With the first week of free agency in the books, it's time to look back at some of the bigger moves the Colts have made this week. I'll be going through some of the new players with film and statistical summaries in coming weeks, but first I wanted to take a look at the actual contracts the players received.
The Colts cap guru under Ryan Grigson, Mike Bluem, has been getting a lot of praise lately due to the structure of the contracts the Colts have signed over the last year. While I certainly don't agree with every signing, and some are downright bad, the structure of many of these big money deals has been interesting to watch.
— Ted Sundquist (@Ted_Sundquist) March 5, 2014
So let's break down the Colts' notable multi-year deals and the intricacies that make them so flexible.
$22 million over four years, $11 million guaranteed (2014 base salary, $1 million signing bonus, 2015 roster bonus and base salary)
The 2015 base guarantees on the fifth league day of 2015 (which likely will begin in late February), while the roster bonus guarantees in March of 2015. By making that a roster bonus and not a signing bonus, the Colts essentially made it a one-year, $4.75 million deal with a potential three-year extension. If they cut Jackson by early February next season, they'll only have $750k dead money.
A roster bonus only counts against the cap for that year, while a signing bonus is prorated across the entire contract. By making the majority of Jackson's payment for 2015 a roster bonus while lowering his base salary, his cap hit for that year is more than manageable even if the Colts don't cut him.
The first year is completely guaranteed, so if Jackson is a complete bust before the season even starts, they'll be in the hole $4.75 million this year. Outside of that, the team does have good insurance if he doesn't work out. I still don't particularly like the signing, but you have to give it to Grigson and Bluem for constructing it in a way where it doesn't have to hurt the Colts long-term.
$33 million over five years, $16 million guaranteed ($5.5 million signing bonus, 2014 base, 2015 base-injury only)
Jones' contract isn't quite as exciting, but we do see the beginning of a pattern here where Jones' cap hits come. It's low this season, big in 2015 and low in 2016.
It is worth noting that the $6 million base salary in 2015 only becomes a guarantee if he's on the roster.
$39 million over four years, $20 million guaranteed ($5 million signing bonus, base 2014-2015 and 2015 roster bonus)
Here we see the Colts using roster bonuses creatively again. It's a fantastic way to sneak guaranteed money into the contract without it counting toward the cap for years, like a signing bonus.
In Davis' case, the $20 million guaranteed comes from the base in 2014 and 2015, the $5 million signing bonus and the $6 million roster bonus in 2015. Of the $6 million roster bonus in 2015, $5 million is only guaranteed after the fifth day of the 2015 league year. You'll notice that the numbers above only add up to $36 million, as $3 million of the contract is only available (in the final two years of the contract) if Davis hits certain performance measurements.
Because of the roster bonus containing a large part of that guaranteed money, the dead money in Vontae's contract plummets after 2015, meaning that if he turns out to not be worth the enormous cap hit, the Colts can get rid of his contract with minimal consequences.
Again, notice the large cap hit in 2015 and the drop again in 2016.
Adam Vinatieri and Pat McAfee
Both of these two contracts are pretty simple. Vinatieri got $5 million over two years. His base salary is $2 million in each year, with a $500k signing bonus prorated over the two years. He also has a roster bonus of $500k in 2015. His cap hit is $2.25 million this year and $2.75 million next year, with minimal dead money.
McAfee got $14.5 million over five years. It comes out to a base salary of $2.75 million every year except 2016, when it's $2.5 million. Yes, Grigson has saved every penny that he possibly could in 2016.
What's coming next?
Right now, the Colts project to have around $30 million in cap space in 2015 again, more than enough for their big re-signings (Anthony Castonzo and Jerrell Freeman) and bringing back a few cheaper veterans (Reggie Wayne, Cory Redding, Darius Butler).
Edit: I was reminded by Twitter follower @GbengaOkusanya that Freeman is an RFA in 2015, meaning the Colts will likely tender him and push his re-signing back to 2016 as well.
The real crunch comes in 2016, when the 2012 draft class (Andrew Luck, Coby Fleener, Dwayne Allen, T.Y. Hilton, Vick Ballard, Josh Chapman, Trent Richardson) has to be re-signed, along with veterans like Robert Mathis, Greg Toler and Adam Vinatieri. While the Colts do have a team option for Luck in 2016, the other young guys will all command notable pay increases.
By lowering the 2014 free agents' cap hits in 2016, the Colts give themselves more flexibility to get those deals done. None of the deals have any notable guaranteed money in 2017 if the Colts take Luck's team option and put off his deal until 2017, again giving the team more flexibility there.
The real trick is going to be how the team structures deals next year and beyond, but for now, Bluem is definitely earning his paycheck.