Roy Williams CAP impact
by DeRat on Jan 20, 2008 5:32 PM CST
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PrintWHAT WOULD BE THE CAP IMPACT OF CUTTING ROY
Early this week I read a post that stated cutting Roy would only be a 3 or 4 million CAP hit to cut him. Based on the 11.1 million signing bonus he received as part of his 2006 contract extension, my initial thought was that this sounded too low. So I asked Mr. Google for some details on Roy’s contract. A hit on Rotoworld listed the 11.1 mil signing bonus and salaries for 2006 through 2010 due to his 2006 contract extension.
Based on these numbers, I made a post stating the following conclusion: If the Cowboys cut Roy after June 1st 2008 the Cowboys would get a NET INCREASE in their 2008 CAP, and a net Zero effect on the 2009 CAP.
BTB regular Burt D responded with some salary CAP numbers from Usatoday that didn’t quite jive with the assumptions I’d made from the Rotoworld data. The base salary was the same on both sites, but the CAP numbers weren’t as expected.
Back to Mr. Google. I suspected there may be some residual affect from his rookie contract, and I wanted to confirm (or refute) the data from Rotoworld and Usatoday. After several hours of web searches (I’ll never admit exactly how much time I spent on this) I wasn’t able to find any data that refuted the salaries listed on Rotoworld and Usatoday. The total value of the contract listed on Rotoworld (30.1 million) IS WRONG. Scores of hits listed the new money as 24 million and the total value as 25.2 million (math confirms this number). The Usatoday site INCORRECTLY lists an 11.1 mil signing bonus for both 2006 and 2007 (There was only one 11.1 mil signing bonus, but it was paid as 5.5 mil in 2006 and 5.6 mil in 2007). I also found a detailed breakdown of Roy’s rookie contract on BSPN. (see below).
A quick reread of "Salary CAP FAQ" on askthecommish.com found the following:
FAQ 1.7e – the signing bonus is evenly pro-rated over the length of the contract. FAQ 1.8b – when a contract is renegotiated, and the original contract had remaining years with a pro-rated signing bonus, the remaining pro-rated bonus is allocated just as if there were no renegotiation. Any new signing bonus will be pro-rated over the years of the renegotiated contract (i.e. there can be a CAP hit from an old pro-rated bonus and a new pro-rated bonus in the same year). FAQ 1.9b – teams can cut players after June 1st and stretch their salary cap liability over the next 2 seasons (NOTE FAQ 1.14: the NFL also allows up to two veterans per team to be cut in March and treated CAP wise as though cut in June). FAQ 1.10 – Voided years in contracts cause any amount of the signing bonus that was allocated to the voided year (or years) to be accelerated and added immediately to the team salary CAP. FAQ 1.11b - Money paid for option buyouts are considered signing bonuses.
Roy’s rookie contract was for 7 years. It included a 4 million signing bonus, and salaries ranging from 1 million to 2 million per year. It also included 2 voidable years (based on playing time), and a 5.3 million buyout option following his first year that significantly reduced his base salaries. The final results: 4 million signing bonus prorated over 7 years (571 K / yr). Salary: (2002) 1 mil, The following March the buyout option was exercised by the Cowboys, (2003) 367 K, (2004) 617 K, (2005) 867 K, (2006) 1.11 mil. The 2007 and 2008 years were voided.
Finally, let’s see if we can calculate Roy’s CAP impact, and see if it matches up with the Usatoday CAP numbers.
2002
Signing bonus proration (571 K) + 2002 salary (1 mil) = 1.571 mil CAP hit. Same CAP value listed on Usatoday.
2003
Original contract signing bonus proration (571 K) + new signing bonus from the buyout (5.3 mil / 4 yr = 1.325 mil) + 2003 salary (367 K) = 2.263 mil CAP hit. Close, but a difference of $74,000 from Usatoday database?
NOTE: If you apply FAQ 1.10 guidance, the 2007 and 2008 voided year’s proration should have been accelerated into the 2003 CAP numbers. It’s clear that the Usatoday salary database did not do this. When we get to 2007 their data is consistent in that they do include a proration from Roy’s original signing bonus (i.e. 571 K). I have to conclude that the guidance from FAQ 1.10 did not exist in 2002/2003, or the Usatoday data is wrong on this point. Absent any other evidence, I will assume the Usatoday data is correct and I will add a signing bonus proration of 571 K into the 2008 CAP calculation.
2004
Bonus proration (1.325 + .571 = 1.896 mil) + 2004 salary (617 K) = 2.513 mil CAP hit. Same difference of $74,000 from the Usatoday database.
2005
Bonus proration (1.325 + .571 = 1.896 mil) + 2005 salary (867 K) = 2.727 mil CAP hit. $37,000 difference from the Usatoday database.
2006
The contract extension introduces a new signing bonus proration into the calculation (11.1 mil / 5 yr = 2.22 mil /yr) and reduced the 2006 salary to 585 K. 2006 is the last year for the 5.3 mil buyout option proration. So the 2006 CAP hit: Bonus proration (1.325 + .571 + 2.22 = 4.116 mil) + 2006 salary (585 K) = 4.701 mil. Same difference of $74,000 from the Usatoday database.
