Chargers 2024 Salary Cap

It’s been a bit since I’ve posted because I was on vacation and watching the Super Bowl. Sorry Niners fans, I was pulling for you. I’m back to it this week to take a look at the upcoming Chargers offseason.

Things are looking better in Los Angeles for the Chargers after hiring new head coach Jim Harbaugh and new general manager Joe Hortiz in January, but it’s been widely (accurately) reported that the Chargers are facing some big off-season salary cap challenges in deciding who to bring back and at what price.

I think a lot of the conventional wisdom in articles and reporting has gotten ahead of itself on the Chargers salary cap issues, so I wanted to go through them. The Bolts aren’t in a great situation with respect to the salary cap, but it’s definitely not “salary cap hell,” as I’ve heard it described by a few pundits. Depending on how the Chargers address contracts for just a handful of players, they don’t necessarily face long-term issues either.

Before diving into the Chargers specifically, I want to go over some basics about the salary cap, how players get paid, and how teams manage their rosters around the salary cap. The rules can be confusing, but they’re integral to how teams build their rosters—there’s no way to understand what a team is going to do in the offseason if you don’t have at least some familiarity with these issues—so it’s a good jumping off point. [There are some primers on this stuff if you want to really get the details—this one from Anthony Holman-Escareno at NFL.com is really thorough, though it covers the 2023 offseason. You also can dig into the CBA.]

I’ll jump right into it.

The NFL Salary Cap

The NFL salary cap rules are the bedrock of roster construction. They can be confusing, so I’m going to simplify things a bit where appropriate to hopefully make this more digestible (you can let me know in the comments if you want more details).

At a basic level, NFL teams have to fill their roster with players who are paid a combination of salary (paid weekly) and bonuses (paid at specified times). Players sign contracts for one or more years and for each year of the contract, the player has a “salary cap charge” that counts towards the team’s salary cap based on how much salary and bonuses the player is slated to receive that year, with some accounting nuances that I’ll describe more later.

The NFL salary cap is what’s known as a “hard cap,” meaning that the money teams pay their players in a given year cannot exceed the salary cap. In other words, player salaries and bonuses for the whole roster added together must fall below the cap. That’s different from the “soft” salary cap for the NBA, which I’ve talked about before, that has a dozen or more exceptions that allow teams to go over the salary cap. The NFL’s salary cap was set at $224.8 million this past season and it is projected to increase to over $240 million for 2024, though the final figure hasn’t been set yet. [Note: some projections, including OvertheCap.com’s, expect the salary cap to come in slightly higher, but I’m using $240 million for now because that’s the latest the NFL has indicated. There’s a good chance the actual cap number comes in a bit higher.]

Counting Team Salary

The way a team’s salary gets calculated for salary cap purposes is detailed and can be convoluted, but at a high level it’s fairly simple. You simply add up the salaries and bonus payments made to players on the roster for a given year, with some fairly simple accounting for discrete items. The components of a team’s salary can be thought of as the three buckets below:

• Salaries for players on the roster;

• Bonuses paid to players on the roster (this gets more complicated, but we’ll deal with the nuances later); and

• “Dead cap” or “dead money” hits, which represent salary caps for players who are no longer on the roster but for whom the team still has to take a salary cap charge.

These components aren’t super confusing—teams have to count the actual money they’re paying to players in a given against the salary cap (salaries and bonuses), and they also have to account for money they already paid to former players as “dead cap” if that money wasn’t counted against the salary cap in a prior season.

The natural implication is that timing is important. When teams take cap charges for salary, bonuses, or dead cap depends on the team’s strategy, but they have to operate within the league’s rules.

Generally, the NFL counts player salaries—the amount they get per year in game checks—toward the team’s salary cap in the year the salaries are paid. If a player’s salary is $10 million for the season (and, for simplicity, we assume the player has no bonuses), the team’s salary cap charge for the player would be $10 million. There are some nuances for players with salary guarantees which I’ll discuss a bit later, but the basic rule is straightforward.

When teams take cap charges for bonuses depends on the type of bonus it is. For some bonus categories like signing bonuses, teams spread out the salary cap charges across the life of the contract—for those familiar with accounting, the team expense of the signing bonus is simply amortized on a straight line basis over the life of the contract. Most other bonuses, including things like roster bonuses (for being rostered as of a particular date), workout bonuses (for attending team workouts), and performance-based bonuses are charged against the salary cap in the year they are paid.

Dead cap hits typically result from a team cutting a player, trading a player, or a player retiring. The dead cap hit counts against the team’s salary cap for either the season in which player was cut/traded (or retired) or the following season, depending on the specific date the cut or trade occurred (June 1st is the magic day if you’re curious).

For any given season, all of those salary cap charges combined—salary and bonuses for rostered players and dead cap hits—have to fall below the salary cap.

Team Use of Cap Space

It’s also important to understand what NFL teams have to use salary cap space for because it governs how they think about managing their respective cap situations. I’ve talked about the first two items below, player compensation and dead cap, but the latter four are also important and often not top of mind for NFL observers:

• Teams must pay the players on the roster (player salaries + bonuses).

• Teams must account for “dead cap” hits for player cuts, trades, or retirements.

• In connection with the NFL draft, teams must set aside some portion of salary cap space for players they select (how much depends on how many picks they have and, especially for first round picks, how high in the draft order they go).

• Teams reserve some amount of salary cap space to sign new players in case someone on their roster gets hurt (this is pretty much guaranteed to happen at some point).

• Teams may save a portion of their cap and use it as “rollover cap” for the next season—in other words, if a team has space below the cap, they can choose to “rollover” that space into the next season.

• A bunch of other stuff! Practice squad player salaries, money paid in response to player grievances, off-season workout payments, and a host of other things are also lumped into the salary cap. These are generally small amounts (relatively) so I won’t dwell on them.

What Goes Into a Player’s Salary Cap Charge

The way that a salary cap charge for an individual player gets calculated is conceptually simple—it’s basically the sum of his compensation for the year plus a prorated portion of his signing bonus (the amortized bonus). A simple way to think of it is that the player’s salary cap charge for a given season is the sum of the following:

• Base salary for the season. This is the player’s salary, which is typically paid out per game.

• In-season bonuses. There are several kinds of in-season bonuses including roster bonuses (bonuses paid for the player being on a roster as of a specified date, like the start of training camp); workout bonuses (bonuses paid to incentivize players to show up for off-season or pre-season workouts); and per game bonuses (pretty self-explanatory).

• Incentives. These are basically bonuses paid for a player hitting particular performance targets, like rushing yards for the season or total touchdowns. For salary cap charge purposes, these get wonky. There are “likely to be earned” incentives (LTBEs) and “not likely to be earned” incentives (NTLBEs), and they are treated differently for salary cap purposes. We don’t need to dive into the details here, so I’ll skip it for now.

• Prorated signing bonus. Players usually get cash up front as a signing bonus when they sign their contracts. This cash is paid up front to the player at the time they sign their deal, but it is accounted for under the salary cap as though it were paid out in equal installments for each year of the contract.

