The deal with a signing bonus is it's paid upfront, but that amount (the signing bonus) is counted against the cap in subsequent years. So it has the same cap hit this year (if we have 14 mil in cap space this year, we can only have a 14 mil cap hit), but we would pay more than that this year. It's the "losing more money now" thing that could scare the Hawks, not the cap hit.
Example:
Let's say we offer Smith a salary starting at 13 million, for 5 years, with 8% raises. That would typically look like this:
Year 1: $13,000,000
Year 2: $14,040,000
Year 3: $15,080,000
Year 4: $16,120,000
Year 5: $17,260,000
Total: $75.4 million
But, we can offer 17.5% of that (13.195 million) as a signing bonus. Our cap hit would be like:
Year 1: $10,361,000 base salary + 2,639,000 signing bonus = $13,000,000
Year 2: $11,401,000 base salary + 2,639,000 signing bonus = $14,040,000
Year 3: $12,441,000 base salary + 2,639,000 signing bonus = $15,080,000
Year 4: $13,481,000 base salary + 2,639,000 signing bonus = $16,120,000
Year 5: $14,521,000 base salary + 2,639,000 signing bonus = $17,260,000
Total: $75.4 million
The owner would be paying $23,556,000 up front. It would only only 13 million against the cap, but the excess the owner would be paying this year is what might scare him off.
