The financial ramifications of the coronavirus are being felt in every corner of the economy, including professional sports. With limited or no fans in stadiums this season, the NFL is in for a significant hit to its 2020 revenue, which will have an impact on the 2021 salary cap.
On Friday, it was reported that the NFL proposed to the NFLPA that the salary cap floor next year be set at $175 million. It could be higher if the decrease in revenue is not as steep as expected, but $175 million per team would be the low point.
Considering the salary cap this year is $198.2 million and it typically increases by about 10% per year, a $23 million decrease would be bad news for every team. Some teams, of course, would be in a worse position than others, depending on the current structure of their roster.
The proposal being discussed by the NFL and NFLPA would spread the impact of any revenue shortfall in 2020 over four years, with a 2021 salary cap of at least $175 million, sources tell me and @MikeGarafolo. No change to the 2020 cap despite owners' proposals.
— Tom Pelissero (@TomPelissero) July 24, 2020
The Rams cleared a lot of cap space in 2021 by cutting Todd Gurley and trading Brandin Cooks, but they still aren’t in great shape with Jalen Ramsey, Cooper Kupp and John Johnson still to pay.
According to Over The Cap, the Rams would have $8.1 million in cap space next year if the salary cap were to drop to $175 million. That’s 21st in the NFL and would obviously put the Rams in a really difficult spot.
Their 2021 free agents include Ramsey, Kupp and Johnson, as well as Leonard Floyd, Troy Hill, Gerald Everett, Josh Reynolds and Samson Ebukam – all of whom should play key roles in 2020. If they were to only have $8.1 million in cap space, it would be financially impossible to re-sign all of those players. The franchise tag for Ramsey alone would likely be north of $16 million.
In the event that the 2021 cap does drop to $175 million, the Rams (and all other teams) would need to restructure a bunch of contracts, cut pricey veterans where possible and sign team-friendly extensions that come with lower cap hits in 2021.
As difficult as this scenario would be for the Rams, there are teams that would be in much worse shape. For instance, the Eagles would be more than $71 million over the cap, with the Saints $66 million over the limit.