With the passing of the newly-minted cutoff date of May 12th; the list of Compensatory-eligible free agent signings has now closed. When the NFL decided earlier this offseason to shift the impact of “June 1st” to mid-May, it accomplished two goals.
First, almost immediately after the draft, teams are able to release players and have their accelerated dead money spread over two seasons. In the current league year, only the allocated signing bonus will count against the cap. All future allocations of signing bonus will hit on the following year’s cap.
For example, if Player A signed a four-year contract with an $8 million signing bonus, that bonus was allocated evenly over the four years at $2 million per season. If they were released after just one season, there is still $6m of unallocated signing bonus that the team has to account for in their salary caps. If Player A was released after May 12th, then $2m of that $6m would be on the 2015 cap, and the remaining $4 million would hit the next year’s cap.
Dallas opted out of using the two free passes to designating players as “May 12th” cuts this year (the CBA allowed for all teams to release two players prior to June 1st and still split the accelerated cap charges over two years as a favor to the players). This means that, at the moment, Dallas does not have any dead money on the 2016 Salary Cap. This does not, however, guarantee things to stay this way. Should Dallas release any player with multiple years left (looking at you, Brandon Carr) on their deals, then there will almost assuredly be dead money for 2016. The fact that we are into offseason workouts and this isn’t the case, is an accomplishment though.
The other goal accomplished is much more important to these “fiscally-responsible” Dallas Cowboys. Dallas had several free agents who signed with other teams this season. They signed several guys from other teams, but not as many as they lost. This imbalance is a good thing, as it means that Dallas will likely be receiving multiple compensatory picks in the 2016 draft. Now that the “window” is closed, all 32 teams can sign veteran FAs without it affecting this additional bonanza of wholesale labor (that’s what the draft is after all, acquiring players for wholesale rates instead of retail value of free agency).
Here’s the ledger of Dallas’ comings and goings of players that qualified for the compensatory formula.
|Player Lost||Contract||APY||Round||Player Signed||Contract||APY||Round|
|DeMarco Murray||5 yr/ $42 million||$8.4m||4th|
|Jermey Parnell||5 yr/ $32 million||$6.4m||5th||x||Greg Hardy||1 yr/ $5.045m||$5.045m||5th|
|Bruce Carter||4 yr/ $17 million||$4.25m||6th|
|Henry Melton||1 yr/$3.75 million||$3.75m||6th|
|Justin Durant||3 yr/ $10.8 million||$3.6m||6th||x||Jasper Brinkley||2 yrs/ $6.5m||$3.25m||6th|
|Dwayne Harris||5 yr/ $17.5 million||$3.5m||6th||x||Andrew Gachkar||2 yrs/$5.2m||$2.6m||6th|
|George Selvie||1 yr/ $1.4 million||$1.4m||7th||x||Darren McFadden||2 yr/$3m||$1.5m||7th|
|Anthony Spencer||1 yr/ $950k||$950k||7th|
The formula still holds mystery, even as the work of several have tried their best to emulate it. OverTheCap.com has done the best modeling that includes updated percentages based on the awarded picks in the 2014 draft. Bad news for Cowboys fans that have been following this series, that change reduced the bounty for losing Jermey Parnell to a 5th round pick.
These tabulations are based on an expected $153 million 2016 salary cap. A lower cap would reduce the thresholds and change which players around the league fell into which subdivision. Here are the finer points:
- Greg Hardy’s suspension as currently enforced means he will earn a maximum of $5.045m this season. If it is reduced, his cap hit will go up, and his level in the equation will rise. Interesting thing, based on these levels, if Hardy’s suspension is dropped to six games, that will barely place him above the threshold for a 4th round comp, and cancel out Demarco Murray instead of Jermey Parnell. Maybe Dallas gives him a week of practice instead of activating him right away? Would you rather have Hardy for 9 games and a 4th round pick, or Hardy for 10 games and a 5th round pick? Would Hardy's sack accrual bonuses enter into the equation down the line?
- The release of Jed Collins brought with it a fourth compensatory pick in the formula. There are ways to sign players that won’t add to the “players signed” ledger. Players who are cut from other teams, players who were RFAs or ERFAs who weren’t tendered, players signed after May 12th.
- Dallas essentially having two additional six rounders in the bag reinforces why they were ok with trading a six-rounder to select Geoff Swaim at the end of the 7th round earlier in the month.
- Players signed or lost that did not affect the formula were Sterling Moore (non-tendered RFA), Corey White, Keith Rivers and Ray Agnew (all released by prior teams).
Here are the projected cutoffs, before playing time and postseason awards are factored in:
2016 Projected on $153m cap 3RD/4TH $10,205,100.00 4TH/5TH $7,344,000.00 5TH/6TH $4,865,400.00 6TH/7TH $3,098,250.00 MINIMUM $760,000.00
- There are only 32 compensatory picks available to be spread out amongst the 32 franchises, but they are not distributed equally. Also, no team can receive more than four compensatory picks in any one draft.
- For each player a team signs, it cancels out a player that team lost. These are canceled out based on the value of the contracts. If a team loses a player valued as a third-round pick, and a player valued as a fifth round pick, but sign a player who’s valued as a third… then the team gets the fifth-round pick compensation. The third-round picks cancel out. However, if they sign a player who’s valued as a fourth, then he would cancel out the lower player, and said team would get compensated with the third-round pick.
- The primary determining factor of which round a team is compensated with for a lost player is the Average Annual Value of that player’s deal with his new team. There are levels associated with each round of compensation and teams are slotted in order within those rounds based on the averages. Playing time and postseason awards are factored in at a much lesser weight.
- The player must stay with his new team through Week 10 of the next season to qualify.
- Per @Jason_OTC, multiple players cannot be rolled into a higher compensatory. For instance, Dallas having 5 players with the last two being 6th round comps, will not move it to a 5th rounder.