During the first week of October it was widely reported/speculated that the relationship between the New England Patriots and Tom Brady had soured and the Patriots had commenced examining at releasing or trading the face of the franchise – Tom Brady. Soon after those reports we started to see articles about Tom Brady’s salary cap numbers. I am writing this blog not because I believe that the Patriots will cut/trade Tom Brady this year but to provide my take on the salary cap implications on releasing/trading Tom Brady and to hopefully provide accurate information. I am writing this blog while listening to October 7 Patriots Football Weekly podcast. Hopefully, this will help Paul, Fred, Eric, and Paul understand the cap better:)
Background information: In late February 2013 Tom Brady who was signed through the 2014 season agreed to an deal that extended his contract 3 more years so that he would be under contract with the Patriots through the 2017 season. In doing so he received a $30 million signing bonus and agreed to lower his 2013 and 2014 salaries while eliminating his $5 million roster bonus and $250,000 roster bonuses. Please note that under Brady’s old deal his 2013 $9.75 million and his 2013 offseason workout bonus would have become fully guaranteed the 5th day of the 2013 League Year (March 17th, 2013) and his 2014 $9.75 million and his 2014 offseason workout bonus would have been fully guaranteed if Tom Brady was on the Patriots roster the last week of the 2013 regular season. As part of the extension Brady’s 2013 and 2014 salaries were fully guaranteed. His 2015/2016/2017 salaries were guaranteed for only injury when Brady signed the extension. They will become fully guaranteed if Brady is on the roster Week 17 of the 2014 season. If Tom Brady is on the Patriots roster Week 17, the Patriots then have to put into escrow with the NFL the $24 million.
|Brady’s Old Deal|
|Existing Signing Bonus Proration||$6,800,000||$6,800,000|
|Brady’s 2013 Extension|
|Existing Signing Bonus Proration||$6,800,000||$6,800,000|
|2013 Signing Bonus Proration||$6,000,000||$6,000,000||$6,000,000||$6,000,000||$6,000,000|
Note: When a player is released or traded, the remaining amounts of proration in a contract accelerate into his teamâ€™s current salary cap. For example, if a player signs a five-year contract with a $10 million signing bonus, $2 million of his signing bonus counts towards the salary cap for each year of his contract. If he is released after the second year of his contract, the $4 million of signing bonus proration from the last two years of the contract automatically accelerates into the clubâ€™s current cap, which results in $6 million of dead money. There are two major exceptions to this general rule. Only the current yearâ€™s proration counts towards the cap with players released or traded after June 1. The proration from the remaining contract years doesnâ€™t accelerate until the next year. A team can also release two players each year prior to June 1st who will be treated under the cap as if they were released after June 1. This is known as a â€śPost-June 1 designation” – Source – Joel Corry’s piece about dead money
Note that when a player with future guaranteed salaries is released all future guaranteed salaries immediately hit that year’s salary cap.
The next two tables show graphically the implications of first releasing Brady and then lastly trading the best quarterback in Patriots history. The two tables presume that Brady completes the 2014 season on the Patriots roster thereby guaranteeing his 2015/2016/2017 salaries. Please note that Brady’s guaranteed salaries do not contain an offset. That is, if released and signed by another team the Patriots will not receive a credit the following year for the money paid to him by his new team.I will address the cap implications of releasing/trading Brady during this season later on.
