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Thread: Thank God we are under the cap.
Thank God we are under the cap.
By Len Pasquarelli
Most fans couldn't care less about the collective bargaining agreement and, justifiable or not, view any discussions of negotiations aimed at extending labor peace through the 2013 season as just another example of the avaricious nature of already overpaid players.
By Thursday, however, when the real-world ramifications of the failed labor talks become more apparent, fans in a lot of NFL precincts will take notice. With negotiations toward an extension having broken off Tuesday afternoon -- despite earlier optimistic reports that the sides were poised to strike an agreement -- salary cap managers from several franchises are readying themselves for what one general manager suggested late Tuesday will come to be known as "Bloody Thursday."
Translation: Because so many teams are up against the projected cap limit of $95 million to $96 million for 2006, and the lack of a CBA extension means there are few options for relief, some big-name players will be jettisoned by Thursday, when teams must be in compliance with the spending limit.
"In past years, you'd see a lot of guys released who maybe still had some name value, but who were really in decline in terms of production," said one AFC team executive who was working late Tuesday, trying to figure out how to pare down a prohibitively bloated cap figure. "This year? People are going to be stunned -- not just by the quantity of players who are cut by Thursday, but by the quality, too. It's going to be ugly. There's going to be blood in the streets and, compared to past years, it's going to be from some bluebloods, guys who can still play."
For a few hours into Tuesday night, after word broke that NFL Players Association executive director Gene Upshaw had departed league offices in Manhattan and headed back to Washington -- after declaring the negotiations hopelessly deadlocked -- there was a sense that the union chief was undertaking one last bit of posturing. As the evening wore on, though, it became increasingly obvious that Upshaw and the league were not just practicing brinksmanship, and that the NFL could instead be poised on the brink of disaster.
The word most often used by teams' staffers, the people charged with crunching the salary cap numbers, and who clearly had bought into the notion that a CBA extension would be struck: stunned.
Said one cap manager: "For months, my owner told me to develop two strategies, one with [an extension] and one without. But nobody, even with all the gloom-and-doom talk of the last few weeks, ever really believed we'd be breaking out 'Plan B.' And then, these last few days, even my owner was telling me he thought it would get done. Unless there's some kind of miracle on Wednesday, our team is going to have to do some drastic things, and I know we're not the only team in that situation."
How drastic? There continue to be rumors the Washington Redskins, who extended numerous contracts in the past to deal with previous cap crunches, could have to play with 20 rookies on the roster in 2006. On Tuesday night in Atlanta, there were rumblings the Falcons, who aren't in nearly the dire straits some other franchises are, might be forced to release tailback Warrick Dunn, who rushed for a career best 1,416 yards in 2005. The Kansas City Chiefs could part ways with perennial Pro Bowl guard Will Shields if he doesn't agree to adjust his contract and reduce a $6.67 million cap charge. And that is just the start of the many examples of potential attrition cited by team officials Tuesday evening.
Certainly the positive vibes of Monday had spiraled into disbelief -- and in some instances, desperation, it seems -- by Tuesday night.
Less than 24 hours earlier, key owners such as Dallas' Jerry Jones and Pittsburgh's Dan Rooney, and high-ranking club officials like New England vice chairman Jonathan Kraft, had offered public optimism about a CBA extension. But in the five-hour bargaining session in New York, things went bad, and by Wednesday's 4 p.m. deadline for reaching an accord that now seems unreachable, they could be far worse.
The league was represented Tuesday by commissioner Paul Tagliabue, vice president of labor relations Harold Henderson, members of the Management Council, and team presidents John Shaw of St. Louis and Atlanta's Rich McKay. In addition to Upshaw, it's believed the NFLPA representatives included attorneys Richard Berthelsen and Jeffrey Kessler.
"We're deadlocked," Upshaw said after the session. "There's nowhere to go."
The two sides remain about 4 percent apart in negotiations. A league source confirmed that the NFL is offering 56.2 percent of revenues, while the NFLPA is seeking a 60-percent share of the pie. The difference translates into approximately $300 million to $350 million per year. In a statement released Tuesday night, the NFL accused the NFLPA of "overreaching." And, rather predictably, the union, which has remained firm in its conviction that the old revenue-sharing models have become obsolete, charged that the optimism of Monday, that a deal would be completed, had been fabricated by the league in an attempt to pressure the NFLPA into a deal.
