Looking at Brock Osweiler’s Contract

In March the Texans shocked the NFL when they signed Brock Osweiler to a four year, $72 million contract with $37 million guaranteed. Osweiler had started all of 7 games in his career before being benched for the playoffs by the Broncos in favor of Peyton Manning, whose arm had retired about 20 games before Manning himself officially hung it up. Somehow the Texans, who had been desperately searching for a quarterback, deemed him the answer and made the bold signing that paid Osweiler $21 million this year, including a $12 million signing bonus. 14 games into the season the Texans benched him in favor of Tom Savage and his $600,000 salary. The question now is can the Texans do anything to get out of this contract?

The short answer to that question is no. Here is what Osweiler’s contract with the Texans looks like over the next three years:

Osweiler’s $16 million salary is fully guaranteed for next season, which would leave the Texans with a $25 million cap hit if they cut him. The NFL does not allow the June 1 cut to aid in the acceleration of guaranteed money so even a June 1 cut would result in a cap charge of $19 million in 2017 with $6 million being pushed to 2018. That would be the identical scenario to him remaining on the team in 2017 and then being cut in 2018. Considering the Texans will rank in the bottom 3rd of the NFL in cap space in 2018 taking an added $6 million cap charge may not be the best decision.

About the only realistic way for the Texans to get rid of Osweiler would be to prepay a large portion of his salary as a signing bonus in March and then trade him away. Basically what the Texans would have to do is work out a trade with another team in which the team determines the price point at which it becomes an acceptable contract.  My guess would be that a team would be willing to pay him between $3 and $4 million which would be the going rate for a decent backup QB. Could they convince a team with a bad QB situation like the Jets to take on a $5-6 million salary?  Its possible but not likely.

To make that work what would happen is that Osweiler would agree to a new contract with the Texans that would pay him around $13 million as a signing bonus while reducing his salary for the year to $3 million. Once the contract is accepted by the NFL the Texans would then turn around and trade him. The Texans would take on a cap charge of $22 million in that scenario but save themelves $3 million over a two year period. It also gets him off the roster. The Texans would likely have to include a draft pick in any such trade and/or potentially bring back a bad contract.

This is a situation that the Texans should have seen coming. Its very difficult to take limited upside players, hand them a big contract, and see things go well. Even more established players like Jay Cutler, Alex Smith, and Andy Dalton have come under heavy criticism in large part because of the big expectations such contracts bring and the fact that none have the skills needed to carry a team the way the contract implies.  So this was pretty much a disaster waiting to happen.

It’s one of the problems with the QB position right now around the NFL. It takes a backbone to not go crazy on these contracts and few, if any teams, have shown that backbone. In the current NFL only the Redskins have shown any resolve on the position opting to franchise Kirk Cousins rather than handing him a massive contract off a smaller sampling.  Ironically he is the one QB that has worked out and is in line to receive a huge contract this offseason. Other teams like the Jets, Bills, and Vikings simply went off the rails like the Texans when it came to QB decisions.

For Houston it would be surprising if this somehow didnt cost someone a job or at least some power within the organization. The problems began in 2012 when they decided to give Matt Schaub an extension that put the weight of the world on his shoulders and he imploded, which cost the coach his job and moved the team into the Bill O’Brien era.

O’Brien’s track record with the QBs has been terrible. They went with journeyman Ryan Fitpatrick in 2014 for the first 9 games before benching him in favor of Ryan Mallett. Mallett was generally ineffective and was injured which led to the return of Fitzpatrick who also ended up injured which paved the way for Case Keenum. The following year they went with another reset and decided they would trade Fitzpatrick and Keenum and sign Brian Hoyer to compete with Mallett. It was a bizarre year with them seemingly picking a new QB weekly before putting Hoyer in which led to a situation where Mallett basically quit on the team and was released. Injuries saw TJ Yates and Brandon Weeden also get starts before Hoyer had one of the worst playoff games of all time. It was another reset this year which culminated with the contract for Osweiler and eventual replacement by Savage. Somewhere in all of this they could have drafted Derek Carr but decided they could get by without a draft pick.

