Contract Restructuring - Future (1 Viewer)

[bellangert]

I know that it may have been discussed previously on this board, but isn't there a future detriment for continuing to restructure these contracts. I am sure that salary cap numbers will continue to grow, but not a the same pace as these backloaded contracts.

Should we be prepared to try to take advantage of the next few years (i.e. Drew Brees window of opportunity) because in the near future we will have to blow up this team and start from the beginning and have a couple years of dreadful rebuilding.

If this is the case, it is equivalent to living on credit then eventually having to file bankruptcy in an effort to star over.

Am I looking at this correctly or am I completely wrong in how restructuring these contracts work?

 

[billinms]

1. Loomis has this
2. Loomis has this

 

[bornnraisedwhodat]

I just dont see it being a huge deal. Over half the teams in the NFL are dealing with the same issues of balancing huge contracts and a flat cap. The Owners/League will not let stupid accounting rules ruin the game of football. They come up with some new way to move around money, write off the way it's carried, and stuff like that. Look at how they allow teams to carry over cap space year to year, it's all accounting gimmicks.

Not worried at all. At worst, at some point we will have to go through a year or 2 of rebuilding at some point, but its not like there will be a "Going Out of Business" sign on the Saints facility.

 

[whodatbe]

It amazes me how some people lately are starting to let the idea of "is Loomis losing it" creep in the back of their minds. I believe Bill said it best in point 1 and 2.

 

[Wicket6]

It amazes me how some people lately are starting to let the idea of "is Loomis losing it" creep in the back of their minds. I believe Bill said it best in point 1 and 2.

given our draft history and our stuggles in fixing our defense its not that weird to be sceptical about loomis to a certain extend

 

[Brad01]

You're going to have "dead" cap space every year. It's not like it builds up every year to where at some point it's going to be 100+ million.

As long as the team isn't giving out massive guaranteed contracts (outside of the one to Brees) and continues to have late round and undrafted players make the roster, then it's not much of an issue.

 

[whodatbe]

given our draft history and our stuggles in fixing our defense its not that weird to be sceptical about loomis to a certain extend

I kind of agree with you, but Loomis doesn't coach guys.

 

[tonyarm99]

Why in the word is no one talking about restructuring or out right releasing Roman Harper?? The guy is dead weight at Saftey. He almost single handedly lost the last 2 playoff games for us!!!!!

 

[billinms]

given our draft history and our stuggles in fixing our defense its not that weird to be sceptical about loomis to a certain extend

Blame bad draft picks and defense on Payton. Loomis is the money guy.

 

[BoNcHiE]

No, because the cap is not stagnant. It goes up every year (the new CBA has mandated several large jumps over the next five years) and new contracts inflate with it as well (meaning that a team way under the cap doesn't necessarily gain buying power when it goes up). So pushing older contracts down the road can actually be done without crippling the team as the raised cap can encompass them.

It's not perfect. Eventually you'll pay something, but you lessen the blow this way significantly. It's why Loomis has been able to do this stuff for a decade and it still not "catch up with us."

 

[WhiteWolf]

1. Loomis has this
2. Loomis has this

you forgot one.

3. That is all

 

[JJ]

I know that it may have been discussed previously on this board, but isn't there a future detriment for continuing to restructure these contracts. I am sure that salary cap numbers will continue to grow, but not a the same pace as these backloaded contracts.

Should we be prepared to try to take advantage of the next few years (i.e. Drew Brees window of opportunity) because in the near future we will have to blow up this team and start from the beginning and have a couple years of dreadful rebuilding.

If this is the case, it is equivalent to living on credit then eventually having to file bankruptcy in an effort to star over.

Am I looking at this correctly or am I completely wrong in how restructuring these contracts work?

Yes, it's what we've done the past couple of years, and why we're $20 million over the cap to start. It does make it sort of funny when you see people so excited, as if Loomis is working some sort of magic on the cap. All these restructures have done is pushed the problem down the road.

Now don't get me wrong, Loomis won us a superbowl, he's the reason we have Payton and Brees, and he absolutely should be trying to win at all costs right now. Their motto should be "There is no next year." But we will suffer every year as long as we keep pushing money back like this.

The good news is everyone expects big cap jumps after this season due to the new TV deals kicking in. We should get some needed breathing room.

 

[WhoDatElite]

Why in the word is no one talking about restructuring or out right releasing Roman Harper?? The guy is dead weight at Saftey. He almost single handedly lost the last 2 playoff games for us!!!!!

Because we've talked about on just about every thread.


Releasing him would add $4 million dollars in cap penalties this year alone. And if Harper knows that he can't be realeased, why woul he restructure? If he restructures it will be becuz he was gauranteed his starting job.

