Hard to Compare Marshawn Lynch and Jamaal Charles

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While we already have discussed the Marshawn Lynch contract on the site in the past I thought in light of his holdout that we could use this as an opportunity to look at certain distinctions between contract situations. On it’s face the immediate reaction to Lynch holding out is that Jamaal Charles got a raise and thus the Seahawks should follow the pattern to give Lynch what he deserves. However, the two contract situations are very different.

Charles was underpaid during the term of his agreement. Based on his production at the time of signing (which was more or less near the end of the 2010 season) the Chiefs got a tremendous bargain. The fact that he produced at an even higher level in the future made it even more of a bargain. For the most part Charles was giving the Chiefs $10 million a year production at 55% of the cost.

Lynch was paid very well upon signing his contract in 2012. The Seahawks follow a different contract model than many other teams. Many of their contracts appear to be very forward looking rather than using the past as a guide for future performance.  Whether it was Percy Harvin, Zach Miller, Sidney Rice, or a number of other players on their team, they often try to identify the future benefits they will realize once the player is fully immersed in their system. Lynch is one of those players.

Lynch began his career in Buffalo and fell out of favor in 2009. During the 2010 season he was traded to the Seahawks and had a relatively lackluster run averaging 3.5 yards per carry and producing 573 yards in 12 games. Lynch would have a much better season in 2011 running for 1,200 yards on a 4.2 YPC as he looked for a contract in free agency.

I like to use a matrix on valuing contracts (and there are plenty of other ways to do this) where we use a weighted average of three years of stats to help identify a range of pay. I usually split the numbers 50/35/15.  Lynch signed in the same offseason as many other players. I included Charles in the list as comparison even though he signed in 2010. Here were the numbers leading into the contracts signed by the player:

PlayerAgeAttYdsYPCTDRecYdsYFSYPT
Rice25291.11309.94.508.871.8651.91961.85.41
Foster26261.61216.24.6511.150.8533.91750.05.60
Charles25191.61179.16.165.040.6378.81557.86.71
McCoy24232.21128.14.8611.657.3410.91539.05.32
Forte27223.21012.04.544.252.4507.11519.15.51
Lynch26231.2927.54.018.425.9183.61111.14.32
Stewart25166.5820.04.934.229.0263.41083.45.54

In terms of production Lynch was near the bottom, only better than Jonathan Stewart. In terms of per play performance Lynch was at the bottom of the list and was also one of just two players to be a non-factor in the passing game.

One of the ways we can break down the valuation on the contract is by looking at the annual value and the three year contract average value per rushing yard and yard from scrimmage. This tells us what the player would have cost, in an average year, per yard of production.

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Dollar per yardDollar per yard

dollar per total yard

So when you look at Lynch what you see is a player who was compensated, at the very least, fairly over the terms of his original contract. On an annual basis he was more or less compensated at the top of the position (discounting Adrian Peterson and Chris Johnson’s outlier deals). That was balanced out somewhat by the cash flows of the contract which were steady rather than frontloaded like Rice, Foster, and McCoy, but it was still a contract that called for a high level of salary based on what he had done before. Due to the lack of expected receiving production he would likely have been a player that a team would have required a partner for passing downs.

As things turned out the Seahawks were correct in their projections and Lynch was worth the risk, but it was one of the better player contracts in the NFL. He was also guaranteed $17 million right from the start, higher than all but two players on this list, both of whom signed longer contracts.

That’s why it is hard to compare the situation of the Charles and  Lynch and expect the same results, even just on the principle of “fairness”.  Charles was the most underpaid of the group. If the Seahawks took an optimistic eye with Lynch, then the Chiefs took a super pessimistic one with Charles. Even if we factor in Charles’ new money ($5 million) into the deal, he would simply come up to the Forte/Rice levels on annual value per run yard and still be the lowest paid using total yards from scrimmage as a metric.

While its understandable that Lynch is holding out, Charles was far more deserving of the raise he received. In Lynch’s case, his improved performance was built into the contract he signed in 2012. We’ll see if Seattle budges, but this is a spot where the fans may not be on the player’s side

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Looking at Jamaal Charles’ Contract and Chiefs Salary Cap

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According to KCTV5, Chiefs star running back Jamaal Charles is going to hold out of training camp in the hopes of earning a new contract with the Chiefs.

