Salary cap historical lesson

[Patler]

I have read several comments on here to the effect that there is something "different" concerning the salary-cap now, and teams' ability to pay free agents under the new CBA. Several have said "this isn't the 1990's anymore" or something to that effect.

While the increase last year was large enough that cuts to get under the cap were all but eliminated, long term nothing has really changed. The increases last year and this year are not unprecedented. Nothing has really changed except that the numbers are larger. Percentage wise the increases are not unusual or extraordinary.

As a percentage of the previous year's salary-cap, the increases have been as follows:

1995- 7.2%
1996- 9.9%
1997- 1.6%
1998-26.5%
1999-11 .45%
2000- 6.5%
2001- 8.4%
2002- 5.5%
2003- 5.6%
2004- 7.4%
2005- 6.7%
2006-18.6%
2007- 6.9%
2008- 6.4%

As you can see, the recent increases are not all that unusual. The numbers are larger because we are dealing with a larger base. It will take only a couple years for salaries to "catch up" to the new, bigger salary pot.

Minimum salaries have also increased, and recently having increased more than the salary cap has increased, on a percentage basis. For example, while the salary cap this year increased 6.9%, rookie and veterans minimums increased approximately 10%.

The substantial salary cap increase for the 2006 season caught everyone's attention, and it was a large increase in dollars. However, as a percentage of the previous year's salary cap, the increase in 1998 was much larger and 1999 followed with an increase of another 11.45%, percentage wise much greater then the 2007 increase. In actual dollars, the increase in two seasons, 1998 and 1999, was $17 million, not that far from the $23 million of the last two seasons. Percentage-wise, it was much larger, yet it didn't take teams long to use both up and get into salary-cap troubles by back loading contracts that overpaid marginal players. It can happen again and probably will in a couple years. There has already been some discussion that several teams will struggle this year to get under the salary cap when the rookie pools are assigned. Denver is in that situation.

Healthy salary cap increases have an immediate impact of reducing the quality of the free agent pool, as teams can "keep their own" when they want to. However, as the increases level off, more and more teams find themselves with salary cap challenges.

[Bretsky]

This is interesting; but I would say from the above statistics things have changed and I would compare the 2006 extreme cap raising with back in the 98-99 area when they had an even bigger % increase.

The 2006 bump explains why everybody has lots of money; Wahle's deal came due on the wrong year I guess.

With the 18 percent increase, teams have excess money. What a great time to be a free agent.


B

[MJZiggy]

:worship: :worship: :hrt: :bow: :bow:

Thank you Patler, Thank you, Thank you!!!

[LL2]

Thanks for the Saturday morning lesson Patler! I know you said your good at remembering numbers and stats. What is your profession?

This doesn't take away from the fact that GB still has quite a bit of money under the cap. If TT isn't going to use it on FA (that's a given) then he better lock up Williams and Barnett to long term deals.

[Fritz]

Patler, I thank you for introducing facts to these debates. Facts sometimes seem to have the effect of dampening debate, though, don't they?

[Packnut]

Is'nt your 2008 number a "projected" cap? Since the actual cap is based on a percentage of team and league revenue for the previous season, the actual cap # won't be known until AFTER the season. Below is the cap formula.


Answer:The Cap is determined through a complicated calculation system, which has changed with the latest extension of the CBA. The Cap is based on income that the teams earn during a League Year. Originally that "pot" was limited to what was known as Defined Gross Revenues (DGR), which consisted of the money earned from the national televison contract, ticket sales, and NFL merchandise sales. Under the new agreement the "pot" has been expanded to include total revenue. Thus, other sources of revenue, including such other items as naming rights and local advertising, have been added. As was the case with the original DGR, the expanded revenue is divided equally amongst all 32 teams for purposes of claculating the salary cap.

For all of you nerds out there, here is the actual mathematical calculation:

Projected revenue x CBA Percentage = Players Share Total Revenue

Players Share minus Projected League wide Benefits =
Amount Available for Player Salaries

Amount Available for Player Salaries / Number of Teams =
Unadjusted Salary Cap per Team

[Packnut]

Here is another cap question site. There is no 2008 salary cap # because again, it is based on a percentage of revenue from the previous season. If you look at what's included in team revenue it's impossible to get a number cause ad rates hav'nt been locked in yet.

http://www.skinsfans.com/pcinoz/Salary%20Cap%20FAQ.htm

[Bretsky]

Patler, I thank you for introducing facts to these debates. Facts sometimes seem to have the effect of dampening debate, though, don't they?


