Month: July 2009

The New York Jets parted ways with an old friend this week, releasing Bubba Franks. Just as their one-year experiment with Brett Favre ended earlier this offseason, the Jets have also ended their relationship with the tight end Favre played with for eight years with the Packers in addition to their year together as Jets.

After a year in which Bubba caught only six balls for 47 yards, it probably wasn’t a tough decision. This is another case of a team realizing a player wasn’t going to make the team and deciding to make the move before any possibility of injury. Without Favre, Bubba’s staunchest advocate, around to support his continued existence on the roster, he was “Jettisoned.”

The Next Odoms?

Bubba – or Daniel, his given name, which we jokingly called him — is a good guy and was a popular player in the locker room in Green Bay. I remember when we picked him in the first round of the 2000 NFL Draft. He was not our first choice in the weeks prior to the draft, but as with most situations, timing is everything. Our starting tight end at the time, Mark Chmura, was found in a compromising position with a teenage girl five days before the draft, necessitating a change in plans. With our top target, John Abraham, taken by the Jets right before us, GM Ron Wolf pulled the trigger on a big tight end from Big Springs, Texas. I remember Ron comparing Bubba to a tight end who played 12 years for the Broncos, Riley Odoms (with four Pro Bowls on Odoms’ resume, we would happily take that).

The Offseason Home

After his first season in Green Bay, Bubba left his townhouse and went back to Miami for the offseason. When I say left, I mean he just closed the door and left the brutal Green Bay winter behind. While he was away, the pipes froze and burst, resulting in considerable damage to his apartment. That took a bit of our time – and several lawyers – to sort out the mess.

Speaking of Bubba leaving town in the offseason, that was an issue with players from warmer climes, especially those from the U, or the University of Miami. Bubba, like all the guys from Miami, was beholden to his workouts with the Hurricanes’ strength and conditioning coach, Andreu Swasey, and loved the camaraderie with his teammates such as Edgerrin James (who appeared to be the ringleader of the gang down there), Ed Reed, Reggie Wayne, Clinton Portis, Jeremy Shockey and another of our players, Najeh Davenport. This was a problem we addressed once Mike McCarthy came on board as coach in 2006 and made a commitment to have near-perfect attendance in the offseason program. I negotiated all contracts to incentivize players to work out in the area during the offseason. Bubba reluctantly became a regular in Green Bay after that.

The Second Contract

After Bubba’s five-year rookie contract expired following the 2004 season, we were unable to come to common ground on a contract and placed the transition tag on him, which gave us the right to match any offer he might receive, although without compensation. I thought this would be the best way to see if Bubba was worth the value his agent claimed since we had a different idea of his value. Bubba never received a sniff as a transition player, and we ultimately came to a seven-year, $28-million deal, which, for our purposes, was a three-year, $9M deal (he was released after three years).

Bubba’s negotiation is a classic example of the problem for team negotiators when it comes to personnel discussions. His agent, Gene Mato — a nice guy who also had the bliss and blight of representing Manny Ramirez – always claimed that Bubba was right below Tony Gonzalez and Antonio Gates and compared favorably to players such as Todd Heap, Jason Witten, Shockey and others, even though his statistics did not bear that out (except for touchdowns).

It’s Business, Not Personal

One thing I’ve tried to never do is enter a debate about whether a player is “better” than others who have been rewarded with contracts. Bubba’s agent kept talking about Bubba being as good as or better than those players, and this often happens in a negotiation. I try to stay away from those conversations as best I can for several reasons: One, I have never been a scout and am in no position to evaluate our player against others. Two, every agent believes his player to be a higher level than he is; that’s a given, and there’s no point debating it. And three, anything I say will go back to the player, especially if it can be perceived as a slight regarding his abilities. Negotiation is an art, and one of the nuances is avoiding the “who’s better” debate with agents since there’s little to be gained from them.

This might be the end of the NFL road for Daniel “Bubba” Franks (unless a certain player signs with a certain team in the Packers’ division and successfully lobbies again for him). If so, he leaves behind a solid career of nine years, eight with one team. The vast majority of players would take that.

