Thoughts on the Franchise Tag

I wanted to share some thoughts today on the franchise tag and the use of the tag around the NFL. There are a number of reasons for a team to use a franchise tag on a player that are beneficial but at the same time it’s not always all bad for the player. Teams can get caught up in various contract metrics just as easily as agents and sometimes lose sight of the big picture and what things can cost in the long term when deals are not made. 

As a one year contract the tag is clearly beneficial to the team and detrimental to the player.  The tag itself maintains the burden of risk on the player. The player, generally 26 or 27 years of age, has to maintain his health and his production in order to have a good chance to potentially reach free agency one year later, not to mention to keep his nose clean of any off field issues. Historically there are a number of players who have lost with the franchise tag.  Greg Hardy and Henry Melton are probably the two most recent players who never came close to realizing their financial potential in part because of the tag.

The tag also shortchanges the star player and is a method to artificially lower prices. For example Dez Bryant, had he played one year on the tag would have earned just $12.8 million compared to the $23 million payout he received by signing a long term , $13 million per year contract instead of taking the risk of playing on the tag. Now things worked out for the best for Bryant who struggled with injuries in 2015 and was ineffective, but had no tag existed Bryant arguably may have earned a contract worth $17 million a season. So the team is clearly a in a better position because they are using the leverage of the tag and the burden it puts on the player to negotiate favorable terms on long term contracts. In turn these stars knock prices down across the board for one or two additional years giving an added benefit to the league.

But when you are in the position of general manager you have to have an end game in sight when you use the tag. I Of the 18 players that were designated a franchise player between 2014 and 2016, nearly 80% ended up sticking with the team for at least one more year (this assumes that Trumaine Johnson and Kirk Cousins will not be traded).  So the goal clearly seems to be to keep the players for the long haul with few exceptions. If the player is someone that you are prepared to sign long term the tag should be a negotiating tool and you have to consider the possible scenarios that exist if they refuse to call your bluff and are prepared to play the year on the tag.

In most cases once we move into the category of having to apply a second franchise tag the player has won. It might not always reflect itself in the APY of a new contract, but cash is king and the cash aspect tells a different story.

For example 1 I’ll use Kirk Cousins. In Cousins case this was a perfectly acceptable use of a franchise tag in 2016. With Cousins as a potential one season wonder you have to be very conservative especially given the prices at the position, but Cousins went out and played well two years in a row. I get it that you don’t think Cousins is worth $24 million a year like Andrew Luck, but what functional difference are the Redskins making with a second tag?

Cousins two year payment now stands at $43.897 million. If the Redskins have to tag him again that number balloons to $78.5 million, or Luck money (Luck earns almost $80 million over three years). If they let him play the year out and he craps out how far can he really fall?  The low level salary for quarterbacks these days is a $20 million payment. So in that case the Redskins “win” by signing him to a $19M a year contract and end up paying him nearly $64 million to do so over three years to do so?   That’s almost Cam Newton money. Or they pat themselves on the back for not signing him this year and spending $44 million to say “I told you so”? And what if he does great?  Well you paid him $44 million to just pay him like Andrew Luck anyway while pinching your salary cap every step of the way. Just get it out of the way now and get the deal done or trade the guy rather than costing yourself in the long run.

Example 2 is Trumaine Johnson of the Rams. Unlike Cousins there was really no need for this tag. Johnson was what he was and the market was set. The Rams are now committed to paying him $32 million over two years. That’s more than Janoris Jenkins and just a few million under the high enders of Richard Sherman, Patrick Peterson, and Joe Haden. His salary this year is higher than any other cornerback received in the first year of their contract with the exception of Josh Norman who earned $20 million, so any extension he signs is going to have a massive first year salary relative to the position.

What leverage has the tag given the Rams?  What benefit is a 4 win team really gaining from this scenario?  If Johnson gets extended his paper money from 2016 through 2018 will likely rank 2nd among all corners. Johnson won in this case.

Prices are also always rising in the NFL and a team runs that risk as well by using the tag for a full year. This was a player reportedly seeking around $11 million a year in 2016 which the Chiefs would not agree to. A few months later the Cardinals do an excessive contract for Tyrann Mathieu and next thing you know the Chiefs feel backed into a corner and sign Berry to a $13 million a year extension this season when faced with the prospect of tagging him again.

Assuming the reports of a $20 million signing bonus are correct it means the Chiefs are now going to pay Berry around $31.8 million for two years. Last year probably $24 million over two years gets the deal done. That’s a big cost for the Chiefs.

A lot of people got on the Panthers last season for the Josh Norman situation, but that was the proper way to handle it. Norman was designated a franchise player by the Panthers and the Panthers eventually rescinded the tag when they realized that he was going to call the bluff of the tag and not sign a contract which the Panthers deemed reasonable. Rather than throw away a bunch of money for one year the way the Rams and Chiefs did the Panthers walked away.

The Panthers were killed for the move because short term they had left themselves with no viable corners on the roster, but ask yourself what made more sense: being the Bears and spending $14.6 million on Alshon Jeffery to go 3-13 or the Panthers who saved $14 million to go 6-10? These players are important to have but only in rare circumstances is one player the difference between 5 wins and 10 wins. The Bears wisely walked away from Jeffery this year rather than sinking more money into a lost cause.

So the tag is certainly good to a point but there are times when it is not the right move. Once you use the tag only in the most extreme of circumstances should it not lead to a new contract by July 15. If no contract is reached there is some kind of failure that needs to be corrected in the future. Sometimes the best interest of the team is not going to be measured by annual contract values and sometimes the best interest of the team is just letting the player walk away.

