Russell Wilson was the latest QB signing of the season, inking a five year extension worth $49 million a year, with $165 million in injury guarantees. Mike Klis has the breakdown of the contract and overall it seems like a relatively fair contract for both sides.

When the news of the contract first broke this morning, my thought was to look at the cash flows of the contract before really making an opinion on the deal. Here is how the contract breaks down compared to some other recent contract signings.

The numbers here are legitimate for Wilson. Once the extension starts he will rank no worse than 2^nd among his peers in new money. The $110 million over two seasons is a big jump up from Kyler Murray’s contract and the $150 million over three years is close to Rodgers, though the Rodgers deal  was revalued at the time of signing which makes the comparison here more difficult (Rodgers got a massive raise if valued like Wilson’s contract).

The benefit for Denver is what you see in the “Year 0” figures. These numbers represent the raise that Wilson received over his prior contract which had two years remaining.  Wilson’s raise will be $34 million over two years, which is a far cry from the $53 million raise he received from the Seahawks back in 2019. In that contract Wilson earned $71 million by Year 1 and here the number is “just” $73 million. Keeping in mind how strong the front end of that contract was for Wilson in Seattle I think you can see the benefits for the Broncos in effectively keeping the numbers flat despite the market jumping by nearly $15 million a year from the last time Wilson signed a contract.

As for the guaranteed dollars, Wilson receives $114 million in new guaranteed salary. Of that total, $73 million is fully guaranteed at signing while another $37 million will become fully guaranteed if he is on the roster when the league year begins in 2024. Considering the cost to cut would be massive in 2024, this guarantee is a virtual lock to be earned. Overall this guarantee would be considered middle of the pack among top contract players, but is certainly solid especially given Wilson’s age. Essentially this is buying into two exclusive franchise tags early on.

The topic of full guarantees came up again when this contract was announced and many are speaking negatively of it not being fully guaranteed.  We only have two 3+ year non  rookie contracts which were fully guaranteed in NFL history- Kirk Cousins free agent contract in 2018 and DeShaun Watson’s contract earlier this year. Both had massive leverage as they were being bid on in free agency (Watson was treated as a free agent by all his potential suitors) and that is leverage no other players have. Wilson is a 34 year old quarterback who never pulled off the full guarantee before and he had two cracks at it in Seattle. The landscape hadn’t changed enough to even expect that to happen. Getting over $100M in new guarantees at this age is a good thing not a bad one.

Now I would imagine that Denver has a very different view of the contract than I do regarding the cash component. They had no sunk costs in Wilson prior to this and most teams in that situation are usually much easier to get a deal done with than their prior teams where they are truly looking at the prior contract as very meaningful. This is how DeAndre Hopkins, Tyreek Hill, AJ Brown, etc… all signed what look like mind blowing contracts so quickly with a new team when their old teams had little interest in those kind of numbers.

For Denver this is a 7 year, $296 million contract with cash flows of $57 million through the first year, $85 million through year two, and $124 million through year 3. Those numbers are under Dak Prescott’s contract figures and would trail Matt Stafford’s first two contract years before jumping him in year 3. These comparisons are not the easiest to make due to all the different circumstances but I would imagine this is why Denver was more than willing to do a contract that nearly hit $50 million a season when valued as an extension.

The question I would have if I were the Broncos is why not get this deal done earlier in the offseason if you were going to extend him sight unseen?  This trade was agreed to early on and there should have been time to hammer out a contract which likely could have been finalized before the craziness of the Watson extension coming down, though maybe nobody saw that coming (I certainly did not). Still there were other contracts that could impact the market in that timeframe as well.

I thought the Rams took the right approach with Stafford last year. Have him play out the season, see how he fits in with the team, let him get a feel for the team, and then negotiate a deal. He won a Super Bowl and wound up with $40 million a year. That should have been the comparable player and situation. Had Stafford flopped the Rams would not have extended him. If Wilson struggles the Broncos are going to regret the contract even with some things that are positive for them. Even though they gave up a lot I think the wait and see approach would have made more sense.

 As for the salary cap impact of the deal, Wilson’s salary cap number this year will drop by $7 million and by $5 million in 2023. It jumps to $35.4 million, assuming they pick up the option million, in 2024 and then ramps up to $55.4 million in 2025, at which point the new TV deals should all be running and driving the salary cap limits way up.

It won’t really be feasible, unless the team goes into a full rebuild, to cut Wilson until 2026. His release that year would leave $31.2 million on the salary cap. Conceivably they could trade him in 2025. The high would be large ($49.6 million) but it would be a few million less than cap number that year if on the roster and would save them from paying his $37 million salary.