Everyone sucks at salary cap management, except the Tampa Bay Buccaneers. Okay, so that's not entirely true: plenty of teams manage their salary cap well, and they do so with few long-term problems. But it is true in the NFC South: the Atlanta Falcons, the New Orleans Saints and the Atlanta Falcons have almost no salary cap space left, and this will hurt them now and in the future.
What have the Bucs done to manage their salary cap
Well, for one, they didn't actually spend much money for years on end. That certainly helps, but that's only a small step on the way to managing your salary cap the right way. The Carolina Panthers did the same thing, yet they now have the least amount of cap room in the NFL after one offseason of spending because of the way they handled their contracts: badly. All of the Bucs' division rivals have less than $2 million in salary cap space at the moment. Signing their drafted players alone will take up more cap space than that. So why have the Bucs managed to keep their salary cap clean?
The Tampa Bay Buccaneers have been (re-)signing players under Mark Dominik for four years now, and they have consistently done their contracts in a specific way: they don't hand out signing bonuses, instead guaranteeing the first few years of a player's salary.This has two effects:
1. Big contracts pose a minimal risk to the team, because there is little to no dead money after a player is cut. When handing out a signing bonus, the amount of that bonus is divided equally over every year of a contract for salary cap purposes. This means that if a team wants to cut a player after a few years, all the signing bonus money that hasn't been accounted for in previous years, hits the salary cap that season. That's the source of dead money, and that dead money makes it very hard for teams to cut ties with overpaid players: if they cut them, they take a huge salary cap hit they often can't afford.
Not to so with the Bucs' contracts. They can cut Vincent Jackson after two years, and they will take no salary cap hits and owe him no money - because all the guaranteed money was paid out and accounted for in the first two years of his deal in the form of salary, not a signing bonus. The same is true for every big contract the Bucs have handed out the past years: they can cut their big signings within two or three years with no salary cap implications. That means the long-term risk of signing these players is minimal, despite the huge deals - and future salary caps should not be heavily burdened by these deals.
2. Contract numbers go way up. The fact that the team can now easily cut players, comes with a corollary: players now have less job security. This means the team must pay these players more money in their deals, because those players are less likely to actually be paid the salaries in their later contract years. Whereas the dead money in signing bonuses gives the players a small guarantee that they'll see their later salaries, this is not the case with these contracts.
Of course, this means those players who are motivated primarily by money should be more motivated in the later years of their deals as well: every year they have to perform, or they could be cut without a second thought by the team.
Okay, that sounds smart, but why is everyone else so terrible at managing their salary cap, then?
The Bucs could manage their salary cap this way because they had been cheap in previous years. You need to have a lot of cap room to operate this way, because you must be able to take salary cap hits immediattely when you start this strategy. The New Orleans Saints and Atlanta Falcons never had the luxury of operating in this fashion, at least in the past few years, because they didn't have the salary cap room to move to that method of accounting.
This is absolutely true: the New Orleans saints have managed to sign players - this season. They have done so by giving these players signing bonuses on very long deals and very small first-year salaries, minimizing the salary cap hit in 2012. There's only one problem: that money is not going to disappear, and it will hit the cap at some point in the future - and soon. As explained above, they can't cut these players without suffering big salary cap hits.
Essentially, the New Orleans Saints are signing players by pushing salary cap hits forward."I'll deal with the problem later" appears to be their method of accounting. For the results of that thinking, just think back to the post-Super Bowl Buccaneers. Those Bucs had to let go of a lot of quality players, including Warren Sapp and John Lynch, because they were in constant salary cap hell. For a more recent example: just look at this year's Houston Texans. They've had to say goodbye to a number of very good players like right tackle Eric Winston and middle linebacker Demeco Ryans. Those moves were presumably motivated by their lack of cap space (or possibly just their lack of money).
I get that, but how come the Carolina Panthers are in trouble? They had more cap space than anyone last year!
So they did, and they could have applied the same strategy the Bucs had: hand out deals with no signing bonuses. Instead, they went in the opposite direction: they handed out absolutely massive signing bonuses, and now they're stuck with those players for years, no matter how they perform. That's problematic, as the Panthers saw a bunch of those players hit a massive injury bug this past season.
Okay okay, but shouldn't this be cleared up soon? I thought the salary cap would rise in 2014.
Short answer: nope. It appears that the salary cap will not rise or rise only minimally from 2012 through 2014. In fact, the salary cap is expected to around $122 million in 2015, according to ESPN. For reference: it's at $120.6 million this season, and it was at $123 million in 2009. That CBA sure looks bad for the players now. Teams that are in salary cap hell now and keep pushing forward their cap hits will feel the blow soon - because there's no bailout year coming.
One final point: the Bucs will keep healthy cap going forward, if they keep some room each season
The new CBA did include one provision that should aid teams: they can roll over any and all salary cap space they have left at the end of a season, to the next. The Bucs did that this year, adding some $25 million to their salary cap or thereabouts. They will likely do the same next year, and I would expect that number to be around $8 million. The team can keep doing that every year, as long as they keep some room. This gives them more flexibilty and simply more cap room than other teams.
The Bucs are now set up for long-term success, much more so than their immediate rivals, but can they cash in?