Heading into the seemingly premature offseason, managing the current roster is Job One. Some players have exceeded expectations and deserve extensions. Here is a link to that very subject. The other part is cutting players who did not meet expectations (i.e. Breaking Bad Contracts).
Understanding NFL contracts can be a difficult endeavor. Unlike most other professional sports leagues, contracts in the NFL are not fully guaranteed. This means just because Michael Vick signed a $100M deal before the 2011 season does not mean he stands to realistically earn all $100. Contracts are constructed with a level of guaranteed money and then phony money (aka“empty promises”). Vick’s contract only had around $40M guaranteed and it was structured in a way where most of that is paid in the first two years of the 6 year deal. This means after the first two years the Eagles can cut Vick (terminate the contract) ,only owe a minimal amount of money, and incur a minimal salary cap penalty in DEAD MONEY.
This kind of contract is very typical in the league. Depending on the level of risk, caliber of player, and total length of contract, teams will design them to pay most of the guaranteed money in the first half of the deal so if the player fails to perform, they can be cut without catastrophic consequences to the Salary Cap.
Why the Vick example? Well, the Eagles are very good at mitigating risk. They are consistently making calculated moves that more often than not work in their favor. The Cowboys are not always so good at that. Let’s look at which Cowboy’s players are underperforming their contracts and what will the consequence be to cut them now in the offseason?
Doug Free (Contract 4yrs/$32M)
Bad contract discussions seem to begin and end with Doug Free. Doug Free is currently in year 2 of his four year contract. This contract is the nightmare of bad contracts. When the Cowboys extended Free’s contract they saw a physically gifted, young, and improving player. The Cowboys were in in the early stages of rebuilding the offensive line and knew they needed stability somewhere.
Free was an obvious candidate to be that veteran stability. Instead of building a contract like the Michael Vick contract discussed above, they felt since Free was low-risk/high-reward player they would evenly divide the guaranteed money into substantial portions for the entire duration. That essentially says that unlike the Vick contract that can terminate early without much penalty, early termination of Free’s contract results in dead money. Free still has over $8M guaranteed so cutting him in the offseason will result in that amount of dead money.
If Doug Free is cut after June 1 the dead money cap penalty will be divided into two equal parts over the 2013 and 2014 season. If the Cowboys decide to keep Free then he will count $11.175M and $12.175M the last two years of the contract. This would make him one of the most expensive right tackles in the NFL.
Regardless what the Cowboys choose to do, it will be expensive. It will be costly to keep or cut Doug Free. Keep in mind if the Cowboys cut Free they will save $2M but will still need to find a replacement for him. Unless Jeremy Parnell is the answer, the replacement will certainly cost more than the $2M in savings.
Jay Ratliff (Contract 7yrs/$48.625M)
At first look Ratliff’s contract appears worse than Doug Free’s but after closer examination it’s pretty workable. The Cowboys knew Ratliff was getting older and never planned for him to play all seven years. Rat is only in year 2 of the 7 year deal but the last two years are examples of phony money years in which no money is guaranteed. This means the Cowboys could cut him after the 2015 season with no cap penalties.
Sadly Rat has had an injury filled season in which he contributed little except for threatening the physical well-being of Cowboys owner Jerry Jones. Rumors say Rat may be also be cut in the offseason. If so, he would count $6M against the cap if cut before June 1. Again, that figure would be split evenly across the 2013 and 2014 seasons if he was cut after June 1. If the Cowboys elected to keep Ratliff for 3 more years he would cost $7M, $7.5M, and $9M respectively.
Orlando Scandrick (Contract 6yrs/$28.2M)
Orlando Scandrick agreed to a reasonable contract extension averaging $4.7M per year and guaranteeing $10M. Considering new CB, Brandon Carr averages over $10M, it seemed like a good deal for a young and improving player. Unfortunately, Scandrick regressed instead of progressed and his future is now in the air. The money in Scandricks contract is spread throughout the duration (much like Doug Free). If he is kept on the roster he will only cost $3.78M, $5.88M, $7.38M, and $1.680M the next four seasons. With a low cap charge of $3.75M in 2013 the Cowboys will probably give him a chance to prove his worth next season
*Dead Money: Dead money is the amount of money counting against a team’s salary cap by a player no longer on the roster. The amount is based on the remaining guaranteed portion of the contract. Depending how the contract is structured guaranteed portions of the contract can extend over the entire length of the contract or a portion of the contract. To see who counted against the cap in dead money in 2012 follow this link.
**Contract details were obtained from spotrac.com