02-22-2023, 10:21 PM
(02-22-2023, 09:49 PM)TheLeonardLeap Wrote: It's basically a matter of spending cash now to save cap later that year. You'll probably have to pay for it for a year or two cap-wise, years down the line, but you can kick that can for awhile so long as you don't mind spending more cash now.
For instance, the Browns could turn $20m of Watson's $46m base salary into a signing bonus and then pro rate that bonus over the 4 remaining years of his deal, $5m, $5m, $5m, and $5m. His cap hit this year would drop $15m (the 3x $5m over the next 3 years) from $55m to $40m. In exchange his cap hits would rise from $55m in 2024, 2025, 2026 to $60m and you're just banking on the cap to rise enough that the extra increase isn't too painful. Or you extend him and since he's probably not going to average $60m/yr on the extension, the extension would then be able to lower some of those hits by spreading it out a bit more.
The main downside of it (and why you don't see the Bengals doing it much, besides it requiring a competent and creative FO) is you're giving the player a large chunk of money right then and there. Rather than that $20m worth of base salary in my earlier example being paid out over 18 week installments or whatever of ~$1.11m between Sept 2023 and Jan 2024 if it were part of the base salary, you're instead giving them a $20m signing bonus right then and there in whole in say March 2023. If you're shorter on liquid cash, it can be a problem if your an owner whose main/only source of income is their team. It's also the owner losing the opportunity to make profit/interest off of their $20m for the 7 months or whatnot before they'd have to start paying it out in game checks.
Thank you for the detailed and very informative explanation. Watson already had a 45-million-dollar signing bonus. How can he get yet another signing bonus? Do they just redo a new contract and thus get to do yet another signing bonus? What is the maximum signing bonus one can give?