2007
Bonus proration (2.22 + .571 = 2.791 mil) + 2007 salary (595 K) = 3.386 mil CAP hit. Largest difference yet from the Usatoday database, $161,000 ?
2008
If the Usatoday salary database correctly included the signing bonus proration from Roy’s initial contract into the 2007 CAP data (vs. accelerating 2007 and 2008 voided years into the 2003 CAP year per FAQ 1.10), then the last proration from his initial contract signing bonus will be in 2008 (Additionally, note that the salaries take a huge jump). Bonus proration (2.22 + .571 = 2.791 mil) + 2008 salary (3.72 mil) = 6.511 mil CAP hit.
2009
Bonus proration (2.22 mil) + 2009 salary (4.4 mil) = 6.62 mil CAP hit.
2010
Bonus proration (2.22 mil) + 2010 salary (4.05 mil) = 6.27 mil CAP hit.
I wish I could explain the differences (37K, 74K, and 161 K), but Usatoday doesn't explain in detail where they got their numbers (and my head hurts). If any of you know of reliable sources of information on the structure and details of players contracts, please share them.
CONCLUSION
If Roy is cut this year after June 1st (or the Cowboys use 1 of their 2 veteran exemptions and cut him in March and apply the CAP hit as though done after June) the numbers will be:
2008
Bonus (2.22 + .571 = 2.791 mil) minus the Scheduled CAP charge (6.511 mil) = NET GAIN of $3.72 million (Roy’s scheduled salary) to the 2008 CAP. Note I said "NET", the Actual CAP charge would be the 2.791 million for a player no longer on the roster.
2009
Remaining accelerated Bonus (2.22 + 2.22 = 4.44 mil) – the Scheduled CAP charge (6.62 mil) = NET GAIN of $2.81 million. Again, the Actual CAP charge would be the 4.44 million bonus acceleration.
2010
Off the books.
If Roy is cut this year after March and the Cowboys applied the full CAP hit in 2008, the numbers will be:
2008
Bonus (2.22 + 2.22 +2.22 +.571 = 7.231 mil) minus the Scheduled CAP charge (6.511 mil) = NET CAP INCREASE of $720,000 to the 2008 CAP. Again, the Actual CAP charge would be the 7.231 million.
LINKS
Rotoworld 2006 contract extension details
http://www.rotoworld.com/content/pla...
Usatoday NFL salary database
http://asp.usatoday.com/sports/footb...
Nick Eatman article of 2006 contract extension
http://www.dallascowboys.com/news.cf...
EPSN details of Roy’s initial (rookie) contract
http://espn.go.com/nfl/nfc/draftsign...
Salary CAP FAQ
http://www.askthecommish.com/salaryc...
Another user-created commentary provided by a BTB reader.
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Comments
dude...I commend your efforts...
either way we're screwed...Jerry really blew it with this extention...How in the world could he possibly justify this extention with the obvious liabilities and limitations this man poccesses ?
by BoyzRback07 on Jan 20, 2008 5:58 PM CST reply actions
I wonder about this now...
...but I think it was because of how good he was in run support and how his hard hits provided a spark for the defense. I'm not sure if teams throw more now, or just throw more on him now, but either way, it's not working out real well.
While he still provides decent run support, we already have two guys on the field who are liabilities in coverage in our base defense in James and Ayodele (although, James did seem like he improved some this year). I just don't think, in today's NFL and with the word out on Roy's coverage abilities, that you can afford to leave him on the field in any passing situations or even in situations where there's a 60-40 chance they pass (as opposed to 3rd and 12). It's frustrating on multiple levels (that he used to be good at some things, how he hasn't improved at coverage, his salary, the fact he had a rule made for him, etc), but I still don't know if Jerry would part with him.
by GhettoBear04 on Jan 20, 2008 6:35 PM CST up reply actions
Thanks, I agree were screwed
I did this as an exercise in understanding "the rest of the story" in how the CAP numbers are calculated.
Since the Cowboys have entered the Off-season, I am seeing more and more post with misleading (or wrong) CAP numbers.
I agree were screwed. I don't think Jerry will cut Roy, Jerry is loyal to a fault, but when production doesn't match up with CAP liability then the team is hurt.
We Can Only Hope....
The Bears bailed out the Redskins last year after the Redskins paid Adam Archuleta big money during the FA signing period the year before. We can only hope that a team like the Bears is willing to take Roy off our hands during the off-season.
by Fargo Cowboys on Jan 20, 2008 7:10 PM CST reply actions
No one will take him
The Bears took Archuletta because Lovie Smith had him in St. Louis where he was a good player and thought his system would bring out the best in Archuletta. Didn't happen.
So I think we would need Dave Campo to get one of the open HC positions...or maybe Bob Stoops? Barry Switzer?
ANd it may be a net plus on the cap but $7 million in "dead money" is way too much for any team to swallow.
We're stuck with him.
by boysandbosox on Jan 20, 2008 9:58 PM CST up reply actions
Net Cap Gain after June 1
I think you have to look at the expected salary minus the pro-rated bonus to see the net cap impact. In this case it would be the salary ($3.7) minus the bonus ($2.7mm). The net gain would be around $1mm.
