Salary-Cap Floor Rises; Sources Optimistic It Will Be Higher
GREEN BAY, Wis. – NFL teams, especially the Green Bay Packers, got a dose of good news on Thursday when the league announced the salary cap floor for the 2021 season has gone up by $5 million.
Last year’s negotiations between the league and NFLPA set the floor – the lowest possible salary cap – at $175 million. That’s now up to $180 million.
“This is not the final Salary Cap for the 2021 League Year, which will be set following review of the final 2020 revenue figures and other audit and accounting adjustments,” stated the memo.
In the recent collective bargaining agreement, players get 48 percent of league revenue through salary and benefits. With the COVID-19 pandemic meaning teams playing in empty or mostly empty stadiums, league revenue has dropped sharply. The auditing will determine the total financial pie that the players are eligible to receive.
The expectation, one source said, is the cap will be, at a minimum, about $184.5 million but potentially in the neighborhood of $188 million. Another source is even more optimistic, believing the cap will wind up at $190 million or more. The good news, that second source said, is teams that are budgeting solely on numbers provided by the league can at least plan for a $180 million cap.
There is still talk of further borrowing against future caps to blunt the bite of COVID. Under normal circumstances, the cap goes up about $10 million annually. This year, the cap was $198.2 million. Even at the rosy $188 million, next year’s cap would be down by about $10 million.
Borrowing from future caps blunted what would have been a much steeper decline in the cap than the old $175 million floor. With expanded playoffs starting in 2020, the presumptive addition of a 17th regular-season game in 2021 and new TV contracts coming online in 2022, the cap could soar by $40 million, one source said. So, he reasoned, why have such extreme swings, which would hurt teams and players alike?
Every dollar will be precious to teams like the Packers. Even with a restructuring of left tackle David Bakhtiari’s contract, the Packers are almost $20 million over a projected cap of $180.5 million, according to OverTheCap.com.
“You certainly don’t plan for a pandemic,” general manager Brian Gutekunt said at the end of the season.
The Packers are one of 12 teams over the $180.5 million projection, according to Over The Cap.
The league-year, and the free-agent signing period, begins on March 17. Teams can begin negotiating with free agents on March 15. The expectation is the final cap number won’t be set too long before those dates. Multiple agents believe teams are using the projected decrease in the cap as a way to persuade players to restructure or take less money.
“Get ready for the race of the snails,” one agent quipped.
