Sorry for the long hiatus Eagles fans! It’s been a busy Summer with my real job and a couple of other projects I’ve been working on. Hope you’ve all enjoyed the All-22 highlight films I put together during the off-season. If you haven’t had a chance to check them out, I highly recommend you scroll down this blog and do so. It’s back to business now as the Eagles officially kicked off training camp today, and with that comes a new blog post from yours truly.
The Philadelphia Eagles went on a bit of a splurge this off-season, cashing in on the $40+ million of cap space they had at the beginning of the free agency period. Between the signings of DeMarco Murray, Byron Maxwell, and Brandon Graham, the Eagles handed out a total of $129 million with $53 million of that money being guaranteed. At first glance of looking at the overall numbers, the amount of money in these contracts looks like the type of money that ends up handcuffing teams down the road, causing bad cap implications if the team ends up having to move on from a player that didn’t perform at the level he was expected to. However, upon further review, the exact opposite is true.
Teams can find themselves in trouble when they sign a player to a big contract who doesn’t end up living up to the billing. They may want to move on from that player two to three years down the road, but there is one big obstacle in their way: dead money. Dead money in the NFL is the guaranteed portion of a contract that hasn’t been accounted for yet in the salary cap. Most of the time, this is in the form of the remainder of a signing bonus proration.
The NFL salary cap rules allow teams to hand a player a lump sump of money in the form of a signing bonus, but prorate this money out over a period of the length of the contract up to five years when it comes to accounting purposes for calculating that players salary cap value. On one hand, this is great for teams because they can give a player a $15 million signing bonus, but instead of having that $15 million be charged to their salary cap in year one, they can spread it out over five years to be a $3 mil cap charge each year. However, what happens if after three years, the player is not playing at a high level and the team feels he’s not worth the contract he’s being paid? There’s still $6 million left in signing bonus prorations to account for, so if the team decides to cut or trade that player, they will have to take on $6 million in dead money. So even though that player will no longer play for them, they will still have $6 million of their salary cap accounted for by that player. As a result, the team may be forced to hang on to the player for one more year if they don’t have the cap space to be able to take on the dead money for a player who is no longer contributing to the team.
That brings us to the contracts that the Eagles gave to Murray, Maxwell, and Graham. As they had a lot of cap space this year, they didn’t need to hand out large signing bonuses and do a lot of contract voodoo in order to fit those guys under their salary cap. Murray received a $5 million signing bonus, Maxwell a $6 million signing bonus, and Graham a $4 million signing bonus. Those are very small signing bonus numbers compared to other players of similar skill and age. The rest of the guaranteed money for these three players came in the way of guaranteed base salaries for their first two years, and $2 million of guaranteed base salary for Murray in year three.
Of the $53 million in guaranteed money the Eagles gave to this trio, $36 million of it is in the form of guaranteed base salaries in years one and two. Well these three players are pretty much locks to be on the roster for the next two years anyway, so basically the Eagles slapped a guarantee on a portion of money that these guys were already 99% guaranteed to make regardless. As a result, there is relatively very little dead money left on these players’ contracts after three seasons, as you’ll see below. Here’s a breakdown of each of Murray, Maxwell, and Graham’s contract from overthecap.com.
As shown in the contract breakdowns, after three seasons Murray will have $2 million in dead money left in his contract, Maxwell $2.4 million, and Graham $1 million. This gives the Eagles great cap flexibility heading into the 2018 season if they need to move on from one, or all, of these players or if they need to restructure their contracts to lower their cap numbers. But for argument’s sake, let’s just say that after three seasons, Murray, Maxwell, and Graham all hit a wall and are no longer playing at a level that justifies their contracts. If the Eagles were to cut all three players heading into the 2018 season, they would take on a total of $5.4 million in dead money. As a comparison, cutting Trent Cole and Todd Herremans alone this off-season resulted in $5.6 million in dead money.
Here are some more comparisons: The Buffalo Bills gave LeSean McCoy a $13.125 million signing bonus when they restructured his contract this off-season. As a result, if they cut or trade him after three seasons, they will incur $5.25 million of dead money. The Kansas City Chiefs handed Jeremy Maclin a $12 million signing bonus this off-season, leaving the Chiefs with a dead money hit of $4.8 million if they move on from him after three seasons. Cameron Jordan received a $16 million signing bonus from the Saints upon signing his five year $55 million deal. If the Saints move on from him after three seasons, they’ll incur $6.4 million of dead money.
Upon further review, the contracts the Eagles handed out this off-season look very safe and team friendly compared to some of the contracts handed out by their competitors. Hopefully, three years from now Murray, Maxwell, and Graham are all still playing at a high level and there’s no need to do anything but continue to pay them their salaries. But it’s nice to know that if a couple years down the road the team feels that it’s in their best interest to move on from a player, that they can do so without making a significant impact to their salary cap.