Early March is the time for contract restructurings, franchise tagging, painful cuts and assorted salary cap voodoo. It is a time when NFL teams must decide whether to let a window of opportunity close, try to wedge it open for another year or two or seek another means of ventilation.
The Falcons released Michael Turner, John Abraham and Dunta Robinson this week. When combined with the likely retirement of Tony Gonzalez, these moves don't signal the end of the Falcons' playoff run, but they do mark a change of direction. A young rebuilding team five years ago, the Falcons are now a veteran team trying to cut costs while remaining a conference power.
The Cowboys restructured the contracts of Miles Austin, Jason Witten, DeMarcus Ware, Brandon Carr and Ryan Cook this week, and they have other refinancing plans on their agenda involving key veterans like Tony Romo and Jay Ratliff. The Cowboys are determined to squeeze one or two more years out of their veteran nucleus, perhaps because they were so disappointed by previous squeezings.
The Steelers restructured the contracts of Ben Roethlisberger, Lawrence Timmons, LaMarr Woodley and Antonio Brown this week. Like the Cowboys, the Steelers are trying to preserve their veteran nucleus. Like the Cowboys, they are not done rewriting contracts. Unlike the Cowboys, their nucleus has a recent Super Bowl pedigree, so there may be some wisdom in saddling everyone up for a few more years. But like the Cowboys, they risk throwing good cap dollars after bad.
Each of these three teams made moves that have major ramifications for 2013 and beyond. Let's take an in-depth look at each team, what they did, how it could benefit them and what it could cost them.
Atlanta Falcons: Veteran Bloodletting
The Falcons spent the early part of the Mike Smith-Thomas Dimitroff era adding a high-profile veteran every season while doing the bulk of their roster building through the draft. Abraham arrived before the current coach and general manager, but Turner came in 2008 specifically to be a pack mule while Matt Ryan developed. Gonzalez came in 2009 to diversify the offense and serve as Ryan's sophomore security blanket. Robinson arrived in 2010 to patch an injury-riddled secondary for a team that had emerged as a perennial playoff presence.
Three of the four acquisitions exceeded expectations. Dimitroff said at the combine that the Falcons expected one or two more productive years from Gonzalez, not four Pro Bowl caliber ones. Abraham's ability to defy age has been nearly as remarkable as Gonzo's. Turner did exactly what was asked of him at the start of his Falcons career. Robinson was the weak link, but he started for three seasons and joined Brent Grimes to give the Falcons a solid cornerback tandem. The problem with each of these acquisitions is not the role these players initially filled, but the roles they were still filling as of 2012.
Turner's raw productivity did not tail off until last season, but his actual value has fallen every year since 2008. Table 1 shows Turner's rushing DYAR for his Falcons career. DYAR is a Football Outsiders metric that measures how many yards a running back gains that a replacement-level running back (a journeyman free agent or a mid-round rookie) would not have gained. The negative number suggests that Turner was worse than a replacement-level running back last year, which may be a little extreme, but if you watched a lot of Falcons games early in the year it was clear that Turner needed to be replaced, and the Falcons largely replaced him with a mix of Jacquizz Rodgers and increased passing.
Turner bounced back a bit by the playoffs, but by then the Falcons defense looked like "Star Trek" in the Park, and Robinson was the guy in the red shirt who shows up for a second or two, then gets killed. Robinson would have been relegated to a nickel role if Grimes (a free agent this season who is reportedly rehabbing his Achilles well) were healthy, but "If Grimes Were Healthy" could be the title of the Falcons' 2011 and 2012 season highlight reels.
Abraham remains an effective defender: He recorded 10 sacks and led the Falcons with 21 Defeats. (A Defeat is a Football Outsiders statistic for an outstanding play, from a sack to a tackle for a loss or a stop on third down.) The concern for the Falcons was their overreliance on Abraham in recent years. No Falcons defender besides Abraham has had more than four sacks since 2009. Like Gonzalez, Abraham has given the Falcons far more than they could ever have expected, but he has reached the age at which the team is in dire need of a successor.
