LA Rams VP Tony Pastoors should really take a bow right now

Let’s put that on paper

While critiquing the LA Rams dead cap peril is a bit like back seat driving, it was the rapid decision of the team to move on from key players combined with the urge to lock them in and pay handsomely that created the financial Catch-22 for the team.

Well, that and the unexpected plunge in NFL finances due to 2020’s COVID-19 crisis. In simpler terms, the LA Rams use the future salary cap escalators to enhance their ability to pay today’s players. That means that the LA Rams figure into today’s contracts what they expect tomorrow’s salary cap should be. That allows the team to give the appearance of spending more on players than other teams.

The magic of contract language

In reality, it locks in the best players at a fairly consistent share of what the team’s overall salary cap is expected to be.  The Rams signed Odell Beckham Jr. to an incentive-loaded contract in 2021 and dealt with the Denver Broncos in such a way that the Broncos pre-paid nearly all of Von Miller’s salary.

The magic of contract language is significant. A one-year $15 million deal to a player can be either a $15 million, two $7.5 million, or three $5 million salary cap hits to an NFL team. How? Contract language. Bonuses can be spread over the life of the contract. Incentive clauses that are not certain to be met in a contract can be paid out in the following year. Over time, NFL accountants and lawyers have become very skilled at the timing of when a team recognizes salary payments in their salary cap.