After essentially claiming the sides had run out of time, and that the league would play the 2007 season as a so-called "uncapped" year, Upshaw did leave some wiggle room by acknowledging that one phone call could change things. But it's not likely that call will be made. ESPN.com has confirmed that a meeting of the powerful Management Council executive committee, made up of eight owners and high-ranking club officials, is still set for Wednesday. But the session is not scheduled to begin until late afternoon, and, with a 4 p.m. deadline looming, it doesn't appear a last-minute accord is possible.
Tagliabue will convene a Thursday meeting of all owners. By that point, though, the mechanisms for an "uncapped" season in 2007 will already be in place. And Upshaw has reiterated throughout the talks that, if the NFL ever plays without a salary cap for one season, players will never permit one to be reinstituted.
There also exists the possibility that players could be locked out before the 2008 season, by which point the current collective bargaining agreement will have expired.
"We're going to behead the golden goose," one NFC owner said last week. "And I can't see why both sides would ever let it get to that. Then again, a year ago, I would have told you we'd never, ever let it get this close to happening. I figured there were enough 'poison pills' [in the CBA], things that negatively impacted both sides, to force an extension. But, hey, here we are. A lot of things in our league could be changed forever."
The lack of an extension, indeed, means a lot for both sides. And not just the composition of rosters.
For instance, players will now need six accrued seasons, not four, to qualify for unrestricted free agent status. So a standout young player such as Chicago Bears three-year veteran linebacker Lance Briggs, who is coming off a Pro Bowl season and whose contract expires after the 2006 season, would have to wait two additional seasons before being unrestricted. The league would also, in an uncapped year, quit funding 401(k) plans (it currently matches player investments on a 2-1 basis) and most other fringe benefits, meaning players would be responsible for those things.
And there would be difficulties, even for the most innovative teams and creative player agents, in meeting financial expectations on most contracts. Players in free agency and high-round draft picks will have trouble approximating the fat deals of the past, and player agents face problems in trying to explain why expectations might have to be lowered.
As of Tuesday, there were a dozen teams in the league with more than $10 million apiece in 2006 salary cap room. It seems logical that those teams, which include four franchises with more than $20 million each in cap space, would benefit from the problems of cap-strapped clubs, especially if the free agent rolls are swelled Thursday with the anticipated cap casualties. But because of the quirks of the pending "uncapped" year in 2007, even those teams will have to move with great caution in crafting contracts.
One player agent suggested that it will be a "nuclear winter" at the outset of free agency, with few teams jumping out and completing early deals because of the uncharted landscape in which the NFL will be operating.
Some other lesser known implications: Without an extension to the CBA, teams will be able to amortize signing bonuses over just four seasons, instead of the maximum seven years. Because of the 30-percent rule, which essentially stipulates that a player's basic compensation (his base salary plus the prorated share of his signing bonus for 2006) cannot be increased by more than 30 percent, teams can't make up the difference in smaller signing bonus with fatter base salaries.
But perhaps the biggest problem is that so-called "not likely to be earned incentives" (NLTBE) will count immediately against the cap. In normal circumstances, NLTBE incentives count on the following year's spending limit. So NLTBEs earned in 2005, for instance, count against a team's 2006 cap. But with an uncapped year looming in 2007, such incentives and bonuses that are triggered in 2006 would immediately apply.
Indeed, barring a dramatic and unanticipated turn of events Wednesday, it is not going to be business as usual around the league. And if the ramifications are as catastrophic as predictions indicated Tuesday they might be, fans could be forced to pay more than the usual grudging attention to business matters.
Re: Thank God we are under the cap.
In the short term we will be a team that may benefit from this, as teams that are over the cap will have to cut some good players. Some teams will need to cut good players just to get under, as the cap will not be increased. This will hurt FA this years, as the market will be flooded with talent. Pickett for one will not get a big contract; some teams will be dumping players and have no cash to spend. In the short term teams with cash like AZ can get better in a hurry.
Last edited by Rambos; -03-01-2006 at 11:49 AM.
Re: Thank God we are under the cap.
You may see some free agents taking one year contracts with their present teams. I doubt any free agent will want to move with a multiyear contract at reduced price.[SIGPIC][/SIGPIC]
Re: Thank God we are under the cap.You may see some free agents taking one year contracts with their present teams. I doubt any free agent will want to move with a multiyear contract at reduced price.
Would you sign a long-term deal when in 2007 there is no cap!
Who do we have in 2007 that will be FA? The rich get richer; I can’t see the Rams spending like the Yankees to win a super bowl.
Re: Thank God we are under the cap.Originally Posted by Rambos