 2017, they can release him and only take a cap hit of $2.4 million next year or $1.2 million in 2017. Thus, after the dead money cap charges, the Browns would actually save $5.3 million on the cap next year and $7 million in 2017.
This way, the Browns can get a productive Kruger at the beginning of his tenure with the team—he led Cleveland in sacks in 2014, with 11—and aren’t stuck with carrying his contract in the later years if his production declines or a younger, cheaper drafted player is available to take his place. And they don’t have to keep him around simply because of the dead cap hit they’d incur by releasing him, as would have been the case just a year ago.
Knowing the structure of a player’s contract allows you to fully examine what he is actually being paid and when. It prevents the type of overreaction that is all-too common when a player’s contract information is first reported. As I have said before, no $100 million contract is every truly worth $100 million. Very few deals are played out in their entirety, especially ones that appear to have the highest values. Even though the Browns are not a cash-strapped team, again, they need to be spending their money wisely. And looking at both their positional spending and the values of individual players’ contracts are how you figure out if the Browns are spending well or wildly over- or under-valuing a player or a position group.
Much of what comes out of a team on the field is directly related to what the front office put into it, from a financial perspective. That’s why it matters how the Browns spend and on whom, even though they have no overall problems with their cap space on a yearly basis.
All financial and contract data via OvertheCap.com unless otherwise noted.