This was linked in Mr. Dunsmore's Newswire, but it also merits special attention in a stand-alone post.
Since word of J.J. Watt's six-year, $100,000,000.00 ($51,800,000.00 of which is guaranteed) broke late Monday night, we've been waiting to see exactly how the Texans structured the deal. The obvious goal from the team's standpoint was to ensure that the structure of Watt's contract wouldn't prove to be so onerous as to prevent the Texans from making moves to improve the team in future seasons due to salary cap constraints.
A month ago, when discussing the timing of an extension for Watt, I mentioned the team's current projected cap room in 2015 and 2016 could urge the organization to get something done with Watt sooner rather than later. In other words, front-load the contract to take a good deal of the cap hit up front instead of kicking the can down the road and having to repeatedly request a restructure in the later years of the deal (e.g., Andre Johnson).
It appears the Texans did just that. John McClain reports:
Watt received a $10 million signing bonus. He gets a $10 million roster bonus in March. For cap relief, the 2015 roster bonus can be converted into signing bonus, depending on the Texans’ cap situation next year.
Technically, Watt’s contract is eight years for $108.8 million, but he gets $100 million in new money in the six-year extension.
The extra $8.8 comes from what was left in base salaries from his original four-year contract he signed in 2011. He’ll still get that $8.8 million this year and next year.
Watt’s base salary this year changed from $1.9 million to $907,385. His base salary in 2015 changed from $6.9 million to $9.969 million.
Beginning this year and extending through 2021 when he’ll be 32 and an 11-year veteran, here are Watt’s base salaries, with his cap figure in parentheses:
2014: $907,385 ($4.575 million)
2015: $9.969 million ($21.969 million)
2016: $10.5 million ($12.5 million)
2017: $10.5 million ($12.5 million)
2018: $11 million ($13 million)
2019: $13 million ($13 million)
2020: $15.5 million ($15.5 million)
2021: $17.5 million ($17.5 million)
I think Chris Olsen nailed it. Next year's hit is huge, but the Texans have room to digest it. After that, you're looking at relatively low hits from 2016-2019 before seeing a slight jump in 2020 and another jump in 2021. While the possibility of having to restructure in the last two years of the deal is there, the cap hit is not so prohibitive that it's a foregone conclusion, especially with the NFL salary cap expected to increase exponentially in the years to come.
As Texans fans, we should be doubly happy about J.J. Watt's contract extension. The best defensive player in football is staying in Houston through his prime, and the deal is structured in a fashion that won't handcuff the team going forward. It's win-win.
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