The Los Angeles Chargers needed to free up over $20 million in cap space to become cap compliant this offseason and the team made the first financial move to start freeing up money for the 2023 season.
On Thursday, it was reported that the Chargers were restructuring both Keenan Allen and Mike Williams' contracts. By doing so, the Chargers freed up $14.3775 million in cap space. There is still more work to do but this frees up substantial money for the Bolts moving forward.
Restructuring contracts has future implications as well. Teams don't simply get to create more cap space by doing restructures and not have to pay for it later. This decision to specifically restructure Allen and Williams has future implications.
What Keenan Allen and Mike Williams restructures mean for the Chargers moving forward:
First of all, the Bolts now find themselves $6.9 million over the cap after making these moves, per Over The Cap. There are still various ways that the Bolts can continue to free up cap space to not only become cap compliant but be able to pay some impending free agents.
The decision to restructure Williams and Allen when both players have one more year under contract created a massive cap hit for the 2024 season for the pair of receivers. Allen and Williams are going to have a combined cap hit of over $67.1 million in 2024.
This essentially guarantees that Allen is going to remain with the Chargers for the remainder of his contract. There was speculation this offseason that the Chargers would cut or trade him for cap space. By restructuring him, Allen has a bigger dead cap hit next season. The Bolts can still get out of his deal to free up $23.1 million but it would come with $11.6 million in dead cap.
If Tom Telesco was not considering moving on from Allen this offseason then he likely is not going to move on from Allen next year with an $11.6 million dead cap hit. The same can be said for Williams, who would have a $12.4 million dead cap hit next season (although the Chargers would still free up $20 million).
These restructures seem to guarantee two other things for the Bolts as well. First, it seems much more likely that the Chargers are going to draft a receiver early in the 2023 NFL Draft. It might not come in the first round, but the Bolts need to add another receiver in the first three rounds.
The team not only needs depth this season behind the top three but in future years as well. With Allena and Williams making over $67 million combined, the Chargers won't be able to pour in more resources in the receiver room in 2024. They will need multiple receivers on rookie deals and that includes a rookie that should be drafted in 2023.
This also seems to guarantee that 2023 will be Khalil Mack's last season in LA. Mack was a restructure candidate but now that seems far less likely. The Chargers are going to need to create cap space next offseason as well and Mack has a $27.75 million cap hit. LA can get out of it with only a $4.5 million dead cap hit ($23.25 million saved).
If we assume that this is Mack's last year with the Chargers then it is safe to assume that the Bolts will take an edge rusher in the first two rounds of the 2023 NFL Draft to serve as his long-term replacement.
It definitely was a surprise to see both Allen and Williams get their contracts restructured. This is a commitment to the top two receivers by Tom Telesco that frees up money now but could make 2024 tumultuous.