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Deep Dive into the Trevor Lawrence $275M Contract Extension

The numbers are in for Trevor Lawrence’s $275 million contract extension with the Jaguars thanks to Pro Football Talk, which gives us a far better idea as to how this deal stacks up against the rest of the market.

The Cash Flows

The first thing we should be looking at with any of these extensions are the way that the new money cash flows break down. This can give you a strong idea as to whether or not a contract like this will move the market or is just keeping up with the market. Here is how the cash stacks up against the other top five QB contracts in the NFL (Year 0 is new money paid over the existing contract years of the prior contracts- 2024 and 2025 in Lawrence’s case).

PlayerYear 0Year 1Year 2Year 3Year 4Year 5
Joe Burrow$76,210,982$111,460,982$146,710,982$183,960,982$224,460,982$275,000,000
Trevor Lawrence$45,158,707$82,658,707$124,158,707$170,658,707$221,158,707$275,000,000
Justin Herbert$40,000,000$100,000,000$124,000,000$160,000,000$212,000,000$262,500,000
Jared Goff$52,000,000$70,000,000$125,000,000$165,000,000$212,000,000FA
Lamar Jackson$0$80,000,000$112,500,000$156,000,000$208,000,000$260,000,000
Jalen Hurts$20,000,000$60,000,000$102,000,000$153,000,000$204,000,000$255,000,000

The first thing that stands out here, at least to me, is that they seemed to worked backwards off of Burrow’s $275 million rather than forward leading into the $275 million. Lawrence cash flows in 24 and 25 are basically a minor step up from Justin Herbert and through the first new year a massive step back from Herbert. He will catch up to Herbert in year two. This is similar to the Jared Goff structure.

By year three they more or less are splitting the difference between Burrow and Herbert or mimicking the increase Goff had over Herbert. In year 4 we finally pull closer to Burrow and then match in year five.

When I wrote about Lawrence a few weeks back I mentioned one of my concerns with him was the lack of playoff/regular season success when trying to peg him to Burrow.  It was a reason why I felt playing out this year may have had a high reward factor for him. The contract here clearly mimics Herbert which was the standard for a solid young QB whose teams had not really delivered on the field. The non guaranteed backend seasons are where he gets into Burrow territory.

That’s not to say there is anything wrong with the contract but I don’t think it sets a standard that will be meaningful for other QBs. The market basically remains unchanged in that respect especially since Lawrence’s draft status will make him a hard comparison for other young players like Tua.

The Guarantees

$200 million of the contract is guaranteed for injury with $142 million fully guaranteed at signing. This number also splits the difference between Burrow and Herbert.

PlayerYearsInjury GuaranteeFull GuaranteeNew Injury Guarantee% New Guarantee
Jared Goff4$170,611,832$113,611,832$142,000,00067.0%
Jalen Hurts5$179,304,000$110,000,000$175,000,00068.6%
Lamar Jackson5$185,000,000$135,000,000$185,000,00071.2%
Justin Herbert5$193,738,375$133,738,375$160,000,00061.0%
Trevor Lawrence5$200,000,000$142,000,000$168,658,70761.3%
Joe Burrow5$219,010,000$146,510,000$183,960,98266.9%

Both Herbert and Lawrence ended up with lower guarantees here than the others because they had more existing salaries. This is one of the negatives for players with larger existing P5s over multiple years focusing on the total guarantee number rather than the amount of new money that is being guaranteed.

The guarantee structure is similar to the market in that the injury guarantee is likely to be earned as a full guarantee due to the early vesting dates. Here is how much salary would be earned if Lawrence was cut at any point in the contract.