  For example, a player could sign a three year deal for a total value of $45 million, with $15 million paid as a signing bonus and $10 million in base salary for each year of the contract. The $15 million signing bonus would be accounted for as though it was paid in equal installments over the course of three years, or $5 million per year.

• Prorated “restructuring” bonus. Restructuring bonuses are something that articles and media sometimes refer to, but they aren’t really a different category of bonus—it’s treated the same as signing bonus. These restructuring bonuses occur when when the team elects to pay some portion of a player’s salary in a given season as bonus (this is a pretty unique rule for the NFL, so I’ll discuss it more below). Rather than getting weekly salary, the player gets the money up front as a signing bonus, and the amount is then prorated over the remaining life of the contract.

  To see how this works, let’s look at the same three year, $45 million total value contract with a $15 million initial signing bonus that I referred to previously. In Year 1 of the contract, the player actually receives $15 million in signing bonus and $10 million in base salary, $25 million in total, but his salary cap charge for the season is just $15 million—$10 million in base salary and $5 million in prorated signing bonus. In Year 2, the salary cap charge is once again $15 million, although the player actually gets paid only the $10 million in base salary (he already received the signing bonus at the start of the contract). Year 3 is the same as Year 3.

  Now instead imagine that at the start of Year 2, the team decides to convert $6 million of the player’s base salary into so-called “restructuring” bonus. That $6 million bonus gets prorated for the remaining two years of the contract in the same way the original signing bonus was prorated over the life of the original three year deal. This time, the player still actually gets paid $10 million in Year 2, but $4 million is base salary and $6 million is paid as restructuring bonus. Thus his Year 2 salary cap charge is $12 million (instead of $15 million): $4 million base + $5 million in prorated signing bonus + $3 million in prorated restructuring bonus.

  In Year 3, the player gets paid $10 million (all base salary), but his salary cap charge would go up to $18 million: $10 million base + $5 million in prorated signing bonus + $3 million in prorated restructuring bonus.

Teams Have Three Primary Ways to Address Cap Issues

There are three main ways that a team can reduce the salary cap hit for a particular player: (1) move on from the player, usually by releasing or trading them or if they retire, (2) “simple restructures” of the player’s contract, or (3) renegotiations of the player’s contract, which typically involves extending the contract in some way.

Moving On

Teams can move on from players in a few ways to save themselves cap room:

• If the player’s contract is up, they are a free agent and the team can choose not to re-sign them;

• The team can release a player to move on from their contract and avoid paying the player unpaid upcoming salary and certain future bonuses, subject to any negotiated guarantees in the player’s contract;

• The team can trade the player away; or

• The player retires.

For purposes of this post, I’m going to focus on player releases as the main way to “move on” from a player and avoid paying salary. This is because letting a player walk in free agency doesn’t really directly affect the salary cap situation—the player isn’t under contract and doesn’t count against the team’s cap anyway—and because trading away a player has similar implications for salary cap purposes as waiving them (setting aside whatever player salaries come back in a deal). Similarly, for cap analysis purposes, a player retiring functions mostly like them being cut, though there are some nuances based on when and why a player retires (e.g., whether the player retires for injury and how much time they have left on their contract, if any).

Teams release players by cutting them from the roster, which generally allows the team to avoid paying the player any unpaid upcoming salary (other than guarantees they may have specifically negotiated). Unlike in the NBA and MLB, the vast majority of NFL contracts are not guaranteed, so when team’s release players that typically ends any future obligations to continue paying the player after release. Teams also aren’t required to take salary cap charges for the unpaid, non-guaranteed salary and unpaid, non-guaranteed bonuses, so releasing players is often an effective way for teams to clear out cap space.

Some players negotiate for guaranteed or partially guaranteed salary or bonuses in their contracts, and those guarantees generally do have to get paid even if a player is released. Guaranteed salary or bonuses also do get counted as salary cap charges for the team, so the benefits of cutting a player with guarantees are much less significant for the team. As a result, players with salary or bonus guarantees usually aren’t going to get released—that’s why they negotiate the guarantees in the first place.

While teams don’t have to count any unpaid, non-guaranteed salary, bonuses (like roster bonuses or workout bonuses), or incentives to the player as salary cap charges when the player is released, signing bonuses are treated differently. As I noted above, signing bonuses are paid up front and amortized across the life of the contract. So when a player gets released—meaning the contract is terminated early—the future years still have prorated signing bonus cap charges. Those future cap charges don’t just disappear. Instead, the future cap charges for prorated bonus get “accelerated” and count against the team’s salary cap immediately. These aren’t cash amounts the team pays out upon releasing a player—it’s just on paper, the team already paid the money—but the NFL forces teams to account for those bonuses as “dead money.”

For example, the Chargers released cornerback JC Jackson midway through the 2023 season. As a result, they will have to eat over $20.8 million in dead money against their salary cap this year ($15 million of Jackson’s prorated signing bonus and just over $5.8 million of “restructuring” bonus) even though they won’t actually pay Jackson any money in 2024. [If you’re wondering why Jackson’s dead money hit comes in 2024, it is due to the timing of his release—he was released after June 1 of the 2023 season, so the dead cap hit is counted for 2024.]

Teams release players when they can save money against the cap and not generate huge dead money hits, since that dead money can’t be used on the rest of the roster that season (hence the name).

Simple Restructures

Simple restructures are often used by teams to manage their salary cap situation. As I’ve explained, an NFL player’s compensation in a given season can be broken up into (A) base salary and (B) bonuses. The NFL CBA allows teams to convert the majority of player’s base salary into signing bonus essentially at will (they can’t convert it all, as there are some restrictions like players having to make at least the league minimum salary for his seniority level).

Simple restructures are a valuable tool in salary cap management because they allow a team to create cap space immediately. Player base salary gets charged against the team’s cap for the year in which it is paid, but signing bonuses and “restructuring” bonuses are prorated across the remaining contract term—so by converting base salary to bonus, the teams can create salary cap space in the current season by spreading out the cap charges over multiple seasons.

Team’s don’t generally need to consult the players to do these kinds of simple restructures under the CBA. That seems weird, but there’s no real reason the players should care since getting paid earlier is generally favorable for them: they get paid the same amount at the beginning of the season as opposed to getting paid out over the course of the year in game checks. It’s just an accounting gimmick that lets teams move around what salary cap hit they take in a given season (base salary) versus what gets spread out over multiple seasons (signing bonus).

Extensions/Renegotiations

Teams can also renegotiate contracts with players, subject to some restrictions that aren’t super important for this post. Renegotiations can work a variety of ways, but it basically just means the team and player revisit the essential terms of the contract—the amount of compensation, the amount of guaranteed compensation, and/or the number of years the contract runs.

There are lots of situations when renegotiations can occur, but I’ll focus on a few common ones:

• The team wants to extend the length of the contract to keep the player under contract longer.

• The team wants to extend the length of the contract in order to spread out the prorated cap charges for the player’s signing bonus over a longer period of time.

• The team wants to reduce the amount paid to the player, but would keep them around if they are willing to stay at a lower price—implicitly, this means the team would otherwise cut the player if they don’t take a pay cut.

