Since the second week of March, Kansas City Chiefs general manager Brett Veach has signed 11 players for 2022 — and completed a significant contract restructure with defensive end Frank Clark that cleared $12.6 million in cap space, turning a player who was almost universally believed to be a surefire cap casualty into someone being paid an acceptable amount of money.
In most of these deals — which began with placing the franchise tag on left tackle Orlando Brown Jr. on March 7 — Veach has held to form, using every possible advantage (and sometimes thinking outside the box) to get the maximum benefit out of every salary-cap dollar.
The most recent of these clever deals came on Friday, when Kansas City signed free-agent wide receiver JuJu Smith-Schuster, who spent the first five years of his NFL career with the Pittsburgh Steelers. A year ago, Veach had made a strong effort to sign Smith-Schuster for the 2021 season, ultimately offering a one-year, $8 million contract that included $3 million in incentives. Despite the Chiefs’ offer — and an even better one from the Baltimore Ravens (which was reportedly for $9 million with $4 million in incentives) — Smith-Schuster chose to accept an $8 million contract offer from the Steelers.
At the time, many presumed that he simply wanted to remain in Pittsburgh, where he wouldn’t have to compete against Kansas City tight end Travis Kelce and wide receiver Tyreek Hill for targets; it was thought that he believed he would have a better chance at a big contract after another year with the Steelers.
But as it turned out, Pittsburgh was simply offering more money. The contract was actually for an NFL minimum of $1 million in base salary, plus a $7 million signing bonus. But the Steelers would probably like to have that contract back; Smith-Schuster appeared in only five regular-season games before suffering a shoulder injury that kept him on the sidelines until the team’s Wild Card playoff appearance against the Chiefs. Even worse, Pittsburgh had spread that signing bonus over four voidable seasons beginning in 2022 — so when his contract wasn’t extended, $5.6 million of that bonus accelerated into this season’s salary cap calculation.
Given that background, when news broke that Veach had signed the wide receiver to a one-year deal worth $10.75 million, it was reasonable to wonder if the Chiefs should have worked harder to land Smith-Schuster a year ago; his price had gone up. But late Friday afternoon, NFL Network’s Mike Garafolo reported that the deal was only for about $3 million — with the rest coming in incentives.
The #Chiefs‘ deal for WR JuJu Smith-Schuster comes in around $3 million on the base value with the rest of the $10.75 million max value @RapSheet reported coming in the form of incentives, sources say.
— Mike Garafolo (@MikeGarafolo) March 18, 2022
On Saturday, the full contract details became available. Smith-Schuster is again playing for an NFL-minimum salary of $1.035 million — and was paid a signing bonus of $1.455 million. His incentives include a workout bonus of $250,000 and a per-game bonus of $30,000 for every game he is on the active roster. That could add up to as much as $510,000 ($30,000 times 17 games).
But here’s where it gets interesting.
Under salary-cap rules, not-likely-to-be-earned (NLTBE) incentives are based only on the player’s previous season. Since Smith-Schuster played in just five regular-season games in 2021, only $150,000 of that bonus can count against this season’s cap; if earned, NLTBE incentives are charged against the following season’s salary cap. While the precise details of the remaining NLTBE incentives are unknown, they are likely to be easily attainable as long as Smith-Schuster plays a full season — and exceeds the kind of production that a player like Byron Pringle did in 2021.
It all adds up to a 2021 cap hit even lower than Garafolo reported: only $2.89 million — with the rest of the incentives (if earned) counted in 2023. Should Smith-Schuster earn all of them, he’ll likely become the threat that Sammy Watkins represented in 2018 — and the Chiefs’ offense should be significantly more effective. In such a case, the $7.86 million in potential 2023 cap dollars will seem cheap at the price.
But Veach has made other smart moves during free agency. New safety Justin Reid’s three-year, $31.5 million deal includes over $20 million guaranteed — half of it in a signing bonus. That makes his 2021 cap hit just $4.55 million — and leaves only $3.5 million in dead money during the third year of the contract. The rest is guaranteed in the second year of the deal — which means that if Reid doesn’t work out, the Chiefs may easily walk away after two seasons.
In addition, Veach continues to frequently use the veteran salary benefit (VSB) provision of the 2020 Collective Bargaining Agreement, which allows teams to pay long-term veterans at their normal minimum salaries — but carry a cap hit that is the same as a player with only two credited seasons. The Chiefs carried six such contracts in 2021, saving over $2 million against the cap. Two such VSB contracts — one with fullback Michael Burton and the other with offensive lineman Andrew Wylie — are already on the books for 2022, increasing the team’s cap room by more than $1.6 million. There will be more.
In retrospect, it is reasonable to criticize some of the contracts Veach signed during his first two years as the team’s GM. To many fans, players like Clark — and the recently-released linebacker Anthony Hitchens — appeared to underperform their high-dollar contracts. While the Chiefs probably considered those two deals more in line with those players’ contributions than fans did, the criticism still hasn’t been unwarranted.
But since then, Veach’s salary-cap moves have become sharper and sharper. The brilliant (and unorthodox) contract for quarterback Patrick Mahomes was just the beginning; since then, some of the same mechanisms that allowed that contract to be easily used as a source of cap funds have been used on other deals, too.
Per Spotrac, 13 NFL teams are now carrying dead cap in excess of $20 million. Kansas City is now carrying less than one-third of that: $6.5 million. It’s one thing to be short on cap space because there’s a lot of dead money that must be carried under the cap. It’s yet another to be short on cap dollars because the money is being used for its intended purpose: to pay a team’s players.