OutcomeEarnedNew Money EarnedAPY% Earned
Cut 2025$142,000,000$110,658,707$110,658,70740.2%
Cut 2026$142,500,000$111,158,707$111,158,70740.4%
Cut 2027$155,000,000$123,658,707$123,658,70745.0%
Cut 2028$201,500,000$170,158,707$85,079,35461.9%
Cut 2029$202,000,000$170,658,707$56,886,23662.1%
Cut 2030$252,500,000$221,158,707$55,289,67780.4%
Plays contract$306,341,293$275,000,000$55,000,000100.0%

Essentially 62% of the contract is guaranteed to be earned as no other out in the contract would really make any sense for the Jaguars unless Lawrence somehow forgot how to throw a football.

The Salary Cap Structure

The Jaguars almost followed the Eagles contract model by placing gigantic option bonuses in almost every year of the contract. This allows the team to maintain low salary cap charges through 2027 and a reasonable charge in 2028 before the numbers explode in 2029 and 2030. If The Jaguars determine the contract was a mistake they would likely decline one of the later options to make it a little less painful on the cap to release him in 2029 or 2030. I would not be surprised if there were void years running way later into the contract (i.e 2035) as the “option years” to allow them to do just that and not trigger acceleration from any standard void years which are likely part of the contract.

Lawrence has a no trade clause which has also become more standard for QBs, but I always consider those to be pretty meaningless since most players are not going to want to remain in a bad situation. Those options would give the team a little salary cap wiggle room if it came to that and my assumption would be that 2028 would be the year a trade could happen if things went that sideways.

If things are going well the cap structure would likely indicate 2029 as a big year for a possible extension. The salary cap charge should be close to $80 million at that point and even with a rising cap would be a big number. Restructuring that year is always possible but would give the player huge leverage in a contract year. A $75 million cap figure in 2030 would put his 2031 tag figure at $89.66 million to go along with $21 million in void year charges.

Overall Thoughts

This is a solid contract but not something that I would consider a market mover in any way. The numbers showed that Lawrence probably wanted the deal done more than the Jaguars did right now as there would have been no harm in waiting to see if someone the Dolphins or Packers did something crazy with their young QBs in the next two months or if the Cowboys did something with Dak Prescott. It mainly just solidifies a range for the very good young player with upside whose team hasn’t exactly had success while at the same time the player is by no means a failure.

Lawrence, like Herbert, won’t get a pass anymore if his team falters. Rightly or wrongly the money changes the expectations and this will go the same way as Herbert where we saw Herbert detractors begin to show in 2023 with people asking about the cost of a trade. It makes 2024 a big year for Lawrence and it’s a big win for the Jaguars if he hits that high since it would have spiked his value by $5M a year and millions more in cash payments.

On a leaguewide basis I do think we are reaching a fundamental breaking point in the short term approach teams are taking to roster construction. With these types of guarantee structures the teams are basically opting into 60-70% of a contract at signing. Unless you have a Mahomes that’s a huge risk. The reward on contracts of this magnitude should come by getting multiple backend years where the cost of the contract begins to lag the market.  The minimum length needs to be six years and you have to structure the contracts in a manner to not just hand over the leverage on an extension.

These structures where teams are petrified of taking on any large cap hits on the front end of the contract lead to contracts that read five years in length but you could easily argue are only 3 or 4 years in length due to those massive salary cap figures in the final two contract years.  Those numbers will either be harder to manage or lead to an extension at whatever the current rate will be so the team can drop the cap charges again. That is not going to be a winning formula for 90% or so of the NFL.

Competing with the ultra cheap rookie QB is difficult and it is one of the reasons why the top 10 paid QBs don’t have anything more than an average rate of making the playoffs (its about 42% of the top paid who make it). The structures we are seeing across the NFL where teams are trying their best to maintain an extended “rookie-ish” cap window makes these have lower odds of success down the line without really capturing the real rookie benefits which are related to both cash and cap breakdowns.

