The Saints and Drew Brees had been negotiating since this offseason on the terms of a contract extension and per Ed Werder the two sides got in done just in time to ensure the Saints will be cap compliant for the upcoming season.
Drew Brees extension will be 5 years but automatically voids to two. Committed to Saints this year and next only for $44.25M guaranteed
— Ed Werder (@Edwerderespn) September 7, 2016
Though void years can cause a headache in the future the contract is nothing short of a coup for the Saints who will keep their star QB around for an added season on a very reasonable salary.
There were few players who held more contract leverage than Brees. Because of the all the decisions the Saints had made with Brees’ contract structure, it would have been near impossible for the Saints to franchise tag Brees as it would have cost the Saints in the ballpark of $40 million in cash and on the cap in 2017 giving him the leverage to leave in free agency if the Saints didnt sign him to an extension before March. Brees has been one of the top quarterbacks in the NFL for some time and even though he will be 38 next season likely would have signed a close to top of the market contract. Peyton Manning, coming off a significant injury, signed a top of the market contract at the age of 36.
Brees gives up a lot to sign this contract. Eli Manning, Ben Roethlisberger, and Philip Rivers all signed four year contract extensions that paid them between $38 and $41 million in new money by the end of their first extension year. They received around $64 million in injury protection. Around $40 million of the guarantees were new guarantees. These should have been the floor for Brees. Brees will earn just $24.25 million in new guarantees and money. He has no additional injury protection.
Those three contracts will see those players earn about $52 million in new money over two years. For Brees to now break even he will need at 39 to sign a new contract that pays him at least $28 million in 2018. Its not impossible but it will be a hard one to do.
In this contract Brees essentially gave up all his leverage and agreed to the regular franchise tag one year early. To put the salary in context he will now earn about $5 million more than Kirk Cousins. Sure his annual contract value will rank second to just Andrew Luck, trailing by a similar margin that Manning, Roethlisberger, and Rivers trailed league leader, at the time, Aaron Rodgers, but there is little comparison between the contracts when we look at the cash. If this was a player in his 20’s this contract makes all the sense in the world for a player but for a player in his late 30’s thats a great risk.
Knowing the way phrases get thrown around about contracts I am sure that the phrase “one year band aid” is being thrown around, but for a player at this age its not a band aid, its a solution. There is no reason for the Saints to do anything in the future but another one year contract and this deal likely showed his hand that he doesnt want to leave New Orleans so they hold that leverage in the future.
Why the contract took so long to get done is hard to imagine, other than Brees, at the last minute, wanting to remain in New Orleans and not wanting the contract to be a distraction to the team. The Saints could have used this salary cap relief months ago rather than having to once again restructure multiple contracts to deal with their annual salary cap problems.
The reason this deal will give the Saints cap relief is because they signed what is technically a 5 year contract. That will allow them to pay Brees a big bonus and prorate it over five years rather than two. That can be dangerous because all the money prorated into the void years will accelerate onto the cap when the contract expires but in this case I don’t consider this as big of a problem as it would be for most teams.
For the most part the Saints have been stuck in neutral for the last four years, winning just 7 games in three of the four years. They have been unwilling to enter a full rebuilding mode instead moving money around to keep things together while revamping the roster on the fly. By doing so the Saints have led the league in dead money the last two years. They want to keep extending the window as the younger players develop and now this gives the Saints an extra year to make the hard decision about the future of the franchise.
If they remain a 7 win team the path seems simple at that point- there is no choice but to rebuild. Brees at 39 is not a long term solution and if this group cant improve by 2018 they arent going to have the pieces ready in 2019 to compete. Rather than be stuck with a 39 and 40 year old Brees at that point they can walk away and turn the page on the era. If they do improve and Brees doesnt age as quickly as Manning they can do another one year deal.
Thats why the void years dont bother me. At that stage the team will either be so bad that one more year of massive dead money charges won’t make a difference to a team focusing on the draft or they will be good enough to extend Brees and not worry about the void year acceleration. It’s all good for the Saints who will now be able to gather far more information on their team’s future without the need for any real commitment.
The Saints don’t make a lot of moves that I usually agree with but this one, for the most part, sure seems like a home run.
Jason is the founder of OTC and has been studying NFL contracts and the salary cap for over 15 years. Jason has co-authored two books about the NFL, Crunching Numbers and the Drafting Stage, which are widely circulated in the industry and hosts the OTC Podcast. Jason’s work has been featured in various publications including the Sporting News, Sports Illustrated, NFL Network and more. OTC is widely considered the leading authority on contract matters in the NFL.