Two Schools of Thought
(1) The Business "Bottom Line" model.
Agree, if you are trying to determine the net effect on the "bottom line" then you can look at the difference between the pro-rated bonus CAP number and the salary you wouldn’t have to pay (the theory being you "offset" the CAP charge by saving money to use else ware). In Roy’s case this would be:
3.72 M (salary) – 2.791 M (bonus) = 929 K (to use else ware).
I have used this approach in the past, but after looking at CAP management more closely, IMO it is not an accurate depiction of the CAP impact.
(2) The CAP value model.
When the NFL looks at the Cowboys CAP to determine if they are exceeding the 2008 maximum, the NFL will credit one of three numbers against the CAP for Roy:
(a) 2.791 M, based on cutting Roy after June 1st 2008, and stretching the CAP charge over two years.
(b) 6.511 M, based on Roy being on the opening day roster (and thus his 2008 salary becoming guaranteed).
(c) 7.231 M, based on cutting Roy and taking the full CAP charge in 2008.
Therefore, if you look strictly at the CAP charge for Roy being ON the 2008 roster vs. Roy being OFF the 2008 roster. The numbers are:
6.511 M (ON) - 2.791 M (OFF) = 3.72 M CAP charge delta (using the stretched over 2 years option).
right
but there is an added layer of complexity...
the $3.72 delta means that we gain that cap space this year.
it also means that we have a $2.791mm dead money charge next year. (but we also save cap $ then).
if we could cut him earlier and take the full charge it would count $7.231mm against the cap (or we would pay $720k more than planned and not have Roy on the roster BUT next year we would get something like $7mm in cap space.
there are a lot of ball in the air on this stuff.
it also gives a lot of flexibility in structuring other players deals... say you cut roy and spread it over 2 years, then sign hamlinn and front load his contract so its $3.72 for each of the next two years and something tiny in yr 3....
Question
It obviously seems that the popular opinion is to cut Roy Williams... is the anti-Roy sentiment so strong that we really think that ANYONE could step in and replace him?
My actual question is, who does everyone propose come in to play safety? It's easy to say that Roy should be cut, but I want someone to step up and say who we should sign to fill the void.
Resign Hamlin to play SS
have Courtney Brown and Watkins compete in training camp for the starting FS spot.
by Burt D @ Blogging The Boys on Jan 20, 2008 9:11 PM CST up reply actions
Addition by Subtraction
Pat Watkins, Courtney Brown...doesn't really matter who is playing alongside The Hammer as long as it's not Roy Williams. Ok, that's a little harsh, but I think it's fair statement that we just need someone back there that can play in space.
by Fargo Cowboys on Jan 20, 2008 9:12 PM CST up reply actions
Keith Davis
Sad to say I don't think he is that much of a drop off from RW.
And so that I'm not accused of being a "Roy hater" let me state that I would love to see him be a star or even a good safety. He seems like a good guy. But I just don't think he is very good.
by boysandbosox on Jan 20, 2008 9:53 PM CST up reply actions
I would love Roy to be just a decent player
by Burt D @ Blogging The Boys on Jan 20, 2008 9:57 PM CST up reply actions
Easy Solution...
- Move Roy to ILB, and take Ayodele's position. Roy will need to gain a little bit of weight, but his pass coverage is superior to Ayodele's anyway.
- Move Hamlin to SS.
- Sign true "center-fielder" safety.
Roy is way too small to play ILB in a 3-4
by Burt D @ Blogging The Boys on Jan 20, 2008 9:50 PM CST up reply actions
I think your close but
We have our starting FS on the roster
Hamlin to SS
Watkins at FS
I agree Aydodele should be replaced with a younger and faster ILB. I think it's sooner rather than later. My choices are Carpenter or Burnett. Both are superior in pass coverage to Ayodele.
by Cowboys81 on Jan 21, 2008 10:13 AM CST up reply actions
Wow
First, great work. I had been trying to get my arms around some of that stuff and it was damn near impossible -- I commend you and thank you.
Second, I think we should either re-negotiate his contract down or cut him. THIS IS NOT BC I DONT THINK HE IS GOOD OR HAS VALUE, It is simply b/c I think we could be a better team by cutting him and using the money elsewhere.
While a lot of guys on the board think we can re-sign Flo, Barber, Canty, Hamlin and still have room to sign Turner, Asante Samuel and Dante Stallworth, I realize we have limited room and a lot of guys to sign.
Lets build a team for the future not the Daniel Snyder offseason trophy...
Funny how...
...a Pro Bowl safety is being talked about as a potential cut. Please, Roy might have his problems playing in coverage, but unless you can show me a definite alternative at safety, he's our guy.
Also something else we should keep in mind
is that Roy not only takes up cap space but he takes up space on the roster. By Roy being on the roster it makes it harder to keep the rookies we draft. Therefore, keeping Roy hurts our future.
by Burt D @ Blogging The Boys on Jan 20, 2008 11:28 PM CST reply actions
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