It is a different topic entirely but I think much of this boils down to teams simply not filling potential expensive positions in the draft outside of QB. Just looking at the Jaguars a bit here. Is there a point to draft a RB the same year you draft a QB? Should you draft a linebacker the same year you sign a good $15M per year linebacker? Should you draft a 2nd round tight end the same year you extend a $14M per year tight end?  These are the kind of decisions that require you to do these things with the QB contract because now you feel the need to sign Arik Armstead, Gabe Davis, etc…when maybe you could have filled those slots with younger and cheaper players. The decision seems to boil down to  “what can we do with the QB numbers so we can fill these voids we have this year and next” rather than “what’s the best structure for a QB contract so we can maximize our roster every year”.

Go and look at the way that the Chiefs have handled Mahomes’ contract. It has been a long term approach. They have determined when they have had to strike on the cap numbers in the contract and how to minimize the long term constraints that might come with it.  In the first five years of Mahomes’ contract there have been two seasons where he played for about the minimum with the rest being prorated. Those were the first two years of the contract, the first of which only carried a $10 million bonus so basically it left his rookie deal untouched for one year.

The first three years of Lawrences contract are designed to be around minimum salaries. The first five years of his contract contain $177.5 million in bonuses, 87.9 % of the entire contract value in that time. Mahomes, even after receiving raises from the team, has had $91.3 million paid as bonuses in the first five years. That is 66% of the salary paid over that time. Mahomes is obviously the best QB in the NFL but I think it is also safe to say that the Chiefs have built one of the better rosters in the NFL around him and partially that is due to taking a more measured approach to his contract and team building around that contract. They run deep into the playoffs every year. There is something to learn from that but I think team’s are missing that aspect of it entirely and the Jaguars are another team to fall victim to it with their QB contract.

Saints Create $6.6M in Cap Space

The Saints restructured the contract of TE Taysom Hill, converting $8.79 million of salary into a signing bonus and creating $6.59 million in the process. Hill’s 2025 salary cap number will increase by $2.19 million to $17.986 million. There is now $9.7 million in void year salary cap charges that are set to hit the salary cap in 2026 if Hill’s contract voids.

This marks the third year in a row that the Saints have restructured Hill’s contract for cap relief. The team converted $9 million in 2022, $8.8 million in 2023, and now $8.79 million in 2024. If released next year the Saints would face a dead money charge of $17.7 million due to all of the restructures.

The Saints should now have a comfortable $12 million in cap space for 2024.

Seahawks Create $7.4M in Cap Space

The Seahawks restructured the contract of defensive lineman Dre’Mont Jones converting $9.875 million of Jones’ 2024 salary into a signing bonus to create $7.4 million in cap room for the season, lowering his salary cap charge to $10.77 million. Jones’ 2025 salary cap number increased by $2.468 million to $25.645 million and two void years were added to the contract. The two void years currently hold $4.9 million in salary cap charges.

The move was necessitated by the Seahawks current salary cap position which saw the team with a league low amount of cap room, about $1.1 million, prior to the restructure. This should give Seattle the breathing room to now function the rest of the summer and into the regular season.

Thoughts on Justin Jefferson’s $140M Contract Extension with the Vikings

The Vikings and WR Justin Jefferson agreed on a historic four year, $140 million contract today that really creates on the rare true market moving contracts, something we have not really seen at the receiver position since the days of Larry Fitzgerald in his prime. Pro Football Talk has the breakdown of the contract so we can evaluate just how strong this contract really is.

The wide receiver market has been one of the more difficult markets to really explain due to the contracts signed by Tyreek Hill and Davante Adams in 2022 that had paper APY’s of $30 million and $28 million per year, respectively. However, upon closer look at the contract breakdowns the legitimate values on those deals were more in the range of $25 and $22.5 million per year. They set a weird precedent where many receivers in the NFL were receiving ballon salaries on the backend of their contracts to artificially inflate the values of the contracts  which makes it harder to understand where the market truly is. Jefferson’s contact does not use those same mechanisms to inflate the annual value of the contract.

