Monday, August 24, 2009

How Clubs Have Unprecedented Leverage by the Looming Uncapped Year

Once the cash honeymoon of a young player’s rookie contract has subsided, young players in the league who have made a name for themselves then turn their attention towards earning that lucrative second contract via a contract extension or unrestricted free agency. Philip Rivers, Eli Manning, Roddy White, Matt Cassel, and Albert Haynesworth all cashed in this off-season with lucrative second contracts. However, it remains to be seen if players like Shawn Merriman and DeMarcus Ware also cash in, or if their respective clubs utilize the unprecedented leverage created by the looming uncapped year.

The 2010 league year, if uncapped as a result of a failure to negotiate a new Collective Bargaining Agreement, will change the rules of free agency. As has been widely reported, the uncapped year will change the requirement for unrestricted free agency from four accrued seasons to six accrued seasons; meaning unlike today where a player hits the open market prior to their fifth NFL season, a player will not hit the market until they are entering their seventh season. Similarly, and most impactful to players in the 2005 and 2006 draft classes whose rookie contracts are expiring after 2009, the requirement for restricted free agency in an uncapped year goes from three accrued seasons to three through five accrued seasons. As an example, DeMarcus Ware is on track to become an unrestricted free agent after the 2009 season; however, if 2010 is uncapped, then Ware instead becomes a restricted free agent.

Restricted free agency simply gives Club A the right of first refusal should another team extend an offer to Club A’s restricted free agent. In the event that Club A chooses not to match the offer of Club B, then depending upon which one-year restricted free agent tender Club A extended to its player, that will then determine what draft picks Club A receives in return from Club B. For example, prior to signing him to a contract extension, the Cowboys utilized the 1st & 3rd Round tender on running back Marion Barber, meaning if another club had signed Barber to an offer sheet, then, if the Cowboys chose not to match the offer sheet, they then would have received a 1st & 3rd round pick from the club that signed Barber. However, if a restricted free agent is not signed to an offer sheet and instead plays under the one-year tender, then depending upon the tender extended, in 2009, the player will earn one of the salary amounts below.

2009 RFA Tenders: Salary*
- Right of First Refusal (ROFR) only: $1,010,000
- ROFR + Original Round: $1,010,000
- ROFR + 2nd Round: $1,545,000
- ROFR + 1st Round: $2,198,000
- ROFR + 1st & 3rd Round: $2,792,000
* Note: Greater of amount listed or 110% of Previous Year’s Salary

Going into an uncapped 2010 League Year, if a club is uncertain as to the long-term future of a player such that they are unwilling to commit to a long-term extension, they can then retain the player’s exclusive rights by offering him a restricted free agent tender. The upside for the club is that if a club signs this player to an offer sheet and the club chooses not to match, then they receive draft pick compensation for a player who they were uncertain of from a long-term perspective. If the player isn’t signed to an offer sheet, then the club keeps this player at a relative bargain. The downside to this approach is that a club runs the risk of having a disgruntled player walking around their facility, as surely the player will be frustrated by the club’s utilization of this change in the free agency system which ultimately postponed the player’s next big payday. It is this leveraging of the change in the free agency rules that some clubs are considering when determining whether or not they are going to extend players in 2009.

In the case of, say, Washington cornerback Carlos Rogers, the Redskins could sign Rogers to a 2nd Round tender, which would give Rogers a 2010 tender salary of $1.684 million. This proposition works out as a win-win for the club, as they either get Rogers, a cornerback who some front office personnel rate highly in spite of his lack of interceptions, at a bargain rate for one year relative to the current cornerback market, or they get a second round pick for him if he were to leave via restricted free agency. All of this said, front offices recognize the unique leverage presented by the uncapped year in this regard; accordingly, some are willing to utilize this technique to further the long-term goals of the organization, even if in the short-term it results in a disgruntled player. Atlanta was not willing to go this route with Roddy White, but one can be assured that a club will utilize this technique with a player and acrimony will exist thereafter as a result.

Much like Roddy White and Steelers tight end Heath Miller, one would think that players like Merriman and Ware will receive contract extensions in the near future, as they have proved to be integral members of their respective clubs. However, the following players could find themselves disgruntled and disappointed by an uncapped year:

· NO left tackle Jammal Brown
· NE guard Logan Mankins
· WAS quarterback Jason Campbell
· WAS cornerback Carlos Rogers
· SD wide receiver Vincent Jackson
· CLV wide receiver Braylon Edwards
· DEN wide receiver Brandon Marshall
· HST linebacker DeMeco Ryans
· SD left tackle Marcus McNeill

Follow J.I. on Twitter @SalaryCap101

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