A Look at Carson Palmer’s Contract

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Obviously I had a lot of questions about Carson Palmer following his injury and in light of a report by Albert Breer concerning Palmer’s contract I think I can discuss it a bit more intelligently at this point.

Palmer’s new contract looks to be worth $49.5 million over three seasons. Of that $49.5 million he will receive $10 million this year, money that should all be treated as a signing bonus. That is the number I projected the other day as a reasonable figure. The bonus is actually split between a roster and signing bonus which likely only impacts the actual payment of cash and the forfeiture provisions in the event Palmer was to walk away without the blessings of the Cardinals.

Palmer has another $10.5 million that is guaranteed for injury in 2015 but will become fully guaranteed a few days after the Super Bowl. This is important for Palmer because we can consider this money now fully guaranteed. There is no way between now and early February that Palmer will be sufficiently healed from an ACL injury to actually pass a physical, which he would need to do in order to be released without the guarantee kicking in. Since the salary becomes fully guaranteed on that date Arizona has no ability to carry him until he is healthy enough to play and then release him.

Palmer has salaries of $12.7 million in 2016 and $16.3 million in 2017. The salaries are split evenly between a roster bonus and paragraph 5 salary, which basically gives Arizona until March in each year to release him. He won’t be covered by any guarantee those seasons. His dead money charge in 2016 should be $5 million so it is a reasonable escape point if they need it.

The cumulative new money cash flows of Palmers contract work out to be $20.5 million (Year 1), $33.2 million (Year 2), and $49.5 million (Year 3). Those are actually very reasonable charges for Palmer who whose two year totals trail Alex Smith ($37.7M) and Jay Cutler ($38M) by a significant margin. Palmer statistically has compared favorably to both but is also older which likely played a role. Palmer will also trail Andy Dalton over the two year period ($34.9M) but in theory could earn more if he was to see all 3 years of the deal and Dalton hits no contract escalators.

It would look as if Palmer’s 2015 salary cap charge will be $15 million in 2015. Until something is done with Larry Fitzgerald’s contract the Cardinals will have one of the worst salary cap positions in 2015.

Things could also get more complex with the Cardinals salary cap if backup QB Drew Stanton plays well in Palmer’s absence. It was widely reported in 2013 that when Stanton signed his contract that he could earn up significant incentives in his contract if he performed well in a starting role. Considering Stanton has already played a few games this year he will likely be the man taking the majority of snaps on a playoff team which is often one of those hurdles to unlocking contract money. If he was to earn a raise it could put the Cardinals QB salary allocations in a spot they did not anticipate being just one day ago.

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  • Gator4444

    Thanks for the informative article. Is there an updated available cap space number for Arizona next season with Palmer’s new contract extension?

  • Kirk Vollmer

    Cardinals hand out contracts that are just too long with way too big of signing bonuses to players who are either not worth their pay or not worth what they are gonna get paid. Look at their 2015 cap hits and they have 3 non quarterback players with $10 million or greater cap hits, all of them with loads of dead money on their contracts. They also have one who’s pretty darn close at 9.8 million. They way overpaid Patrick Peterson because he said based on zero evidence that he was the best corner in the NFL and got in a flame war with Richard Sherman and for some reason the Cardinals felt they had to stroke his ego by giving him more money then Sherman. Look at Darrelle Revis, Richard Sherman, Aqib Talib, Sam Shields, DRC, Joe Haden and Vontae Davis and no one save for Haden comes anything close to his cap hits and dead money. Sherman his his cap hits but not nearly the same amount of dead money. And somehow they decided that they need to do this while paying Fitzgerald 16 million a year average. They just don’t seem to consider the consequences of giving quarterback money with large signing bonuses to non quarterback players. And with Fitzgerald yeah they will probably go do the whole magic restructure thing where they lower his cap hit for now but just put off that money into more dead money that will hit their cap later. Constant restructuring is not how you keep your team out of salary cap problems, in fact it only seems to delay them and make them worse as you go.

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