Writers of Pro Football Prospectus 2008

15 Jul 2014

Jimmy Graham Signs Extension

You can call him a wideout, you can call him a tight end, but be sure to call him "football player that just signed a four-year, $40 million deal with $21 million in guarantees."

Posted by: Rivers McCown on 15 Jul 2014

40 comments, Last at 18 Jul 2014, 10:38am by tuluse


by jonnyblazin :: Tue, 07/15/2014 - 11:12am

Wow, I feel like he would be worth so much more than that on the open market. I always wonder why really good franchised players don't sit out the first 10 games of the season, sign the tender and play the final 6 games, then hit free agency.

by dryheat :: Tue, 07/15/2014 - 11:48am

He gets 13 million guaranteed this year, 8 million guaranteed next unless he's cut right after the Super Bowl. I think that's a pretty damned good payday.

by jonnyblazin :: Tue, 07/15/2014 - 12:06pm

We'll sure, I'd definitely be happy with that contract. But considering how much an Mike Wallace signed for (5/$60 mil, $30 mil guaranteed) - who's an inferior player- and the fact that the cap is growing, I think he's underpaid by quite a bit. I think his agent would have done better by getting him to free agency.

by Noah Arkadia :: Tue, 07/15/2014 - 12:55pm

Sure, free agents always get more money. The trouble is getting there. The Saints had the ability to franchise him for two years before he got there, and that's two years that the player both earns less money and risks injury.

Who, me?

by jonnyblazin :: Tue, 07/15/2014 - 2:43pm

"Sure, free agents always get more money. The trouble is getting there. The Saints had the ability to franchise him for two years before he got there, and that's two years that the player both earns less money and risks injury."

Yes but Graham could not sign the tender until week 10 and still get paid 6/16 of his salary, and then become a free agent again. He has plenty of leverage, because withholding his services would make the Saints much less potent. They would likely not franchise him again if they knew they would only get a player for 6 weeks who hasn't been in training camp, practices, getting in game shape, etc.

by dank067 :: Tue, 07/15/2014 - 3:03pm

Dramatically different circumstances, but I guess doing something like that kind of worked for Vincent Jackson, in the end. So much riskier though than $21 million guaranteed, more than likely the full $40m, and the chance to potentially be a free agent again at 31, where the best WRs and TEs have all remained very productive in recent years.

by Sisyphus :: Tue, 07/15/2014 - 5:21pm

The risks in that situation are non-trivial for what is effectively a marginal gain. You have the immediate impact of lost salary and the risk of injury is likely greater if you are not in football shape. As a player he also risks losing and certainly minimizes his endorsement value which is another tangible loss. Not all players increase their value going into free agency, while Graham is likely to, if he avoids injury and continues to be the offensive focus; no guarantees exist.

There is also the consideration of the near value of money; money you have now is worth more than future money. If he has $20 million now it is money he can invest and have the benefit of the investment; versus some later amount that may be subject to a greater tax hit and the interim inflation rate.

Finally there is the personal and psychological stress of this tactic. This is obviously a greater concern to some players than others. Most football players have their identity defined almost entirely by the work that they do. As you see when some of these guys go into retirement their lives fall apart and even the better adjusted talk about the difficulties in making it through that transition.

by jonnyblazin :: Tue, 07/15/2014 - 6:46pm

Sisyphus - all good points. The only thing I disagree with is what you call a marginal gain. I think on the open market Graham would command perhaps $15 or 20 million more in guaranteed money, which is not marginal.

by Sisyphus :: Wed, 07/16/2014 - 4:00pm

The 15-20 million is speculation as to his current value in a parallel universe where he would currently be a free agent (not an entirely unreasonable number but in my view somewhat optimistic if he were available today). You have to take risks into account as well as the immediate lost income versus the advantage of having the money up front along with the premise that his future value will be the same or higher. It is not that the amounts involved are trivial it is that the NET gain involved will not be close to those numbers and by comparison to the advantages of the deal (and his future bargaining position) make are simply not worth the risks. I think that the bird in hand is worth keeping in this case and his decision seems prudent, your mileage may vary.

by dryheat :: Tue, 07/15/2014 - 1:01pm

Maybe so on the face of it, but there's no way Wallace sees close to the $60 on his deal. It's also nice that even if Graham plays out this entire contract, he'll hit free agency again still in his prime.

by dank067 :: Tue, 07/15/2014 - 2:51pm

This is key—unless Wallace starts justifying his terrible contract (which is as likely to depend on other players in Miami stepping up as much as him), he'll be out of his contract after 2015. That would give him a $37 million haul over three years, which is really nice, but nowhere near $60m and who knows what the market will make of him at that point.

