How the New Orleans Saints cleared $110 million in cap space two years in a row – New Orleans Saints Blog
METAIRIE, La. — Even by New Orleans Saints standards, it was a bit of a salary cap stunner.
The Saints started this offseason nearly $75 million above the NFL’s $208.2 million salary cap. Still, they pushed over $110 million in cap costs in the coming years without cutting a single player in case they needed to make room for a trade with quarterback Deshaun Watson.
Instead, they can now either spend that space on other free agents (including the quarterback they still need) or carry over any remaining space into 2023.
If you keep track at home – and how could you be? ! — it’s now been two straight years since the Saints cleared more than $110 million in cap space, mostly by restructuring contracts to push sky-high cap fees into the future.
Yes, this “kicking the box” method has an obvious downside. All of these charges will await the Saints for years to come, and they will have to go through the same process to get back under the cap next offseason.
Most severely, they paid a substantial price in 2021 when the cap unexpectedly dropped by $16 million due to lost revenue due to the COVID-19 pandemic. In 2021, the Saints had to release a handful of starters and key contributors to go below the cap.
However, barring another pandemic, the cap is expected to continue to skyrocket in coming years with revenue from TV deals and other sources. Meanwhile, the Saints have never let the cap stop them from making aggressive moves — like pursuing one of the biggest hit trades in NFL history.
They’ve also re-signed several of their own players to huge contract extensions in recent years (Drew Brees, Michael Thomas, Cameron Jordan, Marshon Lattimore, Ryan Ramczyk, Alvin Kamara and Demario Davis among them).
They’ve let two key players go in free agency over the past two years — safety Marcus Williams and defensive end Trey Hendrickson. However, the Saints signed free agent safety Marcus Maye at a lower price to replace Williams.
To cross the $110 million mark this year, the Saints restructured 12 contracts, while safety Malcolm Jenkins and cornerback Bradley Roby took pay cuts. Here is the count:
It’s unclear if Jenkins’ cut will be tied to a future deal, as he took a direct $6.12 million pay cut without converting any of it into a signing bonus. In Roby’s case, he took a pay cut and a one-year contract extension with the Saints to avoid being a potential cap victim. He went from a one-year, $10 million deal to a two-year, $7 million deal that includes an additional $7 million in possible incentives.
“From the outside looking inside, everyone thinks the sky is falling on us. [But] we kind of know what our plans are and what steps need to be taken,” New Orleans Football Administration vice president and salary cap expert Khai Harley said last year. secret weapon of the Saints. “Sometimes these are tough decisions, but decisions we have to make nonetheless.
“When the GM and the coach say, ‘Hey, we want to do XYZ,’ you want to figure out how to do it.”
Maybe one day the Saints will go into some sort of rebuilding mode and play catch-up with the ceiling. But they never wanted to do that when they felt like they were in a Super Bowl window with Brees at quarterback and Sean Payton as coach. And obviously they’re not ready to do that now under new coach Dennis Allen, as they still feel the roster is loaded with enough talent to challenge for a title.
So how did the Saints pull it off? Here’s a little math lesson:
Say, for example, a player has a five-year, $100 million contract set to pay him $20 million a year in base salaries. It would also count for $20 million per year against the salary cap.
However, if the player receives a signing bonus of $20 million, the cap fee is spread over the five years of his contract at $4 million per year.
The Saints routinely convert base salaries and roster bonuses into signing bonuses — paying players up front and securing their money, while dividing cap fees over future years. The Saints also routinely add years to the end of players’ contracts which are set to automatically terminate at a later date.
There is no penalty, such as a tax or interest rate, for this. But the biggest downside is that players will incur huge cap fees in the years to come. And when they are released or retired or their contracts are canceled, there is more “dead money” waiting to hit the cap.
For example, Brees’ final $11.5 million cap fee from past signing bonuses still counts toward New Orleans’ 2022 cap.