Cash over Cap issue (1 Viewer)

[Macdaddy_2004]

Looking arount the internet and can't get a clear definition

To comprehend the concept of cash over cap, one has to understand that the salary cap is just a bookkeeping number, one that can be massaged by amortizing signing bonuses, among other mechanisms. The cap has never been indicative of a team's payroll. The Redskin organization, believed to be the highest revenue-producing machine in the league, has had payrolls well over $100 million the last few seasons, even while the highest salary cap level ever was in 2005, at $85.5 million. The difference between a team's true payroll and its salary cap number is essentially what "cash over cap" means.

Anyone want to explain it to me like I am 8

 

[fridayfrenzy]

I.E. a player receives a signing bonus of 10 million.

The player actually receives a cheque for 10 million in the 1st year, but the bonus is pro-rated over 5 years at 2 million each.

Year 1: CASH = 10 million, CAP = 2 million

In year 1, there is an 8 million cash over cap value.

Cash over cap is just the difference of pro-rated bonuses and actual cash paid out.

 

[Macdaddy_2004]

Okay so is it a fair system or is it not a fair system

I mean its obvious the Redskins are following the rules but......it seems like they have a huge advantage over other teams.

 

[fatness]

I think that remains to be determined over time (If it is fair). There are penalties in the revenue sharing agreement for teams that go over the cap, I believe.

 

[Macdaddy_2004]

Apparently the redskins techinically don't go over the cap - but are dishing out a lot of dough

I guess a part of this is that they expect the CAP to increase every year