Financial ramifications of Cowboys restructuring Ezekiel Elliott’s contract

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It’s been a while since the Dallas Cowboys used white out on their cap ledger. In a relatively quiet offseason from a drama perspective, the club has been pretty quiet when it came to making waves in the salary department too. But less than a week before final roster cuts are made, the Cowboys have made a significant move, pushing forward $8.6 million of his $9.6 million base salary into a restructure bonus. The move was first reported by Yahoo! Sports’ Field Yates.

The bonus gives Elliott early money he was already going to make, clearly. Not only was his entire 2021 salary guaranteed, but so is his 2022 base salary of $12.4 million. However, it does create $6.88 million of additional space this year, money Dallas didn’t need to enter the season in a comfortable place. Unless of course, they need it to absorb a salary not already on the books.

Elliott’s cap hit for 2021 is now $6.82 million. His cap hit in 2022 is now at $18.22 million before declining in both 2023 ($16.7 million) and 2024 ($14.3 million). There’s no guaranteed salary left beyond 2022, but he does have ballooning hits remaining in both 2025 and 2026.

It would now cost the club just under $12 million in dead money to release Elliott in 2023, though they would create around $4.8 million in cap space if they chose to do so at that time.

2021 Impact

Normally teams like to enter the offseason with at least $4 million and $6 million in available cap space. This allows them to sign free agents during the year, when injuries occur and help is needed. It also allows them to handle any bonus incentives a player achieves which were classified as not-likely-to-be-earned; those aren’t counted against the cap during a year.

Dallas already had that room carved out. The restructure pumps their cap space up over $12 million for the upcoming season for when the regular season cap goes into effect September 8 at 3:00 pm CT.

So what do they need the extra room for? Could it be that Dallas is prepared to acquire a veteran player with a big salary that can help them chase a championship? That probably makes the most sense.

If the team were considering even if they were to release a player such as Jaylon Smith, the acceleration of dead money wouldn’t hit until the 2022 books. Doing a Elliott restructure in this way does help somewhat compared to restructuring him next season, but not in a very significant way.

A reward of sorts?

(AP Photo/Rick Scuteri)

The club could have just wanted to give Elliott some up front money, as he is clearly motivated to have a bounce-back season after the worst of his career. With the loss of offensive linemen Travis Frederick in the offseason, La’el Collins in training camp and having just Tyron Smith for two games, Elliott ran behind an inexperienced and pretty bad offensive line. He ran in atypical fashion after suffering from Covid-19 in the offseason and did not look like he had the juice he once did while also doing a terrible job at keeping the ball secure.

When Dak Prescott was done for the year after just 4.5 games, the entire offseason was thrust onto his shoulders with lackluster play from the quarterback position as well. That muted any chance at him recovering from his early season doldrums.

But Elliott returned this offseason in tremendous shape, and seems to have regained the quick feet that he had early in his career. That opinion is based on training videos and camp practices, as he once again was held out of the entire preseason.

He’s also been the star of the team’s Hard Knocks public relation series, as after an intense opening week, owner Jerry Jones has numbed the production down to a yawn with Elliott providing most of the entertainment. Likely? Probably not, but nothing can be ruled out in the ecosystem of the Jones’ family; it could have been a nice thank you for carrying the show through the first three weeks.

Why Elliott instead of someone else?

Still, some may wonder why the club chose Elliott’s deal rather than other star players such as Amari Cooper and DeMarcus Lawrence.

One reason is that Elliott’s deal has the years remaining on his deal after 2021 to absorb the amortization of the spread out hit. A team can use up to five contracted seasons to spread out a restructure bonus. Lawrence has just two seasons left on his deal after this year and already has a void year to absorb dead money in 2024. Cooper has just three years after this season and would need to add a void year.

Elliott’s contract is already guaranteed for 2022 as mentioned above and runs through 2026.

The salary cap is expected to balloon in 2023 so the additional $5 million that is being pushed to the final three years of the amortization (2023 through 2025) that could accelerate will be a drop in the bucket once the league stops pretending that they absorbed a major hit with the loss of in-person attendance in 2020. The new TV deals and gambling revenue will skyrocket the league’s revenue and the cap (calculated on a percentage of a section of league revenue) will follow suit.

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