I would consider the WR market, prior to this deal, to be around $28.5 million per year.  That would include Amon-Ra St Brown at a true value of $28 million, Jaylen Waddle at $28.25 million, and AJ Brown at $28.4 million. To get from $28.4 to 35 million a year would indicate a 23.2% market increase which is absolutely gigantic. You simply do not see moves like that today because it is rare for a player to have that kind of leverage on a team nor for a player to have a skill level that has consistently been better than anyone else at the position.

The cash flows on this one obliterate any of the current market deals.

PlayerYear 0Year 1Year 2Year 3Year 4
Justin Jefferson$18,320,000$50,250,000$76,000,000$106,000,000$140,000,000
Amon-Ra St. Brown$14,500,000$31,910,000$60,020,000$84,000,000$120,010,000
Jaylen Waddle$16,135,000$33,376,000$57,376,000$84,750,000FA
A.J. Brown$30,000,000$59,000,000$80,000,000$111,000,000

The guarantees tell a similar story where Jefferson has $110M guaranteed for injury, $88.7M of which is fully guaranteed at signing. The other players at the position are around $80M injury and far less fully guaranteed.

This brings us back to a point that was made, perhaps mistakenly, by Vikings GM Kwesi Adofo-Mensah where he indicated that Jefferson did deserve to be compensated as one of the highest paid players in the NFL which I said at the time meant the Vikings had to use Nick Bosa as the comp and that is exactly what they did. Here is the comparison of cash flows between Bosa and Jefferson.

PlayerYear 0Year 1Year 2Year 3Year 4
Justin Jefferson$18,320,000$50,250,000$76,000,000$106,000,000$140,000,000
Nick Bosa$32,100,471$48,955,471$79,641,000$102,821,000$136,000,000

There is a little give and take on both sides here but it seems pretty clear that this is the contract that the Vikings were having to work with rather than anything in the receiver market. The guarantees are also similar as Bosa received $122.5M in injury protection and $88M fully guaranteed at signing.

So this is truly a contract that exceeds the market by far more than people realize and values Jefferson in line with a totally different group of players.

Should the Vikings have done this contract sooner?  I would think so, but it depends on how focused Jefferson’s side was on matching or exceeding Bosa from the start. My opinion of Jefferson all of last year was that he would be the first receiver to get a legit $30 million a year contract which would have been about $5-6 million a year more than the position.  By waiting the Vikings allowed the receiver market to move up near $30 million which was always going to make it easier for Jefferson to hit the Bosa range. So the number being this far above the real market does not surprise me but it would be interesting to see where it would have been prior to Devonta Smith really changing the 1A type receiver market or Penei Sewell driving up the offensive player values.  

I know people are seeing this as a launching point for Ja’Marr Chase, CeeDee Lamb, etc… and while it may happen I don’t really see that. I don’t think people are used to seeing contracts like this where the market is totally shaken up by the contract. Once the rookie wage scale came into play in 2011 it just made it incredibly difficult for players to really set market tops. Basically, it has been Aaron Donald and Nick Bosa and that’s about it in the modern era.

Maybe I am wrong and teams do not have the stomach for arguing about how much better another player is or how much his contract is an outlier, but Larry Fitzgerald and Calvin Johnson were basically untouchable a generation ago. Aaron Donald was untouchable. Darrelle Revis and Nnamdi Asomugha were untouchable years ago. Jefferson should fit that same mold.

Jefferson’s numbers since he came into the league really blow away the rest of the league. In his four years in the NFL he has averaged 98.3 yards per game. Tyreek Hill is the only other player over 90 yards (92.7) over that timeframe. Chase is at 82.6. Lamb at 78. In the last three years it has been Jefferson at 10.23 yards and Hill at 95 with Cooper Kupp third at 92. Lamb is at 84 in that time. If you are one of the teams with a great young wide receiver and you go above this deal you are making a mistake, IMO.

