Reaching an agreement on a long term contract with DT Haloti Ngata is one of the Ravens’ stated goals for the offseason, but any deal for Ngata is going to be sizeable and deals like that can often be difficult to reach. But as it turns out, inking Ngata to a long term deal presents hurdles outside of the collective control of the Ravens and the former Oregon Duck’s agent.
Why?
Blame it on the Uncapped Year.
The CBA Rules as they relate to the uncapped year contain a provision that is going to make it difficult for the Ravens to give Ngata the contract extension that he deserves.
One of the Uncapped Year rules is the 30% Rule which places a limit on contracts renegotiated and/or extended during the Uncapped Year. Basically, a contract that was signed during a Capped Year (for Ngata, 2006) can be renegotiated and extended during the Uncapped Year, but only if the player’s “salary” increases annually by no more than 30% of his 2009 “salary.”
For the purposes of the 30% Rule, “salary” is basically base salary plus option bonus prorations.
Ngata’s 2009 salary was a little under $2.4M, so that means that the most Ngata could make (signing bonus excluded) is as follows:
2010: $3.12M
2011: 3.84M
2012: 4.56M
2013: 5.28M
2014: $6M
2015: $6.72M
While those numbers are certainly nothing to sneeze at, they only total just over $29.5M, and usually you would expect higher base salaries for the kind of deal that Ngata will command.
So, in order to balance that out, the Ravens would have to give Ngata a huge, upfront signing bonus because signing bonus money is not considered as part of the 30% calculation.
The Ravens have always preferred to split bonus money into a signing bonus in year one and an option bonus in year two (and sometimes a little in year three, as well). But, in Ngata’s case the 30% Rule would force the club to give one upfront signing bonus of $35-40M to balance out the relatively modest base salaries shown above.
The Ravens would probably not be that adverse to giving a huge bonus to Ngata – he’s certainly not someone the team would have to worry about with regard to off-field issues – but it’s also an issue of just how much money the Ravens can spend at this point in real world dollars and cents.
Already this offseason, the Ravens have paid a $23M option bonus to Terrell Suggs and have also paid close to $22M in other bonuses to Domonique Foxworth, Ray Lewis, Anquan Boldin, Michael Oher, Derrick Mason and Corey Redding. That’s a total of $45M in bonus money paid to just 7 players. As a point of reference, the Ravens spent $112M on their total payroll (all salaries and bonuses) in 2009.
With the possibility of a work stoppage in 2011, it remains to be seen if the Ravens even have the necessary cash flow to take on another bonus – especially one of that magnitude.
That said this dilemma is not unique to the Ravens.
Several other teams are also facing this same problem with players like Chris Johnson, Nick Mangold and Kevin Kolb. Like Ngata those players are still playing under their rookie deals at very modest “salaries”, thus making it difficult to reach viable contract terms given the handcuffs of the 30% Rule.
While there may be a yet-to-be-disclosed, creative way to get around the 30% Rule, for all of those players – Ngata included – it may end up being the case that they will have to wait until the offseason to get their contract extensions.
Why?
Blame it on the Uncapped Year.
The CBA Rules as they relate to the uncapped year contain a provision that is going to make it difficult for the Ravens to give Ngata the contract extension that he deserves.
One of the Uncapped Year rules is the 30% Rule which places a limit on contracts renegotiated and/or extended during the Uncapped Year. Basically, a contract that was signed during a Capped Year (for Ngata, 2006) can be renegotiated and extended during the Uncapped Year, but only if the player’s “salary” increases annually by no more than 30% of his 2009 “salary.”
For the purposes of the 30% Rule, “salary” is basically base salary plus option bonus prorations.
Ngata’s 2009 salary was a little under $2.4M, so that means that the most Ngata could make (signing bonus excluded) is as follows:
2010: $3.12M
2011: 3.84M
2012: 4.56M
2013: 5.28M
2014: $6M
2015: $6.72M
While those numbers are certainly nothing to sneeze at, they only total just over $29.5M, and usually you would expect higher base salaries for the kind of deal that Ngata will command.
So, in order to balance that out, the Ravens would have to give Ngata a huge, upfront signing bonus because signing bonus money is not considered as part of the 30% calculation.
The Ravens have always preferred to split bonus money into a signing bonus in year one and an option bonus in year two (and sometimes a little in year three, as well). But, in Ngata’s case the 30% Rule would force the club to give one upfront signing bonus of $35-40M to balance out the relatively modest base salaries shown above.
The Ravens would probably not be that adverse to giving a huge bonus to Ngata – he’s certainly not someone the team would have to worry about with regard to off-field issues – but it’s also an issue of just how much money the Ravens can spend at this point in real world dollars and cents.
Already this offseason, the Ravens have paid a $23M option bonus to Terrell Suggs and have also paid close to $22M in other bonuses to Domonique Foxworth, Ray Lewis, Anquan Boldin, Michael Oher, Derrick Mason and Corey Redding. That’s a total of $45M in bonus money paid to just 7 players. As a point of reference, the Ravens spent $112M on their total payroll (all salaries and bonuses) in 2009.
With the possibility of a work stoppage in 2011, it remains to be seen if the Ravens even have the necessary cash flow to take on another bonus – especially one of that magnitude.
That said this dilemma is not unique to the Ravens.
Several other teams are also facing this same problem with players like Chris Johnson, Nick Mangold and Kevin Kolb. Like Ngata those players are still playing under their rookie deals at very modest “salaries”, thus making it difficult to reach viable contract terms given the handcuffs of the 30% Rule.
While there may be a yet-to-be-disclosed, creative way to get around the 30% Rule, for all of those players – Ngata included – it may end up being the case that they will have to wait until the offseason to get their contract extensions.
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