In these situations, the team and the player will negotiate to change the terms of the contract to allow the team financial flexibility.

A lot of extensions just add years to the contract and the team and player negotiate what salary they will be paid in each year and how much will be paid up front as bonus (and prorated over all the years of the contract). These are pretty normal and function like contract extensions in other sports.

The NFL also allows another odd accounting gimmick where teams can negotiate to add “void years” to contracts. Essentially, void years are fake years added to the end of a contract for salary cap accounting purposes. The player will not play in these void years, and everybody knows that, but the void years extend the length of the contract and allow teams to spread out the cap impact of signing bonuses over a longer period because the void years get included as part of the contract term when amortizing the signing bonus.

As an example, a player signs a contract with a $12 million signing bonus for four years, with two void years at the end. For salary cap purposes, the signing bonus is prorated over six years (even though the player is only contracted to play for four), so the cap charge of the signing bonus is $2 million per year. Without the void years, the cap charge for the signing bonus alone would be $3 million per year.

Void years don’t allow the team to avoid cap charges entirely. When the real contract years end and the player is no longer going to play, the remaining prorated bonus cap charges accelerate and are charged to the team’s salary cap (assuming the player isn’t re-signed or extended). Thus, when the cap charges for the void years accelerate, the team winds up taking a big cap charge as dead money. This functions like a sort of balloon cap charge at the end of the contract, so it can be tough to manage—so some teams like to use void years as a regular tool to manage their cap while other teams just avoid them entirely (the Chargers haven’t used void years very frequently, but we’ll see what new GM Joe Hortiz prefers soon enough).

Now that we’ve eaten our vegetables, let’s get to the Chargers situation.

The Chargers Are WAAAY Over the Cap

At a glance, the Chargers look to be in a tough cap situation. According to Overthecap.com, the Bolts have about $270.8 million in salary cap dedicated to their 2024 roster (49 players out of 53 total roster spots) and $24.6 million in dead cap hits—meaning their overall team salary cap number would be about $295.4 million. Given the 2024 salary cap will be around $240 million, the Chargers look to be roughly $55.4 million over the cap right now. [I’m rounding numbers here for simplicity—there’s no need to be too precise given we’re working with several projections anyway. Overthecap uses $242 million for the expected 2024 salary cap.]

But things aren’t quite that simple.

For one, the basic cap analysis above doesn’t account for a few important things.

The Chargers still have four empty roster spots and they will eventually have to sign their 2024 draft picks. The Chargers have seven picks in the upcoming NFL draft, so they’re going to be adding up to seven players to the roster (barring trades, which can increase or decrease the number of selections they have in the draft). Assuming they stay at their current draft positions, the Chargers will need to pay the seven newly drafted players ~$14.4 million next season—the bulk of which will go to whomever they take with their first round pick. Since the Chargers have just four open roster spots, they would also get to cut three players on their current roster—likely guys who make the minimum of $795,000—which would save about $2.4 million in cap space. So we can assume the Chargers would need about $12 million to sign their 2024 draft picks and fill out the roster ($14.4 million minus $2.4 million).

The team also needs to reserve at least some space for potential injuries and miscellaneous cap charges. It’s hard to say exactly how much cap space the team will need for this, but we want to leave a reasonable cushion of about $10 million.

In addition, the Chargers were about $8 million under the salary cap in 2023 and can use that $8 million as “rollover cap” for 2024. In essence, that $8 million amount would get taken off of the team’s salary cap total for next season.

The net result is that even though the Chargers are about $55.4 million over the cap for next year, they actually will need to shed about $69.3 million to get under the cap and leave room to maneuver injuries and other cap items next year.

Here’s a table for keeping track of these numbers if it’s easier. Keep in mind that this involves some estimates, so understanding this directionally is more useful than referring to the specific estimated numbers (especially given the 2024 cap hasn’t been set yet).

What Happened to the Chargers Cap Space?

Having to cut almost $70 million in salary seems daunting, and maybe it is ($70 million is almost 30% of the cap if you’re curious). How in the world can the team be so far above where they need to get?

In the Chargers’ case, it really comes down to a handful of players. I see a lot of people suggesting that these cuts are being prompted by the Chargers signing quarterback Justin Herbert to a 5 year, $262.5 million deal this off-season, but that’s not true. Herbert’s contract isn’t a big issue for this coming year (his cap charge for 2024 is just $19.3 million, middle of the pack for QBs), though it will be something the Chargers need to navigate down the line. We can see who is driving the Chargers high team salary by taking a closer look at the Chargers roster overall.

The Chargers 2024 roster has just 10 players with cap hits of over $5 million for 2024, which is roughly middle of the pack and tied for 18th in the NFL. But the Chargers have four players with salary cap charges of over $30 million for 2024—Khalil Mack, Joey Bosa, Keenan Allen, and Mike Williams—twice as many as any other team. About half of NFL teams don’t have a single player with a cap charge over $30 million and the Rams are the only team besides the Chargers to have more than one (Matt Stafford and Aaron Donald).

I’ve listed below the Chargers 10 biggest cap hits for next season to help contextualize what’s really happening with the roster.

1. Khalil Mack at $38.52 million (in the last year of his contract)

2. Joey Bosa at $36.61 million

3. Keenan Allen at $34.72 million (in the last year of his contract)

4. Mike Williams at $32.46 million (in the last year of his contract)

5. Derwin James at $19.86 million

6. Justin Herbert at $19.35 million

7. Corey Linsley at $14.10 million

8. Eric Kendricks at $9.25 million (in the last year of his contract)

9. Trey Pipkins at $8.75 million

10. Rashawn Slater at $5.29 million

In total, these 10 players account for just over $218.9 million in salary cap charges. Mack, Bosa, Allen, and Williams account for over $142.3 million—that means almost 60% of the total salary cap is being used on four players.

That’s not ideal!

Put simply, the Chargers are way, way too top-heavy in terms of salary. It is a problem, but it’s not necessarily the end of the world. What happens with the 10 players listed above—especially Mack, Bosa, Allen, Williams—will drive how the Chargers get under the cap for 2024.

Slashing Salary: Who to Keep & Who to Let Go

The Bolts could take a meat cleaver-style approach and just cut a bunch of players to get under the cap. It wouldn’t be pretty next season, but cutting Khalil Mack, Keenan Allen, Mike Williams, and Eric Kendricks, who are all in the last year of their contracts, plus Corey Linsley retiring, would save the Chargers over $77 million against the cap (after adding back replacement players at the minimum salary). That would totally fix the problem, though it would be painful to let so many veteran productive players walk out the door.

I don’t think the Chargers will (or should) take such a dramatic approach—there are better ways for the team to create cap space and keep at least some of those guys. The team will instead look at each of the 10 players I listed above and consider how to address their situations case-by-case. They’re going to have to shave enough salary to get under the cap and handle injuries, but the Bolts will also probably want to create at least some cap space to go after some free agents too—probably not the at the top of the market, but not necessarily just the bottom of the barrel free agents either.

So I’m going to go through the 10 players at issue, too. I’ll start with the easy ones.

