Originally Posted by rmartin65
But does he count against the cap if he is on IR? You are more into NFL/Team finance than I am, but I though players on IR dont count against the cap?
The only way they don't count against the cap is if they sign a "split" contract, which basically pays out up to X% of the money (specified in each contract) if the player goes on injured reserve. A couple of recent examples of this are Ryan Grant and Cedric Benson, both of which signed split deals with the Packers this season.
Per the report, the contract is for the veteran minimum of $825,000 and he will count only $540,000 against the salary cap because of the minimum salary benefit. More interesting is the split that would drop his contract to $393,000 if he lands on IR. Typically, teams only talk rookies and young unproven players into agreeing to splits. It could be the Packers made a hard stance.
You may also remember that when the Texans were "trying" to re-sign Chester Pitts, one of the stipulations was that they wanted it to be a split deal. He wouldn't go for it and wound up with the Seahawks, and later on IR that season. The Texans this year also had split contracts with Kenyaron Fox and Rashon Harris iirc. Their cap hits for the year will depend on the amount specified as in the split, but I haven't seen it publicized. It's likely that they earned less than half the value of their contract's total.
Now I'm not sure if Lattimore would go for a split deal given the speculation that he would be on IR next season. It's really up to him and his agent, but they would have slightly more leverage if he were drafted rather than an UDFA. It might be an upfront agreement that he wouldn't play in 2013 due to rehab, but could be on IR and part of the team. So instead of getting the 405k that year (min for 2013), maybe they do it as a split deal for 50% of the value and immediately put him on IR after training camp to save cap room and the roster spot.
There's certainly wiggle room for any team and Lattimore to negotiate, but in the Texans situation, I think it may be worth it to wait for him to hit the UDFA market due to cap constraints.