[Overthecap] Minimum Cash Spending in 2020

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https://overthecap.com/minimum-cash-spending-in-2020/

 

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Minimum Cash Spending in 2020

Posted on January 30, 2020 by Jason Fitzgerald

 

With free agency rapidly approaching one of the questions I am getting pretty often these days is about the spending requirements in the CBA. For those unfamiliar with the NFL CBA there is a rule that requires teams to spend at least 89% of the salary cap over a four year period. The current period, which began in 2017, ends this league year and could give some idea as to who will spend this year on contracts.

 

Though our cash numbers that we trace are not going to be 100% accurate they should give us a pretty strong estimate of the teams that are in danger of not meeting the 89% threshold. Through last season we did not have any teams that were under $473.9M in spending, which was the mark required to be on pace to hit the 89% mark. The teams that were closest, the Cowboys, Ravens, Colts, and Chargers were all between $477M and $485M. There is a quirk in the rules that could impact teams in cap trouble (spending on bonuses in contracts in February of 2017 should not count towards spending but we track them as cash for the year)  which means maybe the Cowboys and Ravens were slightly under but if it’s the case it should not be by much.

 

Assuming the cap reaches $200 million this year the four year spending number will jump to $651.8M. Per our estimates we have 11 teams that are under that mark. Of those 11, six should be compliant just by signing their draft picks. Those teams are the Cardinals, Buccaneers, Patriots, Giants, Broncos, and Dolphins. That should leave us with six teams that may have little choice but to spend in free agency this year. Let’s take a look at those teams.

 

Colts, $43M under– The Colts have pretty much avoided spending in free agency the last few years even with a huge surplus of cap space.  Last year when the unexpected retirement of Andrew Luck came down and the team surprisingly did not ask him to repay millions in bonuses paid just months before the retirement and then followed it up by a seemingly crazy decision to agree to a one year, $28 million extension for Jacoby Brissett I surmised that the team was going to be so far under the spending limit that both decisions were in part driven by this. Seeing how far under they are now I think backs that up. Indianapolis will likely make up half of their shortage in the draft but they will most likely have to finally go out and spend at least a bit in free agency this year especially if they do not keep tackle Anthony Castonzo. The Colts may not want to get tied down to anyone for too long so this may wind up being the landing spot for “rehab” projects that take a one year deal in the hope of improving their stock.

 

Cowboys, $45 million under- Despite what most people think of the Cowboys they have basically managed a low cost roster for years now. They have a reputation for spending wildly but the fact is they have not really signed a notable free agent in ages. They should hit this number with two tags this year on Dak Prescott and Amari Cooper. Even if Cooper signs elsewhere just the tag for Prescott should be enough since they have other free agents to sign plus $14 million in draft pick bonuses to pay out. So I would not expect them to be forced into anything in free agency.

 

Ravens, $47 million under– Between a tight salary cap and a cautious approach to extensions and free agency the Ravens have been one of the lowest cost teams in the NFL. Certainly this year they got the most bang for the buck with a low cost team that outperformed all expectations going into the season. The team will probably spend around $15 million on draft picks so they are still well under. This is likely part of the reason why rumors are circulating that the team is considering franchising Matt Judon. A tag for Judon would cost around $16 million and put them much closer to the number. Even if the tag was simply just to trade him part of that logic I am sure is that the most they could receive as compensation is a 3 and that would require extra care in free agency something they couldn’t pull off last year with Za’Darius Smith.  The Ravens did increase payroll last year (they went from being close to the lowest spending team in the NFL for 17 and 18  to around 20th in 2019) and did sign Earl Thomas and Mark Ingram but if there was a year for this team to be even more active in free agency this is probably the year. This is probably a logical spot for some veteran players to chase a ring.

 

Chargers, $48 million under– The Chargers have more or less been resigned to the fact that they were not going to be a legit competitor last year only adding veteran Thomas Davis and backup QB Tyrod Taylor as UFA’s last season. The team will spend $25 million on their first two draft picks alone so its around $20 million they need to spend. I could see this going one of two ways. Either the team signs a few veterans and someone like Marcus Mariota to just hit the minimum spending number or they try to make a splash for their move and go after either Tom Brady or Drew Brees (I personally cant see Brees leaving the Saints but you never know) , tag tight end Hunter Henry, and actually spend quite a bit in free agency to compete. I see this as one of the more fascinating teams in free agency this year that could stun some people with their decisions.

 

Bills, $53 million under– Buffalo had to go into a spending freeze due to the mess that the roster was a few years ago and just started to spend a bit last year as they came out from it. The team will only cover around $16M in draft pick spending so the Bills look to be a hit destination for free agents. The team has a huge surplus in cap space so they can probably structure a number of contracts favorably to maintain flexibility after 2021. Buffalo hasn’t signed a notable free agent in ages and I could see that changing this year. While I don’t think anyone is sold on Josh Allen as the guy this is the window to take advantage of his contract so if there is a time to take more risks its 2020 for Buffalo.

 

There are a few other considerations this year for some of these teams. If they were to extend or restructure players after the season (February 2021) or late in the season signing bonuses should count to help teams meet the number. If the CBA is not extended there are rules that would make it more difficult to do (i.e. extending a Josh Allen in February might not be the easiest thing to accomplish) but it is another route to hit the necessary spending.

 

The other big question is how do teams approach contracts now that the CBA could expire? I think this year’s free agent group is very strong and we should see a record number of double digit annual contract values being signed but since most teams don’t need to spend will they see this as an opportunity to try to break the union? 

