«

»

Jul 11

A Closer Look at the Andre Johnson Financials

Per Ian Rapoport the talks surrounding Houston Texans wide receiver Andre Johnson are heating up again. With that in mind let’s look at the salary cap and cash considerations surrounding a move.

Because we are now past June 1, Johnson’s “dead money” will split between 2014 and 2015, which makes the contract reasonable for the Texans to trade. Currently Johnson counts for $15,644,583 against the Houston Texans salary cap and $11 million against their cash payroll. If traded or released his cap charge would reduce to $4,644,583 in 2014, an $11 million savings. In 2015 his cap would drop from $16,144,583 to $7,319,583, an $8.825 million savings.

For a rebuilding team this is a no brainer decision. The Texans have a major contract extension on the horizon with JJ Watt. Watt is going to look to earn in the ballpark of the $16 million a year Mario Williams earned from the Buffalo Bills. Trading Johnson will create a total of $19.825 million in cap room over the next two seasons, which is a huge number. The payroll savings of $21.5 million (Johnson has already forfeited a $1 million roster bonus due in September that was contingent on offseason participation and likely another $250,000 also tied to workouts) would easily cover a bonus for Watt.

The difficult part of the trade is finding a trade partner. Johnson’s $33.5 million in remaining salary, regardless of how good he has been, is a high figure for a 33 year old receiver. The team trading for him would need to have enough cap space to take on a at least a $10 million cap hit in 2014 or restructure the contract to lower the cap charge. In addition that team would likely need to reinstate the lost $1 million bonus bringing the cap hit to $11 million.

Restructuring a contract (which any player will do) would mean paying Johnson a large portion of his $10 million salary in the form of a signing bonus. That would not only make Johnson more difficult to release in the future but would likely increase his cap charges in 2015 and 2016 to $14 and $15 million a season.  Teams could reduce those numbers slightly by adding voidable seasons to the contract, but that would be locking themselves into future dead money.

NFL.com speculated on a few landing spots. Here are some thoughts on a few of them

New England Patriots

The team is currently $6.4 million under the cap so they would need to create nearly $5 million in cap room to execute the trade and $8 million in cap room to just function for the year. The Patriots have already made one big move when they signed Darrelle Revis to a “buy now, pay later” type of contract, so that would likely be the way they would work with getting Johnson under the cap. The team has very few, if any, candidates for restructure to facilitate a trade.

Carolina Panthers

The Panthers have one of the worst group of receivers in the NFL, but they just recently let the older Steve Smith walk away and the Panthers were not very active in trying to replace him. That makes it hard for me to believe that they would be interested here. Financially it would be difficult. Carolina still has one of the worst cap situations in the NFL and just $4.8 million in cap space. The team needs to consider a longer term extension for Cam Newton and Greg Hardy. I can’t see the financial match.

Cleveland Browns

I’m not sure how Johnson can spin this as playing for a contender, but the Browns have $24 million in cap space making the contract an easy one to take on. This could be an intriguing trade and  I would wonder if Josh Gordon would be involved. Gordon is a high upside player that could be suspended for the season. Houston could consider him and a draft pick as fair compensation. If Gordon was to never play again the Texans would at least have the opportunity to recover the bonus money paid to him by the Browns.

New York Jets

The Jets have a need for a wide receiver and they have already added a few one year veteran contracts to the team in Mike Vick and Chris Johnson. Because the Jets have over $20 million in cap space they could bring Johnson in and not saddle themselves with future dead money. Having Johnson on the team would allow the Jets to quickly evaluate Geno Smith and if they think Johnson could have some trade value in 2015 if things don’t work out they might not have a lot to lose.

Oakland Raiders

This reunites Johnson with Matt Schaub and the Raiders are essentially a one or two year “for hire” program right now. Again this isnt exactly going to a contender, but they have the veteran infrastructure in place to at least consider it a possibility. Oakland has just over $10 million in cap room, so they may have to tinker slightly with the contract to give them an operating budget in September, but that would not be a dramatic departure from their current contract constructions.

Baltimore Ravens

Baltimore already has receivers in place and with just $4 million in cap space it is hard to see them being able to absorb his contract. They have a number of high future cap charges in place an it’s not likely they want to add another one here.


 

  • Drew

    Thanks for the only logical article about this topic.

