Dougherty: Packers should extend Rodgers soon
When Andrew Luck signed a new contract in June worth $23.2 million a year, you can bet that Aaron Rodgers and his agent, David Dunn, took notice.
The deal knocked Rodgers down another rung on the NFL contract ladder, and this time by a lot. While there are several ways to measure contracts — we’ll get into that later — suffice it to say, by the best measure Luck is averaging about $4.5 million a year more than the Green Bay Packers’ two-time MVP quarterback.
Rodgers has four seasons left on the extension he signed in 2013, so at first blush it might not seem like a new deal would be a priority for general manager Ted Thompson and his salary-cap guru, Russ Ball.
But as we all know, the rules go out the window when it comes to NFL quarterbacks. In fact, this is something Thompson and Ball need to start thinking about now, and they’d be smart to extend Rodgers’ deal by next offseason even though he’d still have three years to go.
The reasons are two-fold.
To start with, when you have a premier quarterback, you don’t want his contract to become an issue. Too much of the team’s success revolves around him. And at this point, is anybody doubting Rodgers’ status?
On Tuesday, Mike Sando of ESPN.com published his third annual quarterbacks rankings based on interviews with 42 NFL front-office executives, head and assistant coaches, and scouts. For the third straight year, Rodgers was picked for the first tier and essentially tied for No. 1 overall. This year he and Tom Brady shared the top spot, with Ben Roethlisberger the only other in the first of five tiers.
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Even with that ranking, Rodgers doesn’t have to be the highest-paid player in the league — if they made him that today, somebody would pass him in a year anyway. But if he falls too far behind the pace, there might be problems. A new, early renegotiation preempts that.
Just as importantly, the cost of top quarterbacks is only going up, and by a lot, as the salary cap grows. The cap has increased by $10 million or more each of the last three years, and there’s no reason to think that will change. So the longer the Packers wait, the more they’ll have to pay. Even though Rodgers will be in his mid-30s by the time his current deal runs out, as long as he’s healthy he’ll still be a coveted player.
And the Packers don’t want to tempt fate by allowing Rodgers to get too near the end of his deal. Because the closer he gets to the last year, the more his leverage and their costs grow. We’ll get to that in a moment, too.
But first, let’s look at where Rodgers fits in the NFL’s contractual landscape. And to do that, I first have to make a point: When you read about NFL contract extensions, don’t be fooled. The initial reports usually talk about “new money,” but that’s just a way for agents to inflate the numbers for public consumption. It’s bogus.
For instance, Rodgers’ last contract extension, in 2013, was billed as averaging $22 million, because that’s what the five new years on the deal averaged. But he received a $35 million bonus the day he signed, so in effect he’d ripped up his old contract and signed a new, seven-year deal worth $130.75 million. That’s an average of $18.67 million. That’s his real average.
Same for Luck. The five-year extension he signed in June was reported as averaging $24.59 million, but that was only the new money. In reality, he’d signed a new six-year deal that averages $23.18 million.
This matters, because if you Google quarterback salaries, most lists go by the new money, and Rodgers’ $22 million ranks No. 3 in the league behind Luck and Joe Flacco ($22.1 million).
In reality, Rodgers is a lot farther down. By my calculations, based on NFL salary information from Over The Cap and Spotrac, Rodgers ($18.7 million) is the ninth-highest paid quarterback in the game, behind Luck ($23.2 million), Flacco ($20.8 million), Eli Manning ($20.3 million), Drew Brees ($20 million), Roethlisberger ($19.8 million), Philip Rivers ($19.8 million), Cam Newton ($19.7 million) and Matt Ryan ($19 million).
Among that list, all but Brees and Ryan signed contract extensions in 2015 or ’16. Rodgers’ last extension was in ’13.
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Also, the salaries are going up fast. Luck just signed his new deal this summer and blew past Rodgers. And on the free-agent market, Brock Osweiler ($18 million) signed with Houston for nearly the same salary as Rodgers even though he has started only seven games in his NFL career.
You probably noticed Brady wasn’t on the highest-paid list, and his case is unusual. He has renegotiated his deal a couple times in the last few years, and they’ve been shockingly team-friendly contracts. The extension he signed just this offseason paid him a $28 million bonus, but over the four years of his new deal, he’s averaging only $15 million.
I asked a couple sources in the league what was going on there, and nobody was sure. Maybe he’ll just keep signing yearly extensions with big bonuses until he retires that will make his average salary a mirage.
Maybe at his age — he’s 39 — he’s willing to take less money to save cap and cash to build a stronger roster. But that seems a little hard to believe, because NFL players and their agents just aren’t willing to take deals that drastically below market. So I don’t know what to think there.
Regardless, the Packers need to plan now and act in the offseason. Because the closer they get to the end of Rodgers’ contract, the more it will cost to extend. Here’s the big worry down the road:
If Rodgers ever gets to the last year of his deal, the Packers will be at his mercy. The franchise tag then becomes the starting point for negotiations, and with the way franchise-tag rules work, the money gets really big, really fast.
In Rodgers’ case, his franchise tag for 2020 will at minimum be $25.32 million (120 percent of his 2019 cap number), and it would be more if the average of the top-five paid quarterbacks at that time is higher.
But it doesn’t stop there. To franchise him a second straight season, the Packers would have to pay him another 20 percent raise, or at minimum $30.4 million. And to franchise him a third season, they’d have to give him a 44 percent raise over that, or $42.5 million. Over three years, that’s $98.2 million, or an average of $32.7 million a season.
So that’s where negotiations would start: $98.2 million guaranteed over three years.
Rodgers will be 36 when the free-agent market opens in 2020. In today’s NFL, elite quarterbacks still have several good years in them at that point. So as long as he’s healthy, there will be plenty of takers.
But if the Packers are proactive, they can build goodwill with Rodgers and save money in the long run.