Author: Nick

Broncos have informed RB CJ Anderson they are matching Miami's offer sheet, per source. He stays in Denver.

— Adam Schefter (@AdamSchefter) March 15, 2016

John Elway has confirmed the news.

Just got off the phone w/CJ & let him know we're excited to match the offer sheet. We have high expectations for CJ and are glad he's back!

— John Elway (@johnelway) March 15, 2016

UPDATE, 2:45 PM MT: Mike Klis has now clarified the details of Anderson’s new contract.  In a tabular form, it should look like this:

Base Salary (Guaranteed)	Prorated Bonus	Workout Bonus	Cap Number	Dead Money (pre-June 1 cut)	Cap Savings (pre-June 1 cut)
$675,000	$1,312,500	$100,000	$2,087,500	$7,625,000	($5,537,500)
$2,900,000 $1,700,000	$1,312,500	$100,000	$4,312,500	$5,637,500	($1,325,000)
$4,500,000	$1,312,500	$0	$5,812,500	$2,625,000	$3,187,500
$4,500,000	$1,312,500	$0	$5,812,500	$1,312,500	$4,500,000

 

Ware and #Broncos finish re-structure, he got 2M to sign … He and team see his role as third-down rusher. Important player in locker room.

— Jeff Legwold (@Jeff_Legwold) March 12, 2016

I am using “alter” in my title here (previously “rework” if you look at the URL and tweet), because “restructure” is often poorly used by the media.  “Restructuring” should only be used to refer to the act of converting non-prorated salary into a signing bonus.  In Ware’s case, his contract cannot be restructured unless it was extended, as he only had one year left on his deal.  In order to save salary cap space, Ware either had to agree to an extension (either real, or fake by using void years), or he had to take a pay cut.  We will soon see what is the full truth.

UPDATE, 2:20 PM MT: It is indeed a pay cut (of $3.5 million) that can be earned back from incentives.  Bob posted some numbers by Albert Breer’s that gave an early glimpse at Ware’s pay cut.

UPDATE 2, 3:20 PM MT: Mike Florio is now reporting that Ware has $4 million fully guaranteed, not $2 million as initially speculated. Ware’s 2016 contract year should now look like this:

Base Salary (Guaranteed)	Prorated Bonus	Roster Bonus*	Cap Number	Dead Money (if cut)*	Cap Savings (if cut)*
$4,000,000 ($2,000,000)	$3,666,668	$500,000	$8,166,668	$5,666,668	$2,500,000

*It is unclear when Ware’s roster bonus is precisely due.

One interesting aspect is that the Broncos only guaranteed $2 million of Ware’s salary in exchange for the $3.5 million pay cut.  Hypothetically, should the Broncos decide before the regular season that Ware isn’t worth an additional $4-4.5 million (depending on the timing of the roster bonus being due), Ware could still be cut before then.  I see that as highly unlikely, but the option is there.

I’ve struck out the paragraph above because if Ware does indeed have an addition $2 million in guaranteed base salary, $5.66 million in dead money is not quite as appealing in exchange for only $2.5 million in cap savings.  As Florio speculated, this likely provides some security to Ware against being cut prior to the regular season.

Should Ware earn any of his incentives, they should be charged as a negative adjustment to Denver’s 2017 salary cap, as Peyton Manning’s $4 million Super Bowl bonus was charged in 2016.

NFL Communications released the 2016 compensatory picks for the 2016 NFL Draft, and as happily projected, the Broncos will receive an additional 3rd, 4th, and 6th round selections.  It is my belief that these pick are compensation, respectively, for losing Julius Thomas, Orlando Franklin, and Terrance Knighton in free agency in 2015.  The Broncos now have 10 selections in the 2016 NFL Draft.

I will have a longer evaluation on my projection at Over The Cap later today, but one unique observation I want to make with respect to the Broncos is that this may be the first year since compensatory picks were founded that there were no 7th round comp picks awarded.  That means that the famous Mr. Irrelevant pick, unless it’s traded, will go to your Super Bowl 50 champion Denver Broncos.  The Broncos have never held the Mr. Irrelevant pick in their entire history.