Nothing Much To Do

Justin Herbert and Rashawn Slater. There’s nothing the Chargers really need to do about the contracts for Justin Herbert or starting left tackle Rashawn Slater.

Herbert is a franchise cornerstone and the Chargers just signed him to a new deal before last season, so there’s no significant concerns with his contract. At $19.4 million, Herbert’s 2024 cap charge is actually pretty good—about half of teams have higher 2024 cap numbers for their quarterback as of this post. If needed, the Chargers can easily perform a simple restructure to convert some of Herbert’s $6 million base salary into bonus, saving themselves up to $3.9 million against the 2024 cap.

Slater, who is going into his fourth season and has already made an All Pro team, is similarly not a concern for the team based on his cap number. He’s still on a rookie scale deal (though the team will almost certainly look to extend him), so his cap charge for 2024 is just $5.3 million—a great value. The Chargers are going to look to extend Slater since he’s in the last year of his rookie deal, and they could theoretically lower his cap hit for 2024 by doing so, but his base salary is already low enough that it wouldn’t create cap space in the near term anyway (in fact, a big signing bonus for Slater would probably increase his cap number for 2024).

Estimated potential 2024 cap savings: $3.9 million

Corey Linsley. Corey Linsley, the Charger’s starting center last season, missed 14 games due to a heart issue and has indicated that he is 99% likely to retire as a result (though a final decision probably won’t come until March). He carries a $14.1 million cap number for 2024, but his cap number will fall if he retires. Linsley’s retirement would result in the Chargers getting back either $8.1 million or $10.7 million (accounting for a roster replacement) depending on whether he retires before or after June 1. Most likely, Linsley’s official retirement date will be coordinated with the Chargers’ cap strategy—it won’t effect him, but it will effect the team’s salary cap as Linsley’s 2025 prorated signing bonus will either be counted toward the 2024 or 2025 team salary. I’ll assume that Linsley’s retirement doesn’t take effect until after June 1, which would spread out the dead money on his contract between the Chargers’ 2024 and 2025 caps.

It’s also worth at least acknowledging that because Linsley is retiring before his contract is over, the Chargers also can theoretically ask him to return signing bonus for contract years he won’t play (2024 and 2025), which adds up to $5.2 million in total. It seems unlikely the Chargers would do that given the circumstances of Linsley’s retirement and what he’s provided to the team with respect to leadership and mentoring younger players, but if he does return some portion of his signing bonus, that amount wouldn’t count against the team’s salary cap.

Estimated potential 2024 cap savings: $10.7 million

[Update: Per ESPN’s Field Yates, Linsley agreed to restructure his contract and lower his base salary for 2024 from $11.5 million to the league minimum. The move brings Linsley’s 2024 cap number down to $3.81 million frees up just under $10.3 million in cap space for the Chargers in 2024, close to what the team would’ve gotten by effectuating his retirement after June 1, 2024. The move suggests that Linsley won’t rush his retirement decision. He is unlikely to retire before June 1, which would just incur a dead cap hit of $5.2 million to the Chargers (larger than his 2024 cap number), though he could still retire after June 1 and the team could spread out the $5.2 million dead cap hit evenly across 2024 and 2025. The team and Linsley are apparently working together to give Linsley to the space to make his retirement decision when he’s ready and give the Chargers financial flexibility ahead of free agency opening in March.]

Simple Restructures If Needed

Derwin James. 28 year old safety Derwin James is under contract with the Chargers through 2026 after signing a 4-year, $76.5 million extension in 2022. James will be in the second year of his extension this season and he’s slated to have a cap charge of $19.9 million, one of the five biggest cap charges for a safety league-wide.

James is one of the biggest names on the Chargers defense and still a productive player, though he had possibly his worst season last year (especially in coverage). Given James is still a core part of the Chargers defense and just 28 years old, it’s more than likely the Chargers will keep him. And because he also still has three years left on his contract, the Chargers wouldn’t be able to save much money in 2024 by releasing him or trading him.

If the team were to release or trade James before June 1, his cap charge would actually increase by about $5 million to over $24.7 million. That’s because James’s prorated signing bonus cap charges in 2024, 2025, and 2026—$7.1 million apiece—would accelerate and land on the Chargers 2024 cap sheet, along with about $3.4 million in guaranteed base salary for 2024. Cutting James after June 1 would save the Chargers about $9.3 million in cap space this year, but they’d also be saddled with substantial dead cap hits in both 2024 and 2025 as a consequence.

With James presumably staying on the roster, the Chargers have three remaining options: (1) leave his contract as is, (2) perform a simple restructure, or (3) negotiate to extend his contract or add void years to his deal in order to spread out the prorated bonus charge over more years.

Option 1 is simplest and would present the fewest complications if James can’t return to his Pro Bowl form next season. It also would give the team the most flexibility to deal with cap issues for other players in 2025 and 2026.

Option 2 is also plausible, and could save the Chargers up to just over $7.7 million in 2024 cap space per Overthecap at the cost of some financial flexibility in 2025 and 2026.

Option 3 would similarly allow the Chargers to save space, up to $9.3 million per Overthecap, but it would depend a lot on whatever the new deal looked like. A true extension for James seems risky—it’s not clear whether last year was just a down year or whether his production is starting to decline, and the current deal already runs through 2026, when James will be 30 years old. But adding a void year or two to reduce James’ 2024 salary and spread out the prorated signing bonus charges over more years wouldn’t carry the same risks and could save the Chargers over $9 million in cap space this year at the cost of increasing James’ cap hits in 2025 and beyond.

All together, the Chargers don’t actually need to touch James’s contract at all. But if they want to maximize the amount of cap space they can free up in 2024 without making other cuts to the roster, they’ll probably do something. Some simple restructures seem the least painful path, so I’ll assume that they convert the max amount of James’s base salary to bonus that they can.

Estimated potential 2024 cap savings: $7.7 million

Trey Pipkins. Starting right tackle Trey Pipkins signed a 3 year, $21.75 million deal before the 2023 season. Pipkins is heading into his sixth season with the team and has largely performed adequately, providing serviceable tackle play while mostly staying healthy the last couple years. He’s not quite overpaid given how hard it is to find quality offensive lineman in the NFL, but he hasn’t played well enough to say he’s obviously outperforming his contract either.

Pipkins carries a 2024 cap charge of $8.75 million comprised of $6.25 million in base salary ($4.5 million of which is guaranteed) and $2.5 million in prorated signing bonus. Because his current deal runs through 2025, the Chargers wouldn’t save much money by cutting him—they would actually lose cap space in 2024 if they cut him before June 1 and would only gain $1.75 million in cap by cutting him after June 1, per Overthecap. As a result, it’s likely Pipkins will be on the roster for 2024 regardless of who the Chargers draft in April. On top of that, teams generally are wary of cutting decent offensive lineman even if they find other starters because so many injuries occur during the season.

