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Apr 21

Looking at a Potential Darrelle Revis Extension

I just wanted to post some opinions on what I think would be a contract that might make Darrelle Revis happy in terms of compensation. With the years of working on understanding the Jets salary cap Revis has been a hot topic of debate so he has been a player that I have really tried to get a better understanding of from a financial standpoint. Tampa has a very specific way of doing business so let’s see if we can get the two sides to meet.

Revis’ biggest desire in recent times has been to be the highest paid defensive player in the NFL. That distinction currently belongs to the Bills Mario Williams, who earns $16 million a year from the Buffalo Bills. Considering the market crash of 2013 and the fact that Revis is coming off an injury I think even he has come off that stance. I think at this point it will be acceptable to Revis to come in at a number that is going to be looked at as long term the highest in the game.

Clay Matthews recently signed an extension worth $13.2 million a season to top the OLB market and that becomes a number that Revis will need to top. The next highest paid defensive player is Julius Peppers of the Bears which averages $14 million a season.  That is probably the high end for Revis and a number he would love to top but might not be reasonable. Pepper and Williams could both be gone by 2014 and the reality is any number close to the $14 million is most likely not going to be surpassed barring a dramatic change in salary cap limits. The next “dominant” talents to have the chance would be JJ Watt of the Texans and potentially Jason Pierre Paul of the Giants if he put together two dominant years in 2013 and 2014.

So for the sake of argument I’d say $13.5 million gets the contract done, but we have to consider that  Revis has one year under contract left at $6 million dollars. Under a normal valuation the extension would kick in beginning in 2014 with $6 million of old money being built in, but I can’t see Revis buying that logic as it was an issue with his last Jets contract as well. In real terms that would make a deal $12.25 million for 6. He is going to want the full $13.5 for 6, making the extension years actually worth $15 million a season, for a total of $75 million. That number shatters the new money for Matthews and surpasses Peppers as well.

While Revis will compromise on the total value, if you can call it that, I do not think he will compromise as much on two other areas. The first is going to be the 2 year payout on his contract, which is typically where the guarantees of most contracts lie. Mario Williams takehome is $40 million over the first two years of his contract. That is the same number that DeMarcus Ware of the Cowboys and Terrell Suggs of the Ravens earned. I think that will be a deal breaker or close to it. Ware and Suggs will earn similar or less money annually than Revis and there were ways to have those high payouts early in the contract. To me he has to hit that number, unlike Matthews. The 3 year is important to him as well but I think more in terms of comparing to Ware than Williams. Williams’ takehome is $53 million while Ware is $45 million. Revis will want somewhere in between.  Again I cant imagine a compromise to fall under Ware.

The Buccaneers are a team that rarely does signing bonuses and I cant see them doing one here. They rarely do option bonuses either. For the most part they are a team that works on a cash to cap basis matching cash flow to cap hits other than for drafted rookies. To me that fits in fine with Revis. Revis wants to be the highest paid, in terms of cash, cornerback year after year. This was constantly a holdout argument from his side almost every year against the Jets who used option bonuses, void years, and salary advances in his prior two contracts to keep the cap hits reasonable. When you pay large sums of prorated money to a player it often inflates 1 year cash and deflates future cash flows. You would not hear a peep from Revis in a year designed to earn over $20 million, but the next year when his cash flow is around $7 million the rumblings of being underpaid occurred. You cant have it both ways and I think its important that a deal is structured in way that Revis is almost always guaranteed to be close to a double digit earner in cash flows.

To me that ties in fine with Tampa’s way of doing business. While they did prorate deals for Vincent Jackson and Carl Nicks this past year in preparation for a Revis trade they were not part of their original contract structure and I don’t think they want to compromise the way they do business.  If they fully guarantee base salary with no offset provisions that will provide Revis with the same level of protection as the signing bonus, at least early in the contract. While the Bucs could hold options to convert guaranteed salary to a prorated bonus, that would be as far as I think they would take it.

One of things that I think both sides will look at is the structure of the Jake Long contract with the Rams and a few deals done by Tom Brady with the Patriots. These were contracts where guarantees kick in provided a milestone occurs. Brady’s contracts in the past have had potential to be fully 100% guaranteed provided he was on the roster the day after a Super Bowl or, towards the end of his contract, the last day of the regular season. Jake Long’s has some similar provisions to kick in smaller guarantees and they are based on IR status, which could be a consideration for Revis’ knee. The sides could look at the Peyton Manning deal where passing one physical unlocks 2 years of guarantees as well, but with Revis in his prime and perhaps no prorated bonuses I think they may opt to try to go for year after year guarantees if the Bucs don’t make a decision early about his status. The first two years will be fully guaranteed regardless.

The Buccaneers have over $30 million in cap room and less than $100 million committed to next season (though without a QB under contract) so they can certainly frontload a pure cash contract to Revis and not get into too much trouble. Per CBA rules you have to maintain at least 50% of the salary between year 1 and year 2, but that should not be a problem considering he needs to earn $40 million in that time. Keeping in mind the fact that he has the one year under contract they could do a deal like this:

Cap

Real Cash Total

New Cash Total

Year 0

$24,000,000

$24,000,000

$18,000,000

Year 1

$15,000,000

$39,000,000

$33,000,000

Year 2

$7,000,000

$46,000,000

$40,000,000

Year 3

$10,000,000

$56,000,000

$50,000,000

Year 4

$13,000,000

$69,000,000

$63,000,000

Year 5

$12,000,000

$81,000,000

$75,000,000

 

At these numbers (and you could easily split the cap numbers up to offseason roster bonuses for early payments without hurting the cap) Revis would hit pretty much all his desires. $13.5 million annually. $15 million in “new” money. Yearly cash flows that are almost always double digit millions. Over 50% of his contract coming in the form of guarantees and two year payouts. $40 million in new money over the first two years while having a cash takehome over the first two years of $39 million.  He ends up as the highest paid defensive player in the game for the foreseeable future and will have the opportunity to guarantee large amounts of his contract.

The only worry from  the Bucs point of view is that year 2 payout, but that early  in his contract and given his reputation I do not think Revis would threaten a holdout. I guess there are ways you can protect from that but it would be the only concern. It wont deter Tampa who dealt with a similar malcontent in Vincent Jackson, also repped by the same team that represents Revis, and had no issues finding a deal structure that they hope made him happy.If Revis proves to be unhealthy they would be able to move away by 2016 with no cap penalties. At worst It would cost them $46 million in cap space for a 3 year look at him, and they have alot of that money already earmarked for him to spend now. If you  think he is the guy that gets you over the top its a risk well worth taking. They just need to protect themselves from getting cap penalties beyond that year if they are going to pay him that kind of money.