For all you Packers fans that were hoping for a big name free agent splash, Ted Thompson would like to introduce you to one Julius Peppers, a guy you might have seen around on the Bears and the Panthers before. Some of you (including a fair proportion of our dear commentors) will never be happy because Peppers has never played in a 3-4 scheme, no one really knows exactly what his role will be outside of rushing the passer, has a long injury history and he’s 34 with a motor that’s starting to get cold (you do know that experienced and old usually go hand in hand right?). Well if you want to know what the Packers are going to do with Peppers, this isn’t the article for you. What this article will be looking into is not how Peppers will fit on the field, but how Peppers fits in the Packers salary cap.
As I’ve mentioned before in my previous article, the media and fans often fixate on the total value of the contract, which is probably the least important piece of information. One only has to remember how Donovan McNabb’s 5-year $88 million contract with the Redskins turned out to be more $3.75 million which he actually earned. Ironically, this is also probably the best example to use for Pepper’s contract with the Packers.
Julius Pepper signs 3-year, $30 million contract with the Packers (courtesy of Over The Cap)
2014: $1 million base salary, $2.5 million prorated signing bonus
2015: $8.5 million base salary, $2.5 million prorated signing bonus, $1 million roster/workout bonus
2016: $7 million base salary, $2.5 million prorated signing bonus, $1 million roster/workout bonus
Highlighted in bold are the real important numbers, which are values that Peppers has a good shot of actually receiving, namely Pepper’s signing bonus, which is guaranteed and the first year of his base salary which he will almost certainly earn. That aside, everything else depends on Peppers making the team. Most importantly, notice the jump in his base salary from 2014 to 2015, a staggering difference of $7.5 million. Essentially what this means is that Peppers has one year to prove to the Packers front office he’s worth keeping in 2015. If Peppers shows he’s run out of gas, can’t make the transition to a predominantly 3-4 defense, can’t stay healthy and on the field, the Packers can cut Peppers and only pay him $5 million after the end of 2014 season. It’s also possible that the Packers included offset language in their contract, meaning if Peppers is released and then signs for another team, Peppers loses the same amount of money he gained with the other team from the Packers. Again, keep in mind that the Packers have the leverage throughout the lifespan of contract; the Packer front office can ask Peppers to take a pay cut or a pay cut for a small increase in guaranteed money (which is what they did with AJ Hawk) and Peppers has to listen (As opposed to Aaron Rodgers, where cutting him would not save any money since Rodgers still has a lot of guaranteed money coming in). Overall, Julius Peppers can reasonably expect to earn at minimum $8.5 million.
Compare this Demarcus Ware’s contract that he signed with the Denver Broncos. Peppers and Ware are comparable in the sense that they are older, experienced pass rushers who at one point in time were considered some of the best at getting at the quarterback. On the facade, both received 3-year contracts worth $30 million, but look at how different the splits are.
Demarcus Ware signs 3-year, $30 million contract with the Broncos (courtesy of Over the Cap)
2014: $3 million base salary, $1.6 million prorated signing bonus, $5 million roster bonus
2015: $7 million base salary, $1.6 million prorated signing bonus
2016: $7 million base salary, $1.6 million prorated signing bonus, $3 million roster bonus
Again highlighted in bold is the money that Ware can reasonably expect to see. Again, Ware will almost certainly be on the Broncos in 2014, his signing bonus is fully guaranteed and his 2014 roster bonus will also almost certainly be earned. Ware also has to prove to the Broncos’ front office he’s worth keeping in 2015, but the important point is that Ware already won multiple concessions in his first year that covers the risk of being cut after one year. Overall, Demarcus Ware can reasonably expect to earn at minimum $12.5 million.
Now some of this might be explained by the fact that Ware is younger than Peppers, has experience in both a 3-4 and 4-3 defense and has roughly the same amount of sacks with 3 less years in the NFL. But really, neither Ware nor Peppers is a sure deal at this point in their careers; both have been injured and had to take heavily incentive ladened contracts and have to prove their worth. I would argue that in this situation guaranteed money is not the most important (as I argued it was with Sam Shields), it’s the value of the 1st year of the contract, which is the only year that either player can be fairly certain to be on their respective teams. In that regard the Broncos significantly overpaid for Ware, paying him $9.6 million compared to $3.5 million that the Packers will pay Julius Peppers. The Broncos are in a win now mode with Peyton Manning nearing the end of his career and with the signings of TJ Ward and Aqib Talib in the next couple of years the Broncos will be forced to go into salary cap slashing/ rebuilding mode and Ware is likely going to be one of the first players cut given his age and large salary in 2015 and 2016.
In conclusion, a lot of thought goes into a contract and usually it’s more nuanced than just the total money. For Sam Shields, the Packers crafted a contract that has the flexibility to pay him at market value regardless of what type of player he becomes. For Julius Peppers, the Packers crafted a contract that asks him to prove he still has something in the tank right away.
Thomas Hobbes is a staff writer for Jersey Al’s AllGreenBayPackers.com.