Well, it’s official. The NFL Players Association has narrowly voted to approve a new collective bargaining agreement that will run through 2030, and the league is now entering a period of dramatic change. This deal includes plenty of big-picture ramifications for the NFL, including the option for a 17-game regular season (starting in 2021), a 14-team postseason field, an increase in revenue share for the players, expanded roster sizes and practice squads, and an updated drug-testing policy. With the start of free agency looming, though—either this week or later, if the NFL decides to postpone the start of the league year—the new CBA could also have a sweeping impact on how teams approach the 2020 player market.
Many of the consequences of ratifying the deal stem from the fact that 2020 is no longer the final year of the existing CBA. Several special rules were set to go into effect this season, including teams having the right to use both the franchise and transition tags in the same year. With that option now gone, teams like the Cowboys and Titans have to adjust their offseason plans. Under the old provisions, Dallas would have been able to use its franchise tag on quarterback Dak Prescott and the transition tag on receiver Amari Cooper. Even though the transition tag would have allowed other teams to negotiate with Cooper, Dallas would’ve had the right to match any offer, ultimately depressing his market. Now, if Dallas can’t negotiate a long-term agreement with Prescott before the league year begins, Cooper will become a free agent—and probably cash in big time.
A similar situation is unfolding in Tennessee, which entered this weekend with both quarterback Ryan Tannehill and running back Derrick Henry set to hit the open market. A few hours after Sunday’s CBA news, though, the Titans gave Tannehill a four-year, $118 million deal—with a whopping $91 million in guarantees—as they presumably prepare to use the franchise tag on the league’s 2019 rushing champion.
Another strange loophole closed by this weekend’s vote is the 30 percent rule, originally put in place to limit salary-cap gymnastics on contracts that extend beyond the final year of the existing CBA. The rule stated that “no NFL player contract extending into a season beyond the Final League Year may provide for an annual increase in salary ... of more than 30% of the salary provided for in the Final League Year, per year, either in the season after the Final League Year or in any subsequent season covered by the Player Contract.” In layman’s terms, this means that any player who signed a multiyear extension this offseason couldn’t have had a 2021 salary more 30 percent higher than his 2020 figure. For example, someone who signed an extension with a $12 million salary in 2020 couldn’t have had a salary exceeding $15.6 million in 2021.
With that restriction no longer in place, teams will be able to structure contracts that balloon considerably in the coming years. Let’s say a team like the Falcons, who are projected to have only a few million dollars in cap space, want to make a run at trade target Yannick Ngakoue. Atlanta could theoretically structure a new deal for Ngakoue that comes with a cap hit of $5 million in 2020 before exploding to $25 million in 2021, when the portion of league revenue that goes to the players will increase from 47 percent to 48 (and possibly up to 48.5, with the media kicker that would come into play if the league signs a new TV deal in the interim).
That flexibility will allow more teams to be active in the upcoming free agency period. The league announced Sunday that the 2020 cap would settle around $198.2 million, about $10 million higher than last season. While that uptick is smaller than some expected and unlikely to lead to a lot more free-agent spending on this year’s cap (the approved CBA’s increase in league-minimum salaries from $510,000 to $610,000 for players with less than a year of experience will account for upward of $3 million of that total), the new financial reality should motivate teams to head into this market with designs on allocating more money against their future caps.
Take the Saints and Patriots, both of whom are trying to complete deals with aging quarterbacks who may be interested in year-to-year deals. Before this CBA passed, certain guidelines would have made it difficult for the teams to tack dummy years onto the end of de facto one-year deals in order to prorate some money on their future caps. Those structures have now become more palatable, and could pave the way for Tom Brady to return to New England and Drew Brees to rejoin an organization that has recently favored such deals.
New Orleans has become notorious for pushing its financial obligations into the future. Sean Payton, who wields significant personnel power, and the Saints front office essentially treat their salary cap like I treated my first credit card, kicking the can down the road and leaving the bills for another day. Not all teams will adopt that line of thinking in short order, but the new CBA could push things in that direction. Teams that seemed to have limited resources suddenly have the potential to be real players in free agency by manipulating the cap and putting off some of their financial obligations until the cap takes a leap in 2021. It’s no coincidence that a flurry of transactions arrived shortly after the CBA news broke. The Ravens—who entered this weekend with only $16 million in projected cap space after franchising pass rusher Matt Judon—must have felt more comfortable swinging a trade for Calais Campbell now that the financial landscape has started to take shape. The 33-year-old All-Pro defensive lineman is reportedly finalizing a two-year, $27 million deal after being acquired from the Jaguars. Don’t be surprised if that has a low cap hit in 2020 with more back-loaded in 2021.
Another change resulting from the new deal is that post–June 1 cuts are now available to teams, which wouldn’t have been the case in the final year of the existing deal. Post–June 1 releases allow teams to spread the dead-money hit that comes from cutting a player across multiple years. That option puts a lot more players at risk of becoming cap casualties, and as a result could bring more surprising teams into the free agency fray.
Anytime the NFL’s financial ground shifts, teams take time to adjust to the league’s new topography. And while the demand for elite free agents such as Cooper, Ngakoue, and others will probably reflect the market as it currently exists, teams that are aggressive this offseason could benefit greatly down the road. Smart executives who can convince their owners to free up more cash than they otherwise might have will be able to secure 2020 deals that go down as bargains. The league’s new world is upon us, and those who adapt quickly could thrive.