Salary Cap Nuggets - No. 1: Introducing the series, and discussing Paragraph 5 salary

This series is called Salary Cap Nuggets because ‘nuggets’ is such an interesting word in English. It calls to mind chicken nuggets - tasty, bite sized and easy to eat. But it also calls to mind gold nuggets - small, but valuable.

The salary cap is a product of the Collective Bargaining Agreement (CBA), which is a 301-page contract between the NFL Owners and the NFL Players Association. In these articles, I try to explore just one or two small parts of the NFL salary cap defined in the massive CBA. Hence, Salary Cap Nuggets - small, bite-sized, easy to digest, yet valuable information for NFL fans.

The goal is to, one bite at a time, get a clear understanding of the salary cap.

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The background (This is only for Nugget No. 1 - you won’t have to read this again)

If your only interest is information about salary cap, you should scroll past the next 2,000 or so words of self-indulgence, and stop when you see the large heading that says: Paragraph 5 Salary and begin reading there.

I am a voracious reader.

It’s both a blessing and a curse, I guess. Reading offers me diversion from the everyday world, while also providing the opportunity for new knowledge and insight, which all sounds good, but, throughout my life, I’ve felt uncomfortable if I didn’t have a book handy. I mean, like, all the time.

When I was a young man living in Richmond, Virginia, I walked around with a paperback stuck in the back pocket of my jeans. If I had to wait in line for two minutes at the grocery store, I’d pull out my book and read in line.

For a couple of years of my life when I was in my late twenties I had a two-hour commute to work in Northern Virginia from my home in Richmond. I’d hop on I-95 north around 5 a.m. every morning. I cringe to think about the stupidity now, but I used to turn on the overhead interior car light, prop a book on my steering wheel, and read the book by glancing up and down as I hurtled up the interstate five mornings per week as the sun climbed into the morning sky. How I lived to see my 30th birthday is a mystery.

I credit (blame?) my #2 sister for my passion (obsession?) with reading. When I was a lad — I’d guess I was 8 or 10 years old — she gave me a stack of books for Christmas. These weren’t ‘kids’ books, but novels: The Yearling by Marjorie Kinnan Rawlings, A collection of short stories and poems written by Edgar Allen Poe, and The Hobbit by J.R.R. Tolkien.

I read The Yearling first, and didn’t fall in love with it. But when I read The Hobbit, it was like my entire world changed. I wanted more. I found out that Tolkien had written three more books — a ‘trilogy’ it was called — known collectively as The Lord of the Rings. I got my sister or my mom to buy the first book in the series, The Fellowship of the Ring, for me, and from that moment on, I was lost to the world of men. Every spare moment, from then on, was spent with my nose in a book.

One of my favorite books from my teenage years was a popular book of poetry published in 1974, written by Shel Silverstein, called Where the Sidewalk Ends. Described as a ‘children’s’ book, it was a series of short, humorous, clever poems with pen & ink illustrations that I think any adult would find entertaining. More than 40 years later, I can still recite some of the lines from memory, and each of the poems in the book brings a smile to my face when I read them today. If anyone reading this has kids who enjoy getting their noses in books, I’d encourage you to buy a copy of this 4-decade-old classic and give it to them. You’ll both enjoy it.

The book and its individual poems are widely available on the internet today, and I’d like to share one of my many favorites with you here.

It’s called, Melinda Mae.

MELINDA MAE

by Shel Silverstein

Have you heard of tiny Melinda Mae,

Who ate a monstrous whale?

She thought she could,

She said she would,

So she started in right at the tail.

And everyone said, “You’re much too small,”

But that didn’t bother Melinda at all.

She took little bites and she chewed very slow,

Just like a good girl should...

...And in eighty-nine years she ate that whale

Because she said she would!

The analogy

If the analogy isn’t completely obvious already, the reason I mention this poem is that I plan to tackle the task of exploring the NFL salary cap as defined in the CBA - and it’s a big job.

But, like Melinda Mae, I think I can, I’m saying I will, and starting right in at the (figurative) tail. I’m hoping one or two of you will want to join me in this exploration. I’m hoping that it’ll take less than 89 years.

It may take 89 articles; I don’t know. I haven’t really planned this out. I’m just gonna take little bites and chew very slow and trust the process.

My reading habits in the 21st century

My love for reading has never faded, but its manifestation has evolved since my days standing in line at the supermarket in Richmond Va. A few years ago, frustrated at the difficulty and expense of buying English language books in Thailand, I turned to new technology and started downloading books to my smart phone.

This was great! Now I could read, literally, anytime and anywhere without having to lug a heavy book around with me, and when I finished one, I could just open the next one and keep on reading.

I read on my phone while standing on the train during my morning and afternoon commutes, laying in bed at night as I fell asleep, and in the classroom during the final 4 or 5 minutes before the students came in to study.

