The Broncos unwittingly picked up $2.5 million in cap space via an insurance-related rewriting of Peyton Manning’s contract. The knowingly cleared another $2.5 million by cutting running back Willis McGahee.
His base salary of that amount disappears immediately. But he’ll still cost a total of $1 million over the next two years, based on his prorated signing bonus.
Specifically, the Broncos will carry $500,000 in 2013 and $500,000 in 2014.
As someone asked on Twitter, does McGahee get that money? Yes, but only because he already has received it.
When he signed in 2011, McGahee received $2 million up front. On a four-year deal, that’s a $500,000 allocation per year.
And now I can put my calculator away.
So what will the Broncos do with that $5 million? They can spend it now, or they can spend it later. Eventually, they’ll have to decide what to do with receivers Eric Decker and Demaryius Thomas, whose production with Peyton throwing passes will push them toward the upper reaches of the pass-catcher market.