I'd like to historically compare how the 98/99 effect had to the 2006/07 cap effect.

Seeing the 18% compared to the 26% effect would be interesting. I still think the 18% after all those 6-7 percent years tell me this is a transitional time and great to be a FA.

[RashanGary]

You've brought this up before Patler. I believe it was when as the CBA was being rehashed. I believe you said at that time that there would be a one or two year hike probably similar to the 98/99 CBA and then it would level off.

Thanks for the history lesson, but you deserve more credit than simply stating a stat. You acctually predicted it a while ago.



I completely agree with your point though. Keeping your own is usually resonable where as the free market is typically driven up by need and desperation. It's not to say a team should never jump into FA but it is definilty something that should be looked at with all things considered, including the financial risk. Getting better through FA often doens't happen short term although that is the goal but it always hurts long term. There is very little reward for the risk typically although teams should always be open minded if an oppertunity to fill a major hole arises like replacing Ahmad Carroll :).

[Patler]

Packnut;

I believe the calculations are done one year in arrears. The CBA Extension term sheet signed by the league and Union in advance of the CBA being written states as follows:

"The Salary Cap for 2006 shall be 102M and the Salary Cap for 2007 shall be 109M...."

"Subsequent Caps and adjustments to be made on the following schedule: 2008 cap to be agreed upon after the 2006 season, with any outstanding prior adjustments incorporated therein; 2009 Cap to be agreed upon after 2007 season, with any outstanding prior adjustments incorporated therein; 2010 Cap to be agreed upon after 2008 season, with any outstanding prior adjustments incorporated therein; 2011 Cap to be agreed upon after 2009 season, with any outstanding prior adjustments incorporated therein. If early termination, any adjustments are to be made in the new Final Capped Year."

So, as you can see, the 2008 cap was determined after the 2006 season, not after the 2007 season.

The league announced to the teams in January that the 2008 cap would be $116 million.

[Patler]

Here is another cap question site. There is no 2008 salary cap # because again, it is based on a percentage of revenue from the previous season. If you look at what's included in team revenue it's impossible to get a number cause ad rates hav'nt been locked in yet.

http://www.skinsfans.com/pcinoz/Salary%20Cap%20FAQ.htm

ESPN reported the 2008 salary cap already in December 2006, based on league info.

From your link in your post, I hope you're not taking the word of a Redskin's fan over mine???
:roll: :roll: :smack: :smack: :lol: :lol:

[Packnut]

Here is another cap question site. There is no 2008 salary cap # because again, it is based on a percentage of revenue from the previous season. If you look at what's included in team revenue it's impossible to get a number cause ad rates hav'nt been locked in yet.

http://www.skinsfans.com/pcinoz/Salary%20Cap%20FAQ.htm

ESPN reported the 2008 salary cap already in December 2006, based on league info.

From your link in your post, I hope you're not taking the word of a Redskin's fan over mine???
:roll: :roll: :smack: :smack: :lol: :lol:


NEVER! :oops:

[Packnut]

In hind-sight it really does'nt matter if the cap is 1 billion in 2008. Teddy ain't gonna spend any cash. In fact, he's gonna set a record for the GM saving the most money in cap space for 2 consecutive years! :roll:

[Patler]

In hind-sight it really does'nt matter if the cap is 1 billion in 2008. Teddy ain't gonna spend any cash. In fact, he's gonna set a record for the GM saving the most money in cap space for 2 consecutive years! :roll:

How much of his available salary cap did he not spend in 2005?
How much in 2006?

Do you realize that in 2006 he actually spent MORE than the NFL standard salary cap allotment?

[Charles Woodson]

In hind-sight it really does'nt matter if the cap is 1 billion in 2008. Teddy ain't gonna spend any cash. In fact, he's gonna set a record for the GM saving the most money in cap space for 2 consecutive years! :roll:

How much of his available salary cap did he not spend in 2005?
How much in 2006?

Do you realize that in 2006 he actually spent MORE than the NFL standard salary cap allotment?
Yea but this is ridiculous how slow hes being. i mean really.

