Your Guide to 2022 Green Bay Packers Salary Cap Situation

Restructures, Extensions, and Veteran Cuts–how they work and which Green Bay Packers players fit into each category

Lastly, we will dive into contract restructures, extensions, and cuts or trades, as these are going to be the most common ways that the Green Bay Packers can create that precious cap space. I’ll also take a look at which players could fit into each category.

Contract restructures

In order for a restructure to work, a player needs to have more than one year remaining on their current deal; otherwise, that is when a team has to add those pesky voidable years to the contract.

If that’s the case, and there are at least two years left on the deal, oftentimes, a team will take a player’s base salary for the current season and convert it to a signing bonus. This effectively lowers the cap in the current year because the entire base salary for that specific year counts towards that year’s cap. However, the cap hit from a signing bonus can be spread out over the remaining life of the deal.

For example, and keep in mind this is an oversimplification, if Player A has an $8 million base salary in 2022 and his contract runs through the 2024 season, the team can convert $6 million of the base salary to a signing bonus and spread that cap hit out over the three years left on the contract.

So in short, the 2022 cap hit has dropped to $4 million. The original base salary of $8 million has decreased to $2 million and if you divide the $6 million signing bonus up over three years because that’s what’s left on the deal, then $2 million stays in 2022 on top of the base salary (totaling $4 million), while the cap charges in 2023 and 2024 have increased by $2 million each year.

Restructure candidates: David Bakhtiari, Kenny Clark, and Aaron Jones

Contract extension

The mechanics of an extension are similar to that of a restructure. For a deserving player that a team wants to keep around, they will tack on years to an already existing contract–or extend them. Although the contract is being infused with a hefty dose of new money, it still allows the team to lower the cap hit in the current season.

Oftentimes, a player who is receiving an extension is at the end of a current deal, and they come with a large cap hit and base salary. Just like with the restructure, the base salary can be converted to a signing bonus and spread out over the life of the contract, which has increased due to the additional years added on.

Also, these deals are typically very cash-heavy in that first season, which of course, the player is a fan of because that is money upfront. And for the team, they can assign a large chunk of that new money as a signing bonus, which again, allows them to spread the cap hit out over the entire contract, rather than it hitting the books in one season.

Extension candidates: Jaire Alexander, Preston Smith, Adrian Amos, and Billy Turner

Veteran cuts or trades

These are the simplest moves and ones that fans are likely the most familiar with. An NFL contract is made up of many parts, but two important ones for this discussion include the cap hit and the dead cap hit.

The cap hit is the charges that are going to be on the books that season if the player is on the roster. The dead cap hit is the charges that will be on the books even if the player is playing elsewhere. If you’re wondering what dead cap is, it’s the money that has already been paid out to a player, such as a signing bonus.

Although teams can spread the cap hit of a signing bonus out over an entire contract, that money is actually paid upfront — again, that’s why player’s love signing bonuses — and since it is money already spent, it still counts against the books. When it comes to any of these cap-saving moves, the cap charges all come due at some point, even if it might be a few years down the road.

So now that we have that all out of the way, when a player’s cap hit (the money on the books if they are on the roster) is greater than the dead cap hit (the money on the books even if the player is playing elsewhere), then it makes financial sense for a team to cut or trade that player because they will save cap space.

For example, Za’Darius Smith’s cap hit in 2022 is $27.66 million. However, his dead cap hit is only $12.38 million–meaning if the Packers cut him, they’ll save $15.28 million in cap space.

Cut or trade candidates: Aaron Rodgers (trade), Za’Darius Smith, Preston Smith, Adrian Amos, Billy Turner, Dean Lowry, Randall Cobb, and Mason Crosby

With all that said, there is certainly a lot more that goes into this than what I’ve explained, but at a high level, this is why the Green Bay Packers are in the salary cap situation that they are in, who accounts for those large cap charges, and a few ways that they can create space.