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The Benefits and Repercussions of
Restructuring
Author: |
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NGRUK THE OBVIOUS <ltannous@northlink.com> |
Date: |
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2000/02/10 |
Forum: |
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alt.sports.football.pro.jville-jaguars
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Example One:
Pretend you have a Carnell Lake type of player. 32 years old, career
waning, but has the experience to lend to a young defense in a Super Bowl
run. He's worth a huge paycheck in his first season with your team, maybe
the second, but as he begins to wane, you're not so sure he's worth that fat
check come his third and fourth year.
You sign him to this deal as a UFA:
5 year deal
$5 mil signing bonus
2000 salary: $1 mil .... cap hit: $2 mil
2001: $2.5 mil
2002: $4 mil
2003: $6.5 mil
2004: $10 mil
the next season, after not achieving your main goal (winning the big one),
you want to create cap room to keep your big time players and maybe bring in
one FA to make another push for the big one. you restructure this deal.
4 year deal
$2.5 mil signing bonus (only $1 mil of your original signing bonus has been
burned, so $4 mill from the original sign bonus remains to spread over the
life of this new contract)
2001 salary: $400,000 .... cap hit: $2.025 mil
2002: $3.5 mil (can't really argue for much of a pay cut here, compared
with what was set by the original deal above)
2003: $5.5 mil
2004: $10 mil
Now, after the 2001 season (remember this is all speculative and an
imaginary situation), say you don't win the Super Bowl. That was really the
goal and the reason for sticking your salary cap future out there, right?
Well, like some past salary cap era greats (SF and Dallas come to mind), you
think you have one more shot to win it all. You want to restructure again,
so that you don't again lose too many impact players and can pick up one guy
on the market.
Especially because your above 34/35 yr old player has a cap hit that is
about to jump from $2.025 mil to $5.125 mil if you don't restructure (if you
don't understand the math, just ask and i'll detail it out).
4 year deal (extend original by one year)
$3 mil signing bonus
2002 salary: $500,000 .... cap hit: $2.875 mil (you can't help the 800k
increase from last year, no matter which way you slice it, but you have
drastically reduced the effect of the potential $5+ mil hit that could have
happened this year)
2003: $4 mil (you talk aging player into a bit of a pay cut, based upon
market value for his age)
2004: $7.5 mil
2005: $10 mil
understand this third restructuring will only be done by a player who is
extremely team-friendly (like a Carnell Lake), who wants to stick with a
team that has a shot of reaching the Bowl (like you better not have lost
much in the way of quality year-to-year).
NOW... you STILL haven't won a Super Bowl (only one team a year gets it),
and you are looking at MAJOR cap trouble. WHY? Because this deal above is
an example of how you dealt with 8-10 other players on your team. The cap
hit for the above player goes from $2.875 mil in 2002 to a whopping $6.375
mil in 2003. You have 8-10 players that have similiar jumps in cap hits.
How are you going to deal with that? I mean, that's enough to get you $20
mil over the cap!
What if this player (or others) gets hurt at some point along this path and
is ready to retire, or is already getting beat out by a younger 2nd or 3rd
round draft pick?
To cut this player right now, you eat this cap hit: $6 mil
or you can cut him immediately after the June 1st switch over: $3 mil cap
hit in 2003, and $3 mil cap hit in 2004... and that for NOT HAVING a player
on your roster.
Again, multiply that cap hit by 8 other players. Figure that some of them
(like QB's and WR's) want much bigger numbers than this deal. You could be
looking at a Mark Brunell-type with a $15 mil cap hit if you cut him. What
if he's washed up like a Dan Marino? or his knees are giving out and he
doesn't want to come back? Trading him will likely give you the same cap
hit. It's trouble no matter which way you slice it.
Now, arguably, if you win a Super Bowl within that 3-4 year span, then the
trouble you'll face in the future will have been worth it. Even with the
aging vets and late round draft picks, you still might be fielding a
somewhat competitive team in the next couple of years (8-8 type teams), but
at least you'll have a ring on your finger and quite a bit more devotion
(read: $$$) from your fans (and the new ones you've created by winning in
the spotlight).
THAT would make it all worthwhile. Even the Niners can't be crying in their
milk TOO much, after having a ring from 1994 and winning seasons every year
since. Sure, they have three years of losing ahead of them, but they've got
a LOT of loyal fans still paying for those expensive season tickets.
Unfortunately, you are losing tshirt and hat sales in the meantime.
Losing wouldn't make any of this worthwhile. Losing would make this suck,
and you would have players and fans ready to dis your system every chance
they get. Look at where the Steelers are, what with Lake and Thigpen and
others trashing their way of handling things (the Steelers' system is far
different from this example, but yields pretty much the same results).
okay, that's Ngruk's Example One for today. By the weekend, i'll dish out
Example Two which will deal with younger players getting their first
contract after their rookie deals (Tony Brackens, Aaron Beasley types).
feel free to dissect and dismiss any of this, or correct my math... i did
this in a hurry. it's put out there for football discussion (flamers can
blow me... that means you, Andreas) and nothing else. i'm not trying to say
this system incurs failure or that the Jags will lose, I'm just using this
example (a simple one at that, it doesn't even include incentives) to create
discussion of the upcoming FA period.
ngruk