With the 2008 NFL Draft taking place this weekend, several hundred anxious players await their selection by an NFL club. A rise or fall from their projected slot in the draft can mean significant dollars gained or lost in the contract they ultimately sign with their club. But the salary amount of all of those draftee contracts must fit under the CBA-mandated Rookie Pool limit.

The Rookie Pool provides for a league-wide cap on the first-year salaries of all drafted player contracts. Originally set as a percentage of football-related revenue, the Rookie Pool amount increases each year based on a projected increase in NFL revenue over the prior year’s actual NFL revenue, up to a maximum of five percent per year.

In 2007, the league-wide Rookie Pool was nearly $137 million and will likely increase the maximum of five percent in 2008. An individual club’s Rookie Pool allotment varies depending on the number of picks a club has and where those picks fall within the draft. Thus, drafted players will not know their club’s Rookie Pool allotment until after the Draft this weekend.

“The first-year Salary Cap amount attributable to all draftee contracts can not exceed the league-wide overall Rookie Pool,” said NFLPA Director Salary Cap and Agent Administration Mark Levin. “Yet despite this apparent overall limit on spending for draftee contracts, agents and clubs have devised various ways to get players more money while remaining under the club’s Rookie Pool limit.”

For instance, players drafted in the middle of the first round last year received an average of $8 million guaranteed dollars in their contracts while only using up about $1.25 million of their club’s Rookie Pool room. This is achieved by structuring guaranteed payments in the form of roster bonuses, signing bonuses, option bonuses and guaranteed base salaries. All these techniques are designed to compensate the player fairly while at the same time limiting the effect on a club’s Rookie Pool.

A $2 million signing bonus on a five-year contract, for example, while paid in the first year, would only count $400,000 against the Rookie Pool as the full amount is spread out over the term of the contract for cap purposes. Another method to guarantee money to players is through option bonuses which allow for a club to extend the length of a player’s contract upon payment of a bonus. Clubs typically exercise this right to extend in the second year of a player’s contract and therefore the bonus paid has no effect on the first-year Rookie Pool. In 2007, 28 of the 32 first-rounders received an option bonus.

A new trend to guarantee dollars to players developed last year in the form of guaranteed base salary advances. Under this method, base salaries in future years of a player’s contract are advanced and paid to the player in the second year of the contract. Once again, there is no effect on the Rookie Pool as the advances are not paid until the second year.

“This year I would expect a few more contracts to be structured with base salary advances as clubs consider other factors when negotiating these contracts,” Levin said. “To the players all these rules can be confusing as they focus on the dollars involved, but to the clubs and agents, proper structuring of the contract is at the heart of each negotiation.”