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It looks like we have our second $63-million contract in two days for a player with a franchise tender. After Matt Cassel agreed to a $63M deal with the Chiefs on Tuesday, today’s similar deal between the Ravens and Terrell Suggs is another top-of-market contract that’s sending ripples though the league’s pay scale.

Suggs had some strong leverage, perhaps even more than Cassel. Unlike Cassel, Suggs had not signed his one-year tender, making him an unsigned player with no obligation to report to any offseason activities or training camp. Also, Suggs was on his second franchise tag, meaning that if he were to play it out and be franchised again in 2010 (which could be uncapped), he would have to be tendered at the highest amount for any position – likely that for quarterbacks at a number that will continue to grow once Eli Manning and Philip Rivers join Cassel with new contracts. Thus, Suggs, at $10.2M this year, could have reasonably expected to make almost twice that if he were tendered again in 2010.

With that leverage, Suggs was able to garner guarantees in the next two years of reportedly over $33M, more than the previous top-of-market defensive ends, Dwight Freeney and Jared Allen, who have been at $31M and $32M, respectively. That was obviously a key marker for the deal. According to reports, Suggs also will make more than this year’s free agency poster child, Albert Haynesworth, in cash flow over one-, two- and three-year looks (they are virtually the same in cash flow of $48M after four years).

Suggs’ deal has set a new bar for defensive linemen and linebackers. Somewhere, DeMarcus Ware is smiling.

Why is the Matt Cassel contract not exactly what it seems?

This contract, forecast by the National Football Post for some time, represents a fascinating look at valuation of contracts for franchise-level quarterbacks. Although the guaranteed portion of the contract has been reported at $28 million, a closer look reveals a bit different spin.

Cassel was due to make $14.65 million this season, fully guaranteed (he will still make about the same number, around $15M). Had he played out the year and been tagged with the franchise tender next year, a scenario that was not unlikely, he would have made 120 percent of that number in 2010, or $17.58M guaranteed. Thus, had Cassel not done an extension, he could have reasonably expected – barring injury or a dramatic drop in performance – to make $32.23M guaranteed over two years.

Instead of that $32.23M, Cassel will make $28M in guaranteed salary and roster bonus, all earned in the next two years. However, if he’s on the roster on the opening days of the 2011 league year, there is a $7.5M guaranteed option bonus in the third year of the deal, 2011, bringing the “functional guarantee” to $35.5M for the six-year, $63M contract.

I use the word “functional guarantee” because the $7.5M is not technically guaranteed, as Cassel has to be on the roster after two years to earn the bonus. For practical purposes, the chance of the Chiefs releasing Cassel after paying him $28M over the next two seasons is minimal at best.

Taking out the relative uncertainty of what he would have made next year, we know this year was set at $14.65M guaranteed. Thus, Cassel will make roughly another $20M in functionally guaranteed money over the remaining five years of the deal.

As to the $63M, it’s very similar to what Aaron Rodgers made from the Packers last fall ($65M) after starting seven games for the team. Rodgers, however, was playing for less than $1M. Cassel was playing for $14.65M.

At the end of the day, it appears to be a deal that works for both sides. It’s a strong deal for a player with one year as a starter under his belt and a good deal for the Chiefs to lock up one of the prime assets in the sport – a young and proven quarterback – in a time where, despite the economy, asset values of ascending young quarterbacks will only continue to rise. Somewhere, Eli Manning, Philip Rivers and Jay Cutler are watching with great interest.

Why can teams sign players from the supplemental draft after using their rookie cap room for the other players?

The supplemental draft takes place Thursday via conference call from the league office to all teams. The teams let the league know if they’re interested in any player in any round, and the league will award such player(s) to the appropriate teams.

The draft selection for supplemental picks will be forfeited the following year. So in the event a team uses, say, a fourth-round pick for a player in tomorrow’s draft, that pick will be forfeited from that team’s 2010 draft selections. Thus, a team needs to have the pick available next year in order to exercise the draft pick.

