The Green Bay Packers will have more financial flexibility in 2024 than in 2023, but there is still work that needs to be done in order to give them the space they need to fully operate this upcoming season.
The word flexibility is a relative one–all dependent upon the situation. For the Packers, there is more flexibility in 2024 because Aaron Rodgers’ contract will completely be off the books — the team took on his entire $40-plus million dead cap hit in 2023.
However, at this time, the Packers still have just $7.35 million in available cap space, according to Over the Cap. Additional cap space will have to be created.
There are three fundamental ways that the Packers can create needed cap space this offseason, which include cuts or trades, contract extensions, or contract restructures.
A key term to know in all of this is dead cap space. These are dollars that have already been paid to the player but have not been fully recognized on the salary cap. An example would be a player signing a new deal in 2023 that comes with a big signing bonus. Rather than the team absorbing the entire cap hit from that signing bonus in the 2023 season, they will spread it out by prorating it over the future years of the contract.
So, while the player gets all that money upfront, only a portion of it has hit the 2023 salary cap, which means if he is released or traded in 2024 or beyond, the unrecognized signing bonus dollars that were pushed to those future years are now dead cap.
For players who are released or traded, if they come with a dead cap hit that is larger than the current year’s salary cap hit, the Packers’ cap space will decrease. In short, it costs more cap space to not have them on the team than to have them. On the flip side, if a player’s dead cap is less than their current year’s salary cap hit, then cap space will be created.
One name, in particular, to watch in this regard is De’Vondre Campbell, who battled injuries this past season and didn’t play at the same level that he had been. Campbell’s cap hit in 2024 is $14.2 million, and his dead cap hit, if released, is $11.62 million, which would save the Packers $2.6 million in cap space if they moved on from him.
A contract restructure is typically for players with more than one year left on their current deal. This is not an extension with new years added to the contract, but what this does is push dollars, or salary cap charges, from 2024 to future season(s).
This is done by taking a player’s base salary and/or roster bonus that they have baked into their deal, which both have to be absorbed in the current cap year, and converts it to a signing bonus. This gives the player that money up front and allows the team to prorate those dollars over the life of the contract, thus lowering the current year’s cap hit.
However, the downside is that the dead cap in those future years has now increased and makes the contract more difficult to get out of at that time. Rashan Gary, Jaire Alexander, and Elgton Jenkins are all contract restructure candidates to create cap space.
A strategy to help facilitate a contract restructure and something we’ve seen the Packers utilize often in recent years are void years. These are essentially dummy years added to a contract to push additional cap space to. This is not the same as an extension, as the contract is still up after the original time frame expires.
In its simplest form, this is a book-keeping measure, adding new “years” to a current deal so converted base salaries and roster bonuses have a longer time frame to be prorated over. When the actual contract expires, let’s say in 2025, for example, all those cap dollars pushed to the void years, let’s say 2026 and 2027, would accelerate and come due in 2025 and be on the books as a dead cap unless an extension was reached prior.
Lastly is a contract extension, which adds years and new money to a current deal. Part of the mechanics of this process that helps save cap space in the current year is that, just like with a restructure, a player’s base salary and/or roster bonus are converted to a signing bonus and spread out over a longer period of time because new years were added to the deal. So oftentimes, the player’s cap hit goes down, even though more money was added to the deal because there is also more years to spread those cap charges over.
Kenny Clark is a potential extension candidate, which would help lower his $24.23 million cap hit. Jordan Love will receive an extension as well, but because his cap hit on his current deal is only $12.5 million, and he is about to become one of the highest-paid players in football, his cap hit for 2024 will actually increase.
The largest cap hit for the Packers heading into 2024 belongs to David Bakhtiari at $40.01 million. I can promise you that Bakhtiari isn’t playing out the season on that deal. With this being the last year of his contract, a restructure isn’t in play, unless void years were to be added, but that then leaves a massive cap charge on the 2025 books.
An extension would be a very risky move as well, given the unknown around Bakhtiari’s health and committing even more money to him. This leaves either a pay cut having to be made, which Bakhtiari would have to agree to, or they release or trade him (although I don’t know which team is trading for that contract) and while doing so, that leaves a dead cap hit of $20.9 million. But it also saves the Packers $19.08 million as well.
Another name to watch for cap purposes is Aaron Jones. With how well Jones finished the season and just the overall impact he has, it’s difficult to envision him not being back in 2024, which is the final year of his deal. He does, however, come with a fairly large cap hit, north of $17 million.
As far as cap saving maneuvers that the Packers have, their options are fairly limited. They’ve already utilized three void years as part of a previous restructure, leaving them with only one void year left that they are able to use.
An extension comes with some risk, given Jones’ age, injury history, and how quickly running backs can feel the effects of father time. Jones already took a pay cut in 2023, so I’m not sure how willing he would be to do that again. Perhaps the Packers decide to just let the final year of his deal play out.
As the offseason rolls on and these cap-freeing moves are made, it’s important to remember that when you see that the Packers have $X in cap space, not all of that can go towards free agency. There are still additional operating expenses coming down the pipeline.
This includes the incoming draft class, which Over the Cap projects will be $13.28 million. The Packers also need cap space for the practice squad, reserves for in-season spending, as well as the 52nd and 53rd players on the roster because the offseason salary cap only counts the top-51 contracts, along with other items.
To put a bow on all of this, given where the Packers currently stand from a cap space perspective, many of the cap maneuvers I mentioned will have to take place in order to give them the space they need.
However, while Brian Gutekunst will have more spending power than he did in 2024, I wouldn’t expect major moves in free agency. But truth be told, with how well this roster is currently constructed along with the Packers having five draft picks in the top 100, they don’t necessarily need to either.
