Russell Okung to Denver

Josina Anderson tweeted that the Broncos are about to sign LT Russell Okung to a deal worth reportedly $10.6 million per season over the next five seasons and they re-signed CJ Anderson to a deal worth $18 million total over four seasons a few days ago. These are some of the moves you’re allowed to make to build up the rest of your roster when you let Brock Osweiler walk for $18 million per season.

Denver has also lost Malik Jackson and Danny Trevathan this offseason along with Osweiler, but they’ve used those costs to sign a lineman to fortify their line and they brought back their bell cow running back and they have some players in house that will step into those roles on defense. The Broncos Top 51 spending was at $143.2 million before the Okung move, so we’ll see how the cap hit for 2016 looks for Okung, but it’s likely this is Denver’s last move in free agency and the rest will be addressed through the draft. A move by the Broncos that can’t be praised enough was the deal they made for Derek Wolfe before the playoffs started as he’s considered better than Jackson. While Wolfe will cost the Broncos an average of 5.25% of the projected salary caps over the next four seasons, Jackson will cost Jacksonville an average of 9.81% of the cap over the first four years of his six year deal and 9.29% over the six years. (Jackson in Jacksonville means I’ve gotta put a link to a classic…)

No move happens in a vacuum in the NFL, every move has a consequence or a new decision to be made elsewhere. The Broncos likely had a set of circumstances planned out of what they’d do in every possible situation. The Wolfe deal will go down as one of the most critical moves of this Broncos offseason as the defensive end market exploded and they would have never been able to keep him at 5.25% of the cap, so there’s another huge example of how building through the draft creates value. Not only do you get the players you drafted on a low-cost contract for their first three or four seasons, you have the ability to extend them before they hit the open market, which allows you to lock them in at a price no one else can get them at. Rather than bid on the top players in free agency, you want the equivalent of the lease to buy option and that’s achieved through drafting well.

With whatever you’re doing, it’s highly likely that you have a finite amount of resources whether you’re an NFL General Manager, a small business owner or a UFC fighter in a training camp preparing for his next fight. Most of the time, the resource we’re talking about is money, time or energy. How you spend that determines what you create and it determines the eventual outcome.

After four years with Brock Osweiler, they decided he wasn’t worth $18 million per season and they moved on from him and went with Mark Sanchez on a one-year deal worth $4.5 million and they’ll likely draft a QB in the first two rounds of the 2016 NFL Draft. While it’s not ideal to have Sanchez or a rookie at QB, the Broncos team website said it best, they just won the Super Bowl with “sub-optimal, near-replacement-level quarterbacking,” so they know who they are and how they intend on spending their resources, 100% of the salary cap or 100 units of cap space per year (to give us a kind of metric to use instead of a percentage), over the next few years. If you spend 8-12% of your cap on a player like Osweiler over four years and then get the kind of production you should expect out of a player at 4-6% of the cap or even 7-9% of the cap, you’re getting less value than what you’re paying for.

Like I’ve said before, Osweiler’s averaging 10.36% of the cap over the next four, while Brady has averaged 10.44% over the last 11 seasons. The Patriots are definitely getting a huge value, and most would call it a unique value as Tom Brady could play Daddy Daycare and still be able to buy an island, while the Texans are betting that Osweiler can provide similar production value by giving him that contract whether they know that or not.

Von Miller is up for a big-time extension in the neighborhood of 9-12% of the cap over the next 6-7 seasons, while Demaryius Thomas is in the 8-10% of the cap range for the next four at least. With that in mind, the Broncos decided that, rather than add another 8-12% with Osweiler, they’d see what else was available for 2-6% of the cap over the next half decade whether that’s a low-cost QB or a QB on a rookie deal, while leaving themselves open to the possibility of finding a veteran QB during the 2017 offseason as Sanchez is on a one-year deal. Drew Brees and Kirk Cousins could both be free agents in 2017, while Philip Rivers could ask for a trade if the Chargers move to Los Angeles, but I doubt the Chargers would be willing to trade him to a division rival. I think they’ll end up just going through the draft in 2016, and again in 2017 if they’re not completely comfortable with the 2016 pick.