|Cap Implications of Cutting Tom Brady after this season|
|Date||Total to Keep in 2015||Total to Keep in 2016||Total to Keep in 2017||2015 Cap Number if Cut||2016 Cap Number if Cut||2017 Cap Number if Cut||2015 Cap Savings||2016 Cap Savings||2017 Cap Savings|
|During the 2015 season and before 6/2/2015||$13,000,000||$14,000,000||$15,000,000||$42,000,000||$0||$0||(-$29,000,000)||$14,000,000||$15,000,000|
|During the 2015 season and after 6/1/2015 or given the June 1 designation||$13,000,000||$14,000,000||$15,000,000||$30,000,000||$12,000,000||$0||(-$17,000,000)||$2,000,000||$15,000,000|
|During the 2016 season and before 6/2/2016||$13,000,000||$14,000,000||$15,000,000||$13,000,000||$29,000,000||$0,000||$0||$(-$15,000,000)||$15,000,000|
|During the 2016 season and after 6/1/2016 or given the June 1 designation||$13,000,000||$14,000,000||$15,000,000||$13,000,000||$23,000,000||$6,000,000||$0||$(-$9,000,000)||$9,000,000|
|Anytime during the 2017 season||$13,000,000||$14,000,000||$15,000,000||$13,000,000||$14,000,000||$13,000,000||$0||$0||$0|
|Cap Implications of Trading Tom Brady after this season|
|Date||Total to Keep in 2015||Total to Keep in 2016||Total to Keep in 2017||2015 Cap Number if Traded||2016 Cap Number if Traded||2017 Cap Number if Traded||2015 Cap Savings||2016 Cap Savings||2017 Cap Savings|
|During the 2015 season and before 6/2/2015||$13,000,000||$14,000,000||$15,000,000||$18,000,000||$0||$0||(-$5,000,000)||$14,000,000||$15,000,000|
|During the 2015 season and after 6/1/2015||$13,000,000||$14,000,000||$15,000,000||$6,000,000||$12,000,000||$0||$7,000,000||$2,000,000||$15,000,000|
|During the 2016 season and before 6/2/2016||$13,000,000||$14,000,000||$15,000,000||$13,000,000||$12,000,000||$0||$0||$2,000,000||$15,000,000|
|During the 2016 season and after 6/1/2016||$13,000,000||$14,000,000||$15,000,000||$13,000,000||$6,000,000||$6,000,000||$0||$8,000,000||$9,000,000|
|Anytime during the 2017 season||$13,000,000||$14,000,000||$15,000,000||$13,000,000||$14,000,000||$6,000,000||$0||$0||$9,000,000|
As you can see above, there is no point in time after this season in which the Patriots would save cap space by releasing Brady. As you can also see above, starting on June 2, 2015 the Patriots will create cap space by trading Brady.
The Patriots will not save any cap space in 2014 by releasing Gisele’s husband because Tom Brady, as a vested veteran, is eligible for termination pay. Any Termination Pay liability hits a team’s salary cap at the time the player is released. Releasing Tom Brady before Week 17 would prevent the fully guaranteed salaries from kicking in. Releasing Tom Brady before Week 17 would not change his 2014 salary cap number of $14,805,600. Releasing Tom Brady before Week 17 would cause the Patriots to lose cap space as the Patriots would be expected to replace Brady on the 53-man roster. Releasing Tom Brady before Week 17 would increase his 2015 cap number from $13 million to $18 million.
The following presumes that a rookie making a $420,000 salary would take Tom Brady’s place on the 53-man roster. Trading Brady in Week 7 would create Patriots $1,022,353 in cap space in 2014. Trading Brady in Week 8 would create Patriots $929,412 in cap space in 2014. Trading Brady in Week 9 would create Patriots $836,461 in cap space in 2014. The trading deadline is Tuesday of Week 9 so the Patriots can not trade Brady after Week 9. Trading Brady anytime in 2014 would increase his 2015 cap number from $13 million to $18 million.
If they do not trade Brady before the 2014 trade deadline, per the CBA, teams like the Patriots cannot trade in 2015 players like Tom Brady until after the 2015 League Year begins. Before the 2015 League Year begins, the Patriots will have to decide on the following:
- Darrelle Revis – The Patriots have an option on Revis’ April 1, 2015 roster bonus. They must decide to pick up the option or not by the end of the 2014 League Year. Have created a blog post dedicated to examining Darrelle Revis’s comparables and proposing six different contracts for him and the Patriots.
- Brandon Browner – Brandon Browner earns a $2 million roster bonus if he is on the Patriots 90-man roster the first day of the 2015 League Year
- Vince Wilfork – Vince Wilfork earns a $4 million roster bonus if he is on the Patriots roster the first day of the 2015 League Year
- Rob Gronkowski – Gronk’s 2015 $4.75 million salary becomes fully guaranteed if he is on the Patriots roster the first day of the 2015 League Year. Also, if Gronkowski is on the Patriots roster the first day of the 2015 League Year there will be a $2 million proration of his 2016 million option bonus that will officially hit the Patriots 2015 cap.