Where this should impact the market is pulling up some of the others. At some point the cap grows enough to where a contract becomes obsolete and will be overtaken. That is probably two to three years from now for this one. This contract being a legit $35 million a year should now get rid of the nonsense of throwing fake money years on the backend of a young players contract to hit an APY (though there is probably a good chance a few veterans may do that) and legitimize a market at $30-$33 million a year for these other players. It should also pull up the guarantees. To me this is where Dallas and Cincy lose because its not working off $28.5 million a year and how much funny money to throw in for year 4 or 5 but working on a legit $120M deal for four years.

Overall, I think that we are going to see much more discussion in the next two to three years about the value of a top wide receiver. While that is a discussion for another time receiver is now established as far and away the 2nd most important position on offense. This kind of a gap between offensive tackle and receiver is pretty big and we have to see how these deals pay off.

Ultimately this is a great deal for Jefferson and I think for the few high end players around the NFL that they can find circumstances to hold out for value that represents being so much better than others. Maybe one of these days QBs will follow suit to really shake up the NFL, but this should at least give a few more players hope that they can make a move at their respective positions even if they don’t hold the most leverage in the world while on a rookie deal.

2024 Salary Cap Changes from Post June 1 Cuts

June 1 marks the final day of the NFL calendar where any future bonus money accelerates into the 2024 league year if a player is cut or traded. Starting tomorrow the rules now allow the team to defer all of that acceleration to 2025 if they move on from a player. June 2nd also marks the day when the NFL will officially process the post June 1 designations. I am going to process them a day early so we can go over who gained what cap room.

Raiders Gain $24M with Release of Jimmy Garoppolo

The Raiders were given a gift when Garoppolo was hit with a PED violation that voided the guarantees in his contract, allowing the Raiders to move on without owing him an extra $11.25 million. The team will split his $17.1 million in dead money as $4.26 million in 2024 and $12.8 million in 2025. The Raiders are now near the top of the NFL in 2024 cap space.

Dolphins Gain $18.5M with Release of Xavien Howard

The Dolphins committed a cardinal sin of getting walked into a 3rd contract even though Howard had multiple years remaining on his prior deal and wound up with a big salary cap mess in the process. Howard has $23.1 million in dead money which will be split as $7.5 million this year and $15.7 million next year. His release becoming official was needed by Miami who has next to no cap room remaining for 2024.

49ers Gain $18M with Release of Arik Armstead

The 49ers reportedly tried to negotiate a pay cut to keep Armstead on the team but he opted to test free agency and sign with the Jaguars instead. This was a contract that got away from the 49ers due to restructures leaving them with $25.9 million in dead money to account for. They will split the dead money as $10.3 million in 2024 and $15.6 million in 2025. Armstead’s release opens up just over $18 million giving the team plenty of cap room to work with for extensions or more likely to carry over to 2025 when their position is near the bottom of the NFL.

Cardinals Gain $16M with Release of DJ Humphries

Humphries completed just one year of a three year extension before being released following an ACL injury that occurred at the end of the 2023 season. He has a total of $13.8 million in dead money that will be split equally between 2024 and 2025. Humphries should be injury protection eligible which will allow him to make a claim for about $2 million in salary of which $1.23 million would count on the 2024 salary cap. If claimed this will be in addition to the current $6.9 million in dead money.

Packers Gain $10.6M with Release of D’Vondre Campbell

Campbell completed just two years of a five year $50 million contract before his release. He has $11.6 million in dead money that has to be accounted for of which $3.66 million will count in 2024. Campbell signed a one year deal worth $5 million with the 49ers.

Lions Gain $10.5M* with Release of Cameron Sutton

I put an asterisk on this one because I am not 100% certain of the outcome here. Sutton had a salary guarantee for 2024 which was likely voided when he had a warrant issued for his arrest, but these can sometimes be grey areas that wind up in some kind of grievance hearing. If no guarantee remains then Sutton will count for $2.18 million on the cap this year and the Lions gain $10.5 million. If the guarantee sticks he will count for $12.68 million this year and the Lions gain nothing. In both cases he will count $6.54 million in 2025.