I dont think its likely that Osweiler is traded next year. He is damaged goods and anyone that trades for him, even at a reduced price, will likely have to deal with a good deal of criticism. I’d imagine that the end result will be an open competition that will involve Osweiler, Savage and either a 1st or 2nd round draft pick or some random veterans like RG3 or Matt Barkley. If its not a first rounder involved thats probably not a very exciting option for the Texans but they are probably boxed in with Brock and his massive salary until 2018.

  • Werner

    And the Texans may still win the division despite being surrounded with first round pick QBs Luck, Bortles and Mariota on the other teams and with J.J. Watt on IR. Seems you could get along with the right focus on a strong defense, a game manager on QB and a strong enough running game. At least they got the Lamar Miller deal right.

  • Kirk Vollmer

    I’m curious if it would be legal to do an under the table trade for cap space here. Seems to me Houston’s biggest issue is Osweiller’s 16M guaranteed salary which could theoretically be traded away if a team was willing to take it. Say I’ve got a team that has a ton of cap space, but wants draft picks say like the Browns. Would this sort of thing be legal? Browns Give 2017 7th round pick for Brock Osweiller and Houston’s 2017 2nd round pick. So I’m trading 16 M in cap space to Houston and a roster spot for a high pick. Is it legal to do that (essentially pay another team to take your player and his guaranteed salary off your hands) and if so, the bigger question is how would one value that? But if I was a team like the Browns that needs a massive turn around and draft picks, I would certainly be looking into that. Now if I was Houston I don’t know that I would go for that. 16M is certainly a lot of money, but it’s only for one year and then you can dump him for even less cap hurt then it cost to trade him away and save the draft pick.

    • Kirk Vollmer

      Now that I think about this a little more, it would actually make more sense for the Browns to trade away some UDFA player on their roster that they place very little value in for Osweiller and a Houston Draft pick. Houston could then take that player and promptly cut them. But considering Houston is likely in the playoffs now and probably will be in the hunt next year, trading away a draft pick to clear up 16 M in cap space they would have had to eat on Osweiller might not be a bad deal for them. Especially if they where to grab someone like say Tony Romo and try to go for broke for a quick championship run and spend that 16M on some win now free agents. Obviously that would be risky because Romo gets hurt a lot, but sometimes you have to take those risks if you want to win it all.

      • Werner

        They could trade him to the Jets for Sheldon Richardson,who can learn how to play DL from Watt. And the Jets fans are already hardened what comes to interceptions

        • McGeorge

          Why would the Jets take a useless player and pay him 16MM, when they could get a 4th round pick instead?
          There is no benefit to the Jets trading Sheldon Richardson for Osweiller.
          Maybe, possibly, Osweiller will study and work in the off season, and improve next year. From really bad to not very good.

          • Werner

            Well, Osweiler is a definite upgrade over Fitz, right ? And unloading a failure like Richardson makes it a win-win.

          • McGeorge

            Wrong.

            Osweiller and Fitz are both bad, so there is no reason to take either one. Instead you face facts and realize teh Jets are an old team with few young players who are any good. They need to tank in 2017 and rebuild, not try and win 2 extra games, and still end up with a losing record. There is no reason to get another crappy QB, especially not for 16MM. The Jets would be better off trying a speculative QB like Glennon (who I think will be a bust). Better yet, go with Petty and go 2-14 and draft a good QB prospect in 2018.

          • Werner

            It’s all about getting a quality pick for a salary dump. At least Osweiler may have potential which nobody (in a positive meaning of potential) will say about Fitz They also partially correct their overinvestment in the DL and have to keep Osweiler for a year, while they could still nurture Hackenberg.

          • McGeorge

            Sure, I’d do it for a #2. Jets take Osweiller and a #2 for a ham sandwich. The Texans won’t do that.
            “Nurture” Hackenberg, I like that. I wonder when he will be ready after he’s nurtured. 2018?

