The Chiefs managed to fit their stars under a shrinking cap. Inside this NFL wizardry
On March 30, the Chiefs had exactly $177 of salary cap space. Not $177 million or $177,000 or even $177.01. No, they had $177. That’s to 0.00000089 percent of the money teams are allowed to spend on players this season.
But, let us not scoff at $177. That kind of money can be useful. Andy and Tammy Reid could’ve had a nice romantic dinner with $177, for instance. Patrick Mahomes could’ve bought a pair of jeans. Travis Kelce could’ve paid a teenager down the street to mow his lawn for a month, maybe.
Instead, the Chiefs used that $177 and gave up to $503 million to Mahomes, $85 million to Chris Jones, $57.25 million to Kelce, signed a draft class, and worked new contracts for others.
They’ve done all this with a virtual certainty that the NFL’s salary cap — which has gone up every year, and has always been assumed to go up every year — will drop next year from lost revenue because of COVID-19. This is like checking the weather, seeing a hurricane coming, and figuring out a way to watch safely from the beach.
So, the obvious: how the heck did the Chiefs do this?
“It’s a good question,” general manager Brett Veach said.
Brandt Tills is the Chiefs’ director of football administration, which means he’s in charge of cap management and Brandt, buddy, if you’re reading this I have $6.42 in my pocket and would like to use it to cover college education for my two young sons. Thanks in advance.
You might have two immediate conclusions about how the Chiefs pulled this off:
One is that the salary cap is fake.
The other is that Tillis and Veach are literal wizards, with hats and everything else.
The reality is different. And perhaps not as interesting as actual wizards running the team, but more interesting than the salary cap being fake. Let us discuss.
The first trick the Chiefs pulled off is winning the Super Bowl, and not just winning the Super Bowl, but winning the Super Bowl with a group of players who became friends and respect their coaches.
This sounds corny, or like the company line, but if you’ve followed the Chiefs for a certain amount of time you’ve seen what the opposite of cohesion looks like. You’ve seen players leave when they can, or join only when the other options stink.
You’ve seen players who believed the coaches and front office were in cahoots to limit their production, so that contract negotiations would be more difficult. You’ve then seen players go hardcore in negotiations, often to counterproductive results for everyone.
The 2020 Chiefs are what productive cohesion looks like. We see that on the field with Chris Jones forming a genuine bond with Frank Clark, even after Clark got the contract Jones thought he deserved. We see it with Tyrann Mathieu and Charvarius Ward going mentor-mentee, the veteran working for the younger player’s success as hard as he does his own.
These are small examples of what it looks like when the coaching cliches are reality — critical mass rowing in the same direction, players putting team above self.
That makes the job of Veach and Tillis — to pay the stars but keep the total under the NFL’s salary cap — easier, but not easy.
The most important financial advantage of that cohesion: extensions signed this offseason by Mahomes, Jones and Kelce include virtually no new money in the early years. This is critical.
Particularly in the NFL, athletes care the most about upfront money. It’s about the signing bonus, and money in the first three years. The Chiefs’ best players are bypassing convention, prioritizing the group over immediate financial gain. This can’t be faked.
So, the players were willing to give on structure. That was made possible by the team’s success and general love for each other, but it was also fundamentally necessary because COVID-19 has put the season in some degree of doubt and dropped the salary cap.
In 2020, the cap is $198.2 million. In normal times, that would grow to between $205 million and $210 million next year. At this point, all teams know is that it will not be lower than $175 million in 2021.
“We actually went into the offseason thinking we could do Pat Mahomes and Chris Jones and, cap-wise, we don’t have to do one (and) then the other,” Veach said. “We can just do them and make it work. As we started to get information the season could be compromised, that attendance could be compromised, the cap could be compromised. Then we had to pull back.”
That’s when the reports surfaced that the Chiefs and Jones’ agents were not talking. It’s because they couldn’t. Not productively, anyway, because there was too much uncertainty about where the cap would be.
“We worked different models of, ‘OK, if the cap is flat at $198 (million), $190 (million), $185 (million), $170 (million). We basically knew the levels and at a certain point we couldn’t do Chris. But at $175 (million), that was an area that was doable.”
Here, when Veach says “doable,” what he means is the team can expect to survive the upcoming cap drops and breathe again when the new TV contracts expire in 2021 (ESPN) and 2022 (other networks).
“So, basically, let’s navigate the next couple years and have some flexibility in these big contracts,” Veach said.
The salary cap is malleable, and few teams have proven that more convincingly than the Chiefs. In the last year, they have restructured deals for Alex Okafor, Laurent Duvernay-Tardif (who later opted out), Eric Fisher, Anthony Hitchens and Sammy Watkins.
That’s a lot of willing employees, but it’s also a sign of diligence. The Chiefs, like all responsible front offices, try to include escape clauses or other ways to shift cap space if the need arises.
That’s true in the biggest contracts, too. Mahomes, Jones and Kelce each have roster bonuses that can be converted into signing bonuses to create more immediate cap space. Because of the length of Mahomes’ deal and the expected longevity of his career, his contract could turn into something like an antidote against occasional future cap trouble.
The Chiefs will continue to prioritize similar mechanisms in other contracts, and utilize the existing ones when needed. The money still needs to be paid, and kicking the can down the road can create bigger problems later.
But the Chiefs have problems — and, let’s remember, figuring out how to pay good players is a good problem to have — that need solutions now.
“It’s not a habit you love doing year in and year out but you also know there’s nothing normal with what’s going on in the world right now,” Veach said. “You have to give yourself a little flexibility and know that if you can survive the next few years...
“If vaccines aren’t effective and this spirals into another year, well, the whole league is going to be in the same position ... The reality of it is we just needed some flexibility early on to get us to a healthier time for our sport and really for the country in general.”
Of all the ways 2020 is weird, football executives needing to know something about public health experts and the long-term forecasts by economists probably does not rate all that high. Here we are anyway.
But as much as the current issues feel consuming, the reality when these decisions need to be made will be much different than the one we see today.
The Mahomes deal is relatively risk-free, but the others are not. Kelce is due $17.25 million in 2025, when he will turn 36. Tony Gonzalez is the only tight end with more than 548 yards receiving at age 36 or older. Chris Jones relies on athleticism, has a history of leg injuries, and is due $20 million in 2023, when he will be 29.
Jones can be cut after the 2021 season with no dead money on the cap, and Kelce’s deal could be restructured to ease cap hits.
This is, realistically, the best balance of collecting football talent and maintaining some level of future flexibility that could be expected. Again, these are good problems. This isn’t giving Dwayne Bowe that extension, or the second contract for Tamba Hali.
Guys who are on the books now will underperform, and be cut for cap savings. Guys who are cheap now will develop, and become more expensive. Some might sign extensions, continuing the cycle.
The shrinking cap makes it wizardry, sort of, but the logistics are made possible by a special path of success and made necessary by a group of stars who deserve to be paid.
“Listen, it’s not the greatest flexibility in the world because we have high-priced players,” Veach said. “But we have enough flexibility that we know we can do some different things with players.”
This story was originally published August 21, 2020 at 5:00 AM.