Explaining how the Rams can afford so many big contracts for their stars

The Rams Wire

“Where do the Rams keep getting all this money from?”

That’s the question many fans are asking after seeing the Rams pay yet another star. It’s a valid question, too, considering the NFL has a salary cap that each team has to stay under.

This offseason alone, the Rams paid Matthew Stafford, Allen Robinson, Bobby Wagner, Aaron Donald and Cooper Kupp. The total value of those contracts is $431.5 million, a massive amount of money allocated to just five players. And when it comes to guaranteed money, that sum is north of $310 million; this is total guarantees, not guaranteed at signing.

So, again: how do the Rams keep affording all of these contracts?

The short answer is that they’re really good at maneuvering the salary cap and figuring out ways to move money around so that they don’t strap themselves financially in a single year. It’s not as if the Rams are paying $431.5 million to those five players this year alone. They have plenty of time to pay that money out, thanks to the structure of those contracts.

Let’s take Donald’s deal, for instance. The Rams are giving him $95 million over three years, but there are actually five years on the contract. The final two years in 2025 and 2026 are void years, which means they’re essentially “dummy” years where Donald isn’t going to be on the roster, but the Rams will still be paying him.

That’s why when you look at his contract on Over The Cap, you see a $23.3 million cap hit in 2025 despite the contract actually expiring after the 2024 season. In other words, they’ll be paying him $23.3 million to not be on the team that year. A hefty sum, yes, but it’s also what made it possible for the Rams to sign Donald to such a significant contract with so little cap space in 2022.

And by adding void years, the Rams were actually able to lower Donald’s cap hit from $26.75 million to $24 million this year, a savings of $2.75 million.

A similar approach was taken with Robinson’s deal. He has two void years in 2025 and 2026, with a dead cap charge of $5.6 million in 2025. But his cap hit this year is just $4.3 million compared to $18 million-plus in the following two seasons.

The Rams didn’t use void years with Wagner, but they gave him a much longer deal than expected. It’s a five-year pact worth $50 million, but only $10 million is fully guaranteed at signing. And his 2023 salary of $7.5 million becomes guaranteed next March, so as of now, they’ve really only committed $10 million to him and his cap hit is just $2.5 million in 2022.

Effectively, they can make it a one-year, $10 million deal or a two-year deal worth $7.5 million, depending on whether they want to keep him on the team in 2023; the assumption is that they will. From there, Wagner won’t have much guaranteed money left, with most of his pay coming in base salaries and incentives.

Stafford’s contract is heavily back-loaded, which was helped by a $60 million signing bonus. That gets prorated over the five years, allowing the Rams to spread out the money instead of counting most of it on the cap in 2022. As a result, his cap hit is only $13.5 million this year before rising to $20 million in 2023 and about $50 million in each of the final three years.

The structure of Kupp’s deal hasn’t yet been reported, but it’s assumed that the Rams worked it in a similar way as the other contracts they gave out this offseason. A big signing bonus, a lower cap hit in 2022 and plenty of money at the end of the contract.

So even though the Rams were projected to be $13 million over the cap back in February and they’ve gone most of the offseason without an abundance of space, they still managed to sign all five of these stars – as well as other players such as Brian Allen and Joe Noteboom.

A big reason for that is the fact that they lowered Donald’s cap hit by $2.75 million and Stafford’s by $9.5 million thanks to their new extensions. You don’t expect lucrative extensions to actually help a team financially in the current year, but that’s what these deals did for the Rams.

They have owner Stan Kroenke in part to thank, too. He’s willing to pay these players, with much of that money coming up front in the form of signing bonuses. Those are prorated throughout the contract, but they’re paid to the player right away, and the owner of the team must have the funds to make that happen.

There’s validity in the statement that the “salary cap is a myth,” and the Rams are a good example of teams being able to field a star-studded roster despite needing to stay under the cap. But make no mistake, the bill will come due eventually. It did with Jared Goff, whose deal was a colossal mistake for the Rams. It did with Todd Gurley, too, whose contract was equally bad for the organization.

In 2024, these are the biggest cap hits the Rams will have on the books:

  • Donald: $31.2 million
  • Ramsey: $26.7 million
  • Stafford: $49.5 million
  • Floyd: $22.5 million
  • Robinson: $18.6 million
  • Noteboom: $17 million

They’ll be able to get out of some of those deals if they want to by cutting players, but not without hefty dead cap charges. And if all goes well, they won’t want to cut them.

What the Rams are planning for is for the salary cap to keep going up each year. It typically increases by about $10-12 million per year, and it could go up even more dramatically in the next 2-3 years thanks to the league’s new TV and broadcasting deals.

In that case, the Rams will have more money to play with, thus softening the blow of the sizable contracts they’ve given out.

It’s all been calculated and planned for by the higher-ups in the Rams’ front office. They know exactly what they’re doing and what the team can afford. Now, it’s up to the players to deliver on those deals and make them worth the money.

Author: Lucy Green