Bills salary cap situation: What contracts can be restructured, which players could be cut

This is the first in a three-part series previewing the start of free agency for the Buffalo Bills. Today, we look at how the Bills can fix their salary cap situation.

Not that Buffalo Bills quarterback Josh Allen needs it, but his voluminous bank account is about to get an influx of around $21 million in the next few days.

Starting Monday, the NFL’s legal free agent tampering period window will be open for two days, during which time teams can work out new contracts, not only with their own free agents but anyone else about to hit the open market. And whatever deals get agreed upon can then be implemented once free agency officially opens at 4 p.m. Wednesday.

The Bills can bargain all they want, but because they are currently $17.7 million over their adjusted salary cap of $227.7 million for 2023, they first have to create cap space to enable general manager Brandon Beane to sign players.

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This is where Allen’s bank account comes into play. All Beane has to do is reduce Allen’s 2023 base salary to the league minimum and convert the other $21 million he is owed into a signing bonus. It’s a pretty good deal for both parties because Allen gets all that money immediately, while the Bills would not only be cap compliant but almost $4 million in the black.

For accounting purposes, that $21 million bonus can then be prorated over the remaining six years on Allen’s contract. This is not something Beane loves doing, kicking money into the future, but when you have a team that, before any restructures like this occur, counts nine players with cap hits north of $10 million in 2023, he really doesn’t have a choice.

“It gets tighter and tighter. We are tight on the cap this year and we’re gonna be tight next year looking at it from a forecasting standpoint,” Beane said. “We got a couple of tough years coming up to do that. We will strategically push some money forward with some restructures coming up to get under the cap and then give us the opportunity to operate and fill some holes on both sides of the ball.”

Here are some of the options Beane will have at his disposal over the next few days to open up cap space beyond the Allen move.

Other Buffalo Bills candidates for restructured contracts

The Bills next obvious move would be to perform the same type of surgery on edge rusher Von Miller’s contract, though his is a different type of procedure. He’s due a $13.5 million roster bonus - which cannot be prorated - sometime around March 20, meaning if he’s on the team all that money has to be paid and accounted for on this year’s cap.

Obviously, Miller is going to be on the team and thus, he is scheduled to count $18.6 million. By converting the roster bonus to a signing bonus, that money still gets paid out now but because it becomes a signing bonus it can then be spread out into future years like Allen’s. This would free up around $10.8 million in cap space this season.

The beauty of this move is that it still allows the Bills a reasonable escape from Miller’s original six-year contract after the 2024 season if they so choose. The contract was written with a potential out after that third year and the dead cap hit to release him, at age 36, would be far less than the cap savings his release would trigger. Obviously, if Miller is still going strong, maybe the Bills would keep him, but that’s a decision two years away.

Offensive tackle Dion Dawkins and linebacker Matt Milano could also create some very nice space, about $12 million combined, but restructuring their deals would prove costly in 2025. That’s because while both players are signed only through 2024, each has two void years attached to their current contracts beyond 2024.

Void years are another commonly-used mechanism for teams to lessen current year salary cap hits because even though the player isn’t signed to play in those void years, they extend the time in which bonuses can be prorated.

The downside is that the money pushed into the void years all hits the cap in the first season after the player departs. This means if the Bills restructure Milano and Dawkins to free up that $12 million, it will cost them around $14 million on the 2025 cap when their void years begin.

We will see this in 2023 as guard Rodger Saffold had a void year that will cost $2 million, and then again next year with safety Micah Hyde. His contract expires after this season but the Bills added three void years that total $3.4 million, and all of that comes due on the 2024 cap.

Three players who can provide 2023 relief without creating too much cap pain in future years are cornerback Tre’Davious White and wide receiver Stefon Diggs (about $5 million each) and cornerback Taron Johnson (about $3 million).

Which Buffalo Bills could be in line for contract extensions?

Milano and Dawkins might be candidates for this bucket, maybe even Hyde or Johnson, but the two most likely might be defensive tackles DaQuan Jones and Ed Oliver.

Jones signed a two-year, $14 million contract with the Bills in 2022 with a void year attached for 2025, and then had a superb season as the one-technique DT. He is scheduled to count $8.5 million in 2023, but if the Bills were to give him a two-year extension, they could spread his money out across three years and might save in the range of $4 million on his cap number this season.

Oliver will play 2023 on the fifth-year extension to his rookie deal which the Bills exercised at a cost of $10.7 million. He has been a polarizing player in Buffalo because he has never lived up to his No. 9 overall pick draft status in 2019, so maybe the Bills are content to move on from him after 2023.

But like linebacker Tremaine Edmunds, the Bills have invested time into Oliver and they may want to work out an extension before he’s eligible for unrestricted free agency in 2024. This is what they did to another 2019 draft pick, tight end Dawson Knox, keeping him off the market this year with a four-year extension through 2026.

“You could do an extension that works for him and works for us, you could lower that cap number,” Beane said. “I don’t know that that would necessarily happen before the league year or anything like that, so it’s not probably a move to get under the cap that I see coming.”

Which Buffalo Bills could become cap casualties?

Running back Nyheim Hines tops this list because it costs the Bills zero in dead cap money to cut him. He still has two years left on the extension he signed with the Colts which Buffalo inherited after acquiring him in a trade for Zack Moss. He is scheduled to count $4.8 million this year and $5.4 million in 2024, and there’s no way the Bills are doing that.

However, if the Bills value Hines as a backup to James Cook plus as the primary kickoff and punt returner, they could cut him and then re-sign him to a new deal at a lower cost, essentially a pay cut. Hines might be agreeable because his market value very likely would be less than what he was originally due to be paid.

Wide receiver Isaiah McKenzie had a golden opportunity to grab the slot receiver position last season and make it his, but he didn’t do so thanks to his inconsistency. The Bills would save $2.62 million by cutting him and incur a mere $300,000 dead cap hit.

Lastly, defensive tackle Tim Settle was signed to a two-year, $9 million free agent deal in 2022 but he really wasn’t worth that as a rotational player who played only 33% of the snaps. Cutting him saves $2.25 million with another $1.35 million on the books next season due to a void year.

Sal Maiorana can be reached at maiorana@gannett.com. Follow him on Twitter @salmaiorana.To subscribe to Sal's newsletter, Bills Blast, which will come out every Friday during the offseason, please follow this link: https://profile.democratandchronicle.com/newsletters/bills-blast

This article originally appeared on Rochester Democrat and Chronicle: Bills salary cap: Possible contract restructures, extensions, cuts