But I found that I was hitting a bit of a conflict — specifically when it came to my exercise routines. See, I couldn’t read and lift weights, or — despite my willingness 30 years ago to drive and read at the same time — read while I took long walks on the hot sidewalks of Bangkok. The result was that I’d be reading a book, my planned exercise time would arrive, and I would struggle to choose between continuing to read or putting the book down and starting to exercise. It was a daily conflict.

I solved the conflict by doing something I had resisted for years — I bought a pair of bluetooth earbuds and started downloading audio books to my phone. Now, when it was time to exercise, I could plug in my earphones, turn on an audio book, and multitask. During the summer, I walk about 2 ¹⁄₂ hours per day, so I can cut through about 2 audio books per week.

I’ve also stopped reading in my bed at night, saving a lot of wear and tear on my aging eyes. Instead, I put my phone on the nightstand next to my bed and listen to a ‘bedtime’ story, which I find puts me to sleep very quickly. With the ‘sleep timer’ function, it’s easy to wake up in the morning and just rewind 5 minutes to where I drifted off.

So nowadays, I always have two books available on my phone — one for reading when it’s not appropriate to be using my headphones (when proctoring an exam, or waiting for my queue number to be called in the bank), and one for listening when that’s better than reading (lifting weights, walking, laying down to sleep).

The book I have on my phone right now for reading is one that I had thought about buying for some time, but simply hadn’t gotten around to until last week.

Crunching Numbers

The book is called Crunching Numbers, and it’s written by Jason Fitzgerald and Vijay Natarajan, who run the OverTheCap website. Here’s the precis from the Amazon.com website:

The authoritative guide on the National Football League (NFL) salary cap and Collective Bargaining Agreement (CBA). Crunching Numbers: An Inside Look at the Salary Cap and Negotiating Player Contracts is the perfect book for any NFL fan to broaden their understanding of the rules and decision making processes general managers face each day, as they construct their team.

Crunching Numbers goes into great detail to explain how the money works. Key concepts from the NFL CBA such as signing bonuses, dead money, free agency, salary guarantees, franchise tags, termination pay, minimum salary benefit, bonus forfeitures, grievances, and many more will be looked at closely. By using practical case player examples to illustrate the concepts within the CBA, readers will learn how to calculate a player’s salary cap number and the ways in which teams manipulate those numbers to work within the NFL rules. In addition, Crunching Numbers explores ways to benchmark contracts and the roles team contract negotiators play in today’s NFL.

I have an interest in the NFL salary cap and how it affects roster-building in the modern NFL. Nearly everything I know about salary cap was gleaned from reading articles on the OverTheCap website, but my haphazard form of learning has left me with gaps in my understanding of the topic.

I decided to spend this summer break (I am a university teacher who is now on Day 3 of my annual 100 days off) reading this book and filling in the many gaps in my knowledge of salary cap.

Genesis of the idea for Salary Cap Nuggets

When I wrote a salary-cap based article recently, it garnered a lot of positive comments, and even got some recommendations from third parties on Twitter. In the comments section, some weaknesses in my article were pointed out to me, and I responded by saying that salary cap is such a big, complex, interrelated topic, that I don’t believe you can ever attack every aspect of a question in any one article, or the article becomes too unwieldy to be readable (Crunching Numbers, for example, is 296 pages long).

It was in the day or so that followed that I conceived the idea for this series of articles. It is based on another memory from my teenage years in the 1970s. Anyone who lived through the United States bi-centennial in 1976 will know that it was the focus of everything for a couple of years — sort of like Y2K in the late 90s. For a year or two before the huge July 4th, 1976 celebration, something called Bicentennial Minutes aired on TV.

Here’s the description from Wikipedia:

Bicentennial Minutes was a series of short educational American television segments commemorating the bicentennial of the American Revolution. The segments were produced by the CBS Television Network and broadcast nightly from July 4, 1974, until December 31, 1976. (The series was originally slated to end on July 4, 1976, airing a total of 732 episodes, but was extended to the end of the year.)

The videotaped segments were each one minute long and were broadcast each night during prime time hours, generally at approximately 8:27 or 8:57 P.M. Eastern time. The format of the segments did not change, although each segment featured a different narrator, often a CBS network television star.

The narrator, after introducing himself or herself, would state “This is a Bicentennial Minute,” followed by the phrase “Two hundred years ago today...” and a description of a historical event or personage prominent on that particular date two hundred years before during the American Revolution.

Bicentennial Minutes was an effort to encourage a nation to focus on and appreciate the history that it was celebrating.

