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The June 1 Date and What It Means in the NFL
June 1 represents an important day in the calendar year for the NFL. It is a day when various rules and tenders change.
The biggest impact for teams involves the modification of salary cap accounting rules for players whose contracts will be terminated after June 1 or whose contracts were terminated with the “Post June 1” designation. Prior to June 1 any player removed from a teams roster, either by release or trade, will have all their remaining salary cap allocations accelerate into the current League Year. For example a player with $1 million in prorated money from 2014 to 2017 whose contract is terminated will carry a “dead money” charge of $4 million in 2014.
However, after June 1 that “dead money” charge now splits between two seasons. Once released the team only needs to account for the current years prorated money in their 2014 salary cap accounting. All future years’ prorated money will now land as “dead money” in 2015. So for the example player above the “dead money” charges will equal $1 million in 2014 and $3 million in 2015. In practice this rule allows teams with underperforming, high priced players to release players before the season and remain salary cap compliant. If such a rule did not exist many teams would have a difficult time, with their salary caps often tight, to release a player with high prorated charges.
It is important to note, though, that the June 1 rule does not apply to future guaranteed salary. Such future guarantees immediately accelerate into the current season if a player is released. There is no split of those figures.
For many teams June 2 will open up significant cap room. This is because players designated a “June 1” cut in the offseason will finally come off the books for those teams. The offseason June 1 designation is used when players do not factor into a teams future plans but the team is usually unable to release the player due to the high “dead money” charge associated with the contract, which, in many cases, would make the team no longer salary cap compliant. Often the team does not wait until June 1 to make the move in order to avoid guarantees kicking in (usually the first week of free agency by sometimes as late as April), roster bonuses from being earned (almost exclusively in the first week or free agency) or non-exercise fees from option bonuses to be made. Prior to June 1 the players’ entire salary cap charge remains on the books even though they are no longer on the team. On June 2 only the current years’ proration will remain on the books with the balance being charged to 2015.
Here is the list of June 1 cuts who will come off the books next Monday, giving them the space they need for extensions, rookie signings, or just a functional budget for the upcoming season:
http://overthecap.com/june-1-date-means-nfl/
--------------------
so..........we're rich?
Player Team Current Charge New 2014 Charge New 2015 Charge Cap Space Gained
LaMarr Woodley Steelers $13,590,000 $5,590,000 $8,580,000 $8,000,000
June 1 represents an important day in the calendar year for the NFL. It is a day when various rules and tenders change.
The biggest impact for teams involves the modification of salary cap accounting rules for players whose contracts will be terminated after June 1 or whose contracts were terminated with the “Post June 1” designation. Prior to June 1 any player removed from a teams roster, either by release or trade, will have all their remaining salary cap allocations accelerate into the current League Year. For example a player with $1 million in prorated money from 2014 to 2017 whose contract is terminated will carry a “dead money” charge of $4 million in 2014.
However, after June 1 that “dead money” charge now splits between two seasons. Once released the team only needs to account for the current years prorated money in their 2014 salary cap accounting. All future years’ prorated money will now land as “dead money” in 2015. So for the example player above the “dead money” charges will equal $1 million in 2014 and $3 million in 2015. In practice this rule allows teams with underperforming, high priced players to release players before the season and remain salary cap compliant. If such a rule did not exist many teams would have a difficult time, with their salary caps often tight, to release a player with high prorated charges.
It is important to note, though, that the June 1 rule does not apply to future guaranteed salary. Such future guarantees immediately accelerate into the current season if a player is released. There is no split of those figures.
For many teams June 2 will open up significant cap room. This is because players designated a “June 1” cut in the offseason will finally come off the books for those teams. The offseason June 1 designation is used when players do not factor into a teams future plans but the team is usually unable to release the player due to the high “dead money” charge associated with the contract, which, in many cases, would make the team no longer salary cap compliant. Often the team does not wait until June 1 to make the move in order to avoid guarantees kicking in (usually the first week of free agency by sometimes as late as April), roster bonuses from being earned (almost exclusively in the first week or free agency) or non-exercise fees from option bonuses to be made. Prior to June 1 the players’ entire salary cap charge remains on the books even though they are no longer on the team. On June 2 only the current years’ proration will remain on the books with the balance being charged to 2015.
Here is the list of June 1 cuts who will come off the books next Monday, giving them the space they need for extensions, rookie signings, or just a functional budget for the upcoming season:
http://overthecap.com/june-1-date-means-nfl/
--------------------
so..........we're rich?
Player Team Current Charge New 2014 Charge New 2015 Charge Cap Space Gained
LaMarr Woodley Steelers $13,590,000 $5,590,000 $8,580,000 $8,000,000