Two of this week's releases, then, were no-brainers: The team had little to gain by keeping Robinson or Turner. If Gonzo reconsiders retirement, Dimitroff will arrive in his driveway by jetpack. That leaves Abraham as the tricky choice. Abraham turns 35 years old in May and was due $7.25 million; his release saved the team $5.75 million. The Falcons were not in a full-court cap crisis; they were just below the cap before shedding Turner and Robinson. At the same time, they have free agents like William Moore, Sam Baker and possibly Grimes to take care of. A team on the brink of the Super Bowl could have found a way to retain its sack leader for one more year, but the Falcons have chosen flexibility instead.
The Abraham decision suggests that the Falcons are not in "win at all costs" mode. That is in character for Dimitroff, a former Patriots executive who has always taken a long-range approach to cap management. The Falcons are not trying to extend this playoff run, but maintain the organizational philosophy that has made them a perennial playoff team.
It's a subtle distinction, one that may appear to backfire if the Falcons produce only 22 sacks and fall to 8-8 in 2013. But the Falcons must take care of Ryan soon (his contract expires this year, so they risk a Joe Flacco situation) and they will want to extend young veterans like Julio Jones soon. The Falcons have no crazy cap numbers or dead money to cope with beyond 2013, and they are now about $30 million under the cap for 2013. For the cost of Abraham and some players in obvious decline, they gained the ability to do a variety of things: sign Gonzo to a big one-year deal if the Hall of Famer finds fishing and daytime television boring, extend Ryan using up-front money instead of a back-ended bonus, stay active in free agency, play ball with Grimes, and so on. A playoff team does not stay in good cap condition without making some tough decisions on veterans. The Falcons made those decisions. Now, they must find a way to build a better roster.
Dallas Cowboys: Go .500 Now, Pay Later
The 2006 season was a long time ago. Brett Favre was still the Packers quarterback. Eric Mangenius was the toast of the New York media. Feel old yet? Tony Romo replaced Drew Bledsoe as the Cowboys quarterback in 2006. Jason Witten was already a Pro Bowl tight end, DeMarcus Ware a Pro Bowl pass rusher. Jay Ratliff was a productive young starter. Miles Austin was merely a kick returner because Terry Glenn and Terrell Owens were the starting receivers, veterans who were supposed to help Bledsoe make the Cowboys a playoff powerhouse but instead maxed the team out at 9-7.
Six full seasons later, Jerry Jones is still trying to make a powerhouse out of big-name veterans who keep the team trapped around .500. The Romo-Ware-Witten-Ratliff-Austin nucleus, the solution more than half a decade ago, is now the problem. From 2007-09, this iteration of the Cowboys had three winning seasons, including a 13-3 performance in 2007. Since then, they have managed just two .500 seasons, with 2012 being a typical effort: a 3-5 start, a 5-1 stretch to provide some midseason hope that they have finally turned the corner after a presidential administration's worth of sputtering, two late-season losses as soon as things got real.
Jones is trying to pry the Romo Generation window open for one more year, maybe two, no matter the cost. In addition to the Witten, Ware, and Austin restructurings, the team must rework Romo's contract soon: His cap figure is $16.8 million this season, and the figures range around $15 million until 2016. Ratliff, with a $7 million cap figure, a deal that runs through 2017 with lots of phony-baloney money at the end, and a recent arrest on his record, is also likely to talk restructure. (The alternative for Ratliff, unlike other core Cowboys, may be to talk release. The team has been very public about its reluctance to see Romo in another uniform.)
The most telling restructuring move by the Cowboys was the Brandon Carr deal. Carr just signed with the team last year. Already they are adjusting his contract. It's like opening a credit card to transfer the balance of the credit card you opened last month. It is bad economics, and it's a symptom of how the Cowboys do business.