The Chargers could theoretically extend Pipkins to spread out his cap charges over more years, but he hasn’t played well enough to warrant that now. If the team does anything with Pipkins’ cap number, it would likely be a simple restructure to convert $5.125 million of his 2024 base salary into signing bonus. This would make Pipkins’ 2024 cap charge just under $6.2 million, saving the Chargers a little over $2.6 million against the 2024 (they’d also increase Pipkins’ 2025 cap number by the same amount). While that would make Pipkins harder to cut in 2025, odds are the Chargers would want to keep him around for 2025 even his play doesn’t improve since he’s still good enough to at least be a reliable backup.

Estimated potential 2024 cap savings: $2.6 million

Maybe a Little Risk, But Clear Choices

The Chargers have to figure out how to handle a couple older but productive players from last season: Keenan Allen and Eric Kendricks. Both players were significant contributors last season but their cap hits for 2024 are high enough that they need to be addressed. One of them should stay, but it’s time to let the other walk.

Keenan Allen. This may be the Chargers easiest decision: they should absolutely extend Keenan Allen.

There’s no real question about what Allen (31) means to the Bolts. He’s the longest tenured player on the team and has been a stand-out for over a decade since he was drafted in 2013. In 11 seasons with the team, Allen has made six Pro Bowls and is the team’s second all-time leader in receiving yards and catches behind only Antonio Gates (whom Allen could potentially pass in both categories pass next season). He was also without question the Chargers best offensive player last season outside Herbert, posting 1,243 receiving yards and 7 touchdowns on 108 catches. With Mike Williams out and Austin Ekeler and rookie WR Quentin Johnston underperforming, Allen was routinely the only real weapon Herbert could go to. Opposing defenses knew that too, yet Allen posted stellar performances anyway.

Heading into the 2024 season, Allen is in the last year of his deal and will carry a cap charge of $34.7 million ($18.1 million in base salary, plus a $5 million roster bonus due this year, plus a prorated signing bonus hit of just over $11.6 million). That’s too high to just leave alone. But the Chargers can easily knock Allen’s cap number down by extending him, which his legacy with the franchise and 2023 performance absolutely warrant. Allen has also expressed interest in finishing his career with the Bolts, so there’s mutual benefit to making the relationship last.

That said, the Chargers will need to be smart in how they go about Allen’s extension. He’s going to turn 32 in April and has some injury history, though it’s typically over-stated (Allen has missed just 13 games in the last 7 years, four of which came after Herbert was shut down for the 2023 season). The Chargers should look to extend Allen without going deep into the future and without pushing huge cap hits into the future that don’t make sense as Allen eventually starts to decline.

I won’t go through a full-blown contract for Allen, but I want to walk through what an extension could look like and how it saves the Chargers cap space for 2024.

Allen is slated to make $23.1 million this coming year in base salary and roster bonus (remember, his signing bonus charge of $11.6 million is just on paper since he’s already been paid that money). Any possible extension would likely have to pay him at least that much in guarantees and probably more.

Allen’s latest contract paid him an average of just over $20 million per season, the 10th highest average annual value (AAV) for a WR in the league. He’s likely to make less than that annually given his age, and recent contracts handed out to receivers over age 30 suggest he might be looking at an AAV of closer to $12-15 million (Spotrac lists receiver contracts, and the closest comps to Allen are Odell Beckham, who signed a 1-year, $15 million deal last year, and DeAndre Hopkins, who signed a 2-year deal with an AAV of $13 million). Thus, it’s fair to estimate that Allen could receive a contract extension with an AAV of at least $15 million per year, but probably for more years than Beckham and Hopkins given he’s been more productive recently and is under contract for this season, which increases his negotiation leverage.

The Chargers could make both sides pretty happy by giving Allen a 3-year deal worth $48 million ($16 million AAV) with guarantees to make it likely Allen gets paid in 2025. There are tons of ways this kind of contract could look, so I’ll just pick what I think could be workable for both sides—a 3 year contract, with a total value of $48 million that includes a substantial $24 million signing bonus and a injury-guaranteed salary in 2025. The salary break-down and cap hits for each year could look like the below:

Prorated bonuses calculated using Overthecap

This contract would give the Chargers over $13.8 million in cap savings for 2024, give Allen $24 million as an up front (increasing his 2024 pay slightly), ensure that Allen stays on the roster in 2025 assuming health, and give the Chargers a way to either keep Allen in 2026 at a reason cap number or move on from him as he hits his mid-thirties.

There’s no question in my mind that the Bolts will do an extension with Allen to get some of these savings, although the exact terms (how much signing bonus, guaranteed dollars, base salary apportionment, and number of years) could change based on the free agency market for receivers, what the two sides negotiate, and what else the Chargers do with their other large cap hit players (Mack, Bosa, and Williams).

Estimated potential 2024 cap savings: $13.8 million (TBD)

Eric Kendricks. Kendricks joined the Chargers last year as a free agent. He is a solid player and he was without question a stabilizing presence amongst the Chargers linebackers this past year—exactly why he was brought in. He seemed to be the only linebacker on the team who could consistently get to his spots and make tackles (Kenneth Murray struggled next to him in the starting lineup, again).

But going into his tenth year, there are obvious concerns with Kendricks’ age and athleticism. His pass defense has taken a step back with age; he’s not fast enough to stick with receiving tight ends and running backs in man coverage and he was over-stretched at times in zone coverages. Kendricks’ strength as a run defender were worth the trade-off last year, but the Chargers ought to assume that Kendricks’ play will continue to drop at least some next season.

Most importantly for our purposes, Kendricks has too high of a cap number for an aging interior linebacker so he’s a natural candidate for release. Kendricks carries a 2024 cap charge of $9.25 million, and he’s set to make $6.5 million in base salary and roster bonus next season—by cutting him, the Chargers would save that money.

While they’re a bit thin at linebacker, the Chargers do have two younger linebackers in Nick Niemann (26) and Daiyan Henley (24, a third round pick in 2023) who have cap numbers of just $3.3 million combined. Although Niemann and Henley lack the same experience and probably won’t hold up as well as run defenders, they’re both better in coverage, they both bring more athleticism to the position, and they both played reasonably well last year when called upon. Given Kendricks’ age and limitations in coverage, it’s not obvious Kendricks will outplay Niemann and Henley by enough next season to justify the added salary expense. Plus, the Chargers can always look to the draft to add linebackers if needed—in fact, there are a few former Michigan linebackers that will be in the draft this year, presumably Harbaugh and defensive coordinator Jesse Minter (who both coached at Michigan last year) will be familiar with them.

Assuming the Chargers cut Kendricks, they would ultimately end up saving about $5.7 million against the cap in 2024, net—although cutting Kendricks shaves $6.5 million in salary and roster bonus, the Chargers would still have to fill the roster slot.

The team could alternatively try to extend Kendricks for a year (any longer wouldn’t make sense given his age). I think that route is less likely given there are typically inexpensive linebacker options available in free agency. But it would be plausible if Kendricks would agree to take a meaningful pay cut. A two year contract with a minimum base salary in 2024 (about $1.2 million) and $2.5 million in signing bonus would bring his 2024 cap number down to about $5.2 million—about $4 million in savings (obviously if he’s paid more, the potential cap savings go down).

Ultimately, I think cutting Kendricks is most likely for the larger savings and on account of his age, but if the Chargers want to keep him they can probably find a way to do so.

