To sign its draft class, the Chiefs will need less cap space than you think

Every season, we are reminded that many NFL fans don’t fully understand the intricacies of the salary cap for newly-drafted players. And about this time in every offseason, multiple Kansas City Chiefs fans ask, “How much will the team need to sign their draft picks?”

Here’s the short answer: it might be a lot less than you think. Let’s examine why this is so — and figure out how much money the Chiefs will really need to sign their draft picks.

How rookies count against the cap

When players are drafted — or when undrafted free agents (UDFA) are signed after the draft — they immediately count against the salary cap. But whether they are drafted with the first pick or are the last UDFA signed, all of these rookies initially go into the system at the same salary: $705,000. (Small detail: Some UDFAs may be paid relatively small signing bonuses, which also count against the cap).

But until the regular season begins, each team’s salary-cap space is calculated using only the 51 largest cap hits on its roster. So as a practical matter, this means that virtually none of these rookie contracts will reduce any team’s cap space — simply because any team’s 51st-largest cap hit is almost guaranteed to be more than $705,000. For example: at this writing, Kansas City’s 51st-highest cap hit is $895,000.

Of course, the newly-drafted players will eventually sign contracts for more than the league’s rookie minimum. Some (but not all) of those contracts will eventually be among the 51 highest cap hits. But until their contracts are signed, the drafted players will have no impact on the team’s cap space.

Teams don’t typically start signing these newly-drafted players until June — and they almost always do it in reverse order. It’s often well into July before the most-impactful rookie deals are signed.

Even then, the actual cap-space impacts of the new contracts are reduced by another consequence of the offseason’s top-51 cap-space calculation: a new contract over the top-51 threshold pushes the 51st-highest cap hit below it. In essence, this reduces the cap-space impact of the newly-signed deal by the amount of what then becomes the 52nd-highest cap hit.

During the offseason, we also see this with free-agent signings. For example, we estimate that the cap hit for the contract signed by new defensive tackle Taylor Stallworth will come in between $895,000 and $1.035 million. But when it replaces the current 51st-highest cap hit of $856,000, the new contract’s cap impact will be between $37,000 and $177,000.

How much cap space will be needed?

While we don’t know the precise contract figures right now, the rules of the Collective Bargaining Agreement allow salary-cap sites like Spotrac to project the contract values fairly accurately. Using Spotrac’s figures, let’s see how the cap impacts would shake out if all the team’s picks were signed today.

As we see here, the contracts for just seven of the team’s 12 picks would have any cap impact at all — and only the contracts for the first and second-round picks would have a significant effect on cap space. So what looks like a daunting requirement of $13.8 million turns out to be only $3.8 million.

While it’s true that the entire $13.8 million for these drafted players will be needed by the time the season begins, these things have a way of taking care of themselves. First, few people think that the Chiefs will actually select players with all of these picks; many will be traded to other teams as general manager Brett Veach maneuvers through the draft. Some of the drafted players won’t make the final roster. Over the course of the summer, some veterans will be released, creating cap space for the rookies. And yes... the team could have some cap casualties on final cutdown day.

But what we see here is that there is no immediate need for a big chunk of cap space to sign the rookies. It will be well into July before the contracts with the greatest cap impact will be signed — and by then, it’s possible that the team will have created additional cap space by signing left tackle Orlando Brown Jr. to a new long-term deal — or by making some other move.

It’s still possible, however, that the team might need more (or even less) than $3.8 million in offseason cap space, because it could end up trading some of its picks to move up (or down) the draft order.

Let’s look at some examples of how this could affect the cap-space impact of draft picks. For all of these, we’ll use OverTheCap’s Fitzgerald-Spielberger draft value chart to design trades that could be within the realm of possibility.

Trade A

Let’s say the Chiefs want to make a big move to take one of the draft’s best players. They trade picks 1/29, 1/30 and 7/251 to the Detroit Lions for the draft’s second overall pick. Under the Fitzgerald-Spielberger model, the Chiefs would give up 2770 points to get 2649 in return. How would that impact the cap space they would need?

This illustrates an often-overlooked consideration of trading up to one of the draft’s top picks: it can require substantially more offseason cap space to sign those newly-drafted players. In this case, it increases the required offseason cap space by $3.3 million.

Trade B

Let’s say that the Chiefs wanted to make a big move but didn’t want to give up quite so much draft capital (and cap space) to do it. They trade picks 1/29 and 2/62 to the New York Giants for the seventh overall pick, giving 2203 points to get 2014.

That seventh overall pick is also pretty expensive, but the Chiefs would still get one of the draft’s top players — while requiring about $1 million less than the first example to sign their draft class.

Trade C

But what if another team wants one of Kansas City’s picks? Let’s say the New York Jets want a third first-round pick. They give the Chiefs picks 2/35 and 2/38 in exchange for 1/30, 3/103 and 7/233, trading 2335 points for 2165.

Now this could be a very interesting Kansas City draft: a first-round pick, four second-rounders, a third, two fourths and three sevenths. That’s six picks in the first 100 — and the cap space needed would be only $200,000 more than it would take to sign the current 12 picks. The team could even package the three remaining seventh-round picks to grab another selection in the fourth round — with almost no increase in cap impact.

Takeaway

If you’ve been worried about the cap space the Chiefs will need to sign their draft picks, you can stop. Under top 51 rules, it won’t take as much money to sign them as you might have thought — and even when final cutdown day rolls around, it’s probably not something we’ll need to worry about too much; things will likely work themselves out.

In the meantime, keep an eye on the draft trades the Chiefs make. Trade-ups — especially for picks high in the first round — could have a fairly significant impact on cap space. But trading back will tend to make very little difference in the cap space needed to sign the class — either now or in the regular season.