Meanwhile, Graham gets to stay with the team and Hall of Fame quarterback he has been putting up monster numbers for, should easily earn the entire $40 million in this deal, and will likely be looking at an extension/free agency during/after his age 30-31 season.

by ChrisS :: Tue, 07/15/2014 - 12:26pm

Can't the team suspend the player and not incur a year of service making this technique useless?

by dryheat :: Tue, 07/15/2014 - 1:42pm

A team can't suspend a player who isn't under contract. Their only recourse is to pull the tender or abdicate the team's right to the player, both of which give the player what he wants.

by BaronFoobarstein :: Tue, 07/15/2014 - 5:56pm

What the player wants is a big contract. I have to think that pulling a stunt like that would severely depress future offers.

by dryheat :: Tue, 07/15/2014 - 7:33pm

Depends. If the player is holding out because he's clearly underpaid, as soon as he gets cut, he'll have multiple offers.

I suppose another option is trade.

by dryheat :: Tue, 07/15/2014 - 7:33pm

Depends. If the player is holding out because he's clearly underpaid, as soon as he gets cut, he'll have multiple offers.

I suppose another option is trade.

by MatMan :: Tue, 07/15/2014 - 11:27am

How does this compare to what the top slot-WRs are getting? During the whole "TE or WR" thing, I always thought he should be getting what the best slot WRs in the league were getting paid, not the top WRs.

by Noah Arkadia :: Tue, 07/15/2014 - 11:38am

Victor Cruz is the highest paid at 8.6m a year with only 36% of his contract guaranteed (15m in total). There's only about six WRs who make more than Graham does after this deal. I think he did great.

What I don't understand is how the Saints keep coughing up all this money since they're up against the wall with the cap.

Who, me?

by jonnyblazin :: Tue, 07/15/2014 - 11:53am

Slot-WRs usually don't lead the league in TDs and average 14.1 Y/C.

Labeling him a slot-WR doesn't change the fact that he's one of the most dominant players in the NFL.

by tuluse :: Tue, 07/15/2014 - 1:48pm

Wes Welker's deal with the Broncos is 2 years 12 million.

by theslothook :: Tue, 07/15/2014 - 2:01pm

I know I keep making the same point, but why does the players association and the media overall keep accepting/supporting the franchise tag? If graham could get more money on the open market(and I think he would), then he deserves to. And if that meant he could go to another team(like cleveland), wouldn't that increase parity?

by Jimmy :: Tue, 07/15/2014 - 3:11pm

I would be pretty pissed but the league would lock them out again rather than agree to that in the next CBA negotiation.

by dryheat :: Tue, 07/15/2014 - 7:31pm

I understand the original intent (or at least the one offered to the public) of a franchise being allowed a better chance of keeping their best player, and I'm a free-market guy, but I think a reasonable compromise would be to make the franchise tender a fully-guaranteed 3-year deal. If the team really, really feels strongly about the player, they can keep him for three years at a top 5 salary, and it removes some of the injury risk off the player.

by duh :: Tue, 07/15/2014 - 11:31pm

That seems a mighty fine suggestion.

by Dan :: Wed, 07/16/2014 - 1:45am

Graham would've been even more screwed by that (unless they also fixed the dollar values). 3 years at $7-8M per year? That's ridiculously underpaid (and not much more guaranteed than he's currently getting), and he'd be over 30 the first the he hit the free market.

A better option, I think, would be to end the position distinction for the franchise tag (except perhaps for QB vs. non-QB). Franchised QBs get the average of the top 5 paid QBs. Franchised non-QBs get the average of the top 12 paid non-QBs.

by MJK :: Thu, 07/17/2014 - 1:11am

I think an alternate suggestion would be to get rid of the position dependence and just key the franchise value to the average of the top N salaries in the entire league. Perhaps the top 10 instead of the top 5. If you're justification is that you want to be able to keep "your best guy", then you darn well better pay him like he's your best guy, and indeed one of the best guys in the league, regardless of position.

