we spend real time money, not prorated money

from last April

http://www.ramsrule.com/herd/list.php?13

Kevin Demoff

This question is a little easier to answer this year as it appears the next few years should seem at least modest increases in the salary cap. In previous years, with more uncertainty around how the salary cap would rise, we always expected an increase of about $1-2m per year. While we still use very conservative estimates for future years, I think we can plan for $3-5m per year for the forseeable future which is helpful because we always look at our salary cap planning in 3-4 year increments.

The most important thing we value as a franchise in our salary cap is flexiblity. The best way to preserve that flexibility is to try and write contracts that are linear meaning that the contracts are roughly the same value each year and don’t contain large pro-rated signing bonuses. With most of our bigger signings, be it our own re-signings or free agency, we try to write the contracts where the guaranteed money is in the first 2 years and then there is greater room to manuever after that. That structure is what you have seen most recently in contracts such as Chris Long, James Laurinaitis, Cortland Finnegan, Scott Wells, Kendall Langford, Rodger Saffold, etc…

Ideally we like to write those guarantees in base salaries and roster bonuses, but we also are willing usually to commit $1m/year in signing bonus proration if it helps us afford a player in a given year. Typically our contracts can be structured to be slightly lower in the first year cap wise and then slightly higher in the second year to give us more flexibility in the current year we are in. The goal is to have nearly complete flexibility after the first two years of a contract.

As for coming up with values on players, myself and Tony Pastoors, our senior assistant who manages the salary cap and plays a significant role in our front office, we will sit with the coaches and scouts to get a sense of their needs/wants in any given year. We will then sit with Coach Fisher and Les Snead to develop a strategic plan of the players or groups of players that we would like to go after and an “ideal” range that we would like to sign a player for. There is always some flexibility in that range, but we usually have an idea of a number we won’t go past in any negotiation. If a player goes past our range, we wil consider the next best alternative to sign, although sometimes that player isn’t at the same position.

As for our current situation, we have tried to manage our salary cap from the vantage point that we have the youngest team in the NFL and our young players are going to need to be paid in the next few years. As a result, we have tried to leave greater flexibility and room in the 2015-2018 years and as a result, we have taken higher “cap” charges for our veterans in 2012-2014 when the young players are on rookie contracts. We have tried to avoid the restructuring contracts for salary cap purposes only and have succeeded for the most part with one exception, which was Chris Long last year.

One last thing that I think is helpful to understand our cap situation. I don’t think we will ever be a team that has the most “room” in the NFL the way we look at contracts, but the fact that may be closer to the cap can also be misleading. We have one of the lowest amounts of signing bonus proration in the NFL both now and moving forward, which means our cap dollars are all in salary cap space that can be converted if necessary. Our goal is to always have salary cap options, not just room. But moving forward, we have both room and options and that will be imperative as we try to lock up our young core.

Honestly, we don’t really look as much by unit as people may think, we tend to look at in terms of offense/defense and starters/backups. With such a young team that has so many players on rookie contracts, the units can get skewed fairly quickly. Also, for the most part, we have not found any historical correlation between winning % and dollars spent on a certain position group. However, we do want to be fairly balanced between offense and defense. It is not a must have, but something we do monitor to make sure our dollars are allocated somewhat evenly.

One area which we have studied historically is the % of dollars that are going to starters versus non starters. Ideally you would like to be in the 65-75% range for starters, and your team can get a little top heavy at over 80%. But again, given how young we are and how many of our players are on rookie deals, that hasn’t been a ratio we have paid as much attention to, especially as we have gotten away from signing bonus and focus more heavily on salary and roster bonuses.

The goal though is to use our $133m the most efficiently that we can to get the best possible players. If that means getting out of whack in some spots but it makes us better, we will do what is best for the roster, not just what fits our models the best.

I don’t think we will ever be a team that has the most “room” in the NFL the way we look at contracts, but the fact that may be closer to the cap can also be misleading. We have one of the lowest amounts of signing bonus proration in the NFL both now and moving forward, which means our cap dollars are all in salary cap space that can be converted if necessary. Our goal is to always have salary cap options, not just room.

Okay that means this.

1. They frontload.

2. They try to maximize the frontloading, but that is flexible. They can un-do it a little when they need to. So for example it looks like they spent to the cap this year, but the truth is, the contracts are set up in such a way that they can change that easily and on short notice. What that does is create a little more space THIS year but subtract a bit from the open space they left in future years. They can trade back and forth on that.

3. That means they will LOOK like they are tight against the cap any given year, but that’s in appearance only…any time they need more space, it’s there. They simply have to re-structure someone so that they trade space now for future space.

4. It’s like you put all your money into savings, and only an allowance in checking. Let’s say this month the allowance isn’t workable because something comes up. You just put a little less in savings THIS ONE TIME, without overdoing it. It works exactly like that.

GreatRamNTheSky wrote:

Thats nice. Once they restructure Sam Bradford’s deal they should be in great shape.

Grits

They already are in great shape.

The whole point of this approach was to leave space in future years. They’ve already done that.