The Steelers have quite a bit of legwork to do over the next few weeks as they prepare for free agency and the draft.
Before they can get anything done, Omar Khan and the front office will have to work their magic to create some cap space to upgrade the roster in 2023.
At the time this article is published, the Steelers have only $11,418 in cap space, according to OverTheCap.com. That doesn't sound very encouraging for offseason plans, but that's the purpose of an exercise we're about to go through. Cuts and contract restructures will create the cap space the team needs.
But, what might that look like?
This is by no means an exact roadmap of what the Steelers will do exactly. There is a reason why I'm employed to be a reporter while Khan is general manager of the team -- and a cap expert, to boot.
But, through what we do know and other realistic possibilities, we'll find a somewhat reasonable path for the Steelers to address all of the issues that need attention.
CUT WILLIAM JACKSON III, MYLES JACK, AHKELLO WITHERSPOON, GUNNER OLSZEWSKI
Jackson is the easiest decision as he automatically clears $12.1 million with no dead money attached.
Olszewski is expendable if Calvin Austin III can bounce back from his Lisfranc injury and actually get on the field in 2023, and especially if the Steelers find a way to re-sign restricted free agent Steven Sims. Plus, it would be very un-Steelers for the team to not select a receiver in the draft this April.
And, despite the need for cornerbacks, Witherspoon is expendable as re-signing Cam Sutton and drafting a cornerback is essential to the plan this offseason. Plus, the Steelers could bring back restricted free agent James Pierre to help fill the void if Witherspoon is cut to shed $4 million in cap space. A right-of-first-refusal tender costs teams $2.627 million this year, which is a reasonable price to bring back Pierre given his performance in 2022.
The lone option here that could be difficult to pull off is cutting Jack. To do so clears $8 million in cap space, but also creates an even larger hole at a position of need. However, Jack failed to prove himself as a reliable option due to multiple injuries, and it would be a massive risk to let him play under an $11.25-million cap hit.
This is where the Steelers can address the position by going after a big name -- or even a second-tier guy -- in free agency, re-sign Robert Spillane to a team-friendly contract, and possibly address the position in the draft as well if they don't feel Mark Robinson is ready for a significant workload increase.
And, if the Steelers don't want to cut ties with Jack, they could try to negotiate an extension for another year to lower his 2023 cap hit.
Potential Cap Space After Cuts: $26,198,918
RESTRUCTURE T.J. WATT'S AND MINKAH FITZPATRICK'S CONTRACTS
Another great way for the Steelers to create cap space is to restructure some of the larger contracts on the books for cap relief in the current season. This is a great tool for front office executives, but it can't be done frivolously.
For those who aren't aware how contracts are restructured, the most common way, referred to as a simple restructure, is to take the base salary for a player and convert it into a signing bonus. When a player agrees a contract, their signing bonus is typically spread out evenly over the life of the contract for cap management purposes.
For example, Fitzpatrick's signing bonus for his four-year extension was $17.5 million. Because the four-year extension also bought out the final year of his rookie contract, that $17.5 million was spread out evenly over five total seasons ($3,500,000 per year).
It's the same principle for when teams restructure base salary into signing bonus money. However much money is is taken off the player's base salary for the season, that number will be divided evenly over the remaining years of the contract. According to Spotrac and OverTheCap,com, the Steelers can convert as much as $10,065,000 of Fitzpatrick's 2023 base salary into signing bonus money. While that money is shaved off the 2023 cap, $3,355,000 will be added to each of his respective cap hits over the three remaining years of the deal.
While it's fun to say, "The NFL salary cap is a myth," the truth is all money has to eventually be accounted for, one way or another.
But, saving $10 million from one contract restructure is enticing for the Steelers, especially since the NFL salary cap is expected to rise significantly over the next few years. In fact, looking at the break down of Fitzpatrick's contract, it wasn't a question of if it would ever be restructured, but when it would be. This is the easiest route to save up to $10 million in cap space.
