Why I think we have cap room (and how much)

[G27RR]

It’s the day after free agency has begun, and there seems to be a lot of panic when it comes to fans of the Texans. Rumors of as little as $600,000 of remaining cap room, along with the surprising cut of RT Eric Winston and the UFA status of C Chris Myers and G Mike Brisiel, are driving most of the panic. I’ll try to address some of those concerns by explaining why I am not panicking.

Salary Cap Room

The salary cap for 2012 is currently $122.2M ($120.6M base + $1.6M from the Cowboys/Redskins penalty). If we had not used all of our cap in 2011, we could have carried the unused portion over to this year. There are teams out there that did that, which is one reason why you’ve seen some teams with huge amounts of cap space left over. Of course, those teams weren’t contenders in the playoffs last year.

People have been out there saying the Texans only have $600,000 of cap room left. That doesn’t make a whole lot of sense, unless they are assuming we will sign certain guys back and are already counting the rookie minimum salaries for draft choices against the cap. If we only had $600,000 left, we would have a team of just 45 guys and couldn’t sign our rookies. Do you really think the Texans’ management planned that poorly? I don’t.

As of last night (March 13th), the Texans likely have somewhere around $15M - $24.5M of cap room remaining. This accounts for Andre’s restructuring, Arian’s new contract, and the cuts to Winston, Leinart and Vickers. It also includes having eight guys on the practice squad at a generous $390,000 each. It does not account for dead money left against the 2012 cap. The reason dead money is not in there is that I could not locate reliable sources for those amounts. The remainder is what we can use to sign our UFAs and our draft picks.

How did I come up with that figure? I have been through several sources and cross-referenced most of these contracts against each other for accuracy. I have also been through the entire CBA and verified, to the greatest extent possible, that these calculations include all cap hits and have the correct amortization for cap purposes. That means that the amounts listed should include applicable base salary (A.K.A. paragraph 5) plus signing bonuses, roster bonuses, incentives, etc. For example, I’ve already started looking at 2013, and in that year I had to include a $4M escalator for Cushing.

We appear to have 45 players on our active roster, so naturally I’ve included cap hits for all 45 of them. I’ve also set aside cap room for the practice squad because they are considered part of the “team salary” under the CBA. I assigned a worst-case hit of $390,000/year for each of them, which would allow us to sign any or all of them to a minimum contract for an active roster spot if need be during the year (due to injury or waivers from our active roster).

When you add all that up, you get $97,624,127 against the salary cap. That leaves $24,575,873 of cap room. Unfortunately, we likely have some dead money out there that we owe against the cap for players no longer with the team. Since I could find no accurate estimates, we are left with the $15M - $24.5M of cap room that I mentioned earlier. So, even with an assumption of $10M of dead money, we’re a far cry from just $600,000.

****updated numbers, Thursday morning 3-15****

Updated numbers. It now looks more like $22M, not $25M, less dead money = maybe $14M to sign UFAs and the rookie contracts.

[G27RR]

I forgot to add, the final column shows the cap hit from remaining unamortized bonus. If cap hit this year is not significantly more than the hit from cutting a player, there's no point cutting that player. This does not account for any remaining guaranty that could be potential dead money.

[badboy]

Thanks for repeating what I and some others have been posting for weeks. In a less detailed format, I've posted Mario's $20m 2011 cap + $4.5 savings from Winston +$5.2m Andre's+ Leinert's base $2.5m = $32million. We have spent $8m on Foster and crakerjacks on Weeks.
32-8= $24million available to spend once Mario signs elsewhere. We will see mucho movement when Mario decides.

Good post.

[badboy]

Dead money (not vouching for source):
RB Steve Slaton (Dolphins) – 555,000 DT Amobi Okoye (Bears) – 3,615,000 QB Dan Orlovsky (Colts) – 2,250,000 WR David Anderson (Redskins) – 1,440,
http://torotimes.com/2012/02/12/hous...oaches-part-1/

[G27RR]

Originally Posted by badboy

Thanks for repeating what I and some others have been posting for weeks. In a less detailed format, I've posted Mario's $20m 2011 cap + $4.5 savings from Winston +$5.2m Andre's+ Leinert's base $2.5m = $32million. We have spent $8m on Foster and crakerjacks on Weeks.
32-8= $24million available to spend once Mario signs elsewhere. We will see mucho movement when Mario decides.

Good post.

Yep, saw your post yesterday. It's nice to see similar numbers calculating either backwards or forwards. Hopefully we can stop the insanity a little bit.

[ainsworth]

About 8 million in dead money. **** you Dan O!

[G27RR]

Originally Posted by badboy

Dead money (not vouching for source):
RB Steve Slaton (Dolphins) – 555,000 DT Amobi Okoye (Bears) – 3,615,000 QB Dan Orlovsky (Colts) – 2,250,000 WR David Anderson (Redskins) – 1,440,
http://torotimes.com/2012/02/12/hous...oaches-part-1/

Thanks, that would leave $16.7M using my figures.

[Dutchrudder]

So you're telling me that Daniel Manning was paid 8 million dollars in 2011? I'm not buying that, cause his total contract value was 20 million.

Also, you don't have Schaub's signing bonus added to his cap hit. Something like 1.2 million or so. His cap hit for 2012 should be just over 9 million.

