If you have trouble understanding just how the game of football is played, just try to figure out how football players are paid.
At a time when the National Football League is being challenged to come up with a new collective bargaining agreement on salaries or face the prospect of a players' strike, the front-office maneuverings this off-season have been carrying with them a type of financial language largely foreign to most fans.
Even though he didn't earn an MBA at Northwestern or ever hold a Wall Street job, The Scene asked veteran Titans' beat writer Terry McCormick to cut through the financial gibberish and simplify some things primarily for Tennessee football fans.
[He balked initially, but after renegotiating his contract to include a "writing assignment" bonus, he relented.]
Can we get a McNugget of information on what it means to "tender" a player?
I guess a McNugget is a chicken tender. But in NFL terms, a tender is a one-year contract offer that is given to a player whose contract is about to expire, but who the team has an interest in keeping.
There are four different types of tenders, the most common being the restricted free agent tender, which assigns a certain level of one-year salary for a player to play for the team. Another type of tenders is the franchise tender, which Albert Haynesworth and Bo Scaife had in the past two seasons. Only one player on a team can be given that designation, which equals a salary that is the average of the top five players in the league at that player's particular position. Teams do not have to use a franchise tender, and the Titans did not. It is designed to keep one key unrestricted free agent with the club by allowing the team that tendered the player to receive draft pick [a first and third-round] compensation and seven days to match any offer the player signs from another team.
The transition tender is similar to the franchise tender, but the compensation is different and the salary is lower. Finally, the exclusive rights tender is for players — usually undrafted free agents — whose contracts have expired but don't have enough time accrued in the NFL to be a restricted or unrestricted free agent. No teams may make any offer for those players.
Why are there different "rounds" of tendering?
The normal routine for tendering restricted free agents corresponds to the round they were drafted in. That means if a player drafted in the fifth round has a regular restricted tender, the Titans could either match the offer for the player or receive the signing club's fifth-round pick in exchange for letting the player go.
Some players outperform their original draft status and because of that are tendered at a higher salary and higher level of compensation. For example, Tony Brown came into the league as an undrafted free agent and normally would not require any compensation to sign, but Tennessee tendered him at $2.621 million and would receive a first-round pick if they allow a team to sign him away.
Is an extension the same thing as a renegotiated contract and how do they work?
Not necessarily. An extension means that a player is approaching the end of his contract, and the team gives him a new deal with some guaranteed money that could or could not supersede the years remaining on the deal. The Titans normal mode of operation is not to redo any contract with more than one year remaining [Sorry, Chris Johnson].
Renegotiating a contract [without a pay cut involved] is what the Titans did a lot during Floyd Reese's tenure as general manager in order to stave off salary cap problems. Let's say that Joe Bob Quarterback has two years remaining on his current deal with $5 million each in base salaries for those two seasons and a cap figure of $8 million over that time [from the old signing bonus; more on that in a bit]. Management, back in the day of the salary cap, could come to Joe Bob and say, we will give you a new three-year, $15 million extension if you will cut your base salaries to $2 million over those three years and take the remaining $9 million in a signing bonus. That $9 million bonus hit would be spread out over the three new years of the contract equally, and added to the $2 million base salary to create a new $5 million cap hit, saving the team $3 million against the cap.
Does being a free agent simply mean that a player's contract is expired and he can go out shopping for a new NFL jersey?
Yes, simply enough for any unrestricted free agent. Unless the player has the franchise or transition tender, he is free to walk when free agency begins.
What is the difference between a restricted free agent and an unrestricted free agent and why the hell should anyone care?
A restricted free agent, now that there is no salary cap, is a player who had four or five seasons accrued in the league and his contract had expired. When there was a salary cap, players needed only to have three vested seasons in the NFL to be a restricted free agent.
Unrestricted free agents formerly needed four seasons in the league to hit the open market, but because of the uncapped season of 2010 with the labor agreement set to expire, it now takes six full seasons for a player to be unrestricted.
As for why should they care? Well, it's a lot easier to retain a restricted free agent than an unrestricted one. You see how easily Kyle Vanden Bosch got another job. With a restricted free agent a team will always have the right to match any offer to keep the player.
Why is there a "free agency period" and how long does it last?
Free agency began on March 5 and goes on basically throughout the season. Teams are always able to sign players who are, for lack of a better term, unemployed. You see it during the season when injuries strike a team, sometimes they will sign a player that was not in camp with any team, but was a free agent still waiting to sign a new deal somewhere.
It's obvious that a "salary cap" is not something you wear, but what is it really?
The salary cap was a setup that kept the league's competitive balance in check. It set a limit on how much teams could spend on player salaries. For 2009, it was around $127 million. There was also a salary cap floor that set a minimum limit teams had to spend as well. [I'm talking to you, Cincinnati Bengals.].
For 2010, because of the owners opting out of the labor agreement, the salary cap has gone away both on the top and bottom ends, much to the delight of Jerry Jones and Daniel Snyder, I'm sure.
When they talk about teams "beating the cap," what does that mean? Can't you only be over or under a cap?
Certain teams were accused of trying to circumvent the cap, and were fined for it in the past. There are creative and legal ways to "invent" cap space, as explained above with the restructure, but in theory all teams had roughly the same type of budget to work with. It's all a matter of how that money is spent.
What is the difference between "guaranteed" money and "bonuses" and do they count against the cap? Which begs another question: What does "against the cap" mean?
NFL contracts are not guaranteed, and a player can be released, no matter what, at any point. It's certainly not going to happen, but if they wanted to, the Indianapolis Colts could cut Peyton Manning today. If they did, Peyton would have certain parts of his salary, some that he has already received and other parts that are written in as guaranteed, that he would be owed by the team whether he plays or not.
When there was a cap, a process called "acceleration" prevented teams from just cutting players willy-nilly. Acceleration meant that if a player had $9 million worth of money against the cap and was cut three years before his contract, rather than the $3 million for each year going onto the cap, all $9 million would shift immediately against the cap when the player is released.
Bonuses can be either guaranteed or not guaranteed. Signing bonus money given up front is guaranteed and prorated over the life of the contract. Other bonuses that are guaranteed at some point in the deal prorate from the time they kick in over the remaining life of the deal.
Some bonuses are installed as a way for the team to get out of a bad contract. For instance, had Vince Young not regained his starting job, the Titans would not have paid the $4.25 million roster bonus he is due this month and made him a free agent. But since he has, the team will pay the bonus owed Young, and move forward with him as their quarterback for 2010.
The CBA used to stand for a lousy minor-league basketball league. Now it stands for "collective bargaining agreement." But what is it exactly and why is it holding the NFL's 2011 season hostage?
The collective bargaining agreement is not all that different in labor terms from labor agreements that are in place for the Teamsters or United Auto Workers. It is a contract that governs business between the teams and its owner and the players.
With the owners opting out of the old CBA and the union and owners unable to come to a new agreement, 2010 becomes an uncapped year, and unless a new deal can be reached between now and the 2011 season, owners will almost certainly lock the players out and create a work stoppage.
Lastly, will there be a test on this stuff?
Gosh, I hope not. It was exhausting enough just trying to explain all of this.
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