I decided to write this post based on a couple recent exchanges with good buddies @TDU_Alister and @KyleDe.

First, Kyle asked me a couple weeks ago why I was using a higher amount for in-season cap expenses in my cap-related posts than Daniel Popper has been using in his 2023 cap-related articles. Then I had this exchange with Alister about salary cap and contract details:

Alister: "it's probably the rare freaks like us Tau who think it's even remotely interesting content"
Me: "Yes, I recognize that I have a problem not shared by most... :-)"

So it was obvious that another post about the cap was in order!

I decided to look back at 2022 and see if I could learn anything that might influence my thinking for 2023 and beyond.

2022 Salary Cap Projection as of 9/2/2022

I made a series of posts throughout last offseason, with several commenting on the status of the Chargers roster and salary cap. I posted this on 9/2/2022: 2022 Roster Thoughts - After Roster Cutdown.

In that post, I posted this on the team's 2022 cap charges:

I provided detail in that post linked above for each of these cap charges except the dead cap money, for which I did not provide specifics beyond Bulaga's dead cap hit.

Also, the "budget for additional injuries" was just a speculative estimate. I provided some limited rationale for it in an earlier offseason post last year: 2022 Roster Thoughts - Entering Free Agency.

I also posted this about the team's 2022 functional cap space at that time:

So, What Really Happened?

Somewhat surprisingly, it is not easy to answer this question precisely. I use two primary sources for cap information: OverTheCap and Spotrac. OTC does not make it easy to look back to prior seasons (or at least I don't know how to do it). Spotrac does allow subscribers to look back, but they do not maintain precise accounting of the various categories for which players incur cap hits. The best data I could find is from Spotrac, and I used it to build this table:

I wish one or both of these cap data sources would actually track the data in the categories in which the charges occurred. Here, Spotrac lists each player where he ended up if he was still with the Chargers as of the end of the 2022 season -- active roster, IR, or practice squad. In cases where movement between those categories triggered dead cap hits, those are shown separately.

One caveat... I am usually more confident in OTC data than Spotrac data. I assume this data is at least very close, but I'm not certain it is 100% accurate.

Also, another note. The total cap expenses of $212,130,008 does not include earned incentives that were not considered "likely to be earned" at the outset of the 2022 season. For example, Everett earned $250K for reaching 60 receptions, which adds $250K to his 2023 cap hit. Deandre Carter earned $100K for reaching 45 receptions; since he is no longer with the Chargers, that will result in a negative adjustment to the Chargers 2023 cap. Not sure if there are others.

Observations

Some observations on this data:

• My final projection on 9/2/2022 was for cap expenses of $212,021,687. The final total cap expenses were $212,130,008, so my projection was off by $108,321 (0.05%). Not bad, especially with the volume of roster churn. I choose to view this as validating my methodology.
• I projected that the Chargers had about $4M in functional cap space that they could spend. As we all know, they chose not to spend any of it on additional depth players, other than signing a few practice squad caliber players during the season. Given how the season unfolded, a different decision (e.g., signing a better depth player at OL or WR) may have helped the team to another win, so I am not a fan of their decision-making there. However, not spending it meant the Chargers had a positive rollover, which could help them this season.
• The Chargers had 106 players with cap hits in 2022. I suspect that is a surprising number to some fans. It really shouldn't be, given that they sign 90 or more players to contracts in the offseason, and many/most of them incur a cap hit when waived. (The Chargers had 45 players with dead cap hits this season, per Spotrac.) Combine that with cap casualty cap hits (e.g., Bulaga) and the fact that they occasionally add players from outside the organization during the season, and it's easy to see 106.

Back to Kyle's Question

This data supports the way I track in-season cap expenses. Last year, Daniel Popper used $7M in all of his offseason articles, but this year so far he has been using $4M. I don't know why he is doing that, but he is significantly too low. To review his (and many people's) methodology for assessing functional cap space in the offseason:

1. Start with OTC's available cap space number for the Chargers.
2. Add the delta additional cost that the rookie class will cost above the minimum salary players they will replace in the top 51.
3. Add placeholders for any free agents the Chargers have signed that are not yet accounted for in OTC's data, if applicable. It sometimes takes them 1-2 weeks after a signing to include the contract details.
4. Add an amount for in-season spending. This is where Popper has been using $4M.

In order to get to a more valid amount of functional cap space, the first three steps are fine. But then it is necessary to account for these things:

1. In the offseason, the cap is tracked by using the top 51 active contracts. But in the regular season, the active roster is 53 players. The additional 2 players will have cap hits of at least $1.5M, since the minimum salary in 2023 is $750K.
2. It is necessary to account for the practice squad. I covered the 2023 details in this post: 2023 Roster Thoughts - Entering Offseason. I project it at around $3.5M in 2023.
3. It is appropriate to account for a projection on practice squad activations, which increases cap hits for activated players. I covered this in that same post linked in the previous item. I project these to account for around $1M in 2023.
4. It is necessary to account for earned incentives and the Proven Performance Escalator (PPE), if applicable. The Chargers have no PPE players in 2023.
5. It is appropriate to account for in-season injury replacements, as we just saw in 2022. I usually budget no less than $3M for this.

That is about $9M for 2023 in-season budgeting. So it seems to me that Popper is pretty far off with his budget of $4M, assuming I haven't missed something in his methodology.

Conclusion

Back to my exchange with Alister, it may be that there aren't many Chargers fans who care about all of this detail. I get that, but hope this is helpful to those who may want to understand the details better.