Colts in Comfortable Cap Position Ahead of Free Agency

Today, we are a week away from the start of the NFL's "legal tampering" period of free agency.

While agents may discuss contracts with new teams for their players from Monday, March 15 through the afternoon of Wednesday, March 17, players can begin signing the dotted line at 4:00 PM ET on Wednesday.

Due to the COVID-19 pandemic and its financial impact on the league over the last year, the salary cap is expected to be lowered and is currently estimated at around $180.5 million according to OverTheCap. Over the previous five years, that cap has grown by $11 million on average each year according to Spotrac.

Teams who are now in a big salary cap hole have already begun looking at ways to purge big contracts from the books, but others are comfortably under the cap's limit and are looking to spend to make what they hope are big improvements.

Consider the Indianapolis Colts part of the latter.

They currently have nearly $45 million in cap space heading into the new league year according to OverTheCap, giving them the fifth most in the NFL.

Horseshoe Huddle discussed several topics regarding the Colts, the salary cap, and free agency with Twitter's Colts salary cap expert Kyle Rapoza, better known as @ColtsCapKyle and the owner of ColtsCap.com.

HH: After the Carson Wentz trade the Colts are still projected fifth in the NFL with about $45M in cap space. With that in mind, they still have contract extensions coming up quickly to consider in guys like linebacker Darius Leonard, offensive tackle Braden Smith, and running back Nyheim Hines (guard Quenton Nelson has a fifth-year option).

How might those possible extensions affect how the Colts spend in free agency this year? Why is it wise for them to consider the future spending of these extensions when weighing their 2021 free-agent approach?

KR: It shouldn’t have a big effect on the salary cap. The Colts routinely use roster bonuses in place of signing bonuses, so it could be easy to structure deals so it doesn’t change their 2021 cap much if at all.

General manager Chris Ballard has said before that they plan things several years out. A big factor for a lot of teams is cash spending more so than the salary cap. Because many of the Colts players who are due extensions will be amongst the highest paid in the NFL at their position, it’s something they need to prepare for in the future.

HH: Around the league, guys are expected to be cut at a pretty heavy clip this year considering the lowered salary cap.

Why is that? Why may that be advantageous for the Colts?

KR: The drop in cap was something teams didn’t plan for last year, so teams like the New Orleans Saints entered the offseason over $75 million over the cap. Because of the drop in revenue due to the pandemic, teams either need to release veterans to save money or restructure money to push dead money into the future.

The Colts are in a position where they don’t have to release any veteran players and are one of the few teams with cap space, so they are in a position to bring in several players to help the roster.

HH: What's the potential cost of bringing back free agents like wide receiver T.Y. Hilton and cornerback Xavier Rhodes?

KR: I think Hilton costs somewhere around $10-12 million per year. I think whether back in Indy or somewhere else he’s looking at incentives to raise the overall value due to his age and injury history.

Rhodes will likely cost around $10-12 million per year on a short-term deal as well.

HH: Compared to the rest of the league and how they spend on whole positional units, why is it unrealistic that the Colts pony up for free agent left tackle Trent Williams considering the cost of center Ryan Kelly and future costs of right tackle Braden Smith and Nelson?

KR: With Kelly already the highest-paid center in the league and Nelson and Smith now extension-eligible and soon to become amongst — if not the highest-paid left guard and right tackle in the league — it’s not realistic to spend so highly on one position group.

It would also severely limit the Colts' ability to add to other positions of need this offseason as Williams will likely command at least $23 million in free agency.

*Discussion edited for clarity.

For more discussion with @ColtsCapKyle about the Colts' offseason, check out his appearance on the Bleav in Colts Podcast!

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