The overall positions of the Broncos’ 2016 draft picks are as follows:

Round	Overall	Notes
1	#31
2	#63
3	#94
3	#98	Compensatory (Julius Thomas)
4	#136	Compensatory (Orlando Franklin)
5	#144	from Baltimore
6	#219	Compensatory (Terrance Knighton)
7	#228	from San Francisco
7	#235	from Los Angeles via Houston
7	#253	Mr. Irrelevant

 

Brock Osweiler is now a Houston Texan, signing a contract reported to be in the range of $18 million per year.  There’s already a lot of innuendo on why Osweiler chose to leave Denver.  Mike Klis, for example, reported that there was a lack of communication from Osweiler over the past two weeks.  There’s been rampant speculation that Osweiler may have been upset from being benched in the Chargers game on Week 17 of 2015.

I’m going to take nothing more than a guess on why I think Osweiler chose the Texans over the Broncos.  However, my hope is that this is an Occam’s Razor type of guess.  My guess is that Jimmy Sexton thought that the Broncos severely lowballed Osweiler with the initial offer in the $13-15 million per year range.  And as Houston proved today, and Philadelphia proved with Sam Bradford a week ago, Sexton was correct if he came to that conclusion.  Once it was clear the Broncos weren’t going to breach $18 million, there was likely no need for either side to seriously negotiate further.

Now, I’m perfectly fine with the Broncos holding firm and refusing to sign Osweiler to an $18 million per year plus deal.  John Elway is excellent about standing firm and not getting the team in trouble by overpaying.  That’s what makes him one of the best GMs in the business.  And of course, the Broncos proved without a shadow of a doubt that you can win Super Bowls with a dominant defense amid mediocre quarterback play.

However, I think the Broncos would also be wise to accept the fact that there simply is no existing mid-level market for veteran starting QBs.  So many of us at Thin Air thought Osweiler could be had with a Nick Foles contract, but we were all dead wrong: Foles, along with Tom Brady, have become outliers.  Excluding them, the veteran starters start at $16 million per year and go up from there.  As Osweiler proved, even $16 million per year may now be too cheap.

So what’s the conclusion I’m coming to?  Before I get there, allow me to comment on some actions that I would not take.

• First, I would cross Ryan Fitzpatrick off the prospective quarterback list.  As Adam Schefter repeated many times on the air at ESPN today, if Bradford and Osweiler got $18 million per year, Fitzpatrick has every reason to demand the same for starting for a Jets team that was on the brink of making the playoffs.  Fitzpatrick being represented by Jimmy Sexton also doesn’t help matters.
• I would also not seriously consider trading for Mike Glennon or AJ McCarron, as some have speculated.   Even if the Broncos hit on one of them, they could be in the same predicament in 2017 (for Glennon) or 2018 (for McCarron) as they were for Osweiler in 2016. Plus, they would be out significant draft pick compensation for acquiring them.
• For the similar reason of giving up draft capital, in previous comments I’ve been cold on trading for Colin Kaepernick.  However, I’m starting to thaw on it a bit for the reason that at least he’s under contract for five more years.  In 2016, his maximum compensation of $14.3 million looks like a bargain, and $16.9 million in 2017 may not be too bad either.  Furthermore, if acquired by trade, the Broncos would inherit a pure “pay as you go” contract as the prorated bonuses from Kaepernick’s signing bonus remain the 49ers’ worries.  If Kaepernick flames out, he could be cut with no dead money against the Broncos. However, it should also be cautioned that as yet, the 49ers have shown no public interest in trading Kaepernick, so this may not be an option available to begin with.

That leaves the Broncos with picking from a motley crew of remaining quarterbacks on the market.  I would prefer Robert Griffin III simply because he has the most upside, and that because he was cut, he would count against the Broncos in their 2017 compensatory pick formula.  However, perhaps I could be persuaded on another option.

But even if Griffin or someone else is acquired, that’s clearly not enough insurance at the position.  Thus, here’s the primary conclusion I’m at now: draft a quarterback with the 31st overall pick.  And in fact, don’t be afraid to trade up a bit if there’s good reason to believe that another team in the high second round thinks about trading back into the first round. And take him in the first round, so you can take advantage of that economic fifth year option.

If the Broncos really want the quarterback position to take up a smaller amount of the salary cap, this is the only realistic path to take.  That’s how the Colts are free riding on Andrew Luck despite taking him first overall.  That’s how the Seahawks free rode on Russell Wilson for several seasons.  Of course, it is much easier said than done to hit on that rookie quarterback.  However, thanks to the veteran quarterback premium, it may very well be the only path to take if the Broncos want to continue to prove the mantra of defense winning championships.