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Here's how Justin Houston's contract improves Kansas City Chiefs salary cap situation this year

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The Kansas City Chiefs had about a half million in cap space entering Wednesday. Justin Houston's new contract will lower that number this year and give the Chiefs more cap space.

OK let's lay all this out in English. All numbers are approximate and based off these reports as I haven't gotten my hands on the actual contract yet.

Houston was set to count $13.2 million against the Chiefs cap while under the franchise tag. This new contract will lower his 2015 cap number. His signing bonus is reported to be $20.5 million which, if his first year haul is $21.5 million, means that his first year base salary is about $1 million.

A $20.5 million signing bonus will be pro-rated over the life of the contract (five years) so that becomes roughly $4.1 million per year in cap space. That $4.1 million plus his $1 million base salary equals $5-something million for his first year cap number. Subtract that from Houston's initial $13.2 million cap number and that's how the Chiefs will gain roughly $8 million in cap space (if these numbers are correct).

"I feel that we have enough flexibility to where we'll be able to do more deals," Chiefs GM John Dorsey told us in a conference call following the announcement of Houston's deal.

The Chiefs like to enter the season with about $10 million in cap space to allow them to stay flexible. They could have one of their own players injured and need the money to sign someone else. Or another team could surprise everyone and cut a very good player that the Chiefs want to sign. Whatever it is, the Chiefs need some cap flexibility during the season. And now they have it.

Update: Here are the cap numbers: