To say the start of the 2022 NFL free agency period has been hectic would be an understatement. In quarterback moves alone, we’ve seen Russell Wilson traded to the Broncos, Deshaun Watson traded to the Browns, Carson Wentz traded to the Commanders and subsequently Matt Ryan traded to the Colts.
Each of these blockbuster trades incur what is known as a dead salary cap hit, which is money allocated in a team’s salary going to players no longer on the roster, resulting from a player being released or traded prior to their contract’s expiration. The Atlanta Falcons losing out on the Deshaun Watson sweepstakes, while simultaneously ruining their relationship with franchise cornerstone Matt Ryan led to the quarterback being traded to the Indianapolis Colts, which in turn generated the single largest dead cap hit in NFL history.
In 2022, the Falcons will be paying $40,525,000, or 19.47% of their cap to Matt Ryan alone. No team has ever won a Super Bowl with a quarterback making more than 12.3% of the salary cap (Tom Brady, 2020), let alone a quarterback not even on their roster. Factoring in the Julio Jones trade from last year along with other trades/cuts, the Falcons lead the league with nearly 30% of the team’s salary cap in 2022 going towards players no longer on their roster.
But it could be worse.
In 2013, the then Oakland Raiders experienced an overall dead cap hit of 43.33%, the highest single-season dead cap hit in the past decade. Voiding the remaining years of Hall of Famer Richard Seymour’s contract, along with trading Carson Palmer to the Cardinals, and cutting players such as Rolando McClain, Tommy Kelly and Darrius Heyward-Bey effectively put the Raiders in cap hell, inhibiting their ability to compete as they finished the season 4-12.
The rest of the teams with the single-season worst dead cap hits experienced a similar lack of success. Only 3 teams on the list managed winning records, the 2021 Saints and 2021 Eagles were just barely a game over .500. In terms of point differential, teams fared just as poorly, with only 3 teams having positive point differentials. In spite of their high dead cap hits, the 2012 Colts and 2021 Eagles teams were able to experience modest success, making the playoffs only to lose in the wild-card round.
The teams with the top 10 highest dead cap hits each season struggled more often than they succeeded, as only 35% of teams in the top 10 over the decade posted winning records. Of the 136 total playoff spots occupied during this timespan, exactly 25% were occupied by a team with a top 10 dead cap hit. Following the trend, a lack of Super Bowl success for these teams saddled with dead money would make sense.
Yet the numbers tell us a different story.
Of the 11 Super Bowl winners from 2011-2021, nearly half of them had a dead cap hit in the top 10 for their respective seasons. Although the dead cap hits were high for their seasons, they weren’t necessarily earth-shattering, hovering around 10% and going as high as 13.42% with the 2014 Patriots team. The Los Angeles Rams, however, did the unthinkable and won with a dead cap hit of over 25% this past season, good for the 4th highest dead cap hit of all teams last year.
How is it that a team that had a quarter of their salary cap tied up in former players like Jared Goff and Todd Gurley was able to win it all and bring a Lombardi to LA? Having a top tier coach in Sean McVay certainly helps, along with the acquisitions of elite players like Von Miller and Odell Beckham Jr.
The simplest explanation is that the production of the active players on the roster was far better than their contract numbers. Von Miller played for a whooping 0.39% cap hit, while Odell played for 0.45%. Having two game-changing players added to a team already rich in talent for less than a single percent of the total cap greatly helped the Rams overcome their dead money, and contributed to their high Team Value Ranking. The Team Value Ranking (TVS) is a metric created by Spotrac.com that aggregates player production per contract, effectively measuring how well a team does at maximizing the value of all their players. Last year the Rams had the 6th best TVS; the other Super Bowl winners with high dead cap hits had similarly high TVS rankings, with the exception of the 2012 Ravens.
While some teams can overcome a high dead cap hit over a single season, it is still inadvisable for a team to build a long term strategy around trading/cutting players and accumulating dead money.
Only one team has been able to be truly successful over the past decade in maneuvering past dead cap hits: Mickey Loomis’s New Orleans Saints. The Saints are virtually tied with the Dolphins for the highest sum of dead cap hit percentage at 157%, yet while the Dolphins have struggled in the past decade, with a point differential of -492, the Saints have a positive point differential nearly three times as high at 813.
The obvious first impression is that the Saints had something all other teams on this list lacked: a Hall of Fame quarterback. And while that’s true, Loomis’s impact as a GM is just as integral to the franchise’s decade long success.
Jeremy Trottier of profootballmania.com makes the case for Loomis as top GM, citing his incredible draft hit rate from 2016-2020, where each player taken in the first 3 rounds has started at least one game. Like the 2021 Rams, Loomis exceeds at maximizing the value of players on active contracts, averaging a TVS ranking of 11 since 2012, and 6.5 since 2016.
In a game of inches, the ability to consistently overcome adversity is the key to success. Roadblocks like penalties can set you back on the field, just as much as dead money can set you back off the field. Although teams can find ways to win here and there in spite of these roadblocks, they still make the path to success that much harder along the way.