Ongoing Flacco Contract Negotiations (Merged)

**Haloti92** · 02-06-2013, 08:49 PM

In jonboy's example does Flacco get the $55M all at once when he signs but for NFL accounting purposes it is spread, or does Joe get $25M and wait for year 2 for $15M more, year 3 for $15M more?

And what are the rules regarding splitting? Can you split it so that $1M occurs this year so his cap value is $2M (including a $1M salary) and $54M next year? Or $1M this year, $1M next year, $53M in year 3? Or a 10 year deal where the first 5 years have tiny portions of the signing bonus and the 6th year has 95% of it?

Without some kind of restrictions one can achieve anything in terms of shuffling cap space between future years and the present. But it is good to know that some relief can behad by splitting.

**wickedsolo** · 02-06-2013, 08:55 PM

Originally Posted by Haloti92

In jonboy's example does Flacco get the $55M all at once when he signs but for NFL accounting purposes it is spread, or does Joe get $25M and wait for year 2 for $15M more, year 3 for $15M more?

And what are the rules regarding splitting? Can you split it so that $1M occurs this year so his cap value is $2M (including a $1M salary) and $54M next year? Or $1M this year, $1M next year, $53M in year 3? Or a 10 year deal where the first 5 years have tiny portions of the signing bonus and the 6th year has 95% of it?

Without some kind of restrictions one can achieve anything in terms of shuffling cap space between future years and the present. But it is good to know that some relief can behad by splitting.

There are several contract restrictions as laid out by the cba. One of them, IIRC, is that the length of a deal can not exceed 7 or 8 years.

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**B-more Ravor** · 02-06-2013, 09:37 PM

Originally Posted by bmorecareful

The FO must absolutely be kicking themselves for not paying Flacco what he wanted last August. Obviously that's outcome bias, but he had them over a barrel then and they chose to bet against him and they lost huge. They won't be able to do that again.

You know, I'm not so sure about that. Would they prefer a bargain? Sure, but Ozzie, as a former player, has very often allowed players to hit the market and establish his market value. Sometimes that has worked in the team's favor, sometimes not.

Heck, a month to two months ago, many were saying just the opposite - Flacco should have taken the Ravens offer back in Sept.

The fact is that even though their going to have to pay more, they are probably going to feel a bit more secure in paying it because they can feel a little better about Joe going forward as a true franchise/elite QB.

**Paintballguy** · 02-06-2013, 09:38 PM

Originally Posted by B-more Ravor

You know, I'm not so sure about that. Would they prefer a bargain? Sure, but Ozzie, as a former player, has very often allowed players to hit the market and establish his market value. Sometimes that has worked in the team's favor, sometimes not.

Heck, a month to two months ago, many were saying just the opposite - Flacco should have taken the Ravens offer back in Sept.

The fact is that even though their going to have to pay more, they are probably going to feel a bit more secure in paying it because they can feel a little better about Joe going forward as a true franchise/elite QB.

I agree. I don't think bisciotti and the fo are upset that they have to pay a sb MVP and franchise qb.

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**Sirdowski** · 02-06-2013, 09:45 PM

Originally Posted by B-more Ravor

You know, I'm not so sure about that. Would they prefer a bargain? Sure, but Ozzie, as a former player, has very often allowed players to hit the market and establish his market value. Sometimes that has worked in the team's favor, sometimes not.

Heck, a month to two months ago, many were saying just the opposite - Flacco should have taken the Ravens offer back in Sept.

The fact is that even though their going to have to pay more, they are probably going to feel a bit more secure in paying it because they can feel a little better about Joe going forward as a true franchise/elite QB.

I agree. In the end it worked out well for both parties.

**B-more Ravor** · 02-06-2013, 09:45 PM

Originally Posted by Haloti92

I also don't think allowing another team to sign him and then matching has a massive downside. In fact, I think it would only be around where Joe is currently asking. In other words, while there are some desperate teams out there with plenty of money, the idea one of them offers Joe $22+M per year is nil, imo.

Disagree. It has a very real, certain downside. Quite simply, it would be easy for many teams to structure a deal that the Ravens simply couldn't match. A team with a lot of Cap space could pay him a massive amount of money - all in 2013 - and make a ton of it count in 2013, via a roster bonus, and make it very difficult for the Ravens to match - at least, without truly tearing the team apart.

Heck, the Cleveland Browns could do it and it would be a win-win for them. Either they get Flacco or they force us to essentially gut the team to keep him. Either way, it's a good deal for them.

**B-more Ravor** · 02-06-2013, 10:00 PM

Originally Posted by Haloti92

In jonboy's example does Flacco get the $55M all at once when he signs but for NFL accounting purposes it is spread, or does Joe get $25M and wait for year 2 for $15M more, year 3 for $15M more?

There's a difference between "guaranteed" money and a Signing Bonus. Usually Bonuses (signing or otherwise) are guaranteed, but not all guaranteed money is bonus money.

The Ravens have often used "split" bonuses or "option" bonuses to spread out the guaranteed money and make the earlier years of the deal more Cap friendly.

So, in JB's example, he would get a Signing Bonus of $25M in 2013, an Option bonus of $15M in 2014 and a second option bonus of $15M in 2015. Each bonus is prorated over 5 years from when it's paid, so if it's a 7-year deal, there is some guaranteed money spread out over the length of the deal.