Estimated potential 2024 cap savings: $5.7 million

This Is Where Things Get Hard

For those of you keeping score, if the Chargers make all the moves that I assumed above, they’ll only shave about $44.6 million off of their 2024 salary cap:

• $3.9 million from restructuring Justin Herbert’s contract

• $10.7 million from Corey Linsley retiring

• $7.7 million from simple restructures for Derwin James

• $2.6 million from simple restructures for Trey Pipkins

• $13.8 million from extending Keenan Allen through 2026

• $5.7 million from cutting Eric Kendricks

But remember, we’re aiming to get to over $69.3 million in salary cuts—we’ve still got at least another $24.9 million to go (more if the Chargers want to sign anybody for more than the minimum in free agency).

That said, there are three big roster questions that remain regarding star players Mike Williams, Khalil Mack, and Joey Bosa.

The Chargers have to do something about the cap numbers for at least two of these three players, if not all three, to get to under the cap—there’s no real way around it. But what they actually will do depends on several factors:

How healthy are Williams and Bosa? Is there a trade market for any big names on the roster like Mack, Bosa, or Williams? What positions will the Bolts target on draft day? Are Williams or Mack willing to take a step-back in salary? [Spoiler: nope, keep dreaming]

I can’t answer all of those questions here (or at all in some cases, though a future post will focus on draft strategy). Instead, I’ll go through what I think are reasonable paths forward for each of the three players given what we know today.

Mike Williams. Let’s at Mike Williams, one of the most up and down players on the Chargers’ roster.

Williams is 29 (he’ll turn 30 during the first half of the 2024 season) and coming off an ACL tear in week three of last year. When healthy, he’s one of the best jump-ball receivers in the NFL and he’s been a much-needed alternate weapon for Herbert aside from Keenan Allen. Yet Williams’ overall production has never quite lived up to the potential the Chargers saw when drafting him #7 overall in 2017. Although he’s scored lots of touchdowns, in seven seasons with the team Williams has cleared 1,000 yards just twice, caught more than 50 balls just twice, and has suffered his fair share of injuries. Williams’ inconsistent production and injuries, in part, are why the Chargers drafted Quentin Johnston last year, who boasts similar size and more athleticism (though not the catching ability).

Williams is also in the last year of his contract, and he’s slated to make $20 million this year ($17 million in base salary and $3 million in non-guaranteed roster bonus). That would be fine for a good wide receiver like Williams, but his cap charge is actually far bigger, sitting at $32.46 million for 2024. That cap figure is simply not tenable for a guy coming off an ACL tear who isn’t an All Pro level player.

The Chargers have three options for Williams: cut him, trade him, or extend him (they can’t do a simple restructure of his contract since he’s already in the last year of his deal).

If the Chargers cut Williams, they will save $19.2 million against the 2024 cap (his 2024 compensation minus salary to sign a replacement player for the roster). They would be left with a dead cap hit of about $12.5 million. It’s a clean solution, but it would leave the Bolts with a receiver corps of Allen, Johnston, Josh Palmer, and Derius Davis (unless they draft a WR—for a later post!). That said, that’s basically the same group the Chargers had last year, and the passing game wasn’t really the issue last year. Plus, the Chargers can at least hope for growth from Johnston and Davis, who were both rookies last season.

Trading Williams would net similar savings, offset by whatever the Chargers would have to pay to any players or draft picks they get back in return. But the trade market for Williams isn’t likely to be super robust given his up-and-down production, recent ACL tear, and the possibility the Chargers might cut him.

Extending Williams is possible but would result in lower cap savings. A market contract for Williams would be affected by the same factors as his potential trade market, so he’s probably looking at a deal that is worth somewhere between $8-12 million per year (significantly less than Allen, who is better, healthier, and more historically important to the franchise).

If the Chargers extend Williams through the 2025 season (two years overall), they could offer a reasonable though above market deal that Williams might be willing to take in order to bring down his 2024 cap number and mitigate the team’s long-term risk. Here’s a sample deal for two years at a $15 million AAV, with $17 million in signing bonus, to entice Williams into signing:

Prorated bonuses calculated using Overthecap

With the above contract, the Chargers would save $10 million against the 2024 salary cap. The team would have the option to cut Williams in 2025 if he doesn’t return to form with a reasonable dead cap hit of just $8.75 million. For his part, Williams would get a substantial signing bonus and higher annual pay than he’s unlikely to get from another team, but he’d also have the risk of a short term deal—the Chargers could cut him if Williams doesn’t play well or stay healthy and save about $2.8 million in 2025.

Williams could easily insist on a 3-year deal to avoid the chance that the Chargers cut him in 2025. If he does, the Chargers are probably going to knock down the per-year value of the deal. Here’s a possible deal with a lower $12 million AAV and the same $17 million signing bonus:

Prorated bonuses calculated using Overthecap

This sort of deal would be better for Williams as it would be pretty likely the Chargers keep him on the roster through 2025 (they wouldn’t save money by cutting him at all, so they probably wouldn’t)—I don’t think the Chargers would give an injury guarantee for 2025 since Williams has a long history of big injuries. Still, more likely than not, Williams would be pretty likely to get at least $27 million under this structure. It would also still help the Chargers with their 2024 salary cap situation, as they’d save about $12.8 million against the cap. The bigger risk for the Chargers would be that they have less flexibility to get off of Williams’ contract before the 2025 season if he doesn’t return to form coming off the ACL tear, a real concern.

In sum, I see three reasonable options with different risks:

1. Cut (or trade) Williams and save up to $19.2 million in 2024 cap space;

2. Extend Williams through 2025 and save ~$10.2 million in 2024 cap space;

3. Extend Williams through 2026 and save ~$12.8 million in 2024 cap space.

Personally, I lean toward option 1, as I think extending Williams gets too risky and could muck up the Chargers’ cap situation in 2025 and 2026. On top of that, Williams is coming off a major injury, has a long injury history, and extending him and Allen is probably too much to spend on aging receivers. Cutting Williams also gives the Chargers a lot of wiggle room to deal with Mack and Bosa, both of whom I’d rather keep than Williams. I’ll go into why below, but Mack and Bosa play a more valuable position (edge rusher). Plus, Mack is more reliable (and productive) than Williams and Bosa has a much higher ceiling when healthy. I’ll admit that there have been (faint) whispers that the Chargers could trade Bosa or Mack, which could change the calculus, but for now I am going to assume the Chargers don’t deal either one.

For purposes of this analysis, I’ll assume the Chargers cut Williams. If they keep him, I suspect a three year contract is a little more likely than a two year deal, and the Chargers would save about so the Chargers would save about $6.4 million less against the 2024 cap.

