RAVENS ROSTER OUTLOOK: The Salary Cap will usher in change

Change.

It’s inevitable in today’s NFL.  Some teams embrace it, others run from it.  If the 2011 offseason told us anything, it’s that Ravens’ GM Ozzie Newsome and the Ravens’ Front Office are not afraid to embrace change. 

So, tomorrow, the Ravens staff will begin to address yet another offseason after a near-miss and try and figure out what changes are needed to get them over the hump and back to the Super Bowl.

The question is, how much change will we see?

Based on various media reports, it appears that the 2012 Salary Cap will be set at around $125M.  There will be various credits that will allow teams to increase that Cap number, but no matter what, the Ravens are not going to have a great excess of Salary Cap space, especially when retaining pending Free Agents Ray Rice and Ben Grubbs is expected to be at the top of their offseason priorities.

So, with that in mind, here’s a look at the Ravens’ 2012 Free Agency and Salary Cap status:

PLAYERS UNDER CONTRACT:

The Ravens presently have the following 35 players under contract for 2012 (with base salaries indicated):

QBs (2):  Joe Flacco ($6.76M), Tyrod Taylor ($465K)

RBs (3):  Ricky Williams ($1.5M), Vonta Leach ($3M), Anthony Allen ($465K)

WRs (6):  Anquan Boldin ($6M), Torrey Smith ($529K), Lee Evans ($3.375M), David Reed ($540K), Tandon Doss ($465K), LaQuan Williams ($465K)

TE (2):  Ed Dickson ($540K), Dennis Pitta ($540K)

OL (5):  Michael Oher ($865K), Bryant McKinnie ($2M), Marshall Yanda ($4.5M), Jah Reid ($465K), Ramon Harewood ($540K),

DL (6):  Haloti Ngata ($2.9M), Terrence Cody ($540K), Paul Kruger ($615K), Arthur Jones ($540K), Pernell McPhee ($465K), Michael McAdoo ($465K)

LBs (2):   Ray Lewis ($4.95M), Terrell Suggs ($4.9M)

CBs (4):  Domonique Foxworth ($5.6M), Chris Carr ($2.5M), Jimmy Smith ($714K), Chykie Brown ($465K)

S (3):  Ed Reed ($7.2M), Bernard Pollard ($1.55M), Emmanuel Cook ($540K)

ST (2):  Billy Cundiff ($2.2M), Sam Koch ($1.6M)

These 35 players are under contract for a total Salary Cap commitment of $107.9M.  (Link to Salary Cap Spreadsheet). 

EXCLUSIVE RIGHTS FREE AGENTS (EFAs):

These players must be tendered contracts of the league minimum, based on the player’s length of service in the league (either $540K or $465K).  Once tendered, these players are fully under the team’s control and are not free to negotiate with other teams.

The Ravens have 7 players who are Exclusive Rights Free Agents (EFAs):

OG – Justin Boren

LB – Josh Bynes

LS – Morgan Cox

CB – Danny Gorrer

LB – Sergio Kindle

LB – Albert McClellan

LB – Chavis Williams

RESTRICTED FREE AGENTS (RFAs):

These are players whose contracts have expired and who have 3 years of accrued service time.  The team must tender the player with an RFA offer.  Once done, another team can sign the RFA to an RFA offer sheet, but the Ravens then have 7 days to match that offer sheet and retain the player under the terms of that offer sheet.  If the Ravens were to choose not to match the offer sheet, then they would receive compensation based on which level of RFA tender was made to the player.

There are 3 RFA tenders (the new CBA did away with the “high” tender of 1^st and 3^rd round draft picks as compensation):

1^st Round Tender:  allows the team to receive the other team’s 1^st round – $2.846M (est)

2^nd Round Tender:  allows the team to receive the other team’s 2^nd round pick – $2M (est)

Low Tender:  allows the team to receive a draft pick equal to the round in which the player was originally drafted or the Right of First Refusal (ROFR) for an undrafted player – $1.308M (est)

The Ravens have 4 players who are Restricted Free Agents (RFAs):

LB – Dannell Ellerbe

RB – Matt Lawrence

CB – Lardarius Webb

CB – Carey Williams

In the past, the Ravens have usually tendered all of their RFAs, but on occasion, the team has non-tendered some players and instead, offered them one-year veteran minimum contracts.  The veteran minimum salary for those players would be $615K.  This year, Matt Lawrence could be a candidate for such a deal, if he’s even retained at all.