Charles’ situation is not all that different than the contract situation of Andre Johnson that I have alluded to in the past concerning the disgruntled wide receiver playing for years on an under market contract. Charles was one of the last signings under the old CBA, agreeing to a five year extension worth $27 million in December of 2010. Rather than fighting the uncertainty of the labor situation, Charles agreed to the deal in the midst of a 1,400 yard campaign in lieu of becoming a restricted free agent in 2011 in a very uncertain market.

Though Charles was injured in 2011, it became apparent that if he was healthy he was going to be grossly underpaid by the time 2012 rolled around. Following the mega contracts given to Adrian Peterson, Chris Johnson and, to a lesser extent, Deangelo Williams, a number of players earned massive contracts including Arian Foster, Ray Rice, LeSean McCoy, and Jonathan Stewart.  Foster’s contract had to be a dagger into the back of Charles as Foster was also set to be a restricted free agent when he signed his contract.

The following table presents the financials of the various running backs in the market:

PlayerAPYGuarantee1 Year Cash2 Year Cash3 Year Cash
McCoy$9,000,000$20,765,000$11,750,000$19,750,000$30,000,000
Foster$8,700,000$20,750,000$18,000,000$23,750,000$30,000,000
Williams$8,600,000$21,000,000$19,500,000$25,000,000$30,000,000
Forte$7,600,000$13,800,000$9,800,000$16,100,000$22,600,000
Lynch$7,500,000$17,000,000$10,000,000$17,000,000$22,500,000
Stewart$7,300,000$11,500,000$9,500,000$20,000,000$24,500,000
Rice$7,000,000$15,000,000$17,000,000$25,000,000$29,000,000
Charles$5,400,000$8,000,000$11,600,000$15,100,000$18,100,000

The difference between Charles and everyone of his peers is startling. Four players earned $29 million or more in the first three years of their contract. All earned over $22 million. Charles earned $18.1 million.

From a performance standpoint its hard to make an argument that any has been better. When we break things down into dollars per annual contract value its clear who is one of the best bargains in the NFL.

PlayerRush YdsPass YdsTotal YdsTot Yds/APY
McCoy2,4479123,359$2,679
Foster1,9664002,366$3,677
Williams1,5805202,100$4,095
Forte2,4339343,367$2,257
Lynch2,8475123,359$2,233
Stewart516201717$10,181
Rice1,8037992,602$2,690
Charles2,7969293,725$1,450

It’s no contest as to who has the greatest team value, which usually means a poor contract for the player.

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Charles is only scheduled to earn $3.9 million this season, which will only further the split between he and the other players. That number ranks 14th in the NFL and is $985,000 less than James Casey will earn as a fullback/tight end for the Eagles. Casey played about 14% of the offensive snaps for the Eagles last season. Other players earning more include a seemingly washed up Chris Johnson ($4M from the Jets in free agency), Toby Gerhart ($4.3M in free agency from the Jaguars), and Donald Brown ($4M in free agency from the Chargers). In 2015 Charles salary will jump to $6 million, none of which is guaranteed in the event of an injury.

Charles is hitting the age where the declines in production often come fast and so does the decline in salary, a topic we touched on with Marshawn Lynch a few weeks ago. That kind of makes this his last opportunity to likely gain some leverage since his performance has been so good and he is the best offensive player on the team. Charles is currently the 8th highest paid player on the Chiefs.

Charles does not have as much to lose as some other player. While he does have a $1 million reporting bonus in his contract, he does not have any signing bonus money that can be forfeited. Charles had received a roster bonus in 2010 that is prorated like a signing bonus but does not count in the forfeiture equation. Players can also hold out for five days without real penalty. So this may turn out to be much ado about nothing.

For the Chiefs this is just another in a long line of players who are looking for new contracts from a team that really has very little cap room to be able to accommodate them all. Kansas City went on a spending spree of sorts in 2012 and Dwayne Bowe receiving a deal worth $11.2 million a season likely sets an expectation that the Chiefs should pay their perceived high end player, top end money.

In addition to Charles looking for a new contract, quarterback Alex Smith and pass rusher Justin Houston are both in the final year of their contracts and expecting new contracts. Kansas City has $10 million of cap room left for this season and already has $126 million committed to the 2015 salary cap. Smith is likely seeking around $18 million a season and Houston in the ballpark of $10 million. That makes for a very complex series of negotiations if the Chiefs want to keep this team together in hopes of making a long term contender rather than a one season surprise in the playoffs. It is one of the most delicate situations in the NFL and the news about Charles makes it that harder. Over the next few weeks we will see if the Chiefs are up to the task.