 

The last time the CBA was set to expire spending hit record lows relative to the salary cap. In part that was because of rules (free agency was more restrictive in 2010 with a number of UFA’s being classified as restricted) but if you want to break any potential strike one of the ways to do that is to not be aggressive in free agency. This week we have seen reports of the NFLPA attempting to advise the players as to how much it would really cost to strike and if there is a thought that this could occur teams may “independently” come to the same conclusion that overspending in 2020 is not wise which could make for a very different free agent period.

 

 

So, in order to make it to the minimum required spending over the 4 year period, the Colts will need to spend about 43M for this coming season in free agency. This might include re-signing AC or a number of other free agents. There is no team in the past that has failed to reach the minimum spending requirement. Note - this is the minimum, not the max we can spend.  In other words I would expect Ballard to actually give out some money this summer. Maybe he won't go crazy with it, but it seems like a fair bet that he won't be as frugal as last year. 

[Restinpeacesweetchloe]

So there are teams that need to spend more then the colts.

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Just now, Chloe6124 said:

So there are teams that need to spend more then the colts.

yes. 

[Hoose]

Assuming Castonzo signs, that probably takes the number down below $30 m. They won't have to spend as much as I thought, but as you said, Stitches, they can go well above that minimum number. I expect them to do that. 

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8 minutes ago, Hoose said:

Assuming Castonzo signs, that probably takes the number down below $30 m. They won't have to spend as much as I thought, but as you said, Stitches, they can go well above that minimum number. I expect them to do that. 

To be fair, the author of that piece later explains why teams usually refrain from going on shopping sprees the year the CBA expires. So... even though we might spend some, I'm not really expecting us to go ham with it. 

[EastStreet]

22 minutes ago, stitches said:

https://overthecap.com/minimum-cash-spending-in-2020/

 

 

So, in order to make it to the minimum required spending over the 4 year period, the Colts will need to spend about 43M for this coming season in free agency. This might include re-signing AC or a number of other free agents. There is no team in the past that has failed to reach the minimum spending requirement. Note - this is the minimum, not the max we can spend.  In other words I would expect Ballard to actually give out some money this summer. Maybe he won't go crazy with it, but it seems like a fair bet that he won't be as frugal as last year. 

Thanks for posting!

Many have been saying similar, but this puts things in very good perspective.

 

Honestly, I hate being one of the teams forced to spend to hit the minimum. 

And re-upping with AC isn't going to be a major hit, as we're already paying him a decent amount. Sure he'll get a decent raise, but it'll likely only be 4-5M a year more. 

 

I really hope they spend on a DL FA. We can certainly afford it.

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2 minutes ago, EastStreet said:

Thanks for posting!

Many have been saying similar, but this puts things in very good perspective.

 

Honestly, I hate being one of the teams forced to spend to hit the minimum. 

And re-upping with AC isn't going to be a major hit, as we're already paying him a decent amount. Sure he'll get a decent raise, but it'll likely only be 4-5M a year more. 

 

I really hope they spend on a DL FA. We can certainly afford it.

Yep, DT is the position I want us to go in free agency. It's the position that gets somewhat undervalued by the league, but at the same time the 3T is the position that according to Ballard and other Tampa 2 experts is one of the most important for the scheme to work. 

[Hoose]

2 minutes ago, stitches said:

To be fair, the author of that piece later explains why team usually refrain from going on shopping sprees the year the CBA expires. So... even though we might spend some, I'm not really expecting us to go ham with it. 

I don't expect Ballard to go crazy either, but if the right piece is there, I think he'll pay the money....such as a DT who can improve the pass rush. 

[Hoose]

1 minute ago, stitches said:

Yep, DT is the position I want us to go in free agency. It's the position that gets somewhat undervalued by the league, but at the same time the 3T is the position that according to Ballard and other Tampa 2 experts is one of the most important for the scheme to work. 

Looks like we agree on the DT. Here's hoping.

[EastStreet]

11 minutes ago, stitches said:

Yep, DT is the position I want us to go in free agency. It's the position that gets somewhat undervalued by the league, but at the same time the 3T is the position that according to Ballard and other Tampa 2 experts is one of the most important for the scheme to work. 

I wouldn't say it's devalued by the league. NT is to an extent. DE is the 3rd highest average, and 2nd highest max. Interior DL is right in the middle on both, and it's really impacted by a lot of low paid NTs. A lot of top 3Ts are on par with top DEs. I've linked a chart below.

 

The bolded is spot on, which is why I've been a proponent the last few years of drafting a 3T high. I'm even good with a NT high if he has legit pass rush skills. A bad-xxx 3T would have a huge effect on our D and would certainly make our DBs look a heck of lot better. 

 

There are several NTs in FA that I'd take a look at. I'm happy with Grover's play on early downs but would still like to upgrade with a late down NT just from a rotational perspective. There's a few DTs too, but the ones I like are older, so think we still need to draft there. 

 

Regardless, definitely need some upgrades in the interior. 

 

 

[NewColtsFan]

49 minutes ago, stitches said:

Yep, DT is the position I want us to go in free agency. It's the position that gets somewhat undervalued by the league, but at the same time the 3T is the position that according to Ballard and other Tampa 2 experts is one of the most important for the scheme to work. 

Undervalued?    Is that what you meant to say?

 

Can you elaborate?   I’d like read your reasoning on that perspective....

 

Many thanks.