The Difference between Financial Flexibility and Cap Room

I want to clarify something based on the Redskins-related hysteria that has taken root within our fanbase regarding the ability of the Redskins to spend in the upcoming NFL free agent period.  The hysteria has been based on multiple salary cap reports, including a recent one from Hog Heaven.

What is absolutely true is that the Redskins will have an extrordinary amount of financial flexibility to spend on player contracts.  They can throw money around and structure the contracts to defer heavy payment until the future.  They will have a larger pool of potential targets than previously thought in 2011.

But, unless the Redskins are released from their deadcap obligation in 2011, it is not true that the Redskins will have an abundance of salary cap money left over.  Why is this relevant?  Over at Hogs Haven, Parks Smith is running a really cool Community GM series where the idea is that a majority-rules principal is being used to make decisions on free-agent expedatures.  The contracts have been broken down in such a way that the Redskins are charged a first year cap figure based on the total contract sized, and that figure is subtracted from the total available cash to show exactly what the effect of a contract will be on the Redskins budget in 2011.

Based on the size of the team’s budget, and the available cash they have to spend, I think this is a really cool exercise.  Tony keeps telling me that he isn’t not paying me to sit idly by while people like Mr. Smith have all the really cool ideas that engage blog readers (particularly of Redskins blogs) in interactive exercises regarding the future of the Redskins that illustrate a point.

I do want to point out the issue with the idea that the Redskins can add up to $66 million in cap dollars this year.  There’s just no way to bend the numbers where this figure will be within $25 million dollars of accurate, short at least of assuming the reality of the Redskins being relieved of all dead cap obligations.  While the players would certainly agree to such relief, there just isn’t a lot of other owners who would join the Redskins in their push to have prior deadcap ignored under the new CBA.  I think the safe assumption is that it stays.

One problem is the simple allowances for the players who are listed on the Redskins roster, but aren’t under contract.  It’s hard to assume the total value of these allowances, but I think $4 to $9 million is safe range.  Then you have the rookie cap in excess of this.  The rookie cap will certainly not exceed $5.5 million.  Conservatively, you can say allowing $10 million for unsigned players gets you to 53.  The free agents that will comprise this group will cost more than that, but the allowance doesn’t need to cover expendatures over the minimum.  If I say $12 million, that’s a conservative figure considering there are players who will come off the books as soon as the league year starts (like Santana Moss).

So there’s that $12 million.  Then there’s the already $25 million in deadcap — minimum (unless relieved by CBA agreement) — the Redskins will occur for accelerated releases of Moss, Portis, Dockery, Carter.  That’s unavoidable.  And there are salary cuts the Redskins can or will make that will add to both the dead cap total and the available cap space.  So whether you ballpark the Redskins team salary going into the offseason at $35 million under the cap, at $45 million under the cap, or really conservatively at $30 million under, you know that somewhere between 40 and 60% of what is already available is going to be deadcap.  The HH estimate allows for $27 million saved in future cuts, and also doesn’t consider the portion of that which will become deadcap.

60% of 45 million is 27 million, and 40% of 30 million is 12 million.  In terms of cap space after deadcap, the Redskins are going to be anywhere between $15 million on the super-optimistic end, and $7 million on the hyper-pessimistic end (both estimates ignore the ability of the Redskins to get away from existing contracts for more cap space).  The big point here is that the Redskins figure to have a ton of money to play with in order to get a bunch of parts in free agency.  And their available cap room probably will be in excess of $15 million after the Redskins move McNabb, perhaps Haynesworth, Hicks, Rabach, Kemo, et al.  They have that kind of flexibility where the obscene deadcap just doesn’t mean all that much.

What’s abundantly clear is that even if the Redskins totally tear the roster apart and free up the max cash possible (saving net $10 million on McNabb, $3 million on Haynesworth, $1 million on Kemoeatu, $1 million on Rabach, 1/2 million on Sellers and Phil Daniels, a tiny net loss on Hicks and Mike Williams each), the Redskins are realistically in the $20 million range in available cap room after deadcap.  That is a LOT of money, and the CBA is going to require the Redskins to spend a majority of it, and there will be premier free agents in it.  But $66 million in cap space?  That’s at least three times too much.  The bottom line is you’re looking at maybe 3 need-filling free agents, supplmented by a number of $1-$1.5 million single year or two year contracts to veterans who can help the Redskins win in 2010 (think Grossman or Phillip Buchanon).  There isn’t enough cap space to choose a free agent at every position.

All that said, you do owe it to yourself to go vote for the wide receiver you want the Redskins to sign.  It’s fun.  I voted for Sidney Rice.

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