LA Rams now very wise for clearing 2021 salary cap space

The LA Rams bit the bullet hard by clearing 2021 salary cap space at this year’s expense. That appears to have been very wise now

The LA Rams wrote contracts in 2018 that created highly compensated players through 2022. You no doubt recall who those players are, or rather were. The Rams had assembled a rather formidable offense and wanted to keep the key players on the roster for the foreseeable future. But when a larger stack of cash hit the pockets of QB Jared Goff, WR Brandin Cooks, and RB Todd Gurley, their production plunged.  That placed the Rams in a precarious position.

Should the Rams cut ties with overcompensated players? Or hope their production would catch up to their wages in 2020? Taking the hit now would crush the team’s chances of signing big-ticket free agents. But letting the roster ride this season only created an even more devastating season for the team next year: highly paid players who do not produce blocking the team from signing players who do produce.

Dim 2020 salary cap goes dark in 2021

The Rams elected to trade Cooks, cut Gurley, and work feverishly to restore QB Goff to his 2018 level of quarterback play. That meant that the team would be forced to recognize all the deferred compensation for both Cooks and Gurley, and their combined salary cap hit of over $34 million of dead money. From that moment on, we’ve been asked many times why didn’t the Rams simply wait another year and cut or trade them both next season? In a word, because the 2021 salary cap outlook is even grimmer.

With projections of no-fans-in-the-stands, Forbes estimated the financial impact upon the NFL, and it was downright ugly. With the way the NFL salary cap is worded, 2020 revenues calculate into 2021’s salary cap.  The financial impact of COVID-19 would generate a huge drop in the league’s salary cap, with a sharp return to historic levels the following year. To prevent that drop, the NFL and NFLPA have agreed to limit the 2021 NFL salary cap of no less than $175 million.

Stabilizing the salary cap

That’s a drop of $23 million from 2020 levels, and over $65 million less than the originally projected $240 million salary cap for 2021.  If the Rams had kept both Gurley and Cooks, the team would be well over 2021 projected salary cap before the team ever signed a single player to a contract next year.

The floor of $175 million is huge, in that it gives front offices a certain number to work against.

Don’t say we didn’t warn you

While the Rams and all NFL teams will be hard-pressed to fill their roster needs in 2021, the original situation was nearly impossible to comply with the cap. As it stands today, the Rams have less than $8 million in salary-cap space but have 22 projected free agents. Of course, in any NFL season, there will always be options to renegotiate or restructure contracts to limit the salary cap hits in that year. Even at the beginning of the 2020 offseason, the 2021 financial picture seemed even more difficult for the Rams.

The Rams were very wise to make 2021 financially manageable. Most of the important details about next year are only now becoming available. Now how will the team re-sign all of the players needed next offseason?  Well, there are always options. Keep in mind that salary cap savings this year will roll over into next year. So look for marginal veterans to be on the bubble this season, particularly if a younger less expensive is comparatively as productive. The 2020 roster will be particularly crucial to meet the fiscal constraints of next season.