Three ways the Seahawks can easily create cap space
By Geoff Shull
The simplest way for the Seahawks to create cap space would be to restructure a contract
The team has two logical players they could restructure. The first would be Russell Wilson, the second would be Bobby Wagner. What makes them logical fits would be that they are signed for several additional seasons. They are also both cornerstones on the roster.
What restructuring a player’s contract would do, would be to move a player’s base salary for the current season into a signing bonus. This allows the team the ability to prorate the amount that was paid out via signing bonus over the remaining life of the contract.
An example using Russell Wilsons current contract
Russell Wilson’s contract has a cap hit of $31 million in 2020. This cap hit is made up of $18 million in base salary and $13 million in a signing bonus. The full terms of the contract are below.
Terms: 4 years, $140 million
Avg salary: $35 million
Gtd: 70 million
Cap hits by year:
- 2020: $31 million
- 2021: $32 million
- 2021: $37 million
- 2022: $39 million
So, restructuring the contract would turn up to $16 million from a base salary into a signing bonus. This amount would reduce the current year’s cap hit by whatever was paid out. However, it would then increase his future cap hits by the amount reduced.
Example after restructuring all $16 million into a signing bonus and the effects on his cap hits and guarantees
Terms: 4 years, $140 million
Avg salary: $35 million
Gtd: 88 million
Cap hit by year
- 2020: $15 million
- 2021: $38 million
- 2021: $43 million
- 2022: $45 million
The team needs to be very careful before deciding to restructure a player. After the base salary is turned into a signing bonus, it becomes fully guaranteed. So, if there is any semblance of doubt the player will play out the entire contract, this move could come back to bite the team in the future.
Second, it can harm the team’s future financial flexibility. Russell’s cap hit would increase each season after the restructure by $5.3 million. If the salary cap decreases, this could come back to sting in a few years.
Restructure Russell Wilson’s contract: save up to $16 million in 2020.