Rookie Option Updates

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We learned last night that the first set of rookie options from the 2011 draft class were starting to be picked up, so I thought it might be useful for us to have a running list of the players who are having their contracts extended by one season. The rookie option year is a new rule in the CBA that allows teams to extend the term of a first round draft choice by one season by exercising an option between the end of the players third season and May 3 of the following League Year.

The cost of the option year is dependent upon where a player was drafted and what position he plays. If the player was drafted in the top 10 picks of the draft his one year contract will equal the transition tender for the NFL in 2013. If the player is selected outside of the top 10 then his one year contract is calculated the same way that the transition tag is calculated except the 3rd through 25th highest salaries are used rather than the top 10 highest. All offensive linemen and all linebackers are each grouped as one position and are not specialized (i.e a tackle is paid same as a center or a inside linebacker is paid same as a 34 outside linebacker).

Once the option is exercised the salary is guaranteed for injury only. So if a player is injured in 2014 and unable to pass his physical the following season his entire option salary is protected. However the player can be released at any time up to the start of the 2015 League Year without penalty if he is healthy enough to play football. If the player is on the roster on the first day of the 2015 League Year (first day of free agency) the salary becomes fully guaranteed for all terminations.

There is nothing that prohibits a team from negotiating another contract with the player following the option pickup. In most cases teams will pick the option up to protect their negotiating rights with the player, which is an indication of how little teams really think of injury guarantees. If the option was fully guaranteed there would be a much different approach taken by teams. If teams do not exercise the option they can still use the Franchise or Transition tag the following season, but in most cases that will be more expensive.

What could be interesting is if teams internally calculate out the Transition tag number in 2015 using the 2010 through 2014 cap figures currently available to see if there is a potential decline in the value next year. Being that the salary cap is now rising that would be near impossible, but if a team like the Cardinals estimated that the cost for a cornerback in 2015 could be $9.5 million they may opt to just use the Transition tag in 2015 on Patrick Peterson rather than locking him up at slightly over $10 million now. This would not be applicable to players selected outside the top 10 and would also eliminate a team from using the tag on another veteran player on the team.

My own opinion on the tag is that, while there is no downside to using it, if you have a player you like but not at the option value it is better to try to work out a reasonable extension without having that factored into the equation. Once you lock a player in at say $6 or $7 million it becomes much harder to work out a long term contract valued at $4 or $5. We have seen that often enough with the Franchise tag impeding progress on a long term deal and that can be a detriment to both sides.

Contrary to popular opinion most of the players who will have the option picked up will earn more in their 5th year and have a higher 5th year cap charge than the rookies that were drafted in the old CBA system. So they will have some leverage to negotiate favorable terms if they are a good player. This is not the case for the top 6 or 7 picks who will earn less and have less leverage than their 2010 counterparts. So the option is not a block to a player friendly extension in almost all cases.

The following chart gives a breakdown of the tag values we do know and the players who are eligible for the option. As more options are picked up I’ll update the table.

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Questions about this article? Reach Jason Fitzgerald on Twitter at @jason_otc