Salary Cap

Salary Cap

a) The NFL has set the salary cap at $155.27 Million for 2016, therefore each team has a starting salary cap of $1,552.70 to reflect that number.

b) At no time during the regular season may a team’s total roster salaries exceed the cap. It is a Hard Cap.

c) The salary cap will be adjusted each year to reflect the NFL’s cap numbers. If for example the NFL salary cap goes up to $125 Million in 2014, the cap will go up to $1,250 for the 2014 season.

e) Impending free agents are automatically dropped by commissioner and each team must meet the salary cap requirements at this date.

f) If a team is in violation of the cap, the commissioners will use their best judgment to cut players in order to take the team under the cap with the commissioner decisions being final.

g) All players released because of salary cap issues will enter the free agent pool.

h) During the off-season from the end of week 16 through March 1, owner’s team salaries may exceed the salary cap due to off-season activity and pre-season transactions. This is done to allow trading of players given that impending free agents are still on the roster.

i) If a player is waived prior to his contract expiring; the team incurs a salary cap penalty for the remaining years of the contract. When the contract is cancelled, current year hit on the cap is 50%, with 25% penalty for each additional year. However, these additional contract years are all penalized in the following year.

Therefore if there are:
2 years remaining on the contract, 25% is deducted in the 2nd year.
3 years remaining on the contract, 50% is deducted in the 2nd year.
4 years remaining on the contract, 75% is deducted in the 2nd year.
5 years remaining on the contract, 100% is deducted in the 2nd year.

As an example, the regular season just ended. You decide to cut LeSean McCoy’s, Salary $100 this year, who is on year 1 of a 4 year contract. 50% of cap hit stays in effect for the remainder of the current year for $50 (50% of $100). At March 1st the following year, year 2 of the contract is in effect. Since there were 4 years remaining when the cancellation took place, it’s 75% of that $100 salary amount, in year 2. So your cap is reduced by $75 in year 2. In years 3, 4, and 5, there is no remaining cap hit.

k) The Inflation fee is not charged to contracts cut before March 1st.

l) When a player is dropped by a team and picked up by that team in the same season, the team reacquires the player at his original contract price. For Example: If a team drops Peyton Manning at $150 salary, and picks him up again on waivers for $15, the commissioner will reset his salary at $150 and erase the salary penalty of $75. The commissioner will also reset the contract years to the original contract amount.

m) (Voted in 2014) Players that have been used by an owner for an entire season and then dropped will not have their cap hit count against the current season.  It should count against the next season since the owner had the players services for the entire year.  The deadline for dropping a player and having them count against the current year is the trade deadline.  Since we allow one WW extension, this will allow other owners to acquire the player and give them an extension.  Owners will still be able to drop the players before the salary increases on March 1st, however it will count against the cap for the next season.

Example:  I own Tony Romo at $100. If Romo had 3 years left on his contract and I dropped him before the salaries increased and contracts decreased, I would be responsible for $50 in 2015 and $75 in 2016.  If I waited for the salaries to increase, I would be responsible for $60 in 2015 ($120 * 50%) and $60 in 2016 ($120 * 25% * 2 years).