Steelers Using Qualifying Contracts & Displacement To Stretch Cap Dollars Until June

Despite being severely cap-strapped until June 2nd rolls around, the Pittsburgh Steelers have still been able to sign a few free agents over the course of the last week in the form of running back LaRod Stephens-Howling and punter Brian Moorman. So how are they able to do this with such little cap room? They are doing it with the help of top 51 displacement and one year qualifying contracts.

Displacement I have discussed before, and here is a post that I wrote on that subject a little while back. As far as one-year qualifying contracts go, those are given to players with four or more credited seasons in the league. The contract includes a normal minimum base salary for the players\’ accrued seasons in the league, and if a signing bonus is given, it cannot exceed $65,000.

The cap hit for such a contract is the minimum base salary of what a player with two accrued seasons would earn, plus the signing bonus amount. In the case of Stephens-Howling, his cap hit was $620,000 despite him earning a base salary from the Steelers in the amount of $715,000.

Below is a complete description of what a qualifying contract is via the CBA.

Section 1. Qualifying Players: For purposes of this Article, a “Qualifying Player” shall be defined as a player with four or more Credited Seasons, whose contract has expired or been terminated, who signs a Qualifying Contract.

Section 2. Qualifying Contracts:

(a) For purposes of this section, a “Qualifying Contract” shall be defined as a Player Contract signed by a Qualifying Player that (i) covers only a single League Year and (ii) contains no terms that affect compensation in any way other than (1) the applicable minimum Paragraph 5 Salary, (2) up to $50,000 in “Additional Compensation” (e.g., signing bonus allocation, roster bonus, reporting bonus, or any incentive (“likely to be earned” or not)), and/or (3) a guarantee for Salary and/or Salary advance of up to the Minimum Salary for a player with two Credited Seasons. A Qualifying Contract may not be extended or renegotiated in any manner. Split contracts, if they otherwise qualify, may be Qualifying Contracts. Thus, for example, a contract that includes an option year is not a Qualifying Contract.
(b) The maximum amount of Additional Compensation in (2) above shall be increased to $65,000 for the 2012–14 League Years, to $80,000 for the 2015–17 League Years, and $90,000 for the 2018–20 League Years.
(c) If the player’s prior contract was terminated, he is eligible to sign a Qualifying Contract if he does not earn more than maximum amount of Additional Compensation less the amount of any Additional Compensation and/or guaranteed Salary earned during that League Year under the terminated years of his prior contract(s), but his combined compensation from the terminated contract(s) earned for that League Year and the Qualifying Contract cannot exceed the applicable minimum for that League Year plus the maximum amount of Additional Compensation.

As we sit here in early May, the Steelers have $391,427.00 in available cap space, and for every player that they sign to a qualifying contract that includes the max signing bonus of $65,000 moving forward, it will only use up $140,000 worth of cap space per player.

In the case of Moorman, who didn\’t receive a signing bonus, the Steelers only used $75,000 worth of cap space to sign him as the bottom salary on the top 51 is currently $480,000.

Realistically, the Steelers could still afford to sign a few more players such as Max Starks, Casey Hampton, Doug Legursky or Steve Breaston to these kind of contracts prior to June, but they likely won\’t be able to afford all of them until then.

As soon as June rolls around, the $5.5 million base salary of Willie Colon will come off of he books and then is when I suspect you will see a few of the aforementioned players signed.

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

    The simple fact that no one’s commented is simple; just like me, as I lead the charge, the math grants me a giant headache as it’s filled with Legalese…

  • David Edward

    Qualifying contracts are a great way to sign vet backups on the cheap. In Moorman’s case, he could end up as a starter. One thing to remember, though, is the players signing these contracts aren’t the most sought after FAs…otherwise they would be getting a more lucrative deal. In Starks case, he definitely wants more than the minimum, but he may not get it…will be interesting to see what they do. As for Hampton, they most likely won’t bring him back until they get a look at all of their young NTs to see what they have. It one or two of them are serviceable backups, I doubt he’ll be back. Legursky they can probably take or leave. Breaston doesn’t seem to make sense just for one year since they only have this year left on the contracts of Sanders, Cotchery, and Burress. I could see them waiting till June and giving him a 2-3 year deal like they did with Cotchery.