As for how to pay a supplemental player, the league will assign a “pool number” to the player depending on where he’s selected. That cap charge will be in addition to the cap charge for the players previously drafted by the team in the April draft.

Why did the Raiders cut defensive end Stryker Sulak, their sixth-round pick?

This is extremely rare but not the first time it has ever happened. The Raiders have their reasons for operating the way they do; it’s often different from the way the league’s other 31 teams operate. To actually release a player prior to signing him and letting him at least participate in training camp is highly unusual. This normally happens to undrafted rookies, not to players a team actually spent a draft choice to select. Draft picks – even those in the lower rounds – are valuable assets to teams, or at least they usually are. Players such as Tom Brady and Matt Hasselbeck (my client at the time) are former sixth-round picks.

My only guess is that after signing Greg Ellis and evaluating their other players at that position — and seeing Sulak in mini-camps and organized team practices — the Raiders determined there was no way on God’s green earth he was going to make the roster. It’s still odd, however. As scouts always say, “They were just in shorts” about practices prior to training camp.

The Raiders did save a sixth-round bonus, roughly $100,000.

Why did other sports leagues – Major League Baseball, the NBA and NHL – file briefs in the cases involving Pat and Kevin Williams and their suspensions for using a weight-loss supplement that contained a banned diuretic?

As I wrote Friday, the potential precedent of the Williamses’ case can’t be overstated. Their case now sits in a Minnesota state court, with a ruling expected to determine whether the stricter employee-testing requirements of Minnesota apply over the requirements of the NFL-NFL Players Association Collective Bargaining Agreement. In the event of a ruling favoring the players, there could be anarchy with the league having to deal with the state laws of the 21 states in which it operates.

The other leagues, as well as the USADA, see the potential chaos of this situation as well. Therefore, they have filed amici – or “friend of the court” – briefs to try to ensure the application of collectively bargained rules rather than those of state legislatures.

The Williamses’ case is fast becoming a key marker in sports law.

Why is Brett Favre still making the Vikings wait?

Because he can.

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In the second part of my series about negotiating rookie contracts, I take a look at the mechanism that allows players to upgrade their fourth year.

In the past, most teams used three-year contracts in all lower rounds. After three years in the league, the player is entitled to rights as a restricted free agent, allowing him to seek offers from other teams, for which the incumbent team has a right to match or lose the player for compensation, depending on the level of the tender offer.

In the past five years, more and more teams have switched from three- to four-year contracts for all draft picks below the second round. Any term longer than four years was outlawed by the 2006 extension of the Collective Bargaining Agreement, restricting all contracts below the first round to four years. As a result, almost all teams except a couple of holdouts now negotiate four-year contracts (interestingly, the two Super Bowl participants, Arizona and Pittsburgh, still do three-year deals in the lower rounds; maybe there’s something to that).

I have always debated the value of paying an extra year’s prorated signing bonus to get the fourth year since the odds are that most of these players will wash out before then. The amount of extra bonus is negligible in the lower rounds but can be a couple hundred thousand different in the fourth and third rounds. However, if one or two of these players becomes a star, paying the proportionate amount of signing bonus to get that extra year is worth it for all.

The Escalator

In virtually every round but the second, the “backside” of the contract becomes a separate and important negotiation. The escalator delineates how a player will be compensated in the fourth year in the event he reaches certain performance levels. Those two issues — how he will be compensated when reaching certain levels of performance and what levels of performance are the qualifiers – are the subjects of great debate.

The First Level

Most teams will escalate the player to the draft round Right of First Refusal (ROFR) tender – for this year’s draft picks, their fourth year ROFR tender will be $1.308 million in 2012 – for one year of a requisite playtime, usually at about 35 percent.

Although the majority of teams only mandate one year of qualified playtime to earn the first-level escalator, some teams require two years of requisite playtime at a certain level to get the escalator (we did in Green Bay), the theory being that a backup player can fall into playtime one year due to an injury to the player or players ahead of them on the depth chart.

And although the majority of teams use the ROFR tender as the amount for the first-level escalator, some teams (the Eagles among them) prefer to use a number different than the ROFR number, hedging against a change in the CBA that may potentially raise that number as part of the negotiation.

