With $120 million committed to their top 51 players in 2014 by my numbers, the Tampa Bay Buccaneers will have salary cap issues. They'll have to make some tough decisions on quality players and large contracts which could prevent them from signing or re-signing players. Specifically, they cannot realistically extend Josh Freeman after the 2013 season without sacrificing some other players. So how do they solve that problem?
Pewter Report suggests that the Buccaneers start converting guaranteed salary to roster bonuses as they did with Carl Nicks and Vincent Jackson to free up 2013 cap space.(1) Their solution to the Bucs' looming cap issues to me seems short-sighted and certain to lead the Buccaneers into further cap trouble down the line, but it gives me a good jumping off point for an article I've been wanting to write for quite some time.
This is a practice that Dominik can use over and over again each year to create available cap room for the following year by going to players with big base salaries at the end of the season and using up the available cap room for that year by converting base salary money for the next year into a current roster bonus.
This awful idea needs to be stamped out of Mark Dominik's head immediately. And there's one reason for it: you can't remove cap hits, you can only delay them. Signing bonuses serve to push those cap hits into the future, freeing up cap instantly but costing you in the future.
Doing so at the end of the year would be even worse, though, because unused salary cap space rolls over automatically. There's no point to spending your cap space so you can have more of it in the future if it all rolls over anyway.
(1) Yes, technically Pewter Report is suggesting that the Bucs should give players December roster bonuses to eat up unused cap space. Unfortunately, there are two reasons why this is impossible. First, any unused cap space is automatically rolled over to the next season, so using up more cap space has no effect in the first place. Second, any roster bonus given to a player after the first preseason game in the year of signing is treated as a signing bonus for cap purposes, and is hence pro-rated over the (remaining) length of the contract. Any alteration to a contract requires a new contract, effectively, so any contract alteration makes that a "year of signing". Which is exactly what happened with Vincent Jackson and Carl Nicks: their cap hits were spread out over the remaining length of the contract, because the roster bonuses were treated as signing bonuses, per the CBA. So I'm just going to pretend that Pewter Report made a suggestion that is actually possible.
Learning from the Carolina Panthers
If you want to look at why this is a bad thing, you need only look at the teams who are cap-strapped in future years. With no exceptions, their cap commitment in future years is high because they pushed past cap hits into the future with signing bonuses. Two of those badly managed teams are Bucs division rivals, by the way: the New Orleans Saints and the Carolina Panthers.
They're both great examples of what not to do, for different reasons. The New Orleans Saints have always been free agent-heavy, and they continually pushed cap hits into the future. They're still doing that. It has constrained their spending, and it will really hurt them over the next few years when they will have to start cutting quality players.
The Carolina Panthers, meanwhile, were one of the lowest spenders in the two years before the 2011 labor lockout, as were the Tampa Bay Buccaneers. Both teams entered the lockout with oodles of cap space. The Bucs had the lowest cap figure in the NFL with $63.8 million, while the Carolina Panthers weren't far off at $73 million, according to ESPN.
And then the Panthers did something stupid: they started spending on the wrong players, at the wrong positions, with the wrong contract structures.
If you were to make up a list of "types of players not to give big money to" it will generally start with "aging running backs", continue with "injured linebackers", be followed up by "one-year wonders" and finish up with "centers". Good players at those position can be valuable to the team, but they are generally less valuable than players at other positions. And when you go on a spending spree like that, you can quickly lose your ability to fill holes elsewhere.
Which is exactly what happened. Look at the contracts the Panthers handed out that offseason (all numbers from Rotoworld):
- C Ryan Kalil: 6-year, $49 million, $28 million guaranteed, $18 million signing bonus.
- LB Jon Beason: 6-year, $51.338 million, $25 million guaranteed, $20 million signing bonus.
- 28-year-old LB Thomas Davis coming off three consecutive season-ending knee injuries: five-year, $36.5 million, $7 million signing bonus.
- LB James Anderson, five-year, $22 million contract, $8.5 million guaranteed (via ESPN).
- 28-year-old RB DeAngelo Williams coming off two consecutive knee injuries while they had Jonathan Stewart under an expensive, long-term contract: five-year, $43 million, $21 million guaranteed.
- One-year wonder Charles Johnson: six-year, $76 million contract. $32 million guaranteed, $30 million signing bonus.
That's a total of $119.5 million in signing bonuses and guaranteed money on some of the lowest-value positions in the NFL with a lot of superfluous players. They were paying three 4-3 linebackers big money (and then drafted a high first-round linebacker the very next year), they were paying two running backs very big money, one of them nearing the 30-year mark. And they signed a one-year wonder at defensive end to a ludicrously expensive contract.