With these 11 players are added to the team’s Salary Cap, it raises the team’s total Salary Cap commitment to just over $124.96M for the 46 player either under contract or tendered. 

UNRESTRICTED FREE AGENTS (UFAs):

The following 13 players are Unrestricted Free Agents (UFAs) and will be free to sign with other teams if they haven’t re-signed with the Ravens before Free Agency begins on March 13^th at 4:00 p.m.:

LB – Brendon Ayanbadejo

OC – Matt Birk

OG – Ben Grubbs

OC – Andre Gurode

LB – Jarret Johnson

LB – Edgar Jones

LB – Jameel McClain

DT – Brandon McKinney

S – Haruki Nakamura

DE – Corey Redding

RB – Ray Rice

TE – Kris Wilson

S – Tom Zbikowski

2011 SALARY CAP CARRYOVER:

Under the prior CBA, teams could carry over excess Salary Cap space from prior year’s by inserting “phony” incentives into player’s contract.  These phony incentives would be added late in a prior season and would eat up the team’s remaining Cap space for that year.  When these “phony” incentives weren’t earned (a linebacker earns his incentive when he kicks a field goal), they would be refunded back to the team in the form of a credit against the following year’s Cap, thereby increasing the team’s Cap for the following year. 

The new CBA has done away with this sham accounting and simply lets teams elect to carry over unused Cap space from the prior year.

The Ravens finished 2011 with a little over $6M in available Cap space which they can carry over into 2012.  While some teams may decide not to carry forward excess Cap space, the Ravens have shown that they are not afraid to spend to improve the team and will undoubtedly carry forward the roughly $6M in excess 2011 Cap space.

AMOUNTS BORROWED FROM FUTURE CAPS:

The new CBA contains some “transition” rules aimed at lessening the impact of a reduced Salary Cap that came with the new Agreement.  One of the rules that applies to 2012 allows teams to essentially borrow up to $1.5M against future Caps.  That $1.5M won’t have to be repaid until 2014 at the earliest, so it makes sense for most teams to borrow that amount now since there is plenty of time to plan for the repayment of that amount.  In addition, since teams can now carry forward Cap space from year to year, if the $1.5M is not used this year, it can be carried forward either until it’s needed in future years or could even be used as repayment for itself in 2014 or beyond when the team needs to finally account for the money borrowed.

BASE SALARY ESCALATORS:

There are two players who reportedly have salary escalators in their contracts.  As has happened every year since his rookie year QB Joe Flacco has seen his base salary increase due to playing time incentives.  Having taken all of the team’s snaps in 2011, Flacco will see his base salary increase from $4.61M to $6.56M.  The Ravens’ Divisional Playoff round victory over the Houston Texans added an additional $200K to the Quarterback’s base salary, setting his 2012 base salary at $6.76M. 

The other player with a salary escalator is OT Bryant McKinnie.  While the exact criteria for his $1.2M escalator has never been reported, it’s pretty likely that he has met the requirements, since he played every snap at LT in 2011 and the team made the playoffs.  As such, McKinnie’s 2012 base salary will likely increase by $1.2M, if he remains on the team.

PROJECTED SALARY CAP COMMITMENT:

Taking into account all of the above, the Ravens would have a Cap commitment of $124.96M for the 46 players under contract or tendered as EFAs and RFAs.  Once the season ends, the team will re-sign many of their Practice Squad players from the Practice Squad to one-year contracts of $390K.  Those signings will add an additional $1.95M to the team’s Cap commitment to reach the Rule of 51.  The Rule of 51, which applies during the offseason when rosters can balloon to 80 players, dictates that only the top 51 salaries and all bonus prorations count against the Salary Cap.  That addition will take the team’s Cap commitment to $126.7M.

Any re-signings of veteran players will, of course, add to that Cap commitment total.

Again, the league-wide Salary Cap is projected to be around $125M, however with the above adjustments for Cap carryover and the $1.5M, the Ravens’ adjusted Cap would be $132.5M.  This would leave the Ravens with approximately $7.5M in available Cap space (pending a determination of an adjustment for Incentives).