When  you look at the group of players tagged this season for the first time ask yourself what is gained by the team for keeping the player at this number for one year.  Melvin Ingram and Chandler Jones are scheduled to earn $14.5 million this year. If they play out this contract they would be a lock to earn at least $17M and most likely over $20M in 2018. $34.5 million over two years is already close to Justin Houston money. If they play well this year expect a 2018 salary on along term deal of close to $30M, which puts their 2 year salary above everyone except Von Miller. Is it worth haggling over a few dollars if you can keep the real cost to the team lower? The same applied to JPP except he is earning even more this year than the other two.

For Kawann Short and Le’Veon Bell I think you can make a strong case to potentially play on the tag, depending on contract demands. If Short is looking to be paid like a Fletcher Cox the Panthers are better off with the tag game. If he wants to earn a little more than Malik Jackson, do the deal. Bell kind of falls into a gray area because of the position and he may be a player that is not necessarily a long term option. Two years on the tag would be slightly above the Adrian Peterson and Marshawn Lynch range, which might make doing a deal similar to the final Lynch deal in Seattle a fair compromise. If they are looking to go less than that they need to be working off LeSean McCoy’s deal with the Bills, up the APY to $10M a year and realize they are better off doing that than fighting over keeping an APY under $10M only to turn around and tag twice or extend after paying him $12 million for the year.

  • Dan Kunze

    “…but ask yourself what made more sense: being the Bears and spending $14.6 million on Alshon Jeffery to go 3-13 or the Panthers who saved $14 million to go 6-10?”

    Being a Bear fan, this one hit home but there is more to it. The Bears, like any other team, have to at least show the fans that they are trying. They had Cutler, and a decent duo at wide out with Jeffery and Kevin White. Who knew that all three would blow up and that the Bears would lose their starting center on family night? If the Bears would have let Jeffery go at that point in time, the fan outcry would have been extremely severe. So in hindsight, with a disastrous year, it looks stupid, but at the time I think it was the right choice.

    • Werner

      well, where would the Bears have gone with Cutler at full strength (define that) and Jeffery unsuspended, thus teaming up over 16 games: 6:10, 7:9 or 8:8 ? so something like 2.9 – 4.6 M$ per differential win. Or try to trade Jeffery from the tag, save the cap space and add 2 7M$ players this year ?

      • Dan Kunze

        I certainly don’t have the answers to make the Bears “good” as anyone knows that is a multi pronged issue. They are getting younger, I will give them that. I am just saying that at that time, in lieu of getting a deal done that the tag was a decent choice to avoid a full out fan riot, something I think the Bears ownership group are more sensitive to than most. Of course, I could be wrong.

        • Werner

          Dan, no hard feelings. But an ownership group willing to send out Cutler every week caters more to the masochist group of the fanbase, right ? If he walked over water people still will say “and swimming he can’t do either?”

          • Dan Kunze

            There are Cutler haters galore for sure. I thought he was a decent enough qb when upright. Which is the key to a lot, of course.

    • McGeorge

      >>like any other team, have to at least show the fans that they are trying

      Just to play Devils Advocate, Why? Once I rip you off by selling you a PSL, you have no more leverage over me. I can jack up prices, run the team poorly, wahtever. What can you as a PSL holder do?

      Sell your PSL? I don’t care, the new holder will pay the same ticket price.

      Sell your tickets? I don’t care, you are paying full price,if you take a loss, I don’t care.

      Not buy tickets. Ok, now your PSL is voided. If enough of you do this, then I have a bunch of unsold tickets, and need to cut prices a little or try and run the team a little better. I’ll still get TV money though. Only if all fans gave up their PSLs would this be a possible problem.

      • Dan Kunze

        About half of Soldier Field is no PSL.

        • McGeorge

          Good.

          Because most teams have ripped off their fans with PSLs.
          I’m surpised teams with high PSL prices like the 49ers don’t jack up the prices a lot once all the PSLs are sold.

  • Werner

    Well, looking at the case of Josh Norman. Franchise Tag, then rescind and let him go for a 3rd round comp ? Shouldn’t they have put him on Transition Tag, see what the market is giving and just let him go all the same if the price is not right for them ? Still getting a 3rd round comp or do i miss something ?

  • McGeorge

    Jason,
    How would you like to see the various Tag rules changed?
    Franchise.
    Non Exclusive Franchise.
    Transition.

  • BigYorty

    e
    When teams are committed to spending X dollars per year by the bargaining agreement, what is at risk for each team is insignificant; the player’s risk due to health uncertainties is surely much greater, but closer to Russian roulette. It’s more a matter of when than if.

    In some ways it works to the advantage of players in general, if not the individual. The franchise tag “dance” preceding actual free agency helps set artificial salary benchmarks that set the tone for the actual FA signings. If JPP, Ingram and Short were not tagged, that’s three more edge rushers in the available pool with the same number of teams in pursuit.

    I have more sympathy for the marginal players who have a hard time getting off the vet minimum treadmill or outlasting the ERFA and RFA statuses that provide nothing approaching freedom. Players on their third or fourth team still trying to accumulate enough service time to negotiate a contract, not take what’s offered or walk away. It just seems so wrong to me that no matter how many times you get cut, until you have over three years of service time you remain on the prix fixée menu. It’s living in a shadow world of practice squads and inactive lists.