Contract restructuring 101: What are the Cowboys doing? A comprehensive guide

Jerry Jones

Credit: WFAA

Cowboys Owner Jerry Jones has created room to operate in the 2013 offseason. But at what cost?

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by OR MOYAL

WFAA Sports Producer

Posted on February 28, 2013 at 6:27 PM

Updated Thursday, Feb 28 at 6:45 PM

The Cowboys went into this offseason $20 million over the cap. That's with the assumption that marquee linebacker Anthony Spencer goes elsewhere, the team doesn't make a single draft pick and completely avoids the free agent market. In short, they were in really, really bad shape.
 
After two frenzied days, the Cowboys suddenly appear to be below the salary cap. And they haven't released a single player in that span.
 
The team re-structured the contracts of almost every player on the roster making more than 5 million dollars, and even a few who don't sniff that number.
 
What does that mean? It means the team guaranteed money in future years of the deal, turning 'base salary,' which would have come off the books in the case of a trade or release, into a 'signing bonus', which the player will now make regardless of what the team does with him.
 
Essentially, the Cowboys saved themselves from Cap Purgatory this year but set into motion a continuation of the vicious cycle by guaranteeing many of their older players would continue to count against the team's available resources in the future.
 
Example: Brandon Carr signed a 5-year, $50 Million contract with the team last offseason. But the extent of the Cowboys' cap trouble forced them to structure his contract so that he only made $3.2 Million in the first year.
 
He was set to count for $16 million against the 2013 cap. The Cowboys 'fixed' that by guaranteeing another $13.5M throughout the life of the deal from 2014 to 2017. His 2013 cap hit is now a mere $5.43 million, but he's now set to count for about $13M in each of the following four years.
 
The team basically put this year on the credit card, hoping and praying they hit on enough cheap draft picks that they won't need many more free agents to supplement expensive stars like Carr, Tony Romo, Demarcus Ware, Jason Witten, Miles Austin or Jay Ratliff.
 
I didn't list those names coincidentally. The Cowboys re-worked their contracts, as well as those of Mackenzy Bernadeau, Nate Livings and Ryan Cook. They're reportedly working on Doug Free (notable, as most thought he would be released) and Orlando Scandrick.
 
The team will save $4 million this year on Ware's new deal, $3.65 on Witten's, around $1 million on Livings', $1.5 million on Bernadeau's and $3 million on Austin's deal. As of now, they've slashed $20 to $25 million from this year's cap figure, putting them at or below the cap. They can probably save another 7 or 8 with Free and Scandrick, but there's one more big hammer yet to fall.
 
Tony Romo could make $16.8M this year. 'Could' is a key word because the Cowboys are working hard to extend their franchise quarterback. Such a move would likely cut his 2013 cap figure by around $10 million, clearing huge space and completing the Cowboys' journey from 'most cap-strapped team in football' to 'Welcome, free agents!'
 
Alternatively, the team could cut enough money from the rest of its roster that it can play hardball in the Romo negotiations, under the stance that NFL Commissioner Roger Goodell no longer holds the power to release their players for them in a drastic cost-cutting move. 
 
In all likelihood, Romo will get a new deal. It will be a big deal –– if I had to guess, 5 years, $75 million might be the going rate for a quarterback with Romo's profile. The Cowboys could use their 2013 flexibility to lock up Spencer, pick up a quality offensive lineman like Guard Andy Levitre, or hold on to the money, knowing that 2014 will be similarly rough and both Sean Lee and Dez Bryant will be up for massive new deals soon.
 
But knowing Jerry, they could also end up paying Greg Jennings $40 million and make him Romo's new slot receiver. 
 
In conclusion: The Cowboys earned themselves room to manuever this offseason. They mortgaged a lot of flexibility in future years, but that's reality for teams that don't draft well.
 
The Redskins have been running this carousel for a decade now. Let's hope the Cowboys have an off-ramp in sight sooner rather than later, as the last 10 years of Redskin football don't represent the best model for continued success.  

Follow WFAA Sports on Twitter at @WFAASports

Follow Or Moyal on Twitter at @OrMoyal

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