The Cleveland Browns traded for quarterback Deshaun Watson because, in case you had not heard, the “AFC is loaded at the quarterback position.”
The move to acquire Watson, even with the looming civil lawsuits filed by 22 women who have accused him of inappropriate behavior and sexual assault, makes the Browns better on the field and made the rest of the league sit up and take notice.
But it was what happened next that may have truly shaken some of the competition.
To help seal the deal, general manager Andrew Berry signed Watson to a five-year contract extension worth $230 million, with every bit of that money guaranteed.
That is significant not only for the Browns, but for some of their direct competition who are currently dealing with an extension-ready quarterback, like the Baltimore Ravens with Lamar Jackson, or who will be facing the issue after the upcoming season, like the Cincinnati Bengals with Joe Burrow and the Los Angeles Chargers with Justin Herbert.
The league’s collective bargaining agreement requires teams to place any future guaranteed money in an escrow account if that figure exceeds $15 million. In the case of the Browns, that means they need to put somewhere between $172.5 million and $184 million into escrow to make sure Watson gets his money, according to former NFL executive Joe Banner at The 33rd Team website. (Browns fans might remember Banner from his less-than-stellar tenure as the team’s chief executive officer from 2012 to 2013.)
With Watson’s deal in mind, the league’s other top quarterbacks likely ask for a fully guaranteed deal as well when it is their turn, Banner writes, which could cause problems for teams that don’t have a ready supply of cash on hand.
In the case of the Chargers and Herbert, their current debt situation could be a hindrance, according to Banner:
The Chargers have stadium debt from SoFi and a huge outstanding balance on what they paid the other owners to move the team from San Diego to LA. At this moment, they are also a low revenue team. Coupled with their debt, being a low revenue team makes the Chargers a lower profit team.
When they have to extend Justin Herbert, there are three possible outcomes: either (1) he is going to have to cooperate by taking a shorter deal with less total money than Watson; (2) he takes a deal the same length as Watson with less guaranteed money; or (3) there is a stalemate, and he becomes difficult to extend.
For the Bengals and Burrow, team owner Mike Brown’s penny pinching may cause a problem:
The Bengals historically have not been one of the highest spending teams and are one of the lowest profit teams. They could be financially challenged and philosophically opposed to putting such a significant amount of money in an escrow account.
Cincinnati also has very strict rules that they put in every contract. Specifically, they don’t guarantee P5 Base Salary; instead, they give small signing bonuses and roster bonuses. When they extended Andy Dalton for six years and $96M, they didn’t guarantee his base salary in any season. They give him a $12M signing bonus, a $5M roster bonus in the first year, and a $4M roster bonus in year two. The same was true for Carson Palmer in terms of no base salary guarantees, but Palmer got a fully guaranteed roster bonus instead of a signing bonus. He also had an option bonus.
To keep Burrow, they will have to deviate from this and completely change the way they’ve been doing business, at least at the quarterback position.
The fallout I predicted over the Watson contract has begun, per Steve Bisciotti's remarks.— Andrew Brandt (@AndrewBrandt) March 30, 2022
Now Lamar Jackson can (and should) request/demand a similar/better contract with full guarantees and protections against misconduct forfeiture.
Bisciotti will resist, but he's stuck.
Finally, when it comes to the Ravens and Jackson, there is no telling what might happen as the Ravens have still not signed Jackson to an extension despite the fact that he is entering his fifth year:
Baltimore is a middle-of-the-pack team in terms of revenue that won’t be thrilled about funding Lamar’s guaranteed money. Jackson being self-represented makes this extension a bit of a wild card, so it’s hard to pinpoint what he will demand. But we could be looking at a franchise tag, as Jackson will play this season under the Fifth Year Option then become a Free Agent (unless he is tagged). Baltimore might even have to employ the tag multiple times depending on how long it takes them to reach an extension. The question then will be whether Lamar will hold out.
Berry obviously did what he thought best for the Browns in not only trading for Watson but then subsequently signing him to a major contract extension.
But whether intentional or not, he may have also struck a stealth blow to the very teams that the Browns are competing against in the AFC.