Official 2024 Free Agency Discussion

BakoSaint · 02-27-2024, 04:42 PM

Originally Posted by Rugby Saint II

Let's talk about the restructuring myth for a moment. Restructuring a contract for a five year fifty million dollars that is guaranteed is paid off at the end of the contract regardless. ML can spend $10 million each year over five years or he can give $5 million for the first four years and the balance at the end of the contract.

Restructuring contracts doesn't cost more money! It just pushes it into future years while the cap expands each year and we have free money to spend. Yes, eating a large sum at the end of a contract is hard to do while writing smaller checks in the beginning is easy to do.

Also, the cap went up $30 million this year which we got to spend last year. Let that sink in for a moment. Creative accounting equals free money.

Restructuring contracts does cost more money. If you realize after 3 years that a 5 year $100 million contract is a mistake you might get out of it after paying $60 million over 3 years. But if you restructured it every year and had to face a $40 million dead cap hit if you moved on under year 3, you may be forced to restructure the contract for year 4 to delay the $20 million due, then face even larger dead cap leading into year 5 leading to another restructure. When the contact is set to end after Year 5, you may face a $50 million dead cap hit, and instead choose to pay a backup $15 million, a 'generous pay cut' of much more than his market value. So in the end you don't pay the same you pay $115 million instead of $60 million, and as a reward you potentially block upward mobility for your players, hold roster spots for veterans you are only keeping for financial reasons, and send the message to all your stars that their jobs are safe even if their production drops and to all your younger players that there is no room for them to start because some 30-somethings contract is too big to fail.

Dead cap is much higher, and the spare salary cap space to absorb dead cap hits is much lower, under Mickey Loomis's accounting.

02-27-2024, 04:42 PM	#10
BakoSaint 1000 Posts + Join Date: Dec 2018 Posts: 2,380	Re: Official 2024 Free Agency Discussion Originally Posted by Rugby Saint II Let's talk about the restructuring myth for a moment. Restructuring a contract for a five year fifty million dollars that is guaranteed is paid off at the end of the contract regardless. ML can spend $10 million each year over five years or he can give $5 million for the first four years and the balance at the end of the contract. Restructuring contracts doesn't cost more money! It just pushes it into future years while the cap expands each year and we have free money to spend. Yes, eating a large sum at the end of a contract is hard to do while writing smaller checks in the beginning is easy to do. Also, the cap went up $30 million this year which we got to spend last year. Let that sink in for a moment. Creative accounting equals free money. Restructuring contracts does cost more money. If you realize after 3 years that a 5 year $100 million contract is a mistake you might get out of it after paying $60 million over 3 years. But if you restructured it every year and had to face a $40 million dead cap hit if you moved on under year 3, you may be forced to restructure the contract for year 4 to delay the $20 million due, then face even larger dead cap leading into year 5 leading to another restructure. When the contact is set to end after Year 5, you may face a $50 million dead cap hit, and instead choose to pay a backup $15 million, a 'generous pay cut' of much more than his market value. So in the end you don't pay the same you pay $115 million instead of $60 million, and as a reward you potentially block upward mobility for your players, hold roster spots for veterans you are only keeping for financial reasons, and send the message to all your stars that their jobs are safe even if their production drops and to all your younger players that there is no room for them to start because some 30-somethings contract is too big to fail. Dead cap is much higher, and the spare salary cap space to absorb dead cap hits is much lower, under Mickey Loomis's accounting.
BakoSaint 1000 Posts + Join Date: Dec 2018 Posts: 2,380