View Full Version : Who pays the Cap
03-01-2008, 02:23 PM
I understand a lot how contracts work and how teams can back load or front load contracts. But who actually funds the Contracts. And signing bonus (guaranteed money) come out of the salary cap but in what way. For example experts speculate the first round pick will probably get $35 million in guaranteed money but it doesn't come directly out cause that would use up basically all of the Fins Salary this year.
03-01-2008, 06:02 PM
it is split up over the life of the contract so say it is a 5 year deal then the guaranteed part is $7 mill a year. As for funding the contract, the league pools its revenues (not all revenues, but for simplicity sake i will say revenues) together and takes a set % of it and splits it evenly among all the teams. Teams in NY obviously will contribute more than say Miami, but this is done to keep teams on an even playing ground. That is why there is guessing at how much the salary cap will be for the next year, but no definitive answer until free agency nears and they figure out what the revenue was and thus what the cap will be.
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