“Salary Cap? Salary Cap?” ~Jim Mora voice
by David Perkins | February 26, 2019
Please help me welcome ArrowheadOne’s newest contributor, David Perkins. David has been a frequent visitor here at ArrowheadOne for awhile now and has decided to share his take on all things Chiefs. Thank you David for an epic first offering! Enjoy. -Laddie Morse
Why is everyone panicking about the salary cap? Too many bloggers, tweeters, posters, sportswriters, fans, etc., are up in arms about the Kansas City Chiefs needing to “correct” the salary cap for the big day when Patrick Mahomes II gets signed to a long term deal. In fact, a $200 million multi-year deal is already being discussed! Outrageous! It is too early to fret and talk about cutting this guy and that guy and renegotiating contracts. It is indeed… absurd.
I say “big deal” but no need to panic, today or tomorrow or even 2019, or 2020… or 2021. Here’s why.
A tip of the cap: the basics
PM2 signed in 2017, and as a 1st rounder is under contract for 4 years with a 5th year option. So, we have him on the cheap from 2017 through 2020. The 5th year option in 2021 (which the Chiefs will most certainly pick up) is auto-calculated by the NFL. That means 2022 is the first year of the ominous “big contract.” 3 full complete seasons away! So, take a deep breath now, inhaling slowly and… exhaling slowly….
UnSimple Math… but not complex
The 5th Year – 2021
The 5th year option payout is the average of the top 25 position contracts (excluding #1 and #2). Today that number is roughly $17.6 million. I doubt by March 2021 (the month to exercise the 5th year) that number exceeds $20 million. And here is why:
Top 25 subtractions (11)
Of the Top 25 position contracts, 7 should be retired after the 2020 season including Brees, Alex, Flacco, Ben, Eli, Phillip, and Tom. Four others — Tannehill, Bortles, Keenum & Dalton — should either be out of the game or hanging on by a thread at much reduced prices. These subtractions will lower (or suppress) the positional computation.
Top 25 standstills (2)
Two — Mayfield and Darnold — will not hit their 5th years until after PM2, so they will not affect the positional computations.
Top 25 locks & bagels (5)
Five QBs — Rodgers, Ryan, Garoppolo, Stafford, Carr — do not renew until 2022 or 2023, so they will not affect the positional computations.
Top 25 Upgrades (6)
Four QBs — Russell, Carr, Cousins and Luck — renew in 2019, 2020, 2020 and 2021 and will likely add another $5 million a year to their current deals. Two QBs hit 5th years in 2020 — Goff and Wentz — and will push the $25M-to- $30M mark up from $7 million each.
Top 25 Additions (4)
Three QBs not even in the Top 25 — Winston and Mariota — renew in 2019, and Watson in 2021. The first 3 will likely hit $25 million (since their franchises are desperate), replacing the newly retired on the Top 25 list. In addition, newly drafted QBs will fill in the bottom rungs of the Top 25 ladder in the $7 to $9 million range (thanks to the rookie salary cap).
Top 25 Ties One On (1)
Trubisky exercises in 2021 along with Pat and will certainly hit $25 to $30 million.
Yodeling Totals
Given the above 11 subtractions, 3 additions (plus future QB draftees), 6 upgrades, 5 locks, 3 stand-stills, and 1 tie, the likely 5th year average for Mahomes will be about $18 million (yes I did the math), not much of an increase above today’s number. Add 2 years of cap increases at $18 million to the current $4.5 million due in 2019, and the Chiefs easily cover the 5th year option even if it is $20 million. (inhale… exhale… rinse and repeat)
Super Simple Math – 2022
Excluding 2019, there are three contract years (2020, 2021, 2022) and thus 3 cap increases before PM2 gets the big bucks. The cap has been increasing about $9 million a year (in recent years), therefore another $27 million will be added. In 2019 PM2 receives $4.5 million so add the $27 million of cap increases, and presto, a $30 million contract is covered. Simple. (puts down the inhaler)
The Complicated Math – To Infinity and Beyond
How do we pay for Tyreek, Big Chris, and Kendall? (digs the inhaler out of the trash)
Great question, so stay with me now because the complex is coming, but with PM2 covered, that worry is out of our minds and our calculations. The reality is the Chiefs just need to reconfigure the current dollars and spend them more wisely (so profound). Simple math. Here we go.