- Nate Solder – Solder’s 2015 $7.438 million salary becomes fully guaranteed if he is on the Patriots roster the first day of the 2015 League Year.
- Devin McCourty – If the Patriots do not reach an extension with McCourty before the franchise tag deadline, they have to decide whether or not to place the franchise tag on Devin McCourty. Have created a blog post dedicated to examining McCourty’s comparables and proposing an extension between him and the Patriots.
Let’s say that the Patriots retain 3 or more of the 6 above players. What would the Patriots then trade Brady? Let’s say that the Patriots retain 3 or more of the 6 above players. Can they then afford to increase Brady’s 2015 cap number by 5 million?
Let’s say that the Patriots release Brady before Week 17 so as to avoid guaranteeing his 2015/2016/2017 salaries. Why would any of the six players work with the Patriots to redo their deals so as to lower their 2015 cap numbers.
There have been some articles contending that the Patriots can afford to have Brady’s 2015 cap number increased from $13 million to $18 million via a trade because they are currently carrying so much cap space. One article reported that the Patriots currently have $14,464,425. That number was referenced from the NFLPA site.. The problem of doing so is that site has not yet reflected the expiration of the Top 51 rule. That is, the site was reporting on September 1, 2014 that the Patriots had over $13.5 million in cap space. Since then the following has happened:
1.) Paying for the 10-man practice squad – minimum of $1.7 million – Occurred on 9/4
2.) Accounting for Brian Tyms – 400K – Occurred on 9/4
3.) Paying for the 4 players who were already on IR – $1.212 million – Occurred on 9/4
4.) Paying for players 52 and 53 – 840K – Occurred on 9/4
5.) Reaching injury settlements with Steve Beauharnais and Armond Armstead – Steve Beauharnais reached a two-week injury settlement with the Patriots. The amount of $37,412 is now counting against the Patriots 2014 cap. ESPNBoston.Com’s Mike Reiss reported on September 14, 2014 that Armond Armstead and the New England Patriots reached an injury settlement in the amount of $54,000.
6.) Matt Stankiewitch won his injury grievance to the tune of $178,235.
7.) All the roster moves done after Week 1.
Therefore, it is unlikely that the NFLPA number of $14,464,425 is correct.
There are 3 sites who unofficially track the Patriots salary cap number. . Spotrac.com has the Patriots cap space as $10,162,646. OvertheCap.com has the Patriots cap space as $10,928,847. I have the Patriots cap space as $9,745,399. Therefore, it is doubtful that the Patriots actually have $14.4 million in cap space. It is far more likely that the Patriots have between $9.7 and $11 million in cap space.
Whatever the Patriots cap space number is it is NOT likely that the Patriots will end the season with the same number. I talked about why in two blog posts. One lists 7 possible reasons for the cap space. The main reason is to account for the $8 million in NLTBE incentives. The second main reason is to have cap space to sign players to replace players who are placed on injured reserve after October 10.
Below are some questions that I expect this blog to create:
1.) Question: Why would releasing Brady before June 2nd in 2015 cause a $42 million dead money hit? Answer: The $42 million is a total of the $18 million in remaining signing bonus prorations and the $24 million in guaranteed salaries
2.) Question: When can the Patriots redo Jimmy Garoppolo’s deal? Answer: After the 2016 regular season.
3.) Question: How much dead money do the Patriots have for the 2015 season? Answer: According to my numbers – $4,616,819
4.) Question: What will be the salary cap in 2015? Answer: Heard projections that the 2015 cap will be $140 million. As the 2015 League Year gets closer, we will hear more definitive numbers. Right around the start of the 2015 League Year is when we will find out the Patriots 2015 adjusted cap number.Â As I did last offseason I plan to predict the Patriots 2015 adjusted cap number this upcoming offseason.
5.) Question: How would a $18 million dead money hit in 2015 rank in NFL history? Answer: According to my research it would be the largest dead money hit for one player in one season. I believe that the current high is Richard Seymour’s 2013 hit of $13.714 million.