Bills Gain $10.2M with Release of Tre’Davious White

White’s release was due to a combination of the Bills salary cap issues and White’s injuries. White did land on his feet with the Rams and if healthy should earn back what he would have earned with the Bills. White had just under $10.4 million in dead money remaining on his contract and the team will split that as $6.2 million this year and $4.21 million in 2025. Buffalo is in a difficult salary cap position as the salary cap gained here will basically just give them breathing room for the entire season. They are 2nd in the NFL with $61 million in dead money.

Cowboys Gain $9.5M with Release of Michael Gallup

This was a contract signing Dallas would likely want back if they could re-do things as Gallup never got back on track after agreeing to come back to Dallas in 2022. Gallup had $13 million in dead money left on his deal. Dallas will take on $4.35 million this year and $8.7 million in 2025. The release will move the Cowboys to about $13 million under the cap for this year with multiple extensions on the horizon. Gallup is currently on a one year $1.75 million contract in Las Vegas.

Saints Gain $2.4M with Release of Jameis Winston and Michael Thomas

Both of these were planned cuts with the team and player aggreging to contract structures that would allow them to defer massive amounts of dead money to 2025. For Thomas the team deferred $9.18 million to 2025 while for Winston it was $7.36 million. The Saints only have $6 million in cap room so this was the only way to absorb the released. The two will combine for about $14.6 million in dead money in 2024. Winston is currently on the Browns on a one year, $4 million contract.

Buccaneers Gain $1.9M with Release of Shaquil Barrett

Barrett’s contract became a salary cap mess due to yearly restructures for cap relief that pushed $26.7 million of his $51 million earned since 2021 into the dead money ledger for 2024. The Bucs will carry $9.27 million in dead money this year and $17.4 million in 2025. Barrett signed a one year, $7 million contract with the Dolphins earlier this year. The Bucs have around $10 million in cap room remaining for 2024.

Ravens Gain $1.2M with Release of Odell Beckham

This was certainly the worst one year contract in the history of the Ravens organization and arguably their worst signing they ever made, doing a one year $15 million contract with incentives for a player who was out of the NFL.  This contract was designed to be a June 1 cut to avoid $11.068 million in cap charges all hitting in 2024. The Ravens will take on $2.77 million in 2024 and $8.3 million next year. Beckham is on the Dolphins for $3 million in 2025.

Broncos Gain $0 with Release of Russell Wilson

The Broncos made the difficult decision to move on from Wilson despite a record setting amount of dead money- $85 million in total- and a guaranteed salary of $39 million, deciding to take the pain now rather than making it worse for 2025. Denver takes on $53 million in dead money this season and will defer $32 million to 2025. To put the $53 million in perspective, only two other NFL teams have more than $53 million in dead money for their entire roster this year. Denver gains no cap space in 2024 with the release. The only consolation prize for Denver is that they will receive a $1.2 million salary cap credit in 2025, which is the offset for how much the Steelers are paying Wilson to be their starting QB in 2024.

Other Expected Moves

These are not yet official, but I would expect them to occur in a few days. The Rams should place Aaron Donald on the retired list to free up $1.2 million in cap room. Donald will count for $23.8 million in 2024 cap charges and $9.67 million in 2025 cap charges once the retirement is official.

The Eagles have two players to put on the retired list- Fletcher Cox and Jason Kelce. Cox will count for $4.2 million this year and $10.3 million in 2025. Kelce’s 2024 cap number will be $8.678 million for 2024 and $16.438 million for 2025. The likelihood of the players not being on the Eagles roster in 2024 was taken into consideration last year and both contracts were designed for a June 1 type move so the team will only gain $2.7 million in 2024.