The Current 2019 Cap Situation
8 players exceed $5 million in 2019, accounting for $108 million and 57% of the cap. 16 players range between $1 million and $5 million, accounting for $42 million and 21% of the cap. The balance of the roster is less than $1 million. Clearly to stay out of cap hell, a team needs to strategically pay the superstars, manage the stars and near stars (overstatement), while depth players and projects come and go at or around the league minimum. The Chiefs need more players in the mid-range ($1 – $5 million) to stay competitive and dominate the Super Bowl for the next 15 years.
People complain about the lack of production from Houston, Berry and Watkins, causing a “cut them yesterday” mentality to prevail, but let’s look at this a different way. Player by player systematically by year versus irrational scatter-brainness (is that even a word?).
In the Year 2019
Henne (2019 – $4 million)
If Henne is not cut going into this year, instantly freeing up $4 million, then he is gone after 2019. The same $4 million will be spent on a backup (Litton at $1 million?) or some other cracker jack clipboard holder at $2 to $3 million.
Savings: $4 million in 2019 or $1 to $2 million in 2020
In the Year 2020
Colquitt (2020 – $2.65 million) Dustin retires after 2020 (even though his leg is good until 2030 since he is punting a lot less) and his dollars go to sign Butker and the next punter.
Savings: $0 in 2021 – but we sign 2 players for the price of 1 in 2021
Sorenson (2020 – $4.75 million) Dirty Dan may not make it into 2019 (not in my book anyway), but if he does, he will not make into 2020, so assuming Kendall Fuller hangs around, DD’s monies sign Fuller in 2020.
Savings: $2.7 million in 2019 or $0 in 2020 by signing Fuller
Erving (2020 – $4.7 million) The Chiefs may extend Erving again, but I assume Wylie and McKenzie step up and take over at least 1 starting OG spot and 1 depth spot.
Savings: $0 in 2020; $2.5 million in 2021 after signing Wylie with McKenzie still on his rookie deal
Schwartz (2020 – $8 million) Say it ain’t so please, but assuming retirement in 2020, Schwartz’s $8 million will cover 2 – #1 draft choices in 2021 and 2022 and certainly his replacement drafted in the 2nd round in 2020.
Savings: $0 in 2021 but we now sign 3 players instead of 1
Watkins (2020 – $21 million) I love Sammy. His mere presence juices the offense (see Patriots playoff game). He single-handedly destroyed the Bronco’s at home this year. I would prefer to keep him after 2020 (at a lower rate), but we gotta pay Tyreek. So TH10 takes a smaller contract amount in 2020 and then Ty consumes $16 million of Watkins’ contract thereafter (or possible the entire amount. Yikes!)
Savings: $4 million in 2021 paying for either a) Robinson, Pringle and Deiter (as a group) or b) 2 draft choices with TH10 locked up long-term.
Houston (2020 – $19 million) Not sure JH50 makes it into 2019 but I keep him and then cut him after 2019 and eat the smaller cap hit of $1.5 million then, instead of $7 million now. Yes the $14 million in savings pre June 1 and $15.5 million post June 1 are really tempting in 2019, but he is a leader in the locker room, and we do not yet know how he fits into the Spags defense. I think we need him one more year but will keep an open mind to the 2019 cutting board. These monies can then be used on 3 or 4 quality FA’s or even 2 FAs and 2 #1 draft choices (another multi player exchange).
Another factor is the franchising of DFord55 and whether we sign him 1 year (franchise only) or longer term. Personally, I make DF55 play a second year at a high level. If he does not perform, we get a 3rd or 4th round compensation pick, and if he does, either sign and trade and collect a first rounder (think Raiders) or sign him to a 3 year deal around $16 million. Keep it short. He makes me nervous long-term.