Minutes = Nuggets

It occurred to me that this bite-sized format might be a useful model for discussing the NFL salary cap. After all, it’s not a compelling topic to read about, but every serious NFL fan has to have some familiarity with it in today’s game, since it drives so much of how rosters are built and maintained.

My loose plan is this: I will read the book Crunching Numbers this summer (or maybe longer). As I come across a concept that I find useful — some will be new for me, others I will have already known — I will write that concept into a “Nugget” and publish an article. If it works out the way I envision, then next year, if I write an article about salary cap and there is a sticky point that needs explanation, I won’t need to choose between glossing over the point or adding 800 words to the article; instead, I will be able to link to the appropriate “Nugget”. Any reader unfamiliar with the concept can click on the link and read about it, while readers who are already au fait with the concept can read an article that isn’t stuffed with explanations they don’t need.

Anyway, that’s the concept.

Today, I’d like to start with an idea from the early part of Crunching Numbers — one that I have known about for years, and which is central to the discussion of many elements of the NFL Salary cap.

Paragraph 5 salary

In the recent article that I wrote titled, Do the Redskins have the cap space needed to sign Tre Boston to a free agent contract? I wrote the following:

[T]he salary cap hit is pro-rated for the number of weeks [a player is] on the roster, so, as a simplistic example, a player who signs, say, a $1m per year contract, but who plays only ¹⁄₄ of the season, would carry a salary cap hit of only $250,000.

In the comments section later, I commented on my own example:

I called it a ‘simplistic’ example because, despite playing 16 games, players are paid for 17 weeks. This means it is impossible for a player to actually be paid 1/4 of his P5 salary, but explaining that adds 4 or 5 paragraphs and another 400 words to an already long article. I decided to leave that potentially confusing point for another day and another article.

Well, today is another day, and this is another article.

Let’s explore the idea of how a player earns his base salary, and when it is paid.

NFL Contracts are individualized to each player, but they follow a standard format before all the details are put in, and the paragraph that deals with a player’s salary — what is often referred to as “game checks” — provides the name for that payment: Paragraph 5 Salary.

There is constant reference to Paragraph 5 Salary in the CBA.

The book, Crunching Numbers, explains what it is on pages 12 & 13:

The fifth paragraph in an NFL contract discusses a player’s base salary. The P5 base salary is the money earned for playing during the seventeen weeks of the regular season. The CBA mandates minimum levels of P5 base salary pay, but not maximum levels. Minimum pay is based on players’ experience in the NFL. In 2016, the minimum pay for a rookie was $450,000 and $985,000 for a veteran who has ten or more credited seasons. Under the 2011 CBA, the minimum salary will increase by $15,000 each season. The salary itself is earned in seventeen weekly installments and does not require game participation to be earned. The cutoff deadline for earning a week’s pay is Tuesday 4:00 PM Eastern Standard Time, which is why contracts are often terminated on Tuesday during the season—it avoids an extra week’s financial commitment to a player. In general, P5 base salary would be similar to what you earn at a salaried job.

Players are paid in full their yearly P5 base salary in equal installments. Payment is over the seventeen-week (sixteen games + one bye week) regular season. For example, if a player has a P5 base salary of $1.7 million, that player’s weekly installment would be $100,000 ($1.7 million for seventeen weeks). Like everyday employees, players typically will receive a paycheck every two weeks during the regular season. In our example, the player will earn a (gross) paycheck of $200,000 every two weeks (covering sixteen weeks), with his ninth paycheck making up the $100,000 difference, totaling our $1.7 million P5 base salary. Outside of a negotiated signing bonus, roster bonus, workout bonus, or other similar payments that may be paid on a specific date, players are paid between the months of September and January, depending on when their regular season commences and completes.

Recap of Paragraph 5 Salary:

• This is a player’s ‘base salary’, often referred to as ‘game checks’. It is pretty similar to the normal salary that many ‘average’ people get paid at a ‘normal’ job.
• The P5 Salary is calculated and earned in 17 equal installments, defined by the 17 weeks of the regular season, including the bye week, but players actually get paid every two weeks during the regular season (usually between September and January, based on the NFL schedule).
• A player does not have to be ‘active’ on game day to get his P5 salary; he just needs to be on the roster (that is, either active or inactive 53-man roster, practice squad, or paid reserve such as IR, PUP, etc - though reserve players may face an adjustment called “split salary” that will be dealt with in a different Salary Cap Nugget article).
• P5 Salary does not include things like signing bonus, roster bonus, workout bonuses, or other similar payments which are paid on dates specified by the contract.
• If a player is on the roster at 4:00 pm on Tuesday during the regular season, he gets his P5 Salary for that week. (Also, if a player is added to the roster between 4:00 pm Tuesday and game-time, he gets his P5 salary for the week, meaning that, some weeks, teams may pay P5 salary to more than 53 players if late-week roster changes occur).

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