Let's take a closer look a few of the Cowboys restructurings. Ware had $5 million of this year's salary converted into a signing bonus. Signing bonuses are prorated over the term of a contract, which is one reason why NFL contracts often have Monopoly money seasons at the end: it is there to hide signing bonus money. Ware's salary is now officially $832,000, and he saved the Cowboys $4 million in cap space. But his 2014 cap number is now $16 million, and the eight-digit figures continue through 2017. The Cowboys will release Ware long before 2017, but his release will result in dreaded "dead money," the NFL equivalent of car payments for a vehicle that is already in the junkyard. Releasing Ware in 2014 would not save the Cowboys $16 million in cap space, but a little over $7 million, with the rest eaten up by the ghosts of prorated bonuses past. Even if the Cowboys wait until 2016 and retain Ware's (probably dwindling) services for $14-$17 million per season, he will still cost the team more than $2 million in cap space upon his release.
Ware is not alone. Witten agreed to have $5.5 million of his 2013 salary turned into a bonus. That saved the Cowboys millions in cap space this year, but Witten's cap number rises above $8 million in 2014 and 2015. If the Cowboys try to cut him before the end of the 2014 season, it will eat up $5 million in cap space. Both Witten and Ware turn 31 before the start of this season, so the Cowboys will be faced with the decision to pay more than $24 million to employ two 33-year olds in two seasons, or to spend $12 million in cap space to not employ them.
And then there is Carr. His cap number this year is now a manageable $5.4 million, but it goes up to $12 million in 2014 and stays there until 2017. Thanks to a prorated bonus (just about every dime the Cowboys have paid Carr is a prorated bonus), Carr would still cost the Cowboys $12 million in dead money if they release him before 2015. Carr is a borderline Pro Bowl performer, but he is not a $12 million per year player whose services project well beyond the next season or two.
Here is how crazy the Cowboys situation is: They already have $143 million of cap space committed for 2014, and another $128 million committed for 2015. By contrast, the Falcons have $70 million committed in 2014 and $32 million in 2015. They squeaked under the cap this season by forcing themselves to perform the same limbo routine for the next two seasons. A Romo extension can only provide short-term relief at the expense of even longer-term relief, unless Romo agrees to a pay cut, which he won't.
The worst thing about the Cowboys cap situation is that it has yielded diminishing returns. Just as your purchasing power declines when you spend a large percentage of your paycheck on credit card premiums, the Cowboys are getting an ever-dwindling bang for their buck. And of course, their cap-bending shenanigans have resulted in NFL penalties, so they must be careful about creative accounting.
Yet the Cowboys seem incapable of stopping the cycle. This would have been the offseason to make a painful decision on Ware, as the Cowboys are switching from a 3-4 to a 4-3 defense. With the draft loaded at wide receiver, it would have been a wise time to recognize that Austin peaked in 2009-10 instead of making him a dead-money hangover for 2014 and 2015. They could still part ways with Ratliff, though indications are that they will not. How different would the Cowboys releasing Ware and Austin be from the Falcons releasing Abraham and Turner? The Cowboys could argue that they are in great win-now position because the NFC East is depleted. As it stands, they look poised to max out at about 9-7, even in a weak division, and lose in the playoffs to a team like the Falcons.
The Cowboys were overpaying for a bunch of veterans in 2006, when Romo and this generation asserted itself. Unfortunately, they learned the wrong lesson from the rise of the Romo generation.
Pittsburgh Steelers: Searching for Middle Ground
The Steelers are an old team. Of the 42 players who started at least one game in 2012, 15 were at least 30 years old. They are a successful team: Roethlisberger, Woodley and Timmons, three of their four high-profile refinances this week, were key starters for the 2008 Super Bowl champions; Antonio Brown joined them for the 2010 AFC championship run.
