The final cuts have been made by the Pittsburgh Steelers and the 53 man roster is now set. With that work now done, we can look at the available cap space that the Steelers now have heading into week 1 of the season. As I have posted all offseason, there is plenty of cap room to work with in regard to getting a long term deal done with wide receiver Mike Wallace prior to Sunday.
PFT currently has the Steelers at about $4.5 million under the cap. I have them a little less than that, but we will go with those numbers to use in this post. That $4.5 million includes the three $1.5 million veteran cap credits that General Manager Kevin Colbert said they were going to use once again this year. That number also includes the $2.74 million tender that Wallace signed upon reporting last week.
To figure out how much room they will have for a first year cap hit on a new deal for Wallace, just back out the $2.74 million, which leaves $7.24 million in cap space.
As I also have stated all offseason, a new five-year deal for Wallace will likely include a signing bonus of around $15-18 million and a second year option bonus of around $5-7 million. His first year base salary would likely be about $1 million. If we take the high number of $18 million and divide it by 5, we get a yearly signing bonus amortization of $3.6 million. Add that $3.6 million to his $1 million base salary, and you get a first year cap hit of $4.6 million, which is only nearly $2 million more than he was scheduled to count against the cap this year on his one year tender.
Let\'s say that Omar Khan goes even higher and Wallace gets a $20 million signing bonus and a $1.5 million base salary in 2012, then his first year cap hit would still only be $5.5 million on a five-year deal and it still leaves the team $1.74 million under the cap when using the numbers offered up by PFT. Now I don\'t think the signing bonus will be $20 million by any means, but if it is, they can still make it work.
Of course the total value of the deal still needs to be hammered out, which should be in the neighborhood of $45-55 million, as well as the structure, signing bonus and second year option bonus, if there is one. But with 4 days left to go until the team leaves for Denver, I still feel pretty optimistic about both sides being able to hammer out a deal.
If the two sides fail to reach an agreement, the Steelers have more than enough cap room to work with for this season and they should be able to roll over what is not used this year into next season to help lighten that burden. Let\'s say that they have $2.5 million to roll over into 2013, that means that they could still franchise Wallace with it actually only costing them really $7.5 million to do so, instead of the $10 or so million the tag is speculated to come in at.
This is why I continue to say that the threat of the franchise tag next year on Wallace is real and likely being used as a negotiation tactic. Wallace stands to only earn $12.74 million total in 2012 and 2013 or he could earn about double that over these next two years by taking the five-year deal later this week that I believe is being offered him right now.