That would essentially reduce use of the tag to mainly QB's (and probably not even then, since teams usually work out long term deals with their franchise QB's before it comes to tagging), with occasional application to star CB's and DE's. And that's fair, because these guys would be paid like the best QB's (and a few star CB's and DE's).

by theslothook :: Thu, 07/17/2014 - 4:35am

Someone explain to me why we need a franchise tag in the first place? It just gives all the leverage to teams at the player's expense. And again, it's not like it would weaken the league...it would just enable greater parity.

by Karl Cuba :: Thu, 07/17/2014 - 5:31am

Maybe the league thinks it is more marketable and therefore motte profitable if teams are able to maintain some level of continuity with their star players?

If the NFLPA agreed then that could be a reason for keeping the franchise tag. I have no idea if it's true though, I've never really understood why they have the tag.

by Jerry :: Thu, 07/17/2014 - 7:15am

There's some history in Mike Tanier's piece on Graham's contract:


by theslothook :: Thu, 07/17/2014 - 2:47pm

As I've come to expect, this was a fantastic article.

As it happens when discussing politics, there's the ideal world and the political reality. And in the end, it's hard to plead your case that you're being underpaid when you are making a boatload of money. It's not right, but then we do so many more things far less defensible than this.

by Alternator :: Tue, 07/15/2014 - 5:20pm

What would the players reasonably offer in exchange? That's not a small thing for the owners to give up, they're going to want a big concession in return.

The only thing I can think of that's related to "hold onto players cheap" would be holdouts, but what's the NFLPA going to offer there?

by theslothook :: Tue, 07/15/2014 - 5:50pm

I remember listening to a labor lawyer talk about the lockout. The big weapon that the players association has is they can sue the league on the grounds of anti-trust. And they would win, so says the labor lawyer. That one bullet gives them some bargaining power. Unfortunately, the league still has the lion's share of leverage and probably won't give up the franchise tag.

Honestly, the fairest deal for the players would be no franchise tag and rookie contracts lasting only 3 years in length.

by LionInAZ :: Wed, 07/16/2014 - 9:08pm

If I remember correctly, the NFLPA disbanded during the last round of CBA negotiations to bring an antitrust suit against the NFL, to end the lockout and force the owners back into serious negotiations.

The NFLPA represents more than 1500 players. Their main issues are to ensure that all those players obtain an adequate split of the revenues and fair health and retirement benefits. By comparison the franchise tag is a minor issue, even if every player envisions themselves in that situation. I don't understand why you think the tag issue should rank so high on the NFLPA agenda. You might as well talk about ending the draft and making all rookies free agents.

by Jerry :: Tue, 07/15/2014 - 6:58pm

Each side goes into the negotiation with a list of things they want, knowing that they'll have to give some up in the name of compromise. I don't pretend to know exactly what the NFLPA's priorities were/are, but maybe lessening off-season demands was more important to the membership than the franchise tag.

by tuluse :: Wed, 07/16/2014 - 10:39pm

It doesn't effect very many players and the players it does effect are getting big paydays either way.

by theslothook :: Thu, 07/17/2014 - 4:37am

YOu are overlooking the how much leverage it has. Even the threat of it's use can manipulate contracts in the team's favor. Think of Henry Melton and all the potential money he lost last year.

I fail to see any cogent argument for it's use other than allowing teams to leverage sweeter below market deals for their drafted players.

by LionInAZ :: Thu, 07/17/2014 - 8:21pm

tuluse is right. It affects at most 2% of the players, who get a big paycheck regardless. In exchange for keeping the tag, the NFLPA got $450 million dollars in more money (the difference between the owners' revenue offer and the settled amount) for all of the players. The tag is a minor issue.

Face it -- the NFL is not a free market operation. If it were, there would be no draft, no revenue sharing, and owners would not be allowed to decide who could own a team!

by tuluse :: Fri, 07/18/2014 - 10:38am

You asked why the NFLPA keeps accepting it, not if it's a good thing or not.

by MJK :: Thu, 07/17/2014 - 5:17pm

If a player wants to be safe from the franchise tag, all he has to do is what Revis did this year--sign a contract with a MASSIVE, completely fictional salary or roster bonus in a fictional last year. A team can only apply the franchise tag to an impending free agent--they can't cut a player to avoid the huge payout and then tag him. If they agree to such a contract, they're essentially locking themselves out of using the tag. Of course, they may want get something in return then, but that's why its a negotiation.

This doesn't work for rookies, of course.

by theslothook :: Thu, 07/17/2014 - 6:06pm

Revis' deal still doesn't really protect him from injury. IF he were to tear his acl again, then his next deal will be considerably lower. It may protect him from the franchise tag, but it bares the same level of risk.