The Steelers are also a frugal franchise, one that rarely signs top-tier free agents and has historically been judicious about parting ways with expensive veterans. But when a team is both old and successful, contracts start piling up. James Harrison, soon to be 35 and in obvious decline after a six-sack season, costs more than $10 million in cap space. Larry Foote, 33 before next season, and Casey Hampton, 36, are unrestricted free agents. The Steelers would like to restructure Harrison and keep Foote; they also have expensive, declining defensive starters like Ike Taylor and Ryan Clark clogging up cap space. Most of these players helped the team win one Super Bowl and appear in a second; many were on the 2005 championship team as well. At least the Steelers are paying for a dream home they got to enjoy for years, not an investment rental they were always repairing.
Like the Cowboys, the Steelers have wriggled under the salary cap for 2013 by causing some 2014 problems, and they still need a little more wiggle room to be able to sign draft picks, tender offers to restricted free agents like receiver Emmanuel Sanders, make an offer to Foote, and do anything more than watch during free agent season. Unlike the Cowboys, the Steelers do not have many problems that extend beyond 2014. The Roethlisberger, Woodley, Timmons and Brown commitments eat up $50 million in cap space in 2015, but there is little else on the books by then, and three of the players getting paid are a franchise quarterback and a pass rusher and receiver who will be only 29 years old that year.
Even after the restructurings, the Steelers face a fascinating dilemma. Their nucleus is just one year removed from a 12-4 season, so a purge does not seem necessary; plus, the structure of so many of their veteran contracts would cause a dead money nightmare (cutting Harrison this year, which is still a possibility, would burn $4.9 million in dead money). At the same time, new deals for players at the Harrison-Foote age-and-performance level seem like a terrific way to be in financial peril in two years. The generation below Woodley-Timmons has never coalesced, so releasing too many veterans would cost the Steelers heavily on the field. If the Steelers emulate the Falcons, they risk sparking a full-court rebuilding cycle. If they emulate the Cowboys, they risk paying millions for the rights to release Harrison in two years.
The Steelers never emulate anyone; they follow their own path, and it often always works. So far, they have navigated a treacherous route between austerity and the splurge this offseason. Take care of the franchise quarterback? Sure. Make sure the Steelers pass rush still looks like a Steelers pass rush, even if it costs a premium? Some things have to be done. James Harrison's agent says he will not take a pay cut, and Larry Foote would love to return? Well, perhaps Jason Worilds and Sean Spence are ready for increased roles. In the draft, they will look for players who can be productive starters in 2015. By then, most of the problems of paying aging champions will have solved themselves. Until then, there is enough talent to compete for the division.
The Steelers see a window that will be open for one more year. The Falcons are tinkering with an environmentally conscious light-and-ventilation system they hope will work indefinitely. The Cowboys are running the electric lights and dual-zone air conditioning. Nothing comes without a price in the NFL. It's all a matter of whether you want to pay now like the Falcons, pay in 2014 like the Steelers, or pay in perpetuity, like a certain team in silver and blue.
A Great Cap Site
Much of the cap information for this week's article comes from Over the Cap, which has rapidly become the best resource on the Internet for accurate, up-to-date and comprehensible cap data. The folks at Over the Cap blog about contract news and also take an analytic approach to salary cap management, so you can get your Moneyball fix. But the tastiest meat on the bone is their sortable database of team and player salary information. It's a tremendous resource, and you should bookmark it right next to Sports on Earth, Football Outsiders, Pro Football Reference and your favorite source of old-fashioned football news.
Meanwhile, at the Tailgater
There is plenty of good stuff going on over at my blog. Click here for short features on five interesting characters in this year's draft. Also, if you ever wondered what possesses seven million people to watch the combine, check out this post about just what else is on television on a typical weekday morning. Coming later in the week: more countdowns of the top five wide receivers in each franchise's history, with the Buffalo Bills scheduled next and the Pittsburgh Steelers on the horizon. Get your Andre Reed and Lynn Swann arguments ready!