The Second Level

A handful of teams will escalate to a second level – a higher amount based on superior performance such as a Pro Bowl or cumulative playtime of a high number, say 80 percent. There are about 10 teams that escalate beyond the first level to a higher amount for such performance. There are even a couple of teams (the Dolphins and Giants among them) that have multiple (up to six) escalator levels based on playtime and performance goals.

The theory of the second-level escalator is that, although it is certainly a tall task for an incoming player (especially in the later rounds) to achieve a Pro Bowl selection or cumulative playtime of 80 percent, the carrot of a higher escalator is one that’s a nice incentive for the player to have, no matter how hard to achieve.

As to how high, these second-level escalators usually raise the fourth year to the second-round restricted free agent tender, scheduled to be $2 million in 2012.

The point of the above is that each team is different and there is no standardization in these rookie contracts, making the negotiation much more about the “backside” of the contract than the signing bonus, especially in the later rounds.

Negotiations are all about two things: leverage and risk. The escalator is way to allocate risk in a player contract negotiation, incentivizing the player’s upside while protecting the team’s downside with a fourth year of the contract buying out the vagaries of restricted free agency.

There was some stunning news out of Minnesota on Thursday regarding the Vikings (and it had nothing to do with quarterbacks): The pendulum balancing the NFL’s four-game suspensions of defensive tackles Pat and Kevin Williams, which had recently swung in favor of the league, swung back in favor of the players. The suspensions that were supposed to occur during the 2008 season and didn’t are now uncertain again for the 2009 season.

This is a fascinating (I know that’s a relative term when it comes to complex legal matters beyond the game) intersection between federal law, state law, the NFL Collective Bargaining Agreement (CBA) and labor and employment law policies on the state and federal level. All of the above are relevant and connected to a saga that still has no discernible conclusion.

What happened?

The Williamses were suspended four games last season after testing positive for Bumetanide, a diuretic. The drug is not a steroid; it is, in fact, quite the opposite, an ingredient that masks the presence of steroids in a specimen. It was found in the weight-loss supplement StarCaps, which did not disclose the ingredient on the label.

The StarCaps case set off suspensions, grievances, lawsuits, accusations of nondisclosure by the league and the union and even a lawsuit against the supplement’s manufacturer by Jamar Nesbit, a Saints player who served a four-game suspension for a positive test.

On Dec. 11, after the Williamses’ case passed through arbitration to state court to federal court, a federal judge lifted the league suspensions and allowed the players to complete the 2008 season, a victory for them.

Aren’t players responsible for what’s in their bodies?

Yes, and that has been the NFL’s argument all along. Whether a player is taking a cold medication, a weight-loss pill or anything else, he is subject to strict liability for what is in his system and faces penalties for positive tests.

In May, a federal judge in Minnesota agreed with the strict liability mandate to the NFL testing procedures and ruled that the NFL did not violate the CBA by suspending the players, a victory for the league.

However, that victory was tempered by the fact that the judge said the Williamses’ state claims were not pre-empted by the CBA and sent the case back to the state judge. Now that state judge has blocked the suspensions once again due to state laws.

What about the Minnesota state laws is different than the NFL testing policies?

The Drug Testing in the Workplace Act in the state of Minnesota has rigid guidelines and procedures as to how and when employers can test employees, standards that are tougher for employers than the NFL requires in its Policy for Anabolic Steroids and Related Substances. The state judge has now blocked the NFL from subjecting the Williamses to reasonable-cause drug testing, which the league can do – according to the policy – on a random basis up to six times in the offseason.

Can states’ drug-testing procedures trump that of the NFL?

That’s the question. The position of the NFL would certainly not allow for that, creating a system of anarchy in which the NFL would have to somehow be in compliance with state laws governing testing of employees in the 21 states where there are teams. The league has to have a uniform system of operating in order to consistently apply its rules and regulations. Without it, every Vikings player, and ultimately every player in the league, can look to state law if it’s more favorable to employees than the league policy. Anarchy indeed.