So, rather than commit about 30% of the cap to a Top 3 of Miller, Thomas and Osweiler, they’ve gone with a more equitable cap construction to build a more complete, well rounded team, while they search for a better long-term option at quarterback. With the way that defense is built and the players they’ll want to keep, that 10.36% of the cap for Osweiler would have chewed up some critical cap space.

John Elway proved in 2015 that he can work around some huge deals as Peyton Manning’s 12.21% cap hit was second for a champion (Steve Young 13.08%), while Thomas’ 9.21% was the most for a receiver beating Jerry Rice’s 8.56%. Together, Manning and Thomas were just barely edged out by Young and Rice for the most expensive duo in Super Bowl history, yet even with Manning’s performance drop off, the Broncos were able to win because they built a historic defense around those cap hits. And while Elway has shown us he’s a cap magician, you shouldn’t rely on him to do that year after year, you should instead set up a manageable cap situation like they’re doing and like the Patriots have done for 16 years.

Like I said in Podcast #7 of The Zack Moore Show and in the show notes, both the Broncos and Texans made moves you can understand and now the Broncos are acting on that decision.

UPDATE: I left my computer after writing this last night, but with the dust-settling on this deal, we start to see where the Broncos can go from here with Ryan Clady.

His cap hit of $10.1 million this year with a dead money hit of only $1.2 million means that he’s in line to either be restructured, released or traded, but his $10.1 million cap hit isn’t something another team will likely want to bring on. ESPN says that this move means that Clady will likely be traded and they have something else important to point out as “eddiea” pointed out in our comment section on this article: “Its now been told that Okung is only signed for 1 yr at $8M. Denver has option to add 4 yrs $40M-$48M extension. Nice deal for them and proved Okungs going w/o agent cost him big. Hopefully he plays well and doesn’t get injured.” That $8 million is actually only $5 million, but can become $8 with incentives. Eddiea is right, going without an agent probably cost him.

The fact that the Broncos made the move for Okung and they haven’t been able to come to an agreement with Clady likely means that this move means Clady’s time in Denver is done as a source told Adam Schefter that this trade meant that a Clady trade is an expected, corresponding move. Would it be great to see him restructure and move to right tackle if I’m a Denver fan? Yes as their line left a lot to be desired in 2015 even though they won a Super Bowl, but I don’t think Clady and the Broncos are going to be able to agree on his value from a dollar standpoint.

Follow me on Twitter to stay up to date on the podcast and articles: @ZackMooreNFL

If you want to hear more about the QB market after these first few days of free agency, listen to episode #7 of The Zack Moore Show. You can listen and subscribe on iTunes by searching The Zack Moore Show, but if you don’t have iTunes, then you can listen on Soundcloud here.

Links referenced in the episode:

The QB Contract Decisions Facing the Jets and Broncos by Jason Fitzgerald on OTC on 3/11/16

Projecting Kirk Cousins with the Redskins (1/31/16)

Building the Bronco Formula for 2016 (2/16/16)

Explaining My Beliefs Regarding QB Contracts (2/23/16)

Sam Bradford’s Contract and The Eagles Core (3/4/16)

“Ryan Fitzpatrick out of options so the time to re-sign with the Jets is now” by Manish Mehta

“Product of the System: NFL already becoming a spread offense league” by Jared Dubin

  • eddiea

    Its now been told that Okung is only signed for 1 yr at $8M. Denver has option to add 4 yrs $40M-$48M extension. Nice deal for them and proved Okungs going w/o agent cost him big. Hopefully he plays well and doesn’t get injured.

    • Thanks a lot buddy, adding that to an update to this article. I left my computer after writing this last night and didn’t see it

  • Werner

    What’s does it mean for Ryan Clady? Will he be gone now ?

    • Not sure, I didn’t want to speak on that yet. I think they’re looking for a re-structure.

    • Just updated the article with all the news from last night. Sorry about that and thanks for the heads up