Savings: $15.5 million in 2019 or $17.5 million in 2020 – but we either sign more players around $5 million a year or more than likely we sign DF55 and a FA at $3 – 5 million
In the Year 2021
Kelce (2021 – $9 million) Another extension in my mind (like Schwartz), but if he retires in 2021, his monies go to a FA TE or at least 2 more draft choices if not 3.
Savings: $0 in 2022, but we sign multiple players
Fisher (2021 – $11.5 million) Again like Schwartz and Kelce, possibly an extension, but more than likely these dollars go to fund a FA LT or a LT and RT draftees, 1 of which replaces Fish. The multiplier effect strikes again.
Savings: $0 in 2022, but we sign multiple players
Last Year 2022
Hitchens (2022 – $11 million)
Hitch is likely gone after 2020 or 2021 and these dollars are used for his replacement and at least 1 if not 3 more players (Neimann?, a draftee or 2, or 2 FAs). The multiplier effect strikes again (and again)
Savings: $0 in 2022, but we sign multiple players again (and again)
Berry (2022 – $14 million)
Like JH50 and similar to SW14, CJ95 needs to get paid. So Berry is released after 2019, CJ95 takes a smaller pay day in 2020 and then absorbs Berry’s $14 million starting in 2021.
Savings: $0 – but CJ95 is locked up long term
(Note: Change of heart: – Berry is cut post June 1 and we sign Landon Collins. We save $0 million in 2019, but $5 million thereafter, so CJ95 will eat into the $25+ million stash from 2019)
If you want to add all of that up (neither do I, and anyway I wrote it so you do the math) you can see by reconfiguring the dollars spent beginning as early as 2019 an certainly 2020, 1 player multiplies into 2 or 3 or even 5 younger cheaper players (some combo of FAs and draftees). This allows the Chiefs to afford many more players in the $3 – $7 million range, and certainly many more draft choices between $1.5 – $4 million (on rookie contracts), while still paying the superstars like PM2, CJ95 and TH10, and upcoming stars like KF23, and the new ones yet to reveal themselves.
One major key is to avoid the JH50 and EB29 contracts wherein production is so much less than dollars spent (if only we had that foresight). Houston and Hitch alone pay for 4 or 6 more players and Fish and Schwartz will easily pay for their replacements and then some. Another key is to stay young and be careful about signing certain positional players beyond the age of 30. (when did it hurt so much to grow old?)
And none of the above includes the soon-to-be-mentioned “X” factor.
I believe Veach will be much smarter than Dorsey in respect to “bad” contracts, if for no other reason than Veach is dealing with the cap debacle Dorsey left behind. What a headache!
The “X” Factor & The Cap
PM2 is clearly about winning and not stats, and Patrick has seen plenty a NFL teams in recent years decimate their caps by signing QBs to new outrageous contracts for ego purposes (Green Bay, Detroit, Atlanta) or simply signing QBs prematurely before production equals/exceeds the dollars spent (Oakland, San Francisco, Jacksonville, Minnesota, Denver, Miami). In most of these cases, the overall team talent level suffers due to the newly discovered and long-lasting handcuffs and handicap.
When considering the prior paragraph, and the fact PM2 will easily make $50 million annually in endorsements by 2022, combined with the fact he has personally witnessed the effects of Brady offering the Patriots the “hometown discount” in exchange for championships, is it too far-fetched that he offers the Chiefs a similar discount to keep a well-balanced winning team around him?
I tend to believe so. Here is hoping we sign PM2 in the $25 – $30 million range versus the $35 – $40 million range (or do I even daresay $50 million?).
Summations and Conclusions
In a nutshell, after about 10,000 words more or less, Chiefs fans can rest assured the current cap tensions are solved to easily pay Mahomes in 2021 and 2022 and beyond… and there is enough money to spread around to CJ and Tyreek, and other rising stars to keep us winning for the next 15 years during the Showtime Era.
Think Abundance, not lack, and we will all Prosper.
David Perkins — ArrowheadOne
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