Estimated potential 2024 cap savings: $19.2 million (TBD)

Khalil Mack. What to do with Khalil Mack gets really interesting. Mack is a stud—he was the Chargers best defensive player last year by a wide margin. Mack played over 80% of the Chargers defensive snaps over all 17 games and posted truly remarkable stats for a 32 year old player: 74 tackles, 17 sacks (4th in the NFL), 36 quarterback pressures, 5 forced fumbles, 10 passes defended per Pro Football Reference. He also scored really well by some advanced metrics. For example Pro Football Focus graded him at a 91.8 for the year, with a 90.8 run defense grade and 86.3 pass rush grade. That matches what you see watching Chargers games from last year; Mack consistently made good plays and he was also one of the few guys on defense that made splash plays for the Bolts. He’s also an iron-man who has never missed a game since joining the Chargers in 2022 (he’s only missed 12 games in 10 years, which is INSANE!).

On the flip side, Mack is about to turn 33 years old and he’s in the last year of his deal. He carries a 2024 salary cap number of over $38.5 million, the highest of any defensive lineman in the NFL (Joey Bosa is a close second at $36.6 million while Aaron Donald and TJ Watt the only other defensive lineman over $30 million). It’s also possible that last year was an outlier—Mack posted nine or fewer sacks in each of the four seasons from 2019 to 2022 and his PFF grade jumped up to 91.8 this year from 71.1 in 2022 and 73.0 in 2021 (though those are admittedly his worst career seasons per PFF).

I’m inclined to think that even though Mack’s statistical production probably won’t reach the same heights in 2024, he will still be a premium defensive player next year. But that won’t change the fact that the Chargers need to do something about his contract.

Like Mike Williams, Mack is heading into the last year of his deal, so the same basic options are on the table: cut him, trade him, or extend him.

Cutting Mack outright seems like the wrong move. While it would save the Chargers about $22.5 million against the 2024 salary cap after filling Mack’s roster spot, they really have no replacement for his high-end talent and consistent availability. Tuli Tuipulotu came on strong as a rookie last year, but he and Bosa (whose availability is always an issue) are the only other solid pass rush options on the team. That could change if the Chargers use an early draft pick on a pass rusher, but there are other roster needs.

Trading Mack is a possibility if the Chargers can get a good enough return, though it’s hard to gauge exactly what the team could get back for him in a deal. The Chargers traded a second round and a sixth round pick for Mack two years ago, and while he was coming off of foot surgery when the Chargers traded for him and has been healthy since, that was still two years ago and Mack wasn’t coming up on free agent at the time. If the Chargers can get back good draft capital for Mack (better than third round pick value), or if Mack wants to leave, then trading him probably makes sense. Otherwise, I’d rather try to keep him on the team. Even if Mack isn’t among the league’s absolute best pass rushers, he’s still a very good player that can defend the run and pass rush.

The other option is to give Mack an extension, a tricky exercise given his age. At some point you can assume that Mack’s going to hit a wall—perhaps without warning—so the Chargers will have to structure the contract with ways out, much as we did for Keenan Allen earlier. Mack, for his part, will probably want to ensure that he still gets paid and has some long-term security.

As with Allen, a deal running three total years would be ideal if Mack will agree to it, but Mack is probably going to command a big price tag regardless. Outside of quarterbacks, edge rushers tend to be the highest paid players in the league, as evidenced by the fact that Mack is set to make over $23 million this season. A new deal would probably have to clear that in guarantees and include the possibility of upside for Mack.

The closest comp for a new Mack contract is Von Miller’s 2022 contract with the Bills, but it’s also a cautionary tale and may ultimately be one of a kind. There’s no doubt Khalil Mack’s agent will point to Miller’s deal as a starting point. Miller is two years older than Mack, but has a slightly better career resume—Miller’s Super Bowl performance with the Broncos probably means he’s eventually headed to the Hall of Fame. At age 33 (the same age Mack is now), Miller signed a six year deal with the Bills for $120 million total ($20 million AAV), including about $51.5 million in salary guaranteed money. Unfortunately for the Bills and Miller, things have gone pretty poorly since; Miller has played in just 23 games in two years with Buffalo and he didn’t register a single sack this year. The Bills would presumably like to move on from Miller before 2024 given his lack of performance, but they can’t. Cutting Miller would leave the Bills with a 2024 dead cap hit of over $32 million dollars, so they’re going to end up paying him handsomely to potentially do nothing this year.

Cameron Jordan’s contract with the Saints is an alternative comp that the Chargers can point to. Before the start of last season, Jordan was heading into the last year of his deal and had just turned 34. He signed an extension with the Saints before last season to carry his contract through the 2025 season for $27.5 million (AAV of $13.5 million). The extension netted Jordan more than $25 million in practical guarantees, and he can make another $12.5 million in salary in 2025 if the Saints keep him all the way through the life of the deal. Jordan was a year older than Mack is now when he signed the extension, and he had been a little less productive as a player than Miller or Mack to that point. But like with Mack and the Chargers, the Saints wanted to bring back Jordan and get significant salary cap relief, so the situations are definitely similar.

An extension for Mack should probably fall closer to Jordan’s contract than Miller’s in terms of number of years for it to make sense for the Chargers—they don’t want to end up in a situation like the Bills. But because Mack is a little younger and a bit more productive, in order to keep the kind of flexibility the Saints got with Jordan, the Chargers will likely have to pay Mack handsomely for 2024 and 2025. They could do so with a two year extension (three years overall) that offers Mack a total of $54 million ($18 million AAV) with a $20 million signing bonus, and guarantees of $40 million in total, is probably enough to get a deal done. Here’s how it could look for the Chargers cap sheet:

Prorated bonuses calculated using Overthecap

This kind of deal makes sense for Mack because it secures him at least $40 million (substantially more than Cam Jordan got in a similar situation last season) and the possibility of playing through 2026, his age 35 season, at a good salary. It’s not the Von Miller deal obviously, but I don’t think anything close to a six year deal would be on the table for Mack given how Miller’s deal has worked out. Plus, Mack would still be getting paid an AAV of $20 million in 2024 and 2025, the same as Miller and still among the top 15 edge rushers in the league even though he probably won’t hit that level of performance regularly.

The Chargers, meanwhile, would get about $15.3 million in 2024 salary cap relief and keep a consistent, starting caliber defensive end on the roster for a couple more seasons while they position themselves for the future. They will have to absorb the risk of Mack deteriorating in 2025, but hopefully the full effects of Herbert’s contract won’t have kicked in by then. The team would still be able to move on from Mack in 2026 and only eat about $6.7 million in dead cap.

This deal for Mack would be pretty hefty—it’s a more favorable extension than the one proposed for Keenan Allen earlier. But it’s reasonable and would be closer to what Mack might get in the open market, given the league-wide premium for pass rushers.

Estimated potential 2024 cap savings: $15.3 million

Joey Bosa. If you’re paying close attention, you’ll notice that by cutting Williams and extending Mack, we created another $34.5 million in cap relief—almost $10 million more than the $24.9 million I said was needed to fix the cap situation.

That’s great! In theory, it means the Chargers could keep Eric Kendricks, extend Mike Williams, or sign above-the-minimum free agents without even touching Joey Bosa’s contract.

But more flexibility is still good so the Chargers ought to think about what to do with Bosa’s contract anyway.

Let’s start with the fundamentals of Bosa’s deal. Bosa (29) is in the second to last year of a five year, $135 million extension he signed in 2020 (AAV $27 million for the extension, $24.9 million for all six years). At the time, it was a record deal for a defensive end that included $102 million in guarantees ($78 million fully guaranteed at signing).