Last year AJ, Antonio and Demeco restructured their contracts to help us get the space to sign Manning and JJo. We still have no idea how those restructures were set up. Their cap numbers for 2012 could be much higher than we think.

[NastyNate]

Originally Posted by Dutchrudder

So you're telling me that Daniel Manning was paid 8 million dollars in 2011? I'm not buying that, cause his total contract value was 20 million.

Also, you don't have Schaub's signing bonus added to his cap hit. Something like 1.2 million or so. His cap hit for 2012 should be just over 9 million.

Last year AJ, Antonio and Demeco restructured their contracts to help us get the space to sign Manning and JJo. We still have no idea how those restructures were set up. Their cap numbers for 2012 could be much higher than we think.

This. Plus why are you figuring in the Practice squad? That's a non-point.

[Hardcore Texan]

Championship!

[G27RR]

Originally Posted by NastyNate

This. Plus why are you figuring in the Practice squad? That's a non-point.

Have you read the new CBA? The verbiage indicates it counts against the team salary.

[Honoring Earl 34]

The new CBA makes the have nots spend their money while the haves give away their players .

[G27RR]

Old info

[Blake]

Ive never understood the "were up against the cap!" argument. If we are so damn close to the cap why even bother telling Mario and the world that we want him back? It just doesnt make any sense. We have cap space. We just dont want to be dumb with it.

[noxiousdog]

A similiar number can be found on Spotrac

[majestrate]

Originally Posted by Super Mario

Ive never understood the "were up against the cap!" argument. If we are so damn close to the cap why even bother telling Mario and the world that we want him back? It just doesnt make any sense. We have cap space. We're just saving it for Peyton.

FIFY

maj,
only joking

sorry, had to do it

[NastyNate]

Originally Posted by G27RR

Have you read the new CBA? The verbiage indicates it counts against the team salary.

You REALLY think we're going to sign someone to the practice squad to the extent that they are of the top 51 paid players? The practice squad doesn't count against the cap.

Nate

[Dutchrudder]

Originally Posted by G27RR

My data indcates Schaub's bonus is 500k this year and is included. Andre's figure is as of Monday when he restructured this year.

Per Rotoworld on Schaub:

3/21/2007: Signed a six-year, $48 million contract. The deal included a $7 million signing bonus and a $10 million option in the fourth season. 2012: $7.15 million (+ $500,000 roster bonus due 3/17), 2013: Free Agent

7/6 = 1.166

His cap hit should be about 8.816 million by those numbers.

Daniel Manning:

7/29/2011: Signed a four-year, $20 million contract. The deal contains $9 million guaranteed. 2012: $3.5 million, 2013: $4 million, 2014: $4.5 million, 2015: Free Agent

20 mill total, but only 12 million in salary over the last 3 years? Was he paid 8 million last year, or are the incentives we don't know about? Maybe he met those incentives and they are pushing up his cap hit this year. We simply don't know.


Here's another one that doesn't add up for me:

Owen Daniels:
3/3/2011: Signed a four-year, $22 million contract. The deal contains $6 million guaranteed. 2012: $3.5 million, 2013: $4 million, 2014: $4.5 million, 2015: Free Agent

(Oddly enough, it's the same salary structure as Manning's deal)

That's 12 million paid out in salary over the last three years. It says nothing of incentives, and leaves 10 million to be paid out in that first year. Obviously OD didn't get 10 million in 2011, but he may have earned some incentives we don't know about which push his 2012 cap hit up. There has to be more hidden costs somewhere, or else they wouldn't advertise it as a contract of $22 million.


http://www.rotoworld.com/teams/contracts/nfl/hou/texans

[badboy]

Originally Posted by Dutchrudder

So you're telling me that Daniel Manning was paid 8 million dollars in 2011? I'm not buying that, cause his total contract value was 20 million.

Also, you don't have Schaub's signing bonus added to his cap hit. Something like 1.2 million or so. His cap hit for 2012 should be just over 9 million.

Last year AJ, Antonio and Demeco restructured their contracts to help us get the space to sign Manning and JJo. We still have no idea how those restructures were set up. Their cap numbers for 2012 could be much higher than we think.

WHere do you see $8m for Manning? He lists $3.5m cap. Also, my understanding is Schaub's 2012 cap is apprx $7m not 9. i think you may be adding it twice.

[ChampionTexan]

Originally Posted by Dutchrudder

Per Rotoworld on Schaub:



7/6 = 1.166

His cap hit should be about 8.816 million by those numbers.

Something that's interesting and potentially significant, that I haven't heard discussed at all (by anyone), is that Article 13 Section 6 of the current CBA specifically limits the number of years a signing bonus can be prorated over to 5.

Here's the exact language:

Proration. The total amount of any signing bonus shall be prorated over the term of the Player Contract (on a straight-line basis, unless subject to acceleration or some other treatment as provided in this Agreement), with a maximum proration of five years, in determining Team Salary and Salary, except that:

(1) Any contract year in which the player has the right to terminate based upon events within his sole control shall not be counted as a contract year for purposes of proration. In the event the NFL and the NFLPA cannot agree upon whether an op-tion is within the player’s sole control, such issue shall be resolved by the Impartial Arbitrator.

The previous CBA had essentially the same language, but limited it to 6. If I understand this correctly, it means Matt's initial signing bonus was likely fully amortized at the end of last season.