These contracts were bad in every sense of the word. Each of those players is overpaid relative to the market ($8.5 million per year to a center?! Carl Nicks got $9.5 million per year with no signing bonus!), and they were all the kinds of contracts you can't get rid of. The Panthers cannot cut Deangelo Williams, nor Charles Johnson, nor Jon Beason, nor Thomas Davis even if they wanted to because they would lose cap space by doing so, as pro-rated signing bonuses accelerate.
The problems here are obvious, even with the success stories. Jon Beason looked like a good buy at the time -- but then he missed nearly two full season with injuries, and Luke Kuechly came into the fold and turned out to be a more than adequate replacement. Charles Johnson has been very good - but he's earning Julius Peppers money. Meanwhile, they don't have the money to shore up their offensive line, give Cam Newton anyone besides Steve Smith to throw to or construct a team with enough talent to win. In effect, the Panthers are stuck with overpaid, over the hill players they can't get rid of.
Oh, and to make matters worse, their new coaching staff didn't actually like the players. Ron Rivera has been trying to incorporate more and more 3-4 elements into his defense, while the Panthers just paid a bunch of players who are ideally suited to the 4-3. The Panthers tried to turn to a run game fueled by Cam Newton, while their two expensive running backs were badly and barely used.
All of this played a large role in the firing of then general manager Marty Hurney, whose reign was filled with short-sighted decisions and a lack of long-term perspective.
If the Tampa Bay Buccaneers start doing what Pewter Report wants them to do, they'll run into these issues soon enough as well. Remember, the Carolina Panthers had humongous amounts of cap room in 2011 -- and squandered almost all of it in one offseason, ruining their salary cap situation for at least three or maybe four seasons. And they did this even while having relative bargain Cam Newton under contract at quarterback.
If the Buccaneers continue further down the road of converting base salary to signing bonuses, they will run into these same problems. So far, they haven't done too much damage -- Carl Nicks and Vincent Jackson can be cut next offseason if absolutely necessary, which is unlikely. But they will do damage at one point. After all, Carl Nicks has already missed most of one season, and it's certainly not unrealistic that either player, or Dashon Goldson, or Darrelle Revis, or any of the other highly-paid players declines or suffers catastrophic injuries. That sort of thing happens constantly, and the Bucs do a great job of mitigating that risk with their contract structures.
Now, converting guaranteed base salary to a signing bonus has at least a little less risk than giving out massive signing bonuses at the start of a contract: you know what you have in this player now, more or less. But the issue with big signing bonuses isn't just that the player may not live up to his deal -- it's that it makes it harder to get rid of players
Darrelle Revis is very likely to have his base salary next year converted to a signing bonus, which could save the Bucs up to $12 million on the 2014 cap while pushing that same amount into future years. Revis has hinted at that possibility in the past, saying in his opening press conference that people should wait for the full details of his contract to become known when asked about the risk he was taking in signing a contract with no guaranteed money. The Bucs did the same thing with Carl Nicks and Vincent Jackson, evaluating them for one season before clearing out cap space and taking a risk on them for longer periods.
Beyond Revis, though, I would hope that Dominik takes a different tactic: cutting or negotiating salaries down. Once players' guaranteed salaries run out, they can be cut with no further cap repercussions -- and that threat can cause them to accept lower deals as well. Michael Koenen, Donald Penn, Davin Joseph and Connor Barth would be most vulnerable to that tactic over the next few years.
The Real Answer
The real answer doesn't lie down the road of signing bonuses and cap hell. It lies down the road of youthful refreshment: the NFL Draft. That's where you find cheap, young players who can serve to replace veterans quickly. Consistently drafting well to replace your aging veterans is how you sustain a winning team -- although this is easier said than done.
It would not surprise me to see the Bucs draft an offensive guard to replace Joseph's cap charge and injury-prone performance, or see a kicker out-compete Connor Barth in 2014 to take another $3 million off the books. Perhaps the Buccaneers draft a wide receiver to become the heir presumptive to Vincent Jackson, or a third-round center to replace Jeremy Zuttah.
The NFL is a business, and that business has its ugly side. But planning for those eventualities and making sure that your team is sustainable is one of the most important tasks of a general manager. There will always be draft busts, free agency mistakes and injuries to ruin contracts. A general manager has to make sure that those problems don't stop the team from being successful.
So far the past two years, though, Mark Dominik has increasingly jeopardized the future of the Buccaneers. Trading for Darrelle Revis and handing over that massive contract, signing multiple big-name free agents and pushing cap hits into the future via signing bonuses could prove to be disastrous down the line.