CAP ADJUSTMENT FOR 2011 INCENTIVES:

One unknown variable in attempting to determine the team’s Salary Cap is whether there were any 2011 incentives that were earned (or not earned) that will affect the team’s Salary Cap.  Incentives pay the player an additional amount, over and above his base salary, if the player reaches certain contractually dictated statistical level.  Incentives are categorized as either “likely to be earned (LTBE)” or “not likely to be earned (NLTBE)” depend on whether the player reached that milestone in the prior year.  LTBE incentives count against that year’s Salary Cap, but if unearned, are credited against the following year’s Salary Cap.  NLTBE incentives do not count against that year’s Salary Cap, but if earned, are charged against the following year’s Cap.

The Ravens’ Salary Cap space will likely be reduced by incentives earned in 2011 that were considered “not likely to be earned” and thus didn’t count against the 2011 Cap.  These incentives were added to the contracts of Bryant McKinnie, RB Ricky Williams and C/G Andre Gurode.  These incentives were likely included in order to keep the 2011 Cap numbers of those players lower, while still allowing them to earn “starter” money if they saw enough playing time.  It is unlikely that Williams or Gurode earned their incentives, however, it is likely that McKinnie did earn his $1.5M in incentives. 

Any incentives earned will be applied to the 2012 Cap and will reduce the team’s available Cap space, but will be offset by an LTBE incentives that counted against the 2011 Cap, but were not earned. 

FRANCHISE TAG:

The Ravens have two players who they may consider using the Franchise Tag on – RB Ray Rice and Guard Ben Grubbs.  The projected Franchise Tag for a RB is just under $8M, while the projected Tag number for an Offensive Lineman is expected to be around $9.5M.  It seems likely that the Ravens would use the Franchise Tag on Rice, if he is not re-signed by early March. 

CREATING ADDITIONAL CAP SPACE – RELEASE, RESTRUCTURE, RETIREMENT:

The team will have several options for opening up additional Cap space.  The team could restructure a few of its veteran player’s contracts, although there really aren’t many ideal candidates, but that would cost the team future Cap space to do so and the team hasn’t seemed inclined to follow that approach in recent years.

One contract that obviously bears watching is that of Quarterback Joe Flacco.  Flacco is under contract for 2012, but it should be expected that the Ravens will attempt to sign him to a lucrative contract extension at some point during this offseason.  Given the size of Flacco’s new deal, it’s likely an extension will create some, but not a lot of additional Cap space.

The main avenue available to the Ravens for creating Cap space will be the release or the retirement of players.  The following players are under contract for 2012, but may (or may not) be on the bubble to return because of salary or performance reason, or because of retirement:

[1] Assumes McKinnie obtains his $1.2M salary escalator.

It goes without saying that CB Domonique Foxworth will not be returning next year.  Because he is in the last year of his contract, Foxworth’s release will allow the team to receive a credit against the Cap of Foxworth’s entire base salary of $5.6M. 

It will be interesting to see how the team handles the future of WR Lee Evans, who has one more year left on his contract.  So far, Evans’ time in Baltimore has been pretty much a total disappointment, and that was before he dropped the potential game-winning Touchdown in Foxboro on Sunday.  In 2012, Evans will have a Cap number of close to $6M and it’s very possible that the team will decide that that is too rich for an aging WR who never seemed to find his groove in 2011.  Releasing Evans would create $4.758M in additional Cap space for the team. 

The futures of LB Ray Lewis and S Ed Reed will bear the most watching.  Both will be highly paid next year, but may have retired if the Ravens had won the Super Bowl.  An argument can very easily be made that neither is worth the base salaries they are scheduled to make in 2012 ($4.95M for Lewis and $7.2M for Reed), but neither of them is just an ordinary guy.  Both are amongst the greatest to ever play their positions and sure-fire Hall of Famers, so while last year, the team didn’t seem to hesitate to part ways with long-tenured Ravens like Todd Heap, Derrick Mason and Kelly Gregg, the situation with Lewis and Reed is quite a different story. 

While it’s hard to envision a Ravens game without Lewis and Reed, that day is coming and a Super Bowl victory may well have been the best for all involved because it would allow Lewis and Reed to retire while on top and allowed the Ravens to possibly escape a situation where they are forced to make a very tough call. 

Now, they are left to possibly make some very difficult decisions.

Change.

The offseason is here and another offseason of change is upon us.

Now, it’s just a matter of how many changes the Ravens’ brain trust feels are needed.