Carolina Panthers: Thinking Ahead for the Cap

Al Messerschmidt

We all know that the Panthers are struggling to get under the cap for this season, but has anyone considered what effects there will be in the seasons to come? We're going to take a quick look to see what are situations are going to be next season and in seasons to come.

The biggest problem that I've seen over the last few years is that we have been mortgaging our future to save ourselves in the present. That all has culminated in the Panthers being well over the cap coming into this season and quite frankly that has really hamstrung us over this off-season. We have several needs and there are some really attractive free agents out there who we could bring in... if only we had the space to sign them. Add to the fact that our performance for all this used space has been less than stellar and you have to admit that we simply have too much wasted cap space. So what does the situation look like for the coming seasons?

Doom and Gloom: 2014 Struggles

As you might suspect by that heading... 2014 does not look good. We've currently committed $137 million toward the 2014 cap. That is before any draft picks in 2014.. and even before any draft picks this season. Needless to say, that does not bode well. Our 2012 drafts account for about $8 million of that cap space, and we could likely expect a similar slightly lower figure from our 2013 signings in 2014. So that number becomes about $140 million or so. The question is really how do we fix this problem... and more importantly how to avoid getting back into it. Well, I'm going to highlight a few areas that we could make some headway...

Here's something I want to point out:

Player

2014 Salary

2014 Bonus

2014 Cap Hit

2014 Dead Money

2014 Cut Value

Chris Gamble


8,850,000

8,850,000

0

8,850,000

Jordan Gross


6,700,000

3,000,000

9,700,000

3,000,000

6,700,000

Cam Newton


3,378,477

3,629,500

7,007,977

3,629,500

3,378,477

Greg Olsen


5,250,000

2,950,000

8,200,000

5,900,000

2,300,000

Charles Godfrey


5,000,000

2,100,000

7,100,000

4,200,000

2,900,000

Charles Johnson


8,750,000

6,250,000

15,000,000

12,500,000

2,500,000

Geoff Hangartner


2,450,000

0

2,450,000

0

2,450,000

James Anderson


3,900,000

1,500,000

5,400,000

3,000,000

2,400,000

DeAngelo Williams


5,750,000

3,450,000

9,200,000

6,900,000

2,300,000

Jon Beason


6,500,000

4,250,000

10,750,000

8,500,000

2,250,000

This table represents the yearly salaries, bonuses (signing and restructuring), the dead money for the entire contract from that year on, and the amount that could be saved by cutting that player in 2014. (All data provided by and linked to www.spottrac.com).

Notice something? The #1 way to save cap space in 2014 is also the #1 way to save capspace in 2013: Cut Chris Gamble. There's really no way to get around this. He has no more dead money in 2014 and will immediately provide a bit of relief to a team that is looking at another year of belt tightening to get by. Now, we can eliminate obvious long term investments like Cam Newton, who isn't going anywhere, and perhaps even Charles Johnson and Greg Olsen; basically the players whom we are committed to for the future. But there's no getting away from a few of these others. Players like Jon Beason and James Anderson may be targets for cuts or trades simply because they are both talented and both provide a sizable amount of relief. "But Sweeney, why not just restructure those contracts?" Glad you asked...

When you restructure someone's contract, you devote a portion of their salary into a signing bonus (like what we did with a number of free agents this year). That gives you an immediate relief to your cap figure because you can then spread this bonus out across the remaining years of the contract. And this money is guaranteed. The longer the contract, the more thinly you can spread it. However, in doing so you increase your cap hits in the next years. That is what I mean by "mortgaging the future" when we do these restructuring. We get immediate relief at the cost of more dead money later on.

Greg Olsen's restructuring is a good example of this. It took his dead money in 2014 from $5.5 million to $5.9 million, which means that if we were to cut Olsen, it would actually cost us more money later on in his contract. My table, originally made yesterday before news of Olsen's restructure broke, was originally in order. Notice how his "cut value" is now much lower than it was. Now, obviously we aren't cutting our best tight end. In fact, I wouldn't be surprised if they signed him to an extension in 2015, which is the last year of his current contract. The point I'm trying to illustrate is that restructuring has it's own repercussions. It's also why you can't restructure someone like Chris Gamble. He has only 2 years left on his contract. Because we're already over the cap for 2014, you can't restructure him in 2013 because that's just going to make your 2014 cap numbers that much worse. You would actually have to sign him to a completely new deal, which he has no real motivation to accept.

Brighter Horizons

2015 is not going to be that pretty either. We have $111 million already committed given the current contract statuses and that figure probably will go up to at least $125 million by the time it rolls around. But there are some pluses here... For one thing, the salary cap will probably be close to $128 million, so hurrah! We're finally going to start a year under the salary cap. Secondly, there are no less than 8 players in 2015 who have a "cut value" of over $5 million: Charles Johnson, Jon Beason, Thomas Davis, Steve Smith, DeAngelo Williams, Ryan Kalil, Greg Olsen, and Charles Godfrey. Hell, 3 of those players are over $7 million (Smith, Beason, and Johnson). But finally after so many years of cash strapped difficulties, in for 2016 we have only $50 million toward the cap. How is it that the number drops so low? Neglecting the fact that it's 3 years from now and that's 3 years worth of contracts we haven't inked into place yet (including a big fat paycheck for Cam Newton...), it's really all back to our draft classes.

The reason we're in such dire straights this year is because our draft classes in 2009, 2010, and 2011 (especially the first two) have been poor. We have 2 players from 2009 still on the team. Of the 9 players in our 2010 draft class, only two have developed into starters. It's the lack of talent behind players that has led to us desperately clinging to our starters by overpaying them. That was really the downfall of Marty Hurney. We absolutely had to resign several free agents during his tenure because they simply never found players who could replace them. Having one or two irreplaceable players on your team isn't a bad thing. Having more than 5 of them is. It's not for a lack of trying really, but regardless the situations just haven't panned out.

Now remember those 8 players I listed earlier? Those are the positions we need to target today. Those are the positions that we need to think about finding people to step into because that is how we avoid cap issues. Part of your draft strategy should be to acquire talent so that you have people to step into the roles when you need to create more money for the rest of the team. Yes, that means we might let someone go in 3 years that we are paying handsomely right now. But if you have someone ready to step up behind that player, similar to how we let Johnson replace Peppers, we can keep our costs low and our talent high.

Putting it Together

So how would I go about addressing our upcoming draft? I'd start by putting myself in a position where I can cut players next year without hampering our team. Specifically, that means targeting a left tackle, safety, right guard, and yes, perhaps even another linebacker and tight end. Three of those players are actually positions of relative need this year. That's what I would consider targeting in the draft this year, particularly with our 4th and 5th round selections. Drafting those players now will allow us to time to groom them for when we will actually need them to start. And if they end up not working out, that's where free agency can come into play.

At least, that's how I would do things to get our financial house in order.

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