[Charles Woodson]

Patler can you give me a breakdown of basically how much money we have to spend where.

for instance

$______-free agents
$______-Drafties
$______-Resingines
and such

thanks in advance

[Patler]

Patler can you give me a breakdown of basically how much money we have to spend where.

for instance

$______-free agents
$______-Drafties
$______-Resingines
and such

thanks in advance

Huh? :?:

[esoxx]

While the increase last year was large enough that cuts to get under the cap were all but eliminated, long term nothing has really changed.

Well for me this is the crux of the issue. This indeed does present a big change from years past where teams had to engage in large scale player releases in order to get under the cap. This allowed some top flight talent to be available on the open market, unlike what we've seen here recently.

Those days appear to be gone and it does represent a MAJOR change.

[Bretsky]

While the increase last year was large enough that cuts to get under the cap were all but eliminated, long term nothing has really changed.

Well for me this is the crux of the issue. This indeed does present a big change from years past where teams had to engage in large scale player releases in order to get under the cap. This allowed some top flight talent to be available on the open market, unlike what we've seen here recently.

Those days appear to be gone and it does represent a MAJOR change. :thank:

[Charles Woodson]

Patler can you give me a breakdown of basically how much money we have to spend where.

for instance

$______-free agents
$______-Drafties
$______-Resingines
and such

thanks in advance

Huh? :?:

ha okay what i mean is about how much per section are we going to use our money on. like estimated we are going to need ___ amount for rookie signing, and we have resigned ____ people for____ amount of money and that leaves us with ______ for free agents or resigning our people

[Patler]

While the increase last year was large enough that cuts to get under the cap were all but eliminated, long term nothing has really changed.

Well for me this is the crux of the issue. This indeed does present a big change from years past where teams had to engage in large scale player releases in order to get under the cap. This allowed some top flight talent to be available on the open market, unlike what we've seen here recently.

Those days appear to be gone and it does represent a MAJOR change.

Actually, I think that changed 4 or 5 years ago already. 2006 didn't make a long term change in that regard. Wolf made the comment that in the early years of FA, many teams didn't have a clue, and talented players were all over the FA lists in the mid to late 1990s. He said by the time he retired, most teams had hired full time cap specialists and did much better managing the cap, so fewer good players were available.

That was already the case in 2004, 2005; before the big jump in the cap for 2006. All that 2006 did was give a temporary reprieve to the ones that still bungle it up. Chances are, by 2009, 2010 we will again see a few struggling.

[Bretsky]

I agree that by 2010 we'll see some struggling again, and TT will certainly not be one of them. And it's too bad that Wahle contract would not have come due after the big increase; TT might have decided to keep him then.
But the recent increase had had an impact.

[esoxx]

While the increase last year was large enough that cuts to get under the cap were all but eliminated, long term nothing has really changed.

Well for me this is the crux of the issue. This indeed does present a big change from years past where teams had to engage in large scale player releases in order to get under the cap. This allowed some top flight talent to be available on the open market, unlike what we've seen here recently.

Those days appear to be gone and it does represent a MAJOR change.

Actually, I think that changed 4 or 5 years ago already.

That was already the case in 2004, 2005

Which makes it doubly tough to accept the fact that Mike Wahle, a very talented player just entering his prime, was able to get away due to our own cap mess at the time. I've haven't noticed OL of his caliber on the open market the past few years.

[Patler]

While the increase last year was large enough that cuts to get under the cap were all but eliminated, long term nothing has really changed.

Well for me this is the crux of the issue. This indeed does present a big change from years past where teams had to engage in large scale player releases in order to get under the cap. This allowed some top flight talent to be available on the open market, unlike what we've seen here recently.

Those days appear to be gone and it does represent a MAJOR change.

Actually, I think that changed 4 or 5 years ago already.

That was already the case in 2004, 2005

Which makes it doubly tough to accept the fact that Mike Wahle, a very talented player just entering his prime, was able to get away due to our own cap mess at the time. I've haven't noticed OL of his caliber on the open market the past few years.

I think it remains to be seen if that was a bad thing for GB or not. Clearly it was a bad thing in 2005, but Wahle finished 2006 on IR with a shoulder tear of some sort, if I remember correctly. Might be nothing, or it could end up being significant. Tony Boselli's career ended due to a bad shoulder. I have no reason to believe this is anything close to that, but you never know.

