Math Of Khan – How The Steelers Trimmed Over $29 Million Off The 2012 Salary Cap

There is euphoria in Steeler Nation today thanks to the magic pen used by Pittsburgh Steelers chief contract negotiator Omar Khan over the last 16 days. If you read my work here religiously, you know that all of this comes as no surprise to me. Despite the perceived salary cap hell that the Steelers were faced with immediately after the 2011 season ended, Khan and the Steelers have managed to slash $29.398 million off of the 2012 with the restructuring of five contracts and the termination of two more.

If you have not been following along, here is a quick recap of all of the moves that have been made.

It all started with the restructuring of the LaMarr Woodley contract. Woodley was scheduled to count $11.5 million against the cap in 2012. He was originally due a base salary of $3.4 million and also due a March roster bonus of $5.5 million. The Steelers lowered his base salary down to $700,000 and combined that $2.7 million along with his $5.5 million roster bonus and turned it into a signing bonus which they can prorate over the remaining years of his contract. Woodley was basically cut a check for $8.2 million to do this. Not a bad day at the office. That restructure saved the Steelers $6.56 million against the 2012 cap.

The next moves that were made were the contract terminations of Bryant McFadden and Arnaz Battle. McFadden was scheduled to count $2.666668 million against the cap and Battle was scheduled to count $1.3625 million. The McFadden base salary of $2.5 million was saved as was the $1.0375 million base salary of Battle. Those two moves saved 3.5375 million of cap space and created only $491,668 in dead money charges for 2012.

Next up on the restructure list was Lawrence Timmons. His contract was a restructure much like that of Woodley as his $2.625 million base salary was lowered down to $700,000 and the difference of $1.925 million was rolled together with the $4.5 million roster bonus that he was due and turned into a signing bonus that will be prorated out over his remaining contract years. Timmons was scheduled to count $9.125 million against the cap, but restructure dropped that down to $3.985 million, a savings in 2012 of $5.14 million. Timmons received a check for $6.425 million for just signing off on it.

Next up in the office of Khan was Ike Taylor, who was scheduled to earn a 2012 base salary of $5.75 million. $4.925 million of that was turned into a signing bonus and prorated out over the three years left on his contract. A straight forward restructure that lowered Taylor\’s 2012 cap number of $7.5625 million down to $4.279 million. That was a savings of$3.283 million in 2012.

After three restructures and two contract terminations the Steelers had cleared $18.5205 million of cap space, but they were not done yet. Earlier this week Willie Colon stopped by to see Khan and had his year old contract restructured as well. Colon had $3.8 million of the $4.5 million base salary he was due turned into a signing bonus. It lowered his 2012 cap hit of $5.7 million down to $2.85 million, another savings of $2.85 million.

That had the Steelers at a total cap savings of $21.3705 million as they headed into Thursday. Next up was the big contract of Ben Roethlisberger. The Steelers lowered his base salary of $11.6 million all the way down to $900,000. The difference of $10.7 million was paid out as a signing bonus. It lowered the $16.92 million cap hit that Roethlisberger was scheduled to have down to $8.895 million, which created a cap savings of $8.025 million.

When the smoke had all cleared on Thursday, Khan and the Steelers had managed to trim $29.3955 million off of the cap since February 7th. The Steelers projected Rule of 51 salary cap total now sits at $126,992,038 million and that number projects all of the tenders to the restricted free agents and exclusive free agents as well.

That number, combined with their $2 million worth of credits, which are outlined in the new CBA, puts them right on top of being compliant cap wise. There are bound to be a few more terminations and perhaps another restructure coming according to general manager Kevin Colbert on Thursday, but the Steelers have most their work done now. The rest really depends on what final happens with Mike Wallace over the course of the next few weeks.

For those that are worried about what these restructures are doing to the 2013 cap number, I have outlined that here. Also if you missed my post on how a contract restructure works in depth, you can read that here.

Now you see the results of the magic pen and how the “Math of Khan” worked.

The Math Of Khan

I am, I'm me. 40 something, retired and a life long Steelers fan.
  • Eric87

    hey getting it done however possible. the steelers FO always seems to know what it is doing.

  • Mellymorales07

    All I can say is lets get it done khan !! All smiles here we don’t sell our nuclear weapons to the enemy’s we use them on them we can’t let Mike go !! Pay that man he deserves it !! We have to let go of the old and come in with the new !!

  • Dave Noir

    You are doing such a great job Dave! Thanks for that #khan should hire you as assistant

  • Joe D

    I said sometime ago (see 2012 salary cap link), that Steelers need to cut $35million to be able to sign draft picks, wallace, etc..

    I’m close. They are at 29million in cuts/restructure.. they probably need another 10-12 million in cuts/restructure for 2012. Kemo, Ward, Farrior, Smith are easy cuts to make.. looks like they are keeping Hampton.
    Based upon your report of 2013, looks like all those restructures are not going to hurt 2013… 2013 is in much better shape than 2012.

  • Dave

    I said yesterday, the Steelers haven’t lost a “name” free agent since probably Chad Brown way back in 1996/97. They find a way to keep they guys they want to keep. I’m very confident they will keep Wallace this year and Antonio Brown next year.

  • Mmhanna4

    Here is what I don’t understand: why do we only hear of the Steelers restructuring contracts? Do other teams do it and we don’t hear it? Is it because the Steelers are over the cap? Even so, you’d think if other teams could free up cap space this way and add more free agents, they would do it? I also get that there is a potential future risk, but as the Steelers have shown , if you are careful, it is a win-win? So why aren’t other teams following suit?

  • SteelersDepot

    Other teams do restructure that way. The reason the Steelers have had to do it so much is because they have been up against the cap the last few seasons..

