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Explain this to me..Saints and the cap

Jmac

By Jmac,
in Carolina Panthers

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Jmac Grand Master

Jmac

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According to Nola.com, the Saints will be totally out of the pit before this season. 

Explain this shell game they play. They go from 100 mil.  in the hole to even up in a few months. We can't sign any body of note except JAG's and are always behind the eight ball. Whats the magic they do?

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woahfraze Collaborator

woahfraze

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From below, they apparently are only about $5MM over at this point.  No idea how they managed that with all the the restructures, but the "voidable" year stuff is probably fairly emblematic of their whole philosophy.  Due to cap inflation, it's smart to just continue kicking the can down the road.  The only reason it seemed like an acute issue this year is the cap contracted due to lost revenue due to covid.

Also from below, you can see with the new TV deals coming up, pushing money into the future, like the Falcons just did with Matt Ryan makes a lot of sense. 

https://www.theringer.com/nfl/2021/3/16/22334000/nfl-free-agency-tom-brady-taysom-hill-voidable-years

The second: It actually is financially smart to push cap charges into the future.

The NFL made less money than usual last year because of the COVID-19 pandemic. Subsequently, the salary cap figure dropped (because the cap is a percentage of league revenue). Teams have less money to spend this year than they thought—almost $30 million less than previous projections indicated. Naturally, teams want to cut salary cap costs in 2021.

But they don’t really need to cut costs; they just need to punt them into future seasons. While this is a down year for the NFL’s finances, the league is also preparing to make more money than ever before—and soon. The main way the NFL makes money is by selling game rights to TV networks. And the league is currently renegotiating all of its preexisting TV contracts. While those deals are not done yet, they are expected to almost double in price. Fox might go from paying the NFL $1.1 billion a year to paying it about $2 billion a year. Teams know their Scrooge McDuck swimming pools will have a lot more gold coins in 2022, 2023, and 2024 than they do right now, so they don’t mind backloading contracts.

Hill’s contract is a little more confusing than Brady’s. The details are still murky, but the gist is that Hill was set to cost the Saints $16 million this season, and now that the team has added four voidable years to the deal, he’ll cost just $8.4 million against the cap in 2021. Now, why the team added those four voidable years at the ludicrous cost of $140 million—money that Hill is almost certainly never going to see—is unclear. Jason Fitzgerald at Over the Cap wrote a bonkers explanation of what the Saints might be trying to do that’s worth a read if you want to dive deeper into the subject.

It’s possible the Saints have some grander strategy in mind that can help them even more cap-wise. But it’s also possible that this is (at least partially) a public relations move to appease Hill and his agents. Financially, Hill wants to be seen as a quarterback. (Who wouldn’t, honestly?) And a four-year $140 million extension—even if it’s completely and utterly fake—makes it clear he’s a quarterback.

Ultimately, though, this comes down to New Orleans needing every dollar of cap space it can get. The team was $75 million over the cap just a month ago. They have already shimmied that down to less than $5 million by cutting players and restructuring deals, but they’ve still got a ways to go. And moves like this one with Hill are how the team can franchise tag safety Marcus Williams at an eight-figure cost even when its salary cap space at the time was technically negative. If NFL contracts are like nailing smoke to a wall, then the Saints are the smoke monster from Lost.

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Captain Morgan Grand Master

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8 minutes ago, woahfraze said:

From below, they apparently are only about $5MM over at this point.  No idea how they managed that with all the the restructures, but the "voidable" year stuff is probably fairly emblematic of their whole philosophy.  Due to cap inflation, it's smart to just continue kicking the can down the road.  The only reason it seemed like an acute issue this year is the cap contracted due to lost revenue due to covid.

Also from below, you can see with the new TV deals coming up, pushing money into the future, like the Falcons just did with Matt Ryan makes a lot of sense. 

https://www.theringer.com/nfl/2021/3/16/22334000/nfl-free-agency-tom-brady-taysom-hill-voidable-years

The second: It actually is financially smart to push cap charges into the future.

The NFL made less money than usual last year because of the COVID-19 pandemic. Subsequently, the salary cap figure dropped (because the cap is a percentage of league revenue). Teams have less money to spend this year than they thought—almost $30 million less than previous projections indicated. Naturally, teams want to cut salary cap costs in 2021.

But they don’t really need to cut costs; they just need to punt them into future seasons. While this is a down year for the NFL’s finances, the league is also preparing to make more money than ever before—and soon. The main way the NFL makes money is by selling game rights to TV networks. And the league is currently renegotiating all of its preexisting TV contracts. While those deals are not done yet, they are expected to almost double in price. Fox might go from paying the NFL $1.1 billion a year to paying it about $2 billion a year. Teams know their Scrooge McDuck swimming pools will have a lot more gold coins in 2022, 2023, and 2024 than they do right now, so they don’t mind backloading contracts.

Hill’s contract is a little more confusing than Brady’s. The details are still murky, but the gist is that Hill was set to cost the Saints $16 million this season, and now that the team has added four voidable years to the deal, he’ll cost just $8.4 million against the cap in 2021. Now, why the team added those four voidable years at the ludicrous cost of $140 million—money that Hill is almost certainly never going to see—is unclear. Jason Fitzgerald at Over the Cap wrote a bonkers explanation of what the Saints might be trying to do that’s worth a read if you want to dive deeper into the subject.

It’s possible the Saints have some grander strategy in mind that can help them even more cap-wise. But it’s also possible that this is (at least partially) a public relations move to appease Hill and his agents. Financially, Hill wants to be seen as a quarterback. (Who wouldn’t, honestly?) And a four-year $140 million extension—even if it’s completely and utterly fake—makes it clear he’s a quarterback.

Ultimately, though, this comes down to New Orleans needing every dollar of cap space it can get. The team was $75 million over the cap just a month ago. They have already shimmied that down to less than $5 million by cutting players and restructuring deals, but they’ve still got a ways to go. And moves like this one with Hill are how the team can franchise tag safety Marcus Williams at an eight-figure cost even when its salary cap space at the time was technically negative. If NFL contracts are like nailing smoke to a wall, then the Saints are the smoke monster from Lost.

 

good post.  Two things....if you have your franchise qb and he's not on a rookie contract, this is the model for future NFL teams.  They cost so much money after their rookie contracts that it is very difficult to keep good players around.  When that QB is nearing the end of his career, like Brees, teams can push the money forward to give a few last shots at a ring.  The Saints gambled with the last few years of Drew's career, and they lost.  Now they face the future will little cap room, and no QB, so they'll keep drafting till they find one.

So will we, which is why Tepper is so intent on getting Watson.  We've got the future cap space available to pay him, and he's gambling on Rhule's ability to develop our draft picks rather than go shopping for big money FAs.

 

Second, while there may be an actual reason for Taysom getting the 140 mill that will never happen, I took it as a little jab at the rest of the NFL, saying,  "we know we can do this."  If that's true, it pretty funny.  Still, fug the Saints.  I'm going to enjoy watching them try to find a QB.  The next Drew Brees ain't walking through that door.

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