Not So Fast! What is “Effective Salary Cap Space?”

Last week it was announced that the NFL had set the 2025 Salary Cap at $279.2M.  This was good news because the original projections had the Cap landing in the $270M to $275M range.  And, of course, this set off a feeding frenzy amongst Ravens’ fans (and likely all fanbases) of what the team would be able to do with this “extra” Cap space.  In reality, though, this really isn’t “extra.” It’s certainly helpful, especially for teams like the Ravens who were already going to have a tight Cap, but it’s not really a great windfall given the myriad of other expenses that teams face from this point in the offseason through the end of the season.

This is one of the misconceptions about Cap space at this time of the year and even immediately after the beginning of the new league year (March 12^th in 2025).  At any given time, you will hear that a team has “X amount of Cap space,” but that doesn’t mean that that money is available to be spent on free agent signing and re-signing.  In fact, even during free agency, teams must be mindful of future expenses and operate their Salary Cap with those expenses in mind.

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So, when looking at a team’s true Cap space, this is what is called “Effective” Cap space.  Effective Cap space is the amount of Cap space that is truly available to spend on free agency (and contract extensions) after all other future expenses have been accounted for.

So, what are these future expenses?

First, during the offseason, only the largest 51 salary cap numbers (“The Rule of 51”) for players on the roster (and all other bonus prorations and dead money) count against the team’s Salary Cap. But once the season starts, the Rule of 51 ends and all players count on the Cap.  So, immediately, two players need to be added to the team’s Cap to get to the 53 players that are on the team’s regular season roster.  Also, once the season starts, all players on the 53-man roster, IR, PUP and the Practice Squad – all of them – count on the team’s Salary Cap. So, at a minimum, the 16 players on the team’s Practice Squad are added to the Cap.  And, unfortunately, as the Ravens have learned too often, all players on IR & PUP also count and since players go on IR during the season, the team must also set aside Cap space for the inevitable in-season injuries and the need to replace players who go on IR.

And, as the chart below shows, these expenses take up Cap space. A lot of Cap space.

To review, the Ravens currently have $12.224M in Cap space, which sounds good, but in reality, they are $11.86M OVER the Cap once the future expenses are factored in.

This is the result of “effective” Cap space and what teams are always mindful of as they approach the offseason and the beginning of the new league year.  Fans should also keep this in mind when they speculate on how much Cap space the team really has to spend in free agency.

So, the Ravens are going to have to create a lot of Cap space, not just to have money for signing and re-signing free agents, but also to have enough Cap space to cover their future expenses.  So, while the higher Salary Cap will certainly help close that gap, it’s not really money that they will be spending in free agency.

But every little bit helps.

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Source: https://russellstreetreport.com/2025/03/03/baltimore-ravens-salary-cap/effective-salary-cap-space/