Watt's contract can also be restructured, even after $9 million was converted into signing bonus money before the beginning of the 2022 season. The Steelers could save as much as $12,613,333 by restructuring Watt's contract. However, with only two years remaining on the deal after 2023, that would raise his cap hit to $36.7 million in each of the 2024 and 2025 seasons. While the Steelers probably won't restructure the full amount (never say never), but a restructure of some kind is a very realistic possibility.
Potential Cap Space After Cuts and Restructures: $48,877,252
PLENTY OF ROOM FOR RE-SIGNINGS
Even if the Steelers didn't cut Jack, there's still nearly $41 million in cap space to get things done. But, for the sake of the exercise, we're sticking with it.
Before any attention is turned to the open market, it's important to begin with the team's impending free agents. And, the trio of Sutton, Larry Ogunjobi and Terrell Edmunds would be a great haul to bring back to secure positions of need on defense.
Using OverTheCap.com's Cap Calculator, I gave the highest-projected contracts on either Pro Football Focus or Spotrac to all three of these players to show what the Steelers' cap situation might look like if they were to somehow re-sign all three.
Because PFF and Spotrac only have projections for the number of years, total salary and total guaranteed money, I also looked through several multiyear contracts on the Steelers to study how the team's contracts are typically structured to come up with my own projection of how they could be broken down.
NFL contracts are typically backloaded, but every team has their own way of managing the cap. From some of the current contracts on the roster, the Steelers like to put as much of the base salary guaranteed money up front, giving them flexibility to possibly restructure later on (remember all bonus money is guaranteed). Although, the base salary is typically low in the first year to keep a low cap hit in the first year of a deal.
Here are possible breakdowns of contracts for Sutton, Ogunjobi and Edmunds:
Sutton: Three years, $25.5 million ($15.5 million guaranteed)
• 2023 Cap Hit: $4,083,333 ($1,500,000 base salary (guaranteed), $2,583,333 prorated bonus)
• 2024 Cap Hit: $8,833,333 ($6,250,000 base salary (guaranteed), $2,583,333 prorated bonus)
• 2025 Cap Hit: $12,583,334 ($10 million base salary, $2,583,334 prorated bonus)
Ogunjobi: Three years, $30 million ($20 million guaranteed)
• 2023 Cap Hit: $5,250,000 ($1,250,000 base salary (guaranteed), $4 million prorated bonus)
• 2024 Cap Hit: $10,750,000 ($6,750,000 base salary (guaranteed), $4 million prorated bonus)
• 2025 Cap Hit: $14,000,000 ($10 million base salary, $4 million prorated bonus)
Edmunds: Two years, $10.9 million ($5.5 million guaranteed)
• 2023 Cap Hit: $3,500,000 ($1,500,000 base salary (guaranteed), $2 million prorated bonus)
• 2024 Cap Hit: $7,400,000 ($5,400,000 base salary, $2 million prorated bonus)
Potential Cap Space After Projected Re-Signings: $38,040,585
FINAL THOUGHTS
As you can see, the Steelers' roadmap to a productive offseason is more than possible, even though you might see them strapped against the cap as we sit a little more than three weeks prior to the start of free agency.
Anywhere between $35-45 million in cap space created by cuts and contract restructures gives the Steelers enough room to re-sign much needed free agents, make a couple of impactful signings to bolster positions of need and leave room to possibly bring back restricted free agents and other minor signings to fill out the roster. In addition, the Steelers will probably entertain a contract extension for Alex Highsmith as he enters the final year of his rookie contract.
If the Steelers really wanted to get desperate for cap space to take a swing at a high-priced free agent, especially since off-the-ball linebacker is such a deep position in this year's class, there are other contracts that can be restructured such as Chukwuma Okorafor or Diontae Johnson. In addition, Cam Heyward could possibly be open to an extension, which could lower his cap hit over the next couple of seasons.
The Steelers will be going through all of their options over the next few weeks. It could be something similar to this layout. It might be different. But, the purpose of this exercise was to show that creating cap space to upgrade the roster isn't nearly as difficult as it might appear on the surface.
But, before we really turn a lot of attention on free agency, next up on the docket in the Scouting Combine in Indianapolis, which begins Tuesday.
