Julius Peppers and franchise-tag economics

It behooves both the Panthers and Julius Peppers to reach a long-term deal. (Kevin C. Cox / Getty Images)

It behooves both the Panthers and Julius Peppers to reach a long-term deal. (Kevin C. Cox / Getty Images)

As I reported Wednesday, the Carolina Panthers have been quietly talking about a long-term extension with star DE Julius Peppers for a few weeks now, with both sides amenable to a deal. Peppers signed his franchise tag Wednesday, which guarantees his $16.7 million salary for this season, with a chance to earn a few million more in incentives. His putting pen to paper, a positive development for both team and player, came as a result of some very productive direct meetings between Peppers and team officials, according to sources, with Peppers feeling good about his role on the team and potential future with the club for which he has played his entire career.

The Panthers are in a cap bind, and that $17 million figure looms large. They’re close to a deal with defensive end Everette Brown, their top pick in the 2009 draft (a second rounder), according to a league source, but they need to create more cap room to get the rookie class inked. Getting a new deal done for Peppers would clear out more than enough room, as his new bonuses could be prorated and spread across the length of his contract, thus lowering his cap figure. It’s funny how the franchise tag in many ways ends up driving the sides together — after a bit of acrimony when players are first tagged — based on the incentives it creates to get a deal done (including the July 15 cutoff by which the sides must agree to any new contract that would include the 2009 season).

Consider:

If the Panthers have Peppers play for the $17 million this season, can’t strike a deal and franchise him in excess of $20 million next season, that’s roughly $40 million in two years, with cap figures eating up a massive chunk of their overall space. It doesn’t take a rocket scientist to figure out that Peppers paid close attention to that huge free-agent contract DT Albert Haynesworth signed with Washington back in March (which includes $41 million guaranteed). But in that case, it’s spread across the deal, keeping the cap figures more manageable. And it’s also no secret that the contract for top defensive players have ranged between $12-$15 million per season, so that’s the threshold Peppers would want.

Carolina GM Marty Hurney told the team’s website on Wednesday that the Panthers would not rule out putting the franchise tag on Peppers again in 2010 if need be, which, as we went over, would amount to a possible $40 million commitment over two years. When you look at it from the perspective of which way you want that $40 million sliced up, it would behoove the team from a cap standpoint to have it come from a long-term deal. And for Peppers, obviously, in a sport as violent as this, you’d rather have the $40 million guaranteed in the present rather than play for $17 million this season and risk getting hurt badly and never getting that second franchise-tag payday.

Thus, there is plenty of motivation on both sides to try to get something done. I have heard from multiple sources that the dialogue between the two sides has been cordial and open throughout this ordeal, even when Peppers asked for a trade and passed on all offseason team activities. The Panthers have been adamant through it all that they have no intention of trading the sack-master.

So what would you guys do? Do you make the long-term commitment? Do you make him play out the tender this season and then re-assess once/if the CBA situation becomes clearer? Would you want to wait until a potentially uncapped 2010 to take action? Do you worry about age at all, with Peppers now 29? Do you fret at all about his 2007 season (2.5 sacks), or do you focus on all the double-digit sack seasons, including a career-best 14.5 last season, with the Panthers looking like legit Super Bowl contenders until a playoff meltdown?

Let’s play some armchair GM in the dog days of June.

Jason La Canfora

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