 

[Yingers]

I think they hold the position that as long as we have Brees as our QB that we should all we can to win SBs. Yes that will put us in cap hell down the road, but after Brees retires we will have a far less chance of winning a SB anyway.

I don't have a problem with this philosophy. At some point we will cut some veterans and rebuild our roster with cheap draft choices. A QB like Brees doesn't come around very often and you have to make the most of his time here while it lasts.

If I had to pick between a couple of SBs and then some down years or 10 years of mediocrity, I would choose the former.

 

[NaJ88]

I would be interested in seeing some more data about the average NFL team salary cap figures year to year.

My guess is that on average, you probably have a consistently large % of the salary cap that is comprised of base salary for players currently on the roster.

You probably have a much lower % of the cap devoted to signing bonuses for these same players that have been prorated across the life of their contracts (Drew's massive $7.4M annual hit due to a $39M signing bonus spread out over 5 years is actually a bit of an oddity.)

.... And lastly you probably have an even SMALLER % of the cap that gets attributed to "dead" money. This would be for situations in which the player gets released before the contract actually expires, but has already received a signing bonus that has been spread out over the years that they WOULD have been under contract for.

As I have always understood it, the idea is essentially that you aren't going to give a lot of "guaranteed" money (usually in the form of big signing bonuses) to players unless you are confident that they will be on the roster for years to come. Otherwise, you risk having to cut a guy that will still count against your cap for a much longer time than he plays with the team.

This is where Loomis no doubt has to relegate the task of determining who is worth the guaranteed money to Payton and the coaches... He can move the money around all day long, but at the end of the day he has to make sure he's not wasting guaranteed money on the wrong players (this is just common sense, after all.)

But if you take a look at who just got restructures, I didn't see a whole lot of players that I weren't confident would be with the team in another 3-4 years or so. Colston, Evans, Grubbs, Lofton, Hawthorne, etc... They're all guys who seem to be in the team's plans going forward.

In my opinion, the reason we have not seen restructures for players like Jon Vilma, Will Smith, or Roman Harper is because of the fact that the only 2 ways to lower the cap hits for players in the final years of their contracts are either to RELEASE the guy outright, or to EXTEND their contracts and redistribute the money across the life of the new contract via a signing bonus that will lower the cap in the short term.

The Saints are currently trying to determine whether or not it is more important to cut ties with these players (and their hefty contracts) right NOW or try to stick with them a little bit longer, and it's a very important decision. HOWEVER, these guys are actually perfect examples of why the system isn't broken.

With NFL players, there is usually a gradual and predictable drop-off in production that correlates with age. This means that by the time a pass-rusher gets to be 29-30 years old, or a running back gets to be 25-26, or a quarterback gets to be 39-40 years old, etc... you can expect their production to decline. Red flags start popping up for GM's, and very rarely do they resort to restructuring contracts for players in these situations. Instead, the players get released outright or are not retained when they become Free Agents.

Being good at estimating the risk associated with the players you sign is just the nature of the market. The guys who are most likely to experience a drop in production are not going to be the ones who just received the huge signing bonuses at the beginning of their contracts (hopefully!) You're only going to get the big money upfront if you are safely assumed to be sticking with the team for a while.

So if you're asking the question whether or not Loomis is making smart decisions with the future of the Saints' salary cap in coming years, I think it all boils down to whether or not you trust the team's ability to identify long-term vs short-term players. I personally think he's doing a great job. If he lets Will Smith, Jon Vilma, and Roman Harper walk (provided that not having to pay their 2013 base salaries frees up a considerable amount of space) while having recently restructured Evans, Grubbs, Lofton, Colston, Hawthorne, etc.... Then I would say he's done absolutely ALL the right things considering the circumstances.

 

[State Of Affairs]

I just dont see it being a huge deal. Over half the teams in the NFL are dealing with the same issues of balancing huge contracts and a flat cap. The Owners/League will not let stupid accounting rules ruin the game of football. They come up with some new way to move around money, write off the way it's carried, and stuff like that. Look at how they allow teams to carry over cap space year to year, it's all accounting gimmicks.

Not worried at all. At worst, at some point we will have to go through a year or 2 of rebuilding at some point, but its not like there will be a "Going Out of Business" sign on the Saints facility.

1st and formost... YES!! Absolutely, it matters and will effect the cap but as someone else pointed out, the salary cap will reset itself... For instance, the saints will cut Will Smith's $9million cap hit and the Falcons will sign him for $3.5 million to be their starter and the Falcons will cut John Abraham and the Saints will sign him for $4 million to be our starter (not liturally) but basically, teams will purge and the value of players will go down but as I read somewhere else, just like real life, the middle class will fade away, the top guys will still get over paid and force teams to go with younger, less expensive players...

This is why I wish there would have been an individule cap to what a player could make.. No one needs to make $22 million a year while the guys that block for him or catch his balls make $500,000...