  • Randy Steele

    A good lesson in eKhan-omics 101, eh?

  • http://www.facebook.com/people/Ronnie-Brown/1398137043 Ronnie Brown

    fuck other teams! lol

  • http://pulse.yahoo.com/_2LWSDXAHDX5LZ2VJKJUZKF3HHQ Bryan H

    Sorry, guys, I wouldn’t have kept Ike…he has expose way too many weaknesses over the past few years for him to be worth the money.

  • http://pulse.yahoo.com/_2LWSDXAHDX5LZ2VJKJUZKF3HHQ Bryan H

    I’m all about continued improvement; however, I am also about showing respect to the ones who have gotten us to and KEPT US at the level we are at right now. Yes, I am specifically talking about Hines Ward; he deserves to have a contract restructure that will allow him to retire as a Steeler. He has done enough for the organization to deserve that.

  • J Blubaugh68

    all i can say is wow and dont ever let him go anywhere else.

  • Gtonram

    are we keeping hines ?? we need hines, our top receiver in steelers history

  • Bob

    Money Ball !!!! Great Job

  • The Nevinator

    Wow this guy is a real genius…oh Wait…this is basic high school math…

  • Wdmason

    It all sounds as if Khan is a magician but the way I look at, after reading the great information here, we are just pushing it back to future years, plain and simple. This cant be good. Other teams dont have to restructure because they dont have these problems. The Steelers will be in continuous salary cap hell and you can probably forget about being competative in the future with all the dead money that will have to be paid out.

    I agree it was worth it to go for broke, all or nothing, one more Super Bowl but with we lost and now we have to pay up but instead we are going for broke again. You have to shake your head and wonder…to go where no capologist has gone before? How we get in this mess? Its like someone drowning in debt that keeps borrowing to stay afloat.

  • Shackett4545

    Great on the restructure,Hines being the ? in my mind and history shows money wins ,that being said farewell to one of my all time favorite STEELERS.I bet he sitll has the smile as he retires.

  • Tsizemore57

    hines ward has a done a tremendous job for this organization. the guy has done it all as a leader, mentor, and receiver. but his time has come. there will never be a good time to let hines go. lets bite the bullet and come to an understanding. we are not in a position financially to carry an unproductive guy. we also need todd haley to be in a position where he can focus on the guys that are going to get the job done. i am afraid hines would be a distraction.

  • PADARAY

    the steelers need to move on and so dose ward

  • pipeliner36

    Bryan H,

    As a Steeler fan and Hines Ward fan, I hate to see him go but the fact is, he can’t get it done. He is not a top wr anymore. He is more than welcome to retire now as a Steeler and call it a career. He is trying to run from father time and he doesn’t have the speed for that. As much fun as he has been to watch and cheer for, he has to go. He would be a great wr’s coach.

  • Wintersh

    Hey guys, we need to keep Hines Ward no matter what!

  • taylor>revis

    @bryan i cant believe i just read that, i think im gonna hurl

  • Les

    We need to keep Hines. He may not be the fastest receiver, he never was, but he is still the only one that runs short through the middle and takes the hit, makes the catch, and gets up smiling. None of our other receivers do that. There is a reason why he got to where he is and this is just one of many that he can still do.

  • Steve Paga

    we need to let ike go he just is not worth it anymore he hasnt been putting up any good numbers for a while now

  • Wdmason

    All other teams arent doing it because its not a win win situation. We are going to have to pay these players after they are gone. The steelers are just moving payroll to future years in an attempt to keep all of our players

  • http://www.facebook.com/people/Jamie-McCool/100000516520469 Jamie McCool

    Ike is a good cb… Problem is, he needs help down field. He cant do it all.

  • http://twitter.com/SteelerfanAJ A.J. Sanchez

    Yea that was great of all those guys to do this, but what about Hines?? Are you just gonna throw him out the door like yesterdays news?? He just like the Bus has been the heart and soul of this team and has already taken a pay cut before to stay! All he asked before was to retire a STEELER when he redid his contract. Now after all he has done of the team and the city of Pittsburgh you guys can’t do any better huh? Also if something isn’t done about Mike Wallace and you guys cut Hines and Cotchery and something happens to Antonio Brown… guess what we don’t have anyone worth a crap left as GOOD wide receiver! Sanders is ok but he isn’t any of those other guys, and yea I know “the standard is the standard” but you seen how far that got us last year when people kept going down left and right! I am just one fan of 36 years stating my opinion here. But I think you need to do all you can to keep Hines and not slap him in the face by letting him go or forcing him to leave by giving him a lousy contract just so he can stay! Like I said before you did it for Jerome and look he came back and we went to the Super Bowl and WON! I am willing to bet WHEN you guys go back and WIN this year Hines will retire just like Jerome! Please give the guy a chance!!

  • Swede7377

    Yes, by all means Heinz Ward should be on the team in 2012 as he is great in his help with development of the young players that have moved him to the bench. They respect him and his advice is very important to them.

  • Mmhanna4

    Sure there is risk involved. There is risk with giving any player a signing bonus too. But I think the Steelers have shown that when you are careful it is a win win. The player gets more money upfront, the Steelers get the cap relief they need. Yes, it increases their cap hit in the future, but if a) you do it with players you are confident will play the full length of their contract and b) the allowable team cap increases in the future, the risk is minimized.

  • http://www.facebook.com/profile.php?id=600623758 MaryJean Beccard

    I would love to see him get one more superbowl ring he really deserves it

  • Attractscrazyboys

    So that 1,000 he just hit wasn’t a good number or it was to long ago? Lol at the stupid stuff people say!!