They will probably do the same this year (2012) since the 89% rules does not kick in until 2013. Denver will be very thirfty with the cash.

not a cap budget. Last year they spent an amount in cash (paragraph 5 salaries, signing bonuses, workout bonuses and roster bonuses) that was equal to the 99% of cap rule required by the league. Note that this not the same thing as saying they reached 99% of the salary cap. They stayed significantly below the salary cap max, while spending a cash budget for the year that was equal to 99% of the salary cap.

The same rule applies for 2012, so they will do the same thing: pay out signing bonuses for the rookies, UFAs and RFAs, along with all the workout and roster bonuses, and in doing so they will max out a cash-out-of-pocket budget. The salary cap number won’t even be approached, since proration alone will drop the cap number by 10-20 million.

For these two years, individual teams aren’t technically held to the numbers, since it is a leaguewide 99% number, but in practice, each team will hit its mark to avoid the penalties if the leaguewide number isn’t reached. Starting in 2013, teams WILL be held individually responsible for an 89% of cap cash spending, but by then most teams will be well on the way to complete cap compliance from the old to the new CBA, and so the Salary cap number itself will become more relevant. Denver may still have a cash budget that they can’t budge on, but it is more likely that just complying with the cap will be budget enough at that point.

All that being said, free agent production-to-pay rates are always very low, so it is simply sound financial planning not to willingly overpay a free agent. Enough of that is done accidentally with injuries alone.