Bosa has made two Pro Bowls since signing the extension, but unfortunately he’s suffered a lot of injuries that have really eaten into his value. In the last four seasons, Bosa has missed 25 of 67 possible games, over 37%. Bosa’s snap share in the games he has played has also dropped substantially in the last two seasons, as was only on the field for 54% and 51% of the Chargers defensive snaps in 2022 and 2023 respectively. But he’s been a solid player when on the field. He has 27 sacks in 42 games played since 2020, he’s posted solid pass rush grades of 90.5, 90.3, 84.2, and 80.3 from 2020-2023 according to PFF, and his pass rush win rate outpaces Khalil Mack. But at the end of the day, Bosa’s lack of availability is a giant problem given how much the Chargers have invested in him.

Consistent with his big contract, Bosa’s cap charges for 2024 and 2025 are going to be big, about $36.6 million and $33.0 million respectively, though he will actually get paid less than that. Because he’s got time left on his deal, the Chargers have more options with Bosa than they do for Khalil Mack and Mike Williams—on top of the cut/trade/extend options, they can also perform simple restructures.

Bosa’s contract doesn’t have any guaranteed money left, so cutting him now would allow the Chargers to get out of paying him $22 million this year and $25.4 million next year. But because he’s got two total years left on the deal, cutting him would only save the Chargers over $14.3 million against this year’s cap (they would incur about $22.2 million in dead cap charges for 2024). If Bosa can’t stay on the field, that money would be useful in finding another edge rusher, but it’s probably not enough to find anyone remotely close to Bosa’s talent level. The Chargers would also be completely giving up on their highest drafted player this decade during his theoretical prime. If Bosa ends up staying healthy on another team, it would be a tough pill to swallow.

The team could also try to trade Bosa, but it’s not clear what he would fetch on the trade market. Before last season, ESPN’s Bill Barnwell argued that Bosa was worth “one first-round pick and change” in value. That would be nice, but another injury-riddled season has probably dropped his value below that, though it’s possible Bosa could net a first round pick given how many teams need pass rushers.

If the Chargers can deal Bosa for a first round pick, they have to seriously consider doing it. I’ll talk about this more in a future post, but they ought to be looking at edge rushers in the second or third round anyway depending on who is available, and having another first round pick would make filling the hole much easier. A combination of Mack, Tuli Tuipulotu, and first-round edge talent would be a solid pass rush group, and the Chargers hopefully could avoid having one of their best pass rushers miss a huge chunk of games. Plus, trading Bosa would also net the Chargers more than $14.3 million in cap space (the same as if they cut him), minus the eventual salary of whatever draft pick they get back.

The Chargers could also perform simple restructures of Bosa’s contract for 2024. The Chargers could convert up to $13.79 million of Joey Bosa’s base salary and all $7 million of his roster bonus for 2024 into “restructuring” bonus, which would drop the 2024 cap charge for Bosa down to under $26.3 million from it’s current level of over $36.6 million—about $10.4 million in 2024 cap savings. That’s good for 2024, but the cost would be pushing that money into the Charger’s 2025 salary cap. As things stand with Bosa’s contract now, the Chargers can keep him 2024 and cut him before 2025 if he doesn’t perform to get over $25 million in 2025 cap savings, with a dead cap hit of about $7.6 million. Doing a simple restructure would change that—if the Chargers need to cut Bosa before the 2025 season (e.g., he plays poorly or gets hurt again in 2024), they’d only be able to save about $15 million in 2025 and take a dead cap hit of about $18 million.

Extending Bosa with actual additional years on the contract doesn’t make sense this off-season given his injury history. If Bosa can stay healthy and produce in 2024, there’s plenty of time to re-sign him before his contract expires after the following year (the Chargers could also always use a franchise tag if they needed to). The Chargers could try to get Bosa to agree to a “faux extension” that either adds years he’s unlikely to play, but it’s not clear why Bosa would agree to that without getting more money, which the Chargers probably won’t be willing to pay. Alternatively, the Chargers could try to add void years to the end of his current deal, but that could present similar problems and regardless wouldn’t do much more than simple restructures would.

In all, I think trading Bosa for a first round pick is probably the most financially sensible move for the Chargers. If that kind of value doesn’t materialize, though, the team is probably best off by keeping Bosa and not touching his contract unless they have specific free agency targets in mind. If they want to create another $10.4 million in cap space using simple restructures to sign a quality free agent, I would be fine with it.

Because the Chargers brought in a new coaching staff and front office this off-season, there’s a decent chance they will want to get at least some free agents they identify. So I am going to assume they do the simple restructure and save $10.4 million against the 2024 salary cap.

Estimated potential 2024 cap savings: $10.4 million

The Net Result: Under the 2024 Cap, and No Insurmountable Future Contracts

If the Chargers do all the moves above, they’re going to have some reasonable financial flexibility this off-season—enough to sign a key free agent or two, potentially including players that were on the roster last season like safety Alohi Gilman, tight end Gerald Everett, or running back Austin Ekeler.

Added together, we freed up about $89.3 million in salary for 2024 with the below moves:

• Simple restructure for Justin Herbert - $3.9 million

• Corey Linsley retiring - $10.7 million

• Simple restructure for Derwin James - $7.7 million

• Simple restructure for Trey Pipkins - $2.6 million

• Extension for Keenan Allen (through 2026) - $13.8 million

• Cutting Eric Kendricks - $5.7 million

• Cutting Mike Williams - $19.2 million

• Extension for Khalil Mack (through 2026) - $15.3 million

• Simple restructure for Joey Bosa - $10.4 million

These moves would put the Chargers under the 2024 salary cap, allow them to sign their 2024 draft picks, preserve about $10 million for roster management and backfilling injuries, and leave about $20 million left over to shop around in free agency. That’s not a ton of wiggle room, but it’s enough to re-tool for 2024.

At the same time, making the roster decisions above would affect the Chargers salary cap in 2025 and 2026. They need to be mindful of how Justin Herbert’s extension will start to impact those years, and on top of Herbert’s increasingly expensive contract, potential extensions for Rashawn Slater and Asante Samuel will inevitably require more strategizing from the front office.

That said, most of these moves aren’t too harmful to the team’s cap in 2025 and 2026. The simple restructures push over $20 million onto the cap sheet for 2025, while the extensions for Allen and Mack would add another $45 million to the 2025 cap sheet. But the Chargers only have about $148 million in salary on the books for 2025 right now anyway, so they can absorb those hits and still have wiggle room under the cap, especially since the 2025 cap will likely be higher than 2024 anyway. In addition, the Allen and Mack extensions would also add about $40 million to the Chargers cap for 2026, but the Chargers only have eight contracts that run out that far anyway (Herbert, Derwin James, and rookies from last season) and both Allen’s and Mack’s extensions would probably be structured to give the Chargers a way out if the need it.

So we fixed the 2024 cap!

In a future post, I’m going to write about how these kinds of decisions affect the Chargers draft strategy for 2024. So stay tuned!