For only the second time that I can recall under John Elway, the Broncos have restructured the contract of a major player:
Source: the Broncos converted $16M of LB Von Miller's $18.5M base salary into a signing bonus, creating $12.375M in 2018 cap space.
— Field Yates (@FieldYates) March 15, 2018
What does this mean for Miller? In its simplest terms, the Broncos just wrote a $16.5 million check to Miller right now for salaries he was due to make not until the regular season. Miller (and anyone else!) should enjoy getting $16.5 million in his bankroll right now, instead of six to nine months later.
What does this mean for the Broncos? It’s best to illustrate through a pair of before and after contract tables.
Before the restructure
| Year | Base Salary | Prorated Bonus | Workout Bonus | Cap Number | Dead Money/Cap Savings (pre-June 1 cut) |
|
| 2018 | $18,500,000 | $3,500,000 | $500,000 | $22,500,000 | $38,000,000 | ($15,500,000) |
| 2019 | $17,000,000 | $3,500,000 | $500,000 | $21,000,000 | $16,000,000 | $5,000,000 |
| 2020 | $17,500,000 | $3,500,000 | $500,000 | $21,500,000 | $3,500,000 | $18,000,000 |
| 2021 | $17,500,000 | $0 | $500,000 | $18,000,000 | $0 | $18,000,000 |
Note that this table is slightly different than what’s currently up at Over The Cap. This table includes the full guarantee of $9 million of Miller’s 2019 base salary that will occur on March 18. Such a guarantee helps to make Miller practically uncuttable anyway for the 2018 league year.
After the restructure
| Year | Base Salary | Prorated Bonus | Workout Bonus | Cap Number | Dead Money/Cap Savings (pre-June 1 cut) |
|
| 2018 | $2,500,000 | $7,625,000 | $0 | $10,125,000 | $38,500,000 | ($28,375,000) |
| 2019 | $17,000,000 | $7,625,000 | $500,000 | $25,125,000 | $28,375,000 | ($3,250,000) |
| 2020 | $17,500,000 | $7,625,000 | $500,000 | $25,625,000 | $11,750,000 | $13,875,000 |
| 2021 | $17,500,000 | $4,125,000 | $500,000 | $22,125,000 | $4,125,000 | $18,000,000 |
The $16 million in base salary that was restructured is divided into four $4 million increments over the remaining four years of the contract, and goes into the prorated bonus column. This takes $12 million off of Miller’s 2018 cap year, but adds $4 million to they 2019-2021 cap years. It also adds to the potential dead money totals in 2019-2021 should the Broncos part ways with Miller.
Although this is minor, because Yates said that the Broncos gained $12.375 million in 2018 cap space, it is my belief that Miller’s 2018 workout bonus of $500,000 was also converted to a signing bonus. This slightly ups the four prorated portions to $4.125 million in each contract year.
Now, what does all of this mean?
- Miller now becomes practically uncuttable for 2019, as well. It would have already been dicey anyway after March 18 of this year, but now the dead money hit is accelerated from $16 million to $28.375 million. That’s a big difference.
- This also puts more pressure on a 2019 cap that’s expected to be tight for Denver as it stands. The $4.125 million of Miller’s contract that’s been deferred eats up about half the savings they got on that year from trading Aqib Talib.
- But the Broncos did this for a reason: they want to improve the roster now, and improvements are needed now. And there was no transaction that had a higher cap savings potential–not even parting ways with Talib–than restructuring Miller.
- I also have zero problems with restructuring Miller. He is a Hall of Fame talent that you do not plan on having to part ways at any time soon. Restructuring is not typically something that’s recommended to do regularly, but as this article started off, it’s a rarity in Denver, and it should be expected to remain a rarity given their history under Elway.