What happens now?

The NFL has appealed to the U.S. Court of Appeals for the Eighth Circuit to hopefully have a definitive and declaratory ruling that the labor laws and policies of the collectively bargained NFL-NFLPA drug policies take precedence over any state ruling. The league has had previous success in federal court rulings that collectively bargained agreements should not be disturbed. In my opinion, the federal labor policy deferring to such agreements should be paramount.

Can the Williamses play for the Vikings on opening day Sept. 13 at Cleveland?

As of today, yes. But also as of today, their quarterback for that game is either Tarvaris Jackson or Sage Rosenfels. The next hearing is set for July 22. Stay tuned.

Today’s Wednesday Whys feature several questions from readers, plus a few of my own from recent news items.

Why is the release of a Saints long snapper interesting from the perspective of a failed investment in a film studio in New Orleans?

This is a fascinating under-the-radar story that has emerged since the Saints – in an oddly timed move – released their long snapper, Kevin Houser, and replaced him with an older long snapper, Jason Kyle.

Houser, it turns out, was an investor in a movie studio designed to take advantage of a tax credit program offered through Louisiana’s motion picture studio incentives. Houser put in $125,000 and must have had some strong marketing skills, as he convinced teammates, friends, coaches and colleagues to put in another combined $1.8 million into the project.

Among the investors were defensive end Charles Grant, with the largest investment of $425,000; former punter Mitch Berger at $250,000, and Saints coach Sean Payton at $144,000. The group also included $80,000 from Jeremy Shockey and Archie Manning.

The selling point to the investors was that for every dollar invested, they would receive $1.33 in a credit lowering their state income tax, all in the name of encouraging movie studios to film their projects in Louisiana.

It all sounded good until, well, it didn’t work. The 27 investors have since discovered that the studio project – Louisiana Film Studios — never received state authorization for the credits, and now their money is gone. Studio officials are saying the money will be returned to the investors once they get new investors. Sound familiar, Mr. Madoff?

Manning has said that Houser originally contacted him about the investment, suggesting some initial marketing of the campaign by Houser. Is his late-June release following the revelation of this failed investment just a coincidence? The timing is curious.

Tough week for Houser. He lost his $125,000 investment and his job. Moreover, it is this week’s cautionary tale for professional football players and their limited earnings. With people like Bernie Kosar, one of the most cerebral players to play the game, and Michael Vick, once the highest-paid player in the sport, now in bankruptcy, the message can’t get any louder: It’s not what you make, it’s what you keep.

Why are some people judging Michael Jackson’s personal life, yet we’re not hearing much about Steve McNair’s supposed cheating on his wife, only his football achievements?

Although there certainly has been discussion of the circumstances surrounding McNair’s personal life at the time of his death, this is a fair question. At the end of the day, however, we remember the good about people. For Jackson, it was his special music, dancing and creative talents that were a part of an entire generation (mine).

For McNair, we will always remember his toughness, natural leadership and ability to succeed from a background where so many have failed. It’s clear from comments and reactions that he had a dramatic effect on people he knew and played with. As I wrote Monday, his agent, Bus Cook – someone I have known for more than a decade through Brett Favre – truly loved the guy.

The other fact I’ve learned in more than 20 years of working with professional football players is that, for the most part, they live in a different world than you or I. Too often, though, that world comes crashing down when the music stops – their playing days and celebrity wane. For a player like McNair, his popularity had staying power, especially in Nashville, where he achieved his greatest professional accomplishments.

Let’s not forget, however, what the truly unfortunate story is here: There are four children who lost their father. More than anything that’s been said or written about McNair, they are the story. Our hearts ache for them.

Why did Darnell Dockett announce that he would not be holding out from training camp with the Cardinals?

It’s the latest strategy from Dockett and his agent, Drew Rosenhaus, to get the new deal he’s been seeking. The previous strategy, to complain publicly and seek a trade, did not work. Of course, he really didn’t want to be traded; he wanted a new contract, and still does.