[retailguy]

Actually, I think that changed 4 or 5 years ago already. 2006 didn't make a long term change in that regard. Wolf made the comment that in the early years of FA, many teams didn't have a clue, and talented players were all over the FA lists in the mid to late 1990s. He said by the time he retired, most teams had hired full time cap specialists and did much better managing the cap, so fewer good players were available.

That was already the case in 2004, 2005; before the big jump in the cap for 2006. All that 2006 did was give a temporary reprieve to the ones that still bungle it up. Chances are, by 2009, 2010 we will again see a few struggling.

Patler,

You seem to be arguing that free agency is full of danger. I don't know anyone who disagrees with that. I sure don't.

However, there is a balance between playing 2007 with holes and bringing in a couple of guys to compete. There were some quality players in free agency that could have helped at several positions, in my mind, namely Safety, TE, FB and RB.

While I recognize that the RB's went in most cases for significant money, the other positions were relative bargains, and would have provided camp competition and even if released not overly large "cap hits".

Right now, we have talented but unproven players at those positions, with little depth behind them. If none of them work out we're in serious trouble. If any of them do work out, but get injured, we're in serious trouble.

People "buy" insurance all the time. I'm not asking Thompson to mortgage the future, nor am I asking him to be "an idiot". That being said, we have many needs that can't possibly be filled in the draft. Where are we going to "get" these players?

That's my gripe. I'm not griping because Thompson is not overpaying. I'm griping because the team isn't even improving on paper. I'm not sold that last years 8-8 record is a reflection of the talent level on the team or a "great" coaching job by the staff. I think the record is more a reflection of the schedule that they played in 2006. I'm not optimistic looking at the second place schedule for 2007. I look at the quality of the defenses we'll be facing and think - WE NEED HELP.

I don't see "help" on the horizon.

[Patler]

Patler,

You seem to be arguing that free agency is full of danger. I don't know anyone who disagrees with that. I sure don't.

However, there is a balance between playing 2007 with holes and bringing in a couple of guys to compete. There were some quality players in free agency that could have helped at several positions, in my mind, namely Safety, TE, FB and RB.

While I recognize that the RB's went in most cases for significant money, the other positions were relative bargains, and would have provided camp competition and even if released not overly large "cap hits".

Right now, we have talented but unproven players at those positions, with little depth behind them. If none of them work out we're in serious trouble. If any of them do work out, but get injured, we're in serious trouble.

People "buy" insurance all the time. I'm not asking Thompson to mortgage the future, nor am I asking him to be "an idiot". That being said, we have many needs that can't possibly be filled in the draft. Where are we going to "get" these players?

That's my gripe. I'm not griping because Thompson is not overpaying. I'm griping because the team isn't even improving on paper. I'm not sold that last years 8-8 record is a reflection of the talent level on the team or a "great" coaching job by the staff. I think the record is more a reflection of the schedule that they played in 2006. I'm not optimistic looking at the second place schedule for 2007. I look at the quality of the defenses we'll be facing and think - WE NEED HELP.

I don't see "help" on the horizon.

I'm not at all against signing a few free agents. But I have to admit, I like TT's apparent philosophy of assessing the player's value and sticking to his assessment. Long term you avoid the salary cap pitfalls if you stay away from "impulse buying".

Those who suggest TT will never sign anyone are ignoring the obvious. He was not "cheap" in what he paid Manual or Pickett, and certainly wasn't with Woodson. Franks, Wells, Kampman and Jenkins were not low-balled either.

I think TT's assessment of how much some of this years FAs would actually impact the Packers is much lower than many of the fans feel about those same players. If he felt they would make a big difference, he would pay more. He did with Woodson.

Now I'm sure you can name some players who would have improved the Packers, and TT might even agree. What we don't know is if the player would come to GB for what he signed elsewhere. People turn down jobs every day for many reasons. Players do to. While he was willing to play for $Dollars somewhere else, and maybe TT was willing to pay even 1.1 x $Dollars, the player may have wanted 1.2x$Dollars to come to GB, and that was more than TT was willing to pay.

I used to attend auctions, and bought quite a few things. I do the same there as I do in retail outlets. I decide what I will pay to have something, how much it really means to me, and I won't go over that. I have never regretted it, even when it sells for just a little bit more than I was willing to pay. I have regretted more the times that I over-valued something. After getting it I asked myself what I was thinking when I agreed to pay that much.

