I wrote an article in January that was about how Cam Heyward wanted a new contract and that he might have to wait until after the 2020 season to get one. My reasoning then was because of the 30% clause in the old Collective Bargaining Agreement and restrictions that came with it. Luckily, the 30% rule is no longer something to worry about due to the signing of the new CBA— now players and owners have to worry about the havoc that the pandemic will have on the economics of the NFL in 2020 and beyond.
Let’s lay some simple groundwork regarding NFL economics that is laid out in the exceedingly complicated CBA. The 2021 salary cap will be based on 2020 revenue and the players would get between 48 and 48.5 percent of the total NFL revenue. Early speculation had the 2021 cap between $215 million and as high as $240 million. (I think $210 million was the more realistic figure.) This number is in serious doubt because of revenue lost if fans are not allowed in stadiums or in limited numbers. In the tweet below, Adam Schefter rings the alarm bells that the cap could retreat $30-80 million per team. Because of this reason alone, the Steelers need to pump the brakes on any contract extensions with their 19 players who will be unrestricted free agents after the 2020 season.
Something to monitor: The salary cap in 2021 could potentially take a massive hit due to COVID-19. "The various estimates I've gotten from executives to owners is that the cap could be down anywhere $30M to $80M in 2021" — @AdamSchefter— NFL Update (@MySportsUpdate) May 5, 2020
Full episode https://t.co/yWz44h3j8C pic.twitter.com/FPI0fq9Prn
In my previous article, I laid out how the Steelers have a paltry $13.4 million to work within 2021 cap space. Even going off of the lowest figure if the cap contracts, the team would be roughly $17 million over the cap next season. How will the team deal with that scenario? (I will tackle that in an upcoming article but please speculate in the comments section.)
The Steelers would have a tough time signing players to extensions and now with the possibility of a salary cap contraction looming, the team needs to take a conservative financial approach and tell players they will have to wait for new contracts until the uncertainty subsides. What sense does it make to sign Heyward to a $13 million per year extension, or more, if the team will have less money to work within 2021 than it had in 2020?
Could the NFLPA and the owners reach an agreement to prevent a contraction? That is a possibility that many capologiists and talking heads are talking about, but until it happens, no extensions should get done that could bury the Steelers in a chasm that would force them to take even more drastic measures.
I wonder if Heyward still feels the same way as he did with my initial article.
Chill bruh... I was only saying I wouldn’t mind starting negotiations earlier. Trust me I’ll be just fine. And PS I want to keep all my teammates— Cam Heyward (@CamHeyward) January 30, 2020
If you are unclear on some of the salary cap issues which may concern the Pittsburgh Steelers, make sure you check out my Salary Cap FAQ.