Dockett can look around the locker room and read the tea leaves. Adrian Wilson, who was quiet about his under-market contract, was recently rewarded with what I felt was an extremely strong contract given his age and position (five years, $39 million, $18.5M guaranteed for a safety who will be 30 in October). On the other side of the locker room, Anquan Boldin has been asking for a renegotiation for two years, sometimes quite publicly, with no results. Wilson’s method, which Dockett is now publicly following, seems to be the winner in Arizona. The problem for Dockett is that he has three years remaining on his deal, compared to one for Wilson when he did his deal and two for Boldin.

Why do the Vikings make fans buy tickets to a preseason game if they want to see the Packers game?

This is nothing new and occurred when Favre was playing for the guys in green and gold. It’s a simple way of ensuring ticket sales to a game that has little appeal by tying it to a game that will always sell out, no matter who’s playing quarterback.

Variable pricing is becoming the norm in sports for single-game ticket sales. Although this is not a typical case of variable pricing, its effect is the same.

Why is Favre making the Vikings wait so long before formally signing with them?

Because he can.

Why do Commissioner Roger Goodell and I have something in common climbing the highest peaks in the country?

Goodell is attempting to climb the second-highest peak in the lower 48 states, Mt. Rainier at 14, 411 feet. On July 20, yours truly will attempt to summit the highest peak in the lower 48, Mount Whitney, at 14, 496 feet. Unlike the reasoned and well-organized commissioner, who is summitting over a couple days with a guide, I will attempt to do Whitney in one day, leaving in the wee hours of the morning to try to reach the 11 miles by noon before heading down. Assuming altitude sickness does not get the better of me, I will be writing my Wednesday Whys the next day. God willing…

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First, a note on the “stop-you-in-your-tracks” news of Steve McNair’s death this past weekend in Nashville: I didn’t know McNair but felt like I did in my nine years dealing with Bus Cook, his agent and the agent for Brett Favre. It seemed like every time I spoke with Bus about Brett, I would inevitably hear about McNair (pronounced MAC-nair by Cook) since their careers as the faces of two successful franchises seemed to coincide. Indeed, whenever we worked on a deal for Brett, we always discussed similar negotiations going on with McNair.

When the Titans locked out McNair from working at their facility prior to his trade to the Ravens, I had to hold the phone away from my ear as Bus railed on about the treatment given to the signature player of that franchise (I would later hear the same about another client of his). Throughout that ordeal, however, Bus maintained that McNair would never take shots at the organization and would handle himself with professionalism and class throughout. He appeared to be that type of person and was full of natural leadership traits that served him well in his wonderful career in football.

Bus truly cherished and adored Steve. Rest in peace, Steve MAC-nair….

Second, as a tennis fan and very unsuccessful former competitive player, I think we are truly in a time to count our blessings as fans of the sport. The Roger Federer-Andy Roddick Wimbledon final was a joy to watch, as, it seems, are all of Federer’s matches. His mastery of the game is breathtaking. He also genuinely seems like a good guy, someone who takes his game much more seriously than he takes himself. As I’ve said many times about this era of tennis with Federer, Rafael Nadal, Roddick and sisters Venus and Serena Williams – who seem to be able to win any tournament they grace with their presence – we are truly smack dab in the middle of a golden age of the sport….

The July 4 holiday has passed, and NFL teams now will step up their efforts to bring the rookie class of 2009 into the fold contractually. Of course, the fact that very few high picks have signed is meaningless at this point, as every player has participated in offseason activities and mini-camps, all secured by injury protection forms signed prior to their first team activity in May.

Over the next couple of weeks, I want to take you inside the negotiations of these rookie contracts in a few stages. A common misperception about rookie contract negotiations is that – with the rookie salary cap setting basic levels of contract values – the only substantive negotiation is the number inserted for the signing bonus. In some contracts, that might be the case, but the reality is a bit more complicated. It’s the infrastructure of the contract that often becomes more debated than the dollars and cents. Today, let’s look at the signing bonus.