I turned down a $110,000 house in 1982 over a price difference of $1,000. (Edit, I was vindicated when they subsequently had to sell for a little less than I had offered 2 months earlier!)

I refused delivery on a brand new car I ordered and waited 6 weeks for when the dealer said there was a $300 price adjustment he hadn't told me about. He kept saying, "You're going to turn this down over $300?" I simply said "Yes" because when I ordered it I was at the max that I wanted to pay for it.
Of course, the dealer subsequently sold it with his markup, but I got a car elsewhere for a price I was satisfied with.

TT doesn't seem to be one who sits on the status quo, not the way he has turned over the roster. Changes will occur, but only on his assessment of "value" not on ours or anyone else's..

[Packnut]

In hind-sight it really does'nt matter if the cap is 1 billion in 2008. Teddy ain't gonna spend any cash. In fact, he's gonna set a record for the GM saving the most money in cap space for 2 consecutive years! :roll:

How much of his available salary cap did he not spend in 2005?
How much in 2006?

Do you realize that in 2006 he actually spent MORE than the NFL standard salary cap allotment?

I was'nt talking about 2006. Obviously he front loaded contracts which ate up space. I was talking about 2007 and 2008. I thought that was pretty obvious?

[red]

This is interesting; but I would say from the above statistics things have changed and I would compare the 2006 extreme cap raising with back in the 98-99 area when they had an even bigger % increase.

The 2006 bump explains why everybody has lots of money; Wahle's deal came due on the wrong year I guess.

B
one year too late

if sherman would have been smarter he would have set the contracts up knowing the cap would go way up that year.

he really couldn't do anything right

now wheres that asshole retailguy at?

[Patler]

In hind-sight it really does'nt matter if the cap is 1 billion in 2008. Teddy ain't gonna spend any cash. In fact, he's gonna set a record for the GM saving the most money in cap space for 2 consecutive years! :roll:

How much of his available salary cap did he not spend in 2005?
How much in 2006?

Do you realize that in 2006 he actually spent MORE than the NFL standard salary cap allotment?

I was'nt talking about 2006. Obviously he front loaded contracts which ate up space. I was talking about 2007 and 2008. I thought that was pretty obvious?

I asked the questions as points of historical reference. He has not left cap money unused in the past and will not in the future.

[cpk1994]

Actually, I think that changed 4 or 5 years ago already. 2006 didn't make a long term change in that regard. Wolf made the comment that in the early years of FA, many teams didn't have a clue, and talented players were all over the FA lists in the mid to late 1990s. He said by the time he retired, most teams had hired full time cap specialists and did much better managing the cap, so fewer good players were available.

That was already the case in 2004, 2005; before the big jump in the cap for 2006. All that 2006 did was give a temporary reprieve to the ones that still bungle it up. Chances are, by 2009, 2010 we will again see a few struggling.

Patler,

You seem to be arguing that free agency is full of danger. I don't know anyone who disagrees with that. I sure don't.

However, there is a balance between playing 2007 with holes and bringing in a couple of guys to compete. There were some quality players in free agency that could have helped at several positions, in my mind, namely Safety, TE, FB and RB.

While I recognize that the RB's went in most cases for significant money, the other positions were relative bargains, and would have provided camp competition and even if released not overly large "cap hits".

Right now, we have talented but unproven players at those positions, with little depth behind them. If none of them work out we're in serious trouble. If any of them do work out, but get injured, we're in serious trouble.

People "buy" insurance all the time. I'm not asking Thompson to mortgage the future, nor am I asking him to be "an idiot". That being said, we have many needs that can't possibly be filled in the draft. Where are we going to "get" these players?

That's my gripe. I'm not griping because Thompson is not overpaying. I'm griping because the team isn't even improving on paper. I'm not sold that last years 8-8 record is a reflection of the talent level on the team or a "great" coaching job by the staff. I think the record is more a reflection of the schedule that they played in 2006. I'm not optimistic looking at the second place schedule for 2007. I look at the quality of the defenses we'll be facing and think - WE NEED HELP.

I don't see "help" on the horizon.

The schedule they played? Are you aware that execpt for two teams, the Packers played the EXACT same schedule as the Bears? Since they went to 32 teams, ease of Schedule based on place is hardly relevant.