    It seems to me that the media and fans have not yet caught on to the importance draft picks under the new CBA. Young productive draft picks produce at cost that is such a small percentage of your cap space. Why would a team trade away that potential low cost player for an older much more expensive player? The Texans signed him to a bad deal and now they have to eat it or cut him.

    The best and most obvious example is the Jets trade with the Buccaneers last year. The Jets got rid of a large contract and gained an extremely talented player. Ever better is that the draft pick gets paid less money over four years than Revis got paid in one year. Revis has already been cut by Tampa and the draft pick has 3 more years on his rookie deal.

    This is the worst case scenario, but it is why no GM will trade for Johnson. Texans smartest play is to cut him because nobody will trade a draft pick to take on the 2 years of overpaid Andre. Any teams interested in him as a free agent will offer a 1 year deal and pay him what he is worth.

    • http://www.nyjetscap.com/ Jason Fitzgerald

      I think there are teams that would be willing to pay his salary for 2014, but I dont think they want to sign a deal that locks them into 2015. You can definitely be productive at his age but the injury threat and “fall off a cliff” threat is too high to just go all in. Reggie Wayne signed in the $5 millionish range a few years ago. I think a team would be fine with $10 million this year provided the next years are closer to that level not the current $11-$12 million a year he is going to get.

  • Jim

    The burning question for me is, are the Texans looking for something valuable in return, or would they virtually be dumping him to purge his salary, and get a little bit in return? I can’t think of a team out there that would pay more than 4th rd pick for a 33 yo WR, with a huge salary the next couple years. The falloff is steep for veteran WR’s as they get older and injuries set in. Randy Moss, Terrell Owens and Marvin Harrison didn’t exactly slowly fade from elite to great to good to average. Albeit, Johnson doesn’t have the attitude problems of the first two…

    As for the Jets, who I doubt would be contenders anyway, I’m not sure if $10 mil in cap space is worth an evaluation for Geno. What if Geno gets hurt, do they spend another $10 mil on AJ in 2015? What if Geno is a 60 comp percent, 20 TD’s, 14 INT guy this season? Is that good enough or time to move on? Don’t get me wrong, I see the potential upside of finding if “Geno is for real” or even Brady gets hurt and the division is up grabs, I’m just not sure how realistic that is, and if the cost is justifiable, just in cap dollars, forgetting whatever trade chips Houston would want in return.

    The place I could see him is Cincinnati. They’ve got nothing besides AJ Green at WR, and in that division, with their defense, they could easily be in play for a playoff spot with a bye next year. Andre would fit under their cap as-is, and they’ve got to figure out what Andy Dalton is or isn’t worth next off-season.

    • http://www.nyjetscap.com/ Jason Fitzgerald

      Yeah I dont think the compensation would be huge for AJ. To get higher compensation they probably have to hold on and hope that a team becomes desperate during the year because of injury or something else. The Jets were that way when they made the move for Braylon Edwards. But the downside if you could get nothing if no team grows desperate. If Tannenbaum was still in charge for the Jets it would be a given they would be on the phone. Im not sure with Idzik. Seattle made a number of questionable trades but to their credit they worked out. Maybe they can offer Stephen Hill and a 5th round pick.

  • Edward Rychwalski

    He would surely get more than one year. Look at what the Ravens gave Steve Smith (albeit at only 3 million/year). He is still very productive, and with limited snaps has been able to remain healthier than in years past. He can still be a number 1, baring significant age related regression, for at least one more year, and you pay him in year 2, maybe slightly over his market value at that time, because of other intangibles he brings to the table, and cut him with minimal cap implications year 3, just like the ravens will do with steve smith.

    The texans would be dumb to cut him. They do not need the immediate cap room, and it would leave Hopkins as the defacto 1, and he’s clearly not ready (nor may he ever be). And I would hate to think of what Fitzpatrick would do without him. If he holds out, he gets nothing, and the Texans don’t have to pay him. He grows one year older and gains nothing. If he doesn’t hold out, he plays, and plays well, because he is a professional like that.

    Unless they get something of value (draft picks) for Andre, I can’t see him being anywhere else this year. He is worth more to them for one year than a SWAG of a 6th rounder (the Boldin trade). He plays one more season for them, and they designate him as a June 1 next year. Assuming they can extend Watt before next offseason, this should not be an issue.

    The Texans created this mess by restructuring him 3 years in a row, otherwise he could have been cut now with little dead weight remaining.