The Signing Bonus

Depending on when the contract is negotiated, there may be precious little to negotiate with regard to the bonus. In the seventh round, the haggling may be over tens of dollars. In the sixth round, it may come down to a hundred dollars. In the fifth, the debating may be over a few hundred dollars and so on.

For those teams that wait until the week of training camp – which some teams do – the bonus amounts will have likely filled in around the pick, and it’s simple to fill in a fair number for both sides. As mentioned, some teams will look around the rounds of their picks in the week of training camp, call the agents and fill in the numbers. That’s a relatively stress-free way of doing the contracts; my nature would not allow me to do that because I’d be worried if we hadn’t signed most of our rookies by early to mid-July. For those like myself who tried to lock in contracts early in the development of the round, filling in a number becomes a task based on the previous, rather than the current, year.

Thus, in negotiating among the first deals in a couple of the rounds, the markers used this year were from the 2008 draft, examining the increase in bonus from 2007 to 2008 in various data points:

• the exact slot of the selection;
• the overall selection in the draft;
• the area three picks above and below the slot;
• the quadrant of the round;
• the half of the round;
• the full round.

In the lower rounds, the increases in bonus amounts are typically in the 3-4 percent range. In the second round, the range is broader and higher, anywhere from 6-8.5 percent.

In round numbers, the following are current signing bonus amounts for a mid-round selection in the lower rounds, assuming four-year deals, which most teams are now routinely using:

Seventh: $50,000
Sixth: $100,000
Fifth: $180,000
Fourth: $470,000
Third: $735,000
Second: $1.8 million (signing bonus plus guaranteed salary)

On a four-year contract, the salaries for each player are locked in at the following for contracts this year:

2009: $310,000
2010: $395,000
2011: $480,000
2012: $565,000

So before any bonus discussion, the player is assured of a contract worth $1.75M in total value, although not guaranteed.

Thus, the negotiation about hard numbers becomes a negotiation about the signing bonus, except for the second round, which, due to the operation of the rookie pool, necessitates teams shielding part of the guaranteed amount in a one-time incentive – using the easiest-earned categories allowable for the player to make the money – to keep it out of the pool number. Second-round picks receive signing bonuses and incentives backed by future guarantees in later salaries in the contract.

The rookie cap went up five percent from 2008 to 2009. Interestingly, the minimum salary for year one went from $295,000 in 2008 to $310,000 2009, a 5.1-percent increase in itself. Thus, teams can realistically argue that there should be no increase in bonus this year as the cap number for each player is already up five percent due to the minimum increase. That argument has and continues to be made, although without much success in the agent community.

For most agents, the negotiation is all about the bonus, and I can’t blame them. The sobering fact is that the majority of these players will not last the contract and should probably grab every penny of guaranteed money they can. Every agent should bet on his player to protect the upside but be realistic about the downside.

Speaking of the upside, next in this series: the escalator.

This week’s “Master of the Obvious” headlines:

“New league UFL to consider signing Vick”

An upstart league with no players of name value is considering signing one of the most well-known athletes in the sport. Ya think?

“Favre Doc Says Favre wants to join Vikes”

Dr. Andrews, who was consulted by Favre to advise on his stated desire to play for the Vikings, says what we have known for a year. Ya think?

In the vast majority of cases, the answer to the question anyone is asking is, “Follow the money.” The bottom line is almost always the bottom line. My favorite line from press conferences where athletes sign big contracts is, “It isn’t about the money.” Translation: “It’s all about the money.”

However, there appears to be one metric in sports, especially in the NFL, where the answer may not be to follow the money. That statistic – and it’s the most important one in sports – is winning. Money can buy a lot of things, but it will not necessarily buy a championship – or even a winning record – in professional sports.

My colleague Michael Lombardi aptly described the importance of prudent and targeted spending Thursday in his column about the Buccaneers. According to a report from Jason La Canfora of NFL Network showing all the cash commitments in the NFL from 2004-2008, the range of spending goes from the Cowboys at $567 million to the Bucs at $449 million, a range of $118M, or approximately $30M per season in disparity between the highest- and lowest-spending clubs.