          • Werner

            Well, if Osweiler is bad enough, he may come in 2nd half of 2017. Sounds ok to me, Rodgers may still sit today, if Favre had Brady’s durability. If Hackenberg is offering something, it doesn’t matter if we don’t see it right away, if he doesn’t also not.
            The Jets will not be good next year, even if they go all in at free agents
            with all of their 60′ Cap Space into back loaded FA signings.Another 4-12 like this year is the best i can believe in.

      • Dexter

        wouldn’t the 16M go to Romo?

        • Kirk Vollmer

          It could. In fact getting rid of Osweiller’s 16M in salary might be something that the Texans would need in order to bring Romo in. . . The biggest problem with this is that given the short window in free agency the Texans would have to secure a committment from Romo to sign with them, execute the trade of Osweiller away and then sign Romo.

          I have to say if I was signing Romo though I would try and design the contract so that the majority of his pay only comes if he’s active. Maybe a weekly roster bonus sort of deal.

    • McGeorge

      I think that is legal.
      The question is how much are draft picks worth?
      Is a mid #2 worth 16MM?

      From Cleveland’s point of view, they have a lot of draft picks. If some of those picks turn out to be good players, they would like to have lots of cap room to sign them.

      • Dexter

        Relief from Osweiler’s contract would be achieved before any of the rookie contracts were over and the Browns needed to sign them

      • Kirk Vollmer

        I have to think if you where in win now mode, 16 M in cap space would have to be worth at least a 4th round pick. The FA’s you could get would be able to help you more then the 4th rounder who in most cases would likely need time to develop or be a part time player only. A #2 may have been an overstatement on my part. But I have to think the Browns would be interested in a trade that gives them a 4th to take Osweiller.

    • ThenAtlasSpoke

      Unless the Texans decide they absolutely need extra cap space, why do it? Considering you would still have to sign a replacement with a good enough quality to compete for the temporary starter’s role ($4-6 mil) you’ll be left with about $10 mil extra to spend in cap space. I can’t see the Texans being major players for top free agents this year, so the question then is whether the extra free agent(s) you were able to sign is/are worth that valuable 2nd round pick you gave up.

      • Kirk Vollmer

        As I said in an earlier reply my intitial statement of a 2nd round pick was sort of off the cuff and after re-thinking it I tend to agree that a 2nd round pick would be too high of a price to pay for that sort of thing. However if you are in win-now mode I would think a 4th might be worth it. I don’t think the Texans will do this, partially because it’s never been done before and partially because unless the Texans have a legit QB, especially an old legit QB fall into their laps this offseason, they likely are not really in “win now mode” It was more or less a thought experiment.

    • Kirk Vollmer

      Even though this is old I have to come back and note that this idea is pretty much EXACTLY what happened. I think they where dealing in 2018 2nd round pick and not 2017 but the deal was Osweiler a 6th and a 2nd in exchange for a 4th.

      Ultimately what I was talking about here actually happened. Houston draft picks to the Browns for cap space.

  • Ghoston

    The best hope for the Texans is hope he screws something up where he gets suspended and loses his guarantees. Better hope he is late to a team meeting and then it will be cap savings next year and only 9mIL in dead money.

    • McGeorge

      Maybe the team can set him up! Get him drunk and take pictures with an under aged girl. Or plant some hard drugs on him. Maybe break into his computer and have him try and join ISIS and get arrested at the air port.

      • Ghoston

        It has happened before. The team didn’t do anything but these players are stupid. Chris Culliver had 16 mil guaranteed and lost 8 mil due to a suspension. Trent Richardson missed a walkthrough and his guarantees were gone. They got to hope he does something dumb. It happens more than you think Lane Johnson just lost his guarantees due to his suspension. I don’t know the percentage of players getting suspended, but it has to be close to 10% of the players who have guarantees on a contract for more than 1 year.