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Best & Worst Contracts: The Kansas City Chiefs

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A few weeks ago Jason LaCanfora published a list of best and worst contracts in the NFL so I thought it might make a good idea for us to do the same here at OTC, with a team by team approach. I’ll try to be a bit more analytical in terms of why money was paid and how it fits in the market, but the general premise is the same. The one key difference is outside of restructured rookie contracts under the old CBA we will only use veteran contracts as there is a big difference between best draft picks and best contracts.  Please note that there is a difference between a bad player and a bad contract when discussing some of the selections. Clicking on a players name will take you to his salary cap page.

Jamaal CharlesBest Contract: Jamaal Charles

Charles is one of the best RB’s in the NFL and ran for over 1,500 yards on a team with no offense whatsoever. While overshadowed by the tremendous comeback of Adrian Peterson in Minnesota, Charles recovered from an ACL injury and returned without missing a beat, averaging 5.3 yards per carry and performing nearly as well as he did in 2010.

Because he plays in Kansas City, which has not been in major contention in some time, people fail to realize how good Charles is. In his last three full seasons he has averaged 1,365 yards rushing with a low of 1,120. He is the model of consistency for the Chiefs.

The Chiefs wisely locked Charles up in 2010, when Charles had one year remaining on his contract and had only produced one top flight season. Charles received $8 million up front, the only amount actually guaranteed by the team. The structure of his deal will never impact the Chiefs, with no cap charges exceeding $5 million until 2015, unless he hits various escalators in his contract. Even if he hits his 2014 escalator the cap charges will rise to around $6 million. He could be cut or traded next season with only $2.67 million in cap charges, which is not an impactful figure by any stretch.

At $5.4 million a year in annual salary Charles is a steal. He was the last player to come in at the position under the $6 million mark as there is a clear dividing line between Charles and the next group of players, most of whom earn over $7 million a year. Ray Rice ($7 million) and Matt Forte ($7.6 million) bot received significantly larger guarantees and have salary cap compromising contracts. Charles is far better than Forte and you could make an argument just as good as Rice. Perhaps no contract illustrates the bargain that the Chiefs have in Charles than the $7.3 million a year given to Jonathan Stewart in Carolina, who has produced in the last three years about as many yards and Charles will produce in one.

tyson jacksonWorst Contract: Tyson Jackson

I debated between Jackson and Branden Albert when deciding on this one. Albert was an example of an organization thinking it was too smart by franchising tagging a player they never wanted and then wondering why no team in the NFL would meet their asking price. Normally you have to at least pretend that there is a spot for the player on your team when you play hardball and they never did, with leaks all around saying he did not fit in to their future at all. Now when their bluff was called they are stuck with a $9.828 million dollar pricetag for somebody they would prefer was on another team and they have nobody to blame but themselves for that. But at least Albert can play, Jackson can’t.

Drafted with the third overall pick in the 2009 draft Jackson has been the epitome of the word bust. In four seasons Jackson has sacked the QB five times. He only has 113 tackles. He already has his rookie contract reworked once for some cap relief and they deleted the 2014 season in his 2012 renegotiation to take the proration off the books and prepare for his release in 2013. Except when 2013 rolled around not only did they decide not to release him, but to guarantee him a good chunk of salary to ensure he remained on the team rather than exploring free agency, where a team would have given him a look, but a $4 million dollar look?  Doubtful.

The Chiefs could have released Jackson and taken a dead money cap charge of just $2.5 million in 2013. While he had $3.22 million in guaranteed salary, the salary was not guaranteed for skill and thus the Chiefs could release him with no issues. For whatever reason they decided Jackson was once again worth keeping. Rather than holding him to the $3.22 million in partial guarantees the Chiefs upped his guarantee to $4 million in full guarantees. They also raised his offseason workout bonus from $250,000 to $500,000, essentially guaranteeing him $4.5 million of a $4.7 million dollar contract. If Jackson plays in 50% of the teams snaps he will earn an additional $500,000. Now Jackson’s cap charge stands at $7.2 million, 5th highest among 34 Defensive Ends, a number that never should have been on the Chiefs books.

Check out Our Other Best & Worst Contract Articles

AFC East: Buffalo BillsMiami DolphinsNew England PatriotsNew York Jets

AFC North: Baltimore RavensCincinnati BengalsCleveland BrownsPittsburgh Steelers

AFC South: Houston TexansIndianapolis ColtsJacksonville JaguarsTennessee Titans

AFC West: Denver Broncos, Kansas City Chiefs, Oakland Raiders (July 10)

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