Although I have numbers that are slightly different, the point is the same: Spending big and winning big do not correlate. Indeed, having managed player costs at the Packers during that time frame, we were third lowest in the league at $457M – about $114M average per season — and were an overtime away from the Super Bowl in a year (2007) in which we were the second lowest-spending team in the league.

Cash – not cap — numbers are the key numbers to focus on with teams and spending. Cap spending is something that teams manage in different ways; it does not reflect how much money teams are actually paying players. One of the biggest misperceptions that fans have about teams’ willingness to spend is that if they have a lot of cap room, they are not spending. That can be very far from the truth. A well-managed cap with plenty of room can coincide with having spent liberally to improve. I know that firsthand.

The lack of correlation between winning and spending is not a novel concept and one that has been proven for years. The proper way to build success in the NFL is to assemble and develop young talent that proves worthy of core contract extensions, ensuring continuity of key players at key positions on the roster. Selective and targeted acquisition of free agents is necessary to complement the existing talent base. However, continued spending on free agents, driving up player costs and pushing out players who have been coached and developed, is not a sound way to put together a team.

A large amount of spending league-wide is done in early March during the opening days of free agency. That’s when teams “make a splash,” when owners acquiesce or even encourage finding that “missing link” that will put the team over the top. It’s a time when contract research is thrown away, as bidding by multiple suitors creates unprecedented levels of pay for top-echelon position players. This year alone, Albert Haynesworth, Bart Scott and Jason Brown set new benchmarks for their respective positions at defensive tackle, linebacker and center.

Free agency can work if there’s a plan and a clear vision for the player. The problem with free agency in football compared to baseball (where players hit, pitch and catch) and basketball (where players’ athleticism creates competitive advantages) is that football requires schemes and interdependency among 11 players on every play. It’s not that easy to put a new piece into the mix as it is with other sports. That’s one reason why results from free agency are sketchy. Usually, teams that make noise in March do not make noise in January.

Free agency is also the price paid for not drafting well. In Green Bay, I remember having to chase and sign Hardy Nickerson because our draft choice slated for middle linebacker, Torrance Marshall, was not working out. I chased and signed Charles Woodson because our two high picks from two previous years, Ahmad Carroll and Joey Thomas, did not pan out. Look at any big free-agent signing and chances are he’s replacing someone the team had high hopes for at some point in the recent past.

As mentioned above, the four-year spread between the highest-spending team, the Cowboys, and the lowest-spending team, the Bucs, is less than $30M a year. In contrast, the New York Yankees are spending more than $200M on their 25 players this season, while the Florida Marlins – playing in the same professional sports league – are spending $36M. That’s a spread of $164M between the highest- and lowest-spending teams in baseball! And, as we all know, money hasn’t bought much for the free-spending Yankees in recent years (although that fact doesn’t seem to stop them).

The baseball situation above is what can happen without a salary cap. While there are year-to-year differences in spending between NFL teams, there is a self-regulating effect of the NFL salary cap that will not allow teams to have top-of-league spending every year (the Redskins have been big spenders in 2005, 2007 and 2009 but have had normal spending in the other years).

Bud Selig – a member of the board of directors of the Packers — would shake his head when he listened to my cap and cash presentations, knowing that there was no regulatory mechanism like a cap in baseball. Baseball teams have their own “caps” – budgets – but the inequality in spending was and is a problem in baseball. Selig loved the fact that the Tampa Bay Rays were in the World Series last year with a $44M payroll, proving the theme again that sound management rather than money buys championships.

The disparity in spending in baseball can be a cautionary tale for owners and players in football. Without a cap, there is neither a ceiling nor a floor on spending. There could be teams playing the role of the Yankees and Red Sox and teams playing the role of the Marlins and Rays. Time will tell, and that time may be coming.

Cash is king, and the cash numbers are out. What they show are two things: One, for the overriding goal of winning, sometimes you can’t just follow the money. And two, the disparity in spending is a fraction of that of baseball, a potentially ominous statistic as we stare down the barrel of a year without a salary cap in 2010.

Enjoy the holiday. Happy birthday, America!

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