So, with a $1M base salary for 2013 (for example), Joe's Cap number would be $6M - $1M base salary + $5M bonus proration ($25M/5).

FWIW, I would hope that they don't give 3 bonuses that are that big. I would expect that some of the guaranteed money is base salary. The more amounts that are prorated, the more problems they could have in the future because there is no way to restructure (if necessary) bonus prorations.

So, if it was $55M guaranteed (which is a bit high, IMO), I would expect something like bonuses of $25M, $10M and $10M and guaranteed base salaries equally $10M over the 1st three years of the deal. After all, with that amount of bonus money being paid, there aren't going to be releasing him away, so there's no harm in guaranteeing those base salaries.

**B-more Ravor** · 02-06-2013, 10:13 PM

Regarding the use of the "exclusive" versus "non-exclusive" tag, my only hope - perhaps, naive - would be that negotiations at least go well enough that they consider an agreement to be close enough/inevitable and agree (privately) that the Ravens can use the non-exclusive tag, but that Flacco will not entertain offers from other teams. That way, Flacco would allow the team to have an additional $6M in Cap space to use to sign or retain other key players - Anquan, Jacoby - while they take the necessary time to finally reach a deal (by July 15th).

Of course, it's always possible for the "agreement" to go sideways, but if Flacco is committed to the Ravens and the negotiations are going well, it would seem like a win-win for both sides - Flacco will eventually get his money and the Cap is less harmful for the team.

**Haloti92** · 02-06-2013, 10:32 PM

Originally Posted by B-more Ravor

Disagree. It has a very real, certain downside. Quite simply, it would be easy for many teams to structure a deal that the Ravens simply couldn't match. A team with a lot of Cap space could pay him a massive amount of money - all in 2013 - and make a ton of it count in 2013, via a roster bonus, and make it very difficult for the Ravens to match - at least, without truly tearing the team apart.

Heck, the Cleveland Browns could do it and it would be a win-win for them. Either they get Flacco or they force us to essentially gut the team to keep him. Either way, it's a good deal for them.

But Flacco doesn't have to sign such a deal. What kind of rules are there to prevent a team from offering such a contract to Flacco and then Flacco approaching us with the unsigned deal and us formulating a structure that in the end pays him same but with different cap ramifications?

I guess what I am saying is that this would only be a risk if Flacco wanted to leave. And that I think Flacco would only leave if he was going to get paid less overall here (regardless of structure).

Or do we have to match any 'officially' offered deal to Flacco? Or only something he signs?

**Haloti92** · 02-06-2013, 10:34 PM

Originally Posted by B-more Ravor

There's a difference between "guaranteed" money and a Signing Bonus. Usually Bonuses (signing or otherwise) are guaranteed, but not all guaranteed money is bonus money.

The Ravens have often used "split" bonuses or "option" bonuses to spread out the guaranteed money and make the earlier years of the deal more Cap friendly.

So, in JB's example, he would get a Signing Bonus of $25M in 2013, an Option bonus of $15M in 2014 and a second option bonus of $15M in 2015. Each bonus is prorated over 5 years from when it's paid, so if it's a 7-year deal, there is some guaranteed money spread out over the length of the deal.

So, with a $1M base salary for 2013 (for example), Joe's Cap number would be $6M - $1M base salary + $5M bonus proration ($25M/5).

FWIW, I would hope that they don't give 3 bonuses that are that big. I would expect that some of the guaranteed money is base salary. The more amounts that are prorated, the more problems they could have in the future because there is no way to restructure (if necessary) bonus prorations.

So, if it was $55M guaranteed (which is a bit high, IMO), I would expect something like bonuses of $25M, $10M and $10M and guaranteed base salaries equally $10M over the 1st three years of the deal. After all, with that amount of bonus money being paid, there aren't going to be releasing him away, so there's no harm in guaranteeing those base salaries.

So what happens in JB's example if we cut Flacco after 2013? How much money does he walk away with? $25M or the whole $55M (total of the splits)? (ignoring the small base salary in 2013)

And are there any limits to the splitting? Could we split it $1M, $1M, $53M over the first three years?

**The Excellector** · 02-06-2013, 10:54 PM

Lee Evans ripped several million in guaranteed money, on top of overall average salary, by dropping that pass. John Harbaugh (And/or Steve Bisciotti, depending on what you choose to believe), gave it back to him and more by getting rid of Cam Cameron.

**StingerNLG** · 02-06-2013, 11:32 PM

A couple things:

If Linta is trying to match Peyton's contract, that may not be so bad. Peyton I believe got 5yr/$96mil. And I'm sure Ozzie can structure that so it doesn't look at convoluted as Manning's guaranteed part.

Also, even if they back-loaded the contract and gave him a large signing bonus, remember that the salary cap is going to gradually increase from 2014 on. So they could anticipate Joe's base salary going along with it.

I think everyone is trying to avoid the exclusive tag here. When pen goes to paper, this thing is going to get worked out. Remember this is Joe Linta, not Drew Rosenhaus. And Flacco isn't out front of his house doing situps. Everyone will get what they want here.