The Kansas City Chiefs have rewarded the two most influential players from their Super Bowl LIV victory over the 49ers with gigantic contract extensions this offseason.
First, they gave quarterback Patrick Mahomes a record-breaking deal that could be worth up to $503 million. Then, they reportedly reached an agreement with star defensive tackle Chris Jones on another lucrative extension, a four-year deal worth up to $85 million, on Tuesday.
That’s a whole lot of dough for any offseason. In the midst of a global pandemic that is almost certain to cause a severe drop in league revenue, it might appear short-sighted and downright stupid on the surface. But the Chiefs didn’t climb to the top of the NFL by accident. And if you dig a little deeper, there’s a strategy at play.
For starters, as astronomical as Mahomes’ total salary is, the huge payments aren’t immediate. Mahomes carries a cap hit worth roughly $5.4 million for the upcoming 2020 season, making him arguably the most underpaid player in the league. In 2021, that cap hit balloons to $24.8 million — certainly a large jump, but still less than he is worth.
It’s only 2022 and beyond that Mahomes’ cap hit might prove burdensome to maintaining a championship-contending roster.
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Jones’ contract, on the other hand, is structured in almost the exact opposite manner. According to Over The Cap, all of the guaranteed money is paid out within the first two years of the contract, meaning Kansas City could theoretically cut Jones after the 2021 season and incur no financial penalty.
By structuring Mahomes’ and Jones’ contracts the way they did, the Chiefs managed to reward arguably their two best players and maintain their status atop the league in the immediate, while also providing the team with some financial flexibility down the line. Even star defensive end Frank Clark isn’t guaranteed any money beyond the 2021 season.
Now, the Chiefs’ plan doesn’t come without significant risk. If the salary cap drops significantly for 2021, then they’ll likely have to make some tough roster decisions, as they already have over $200 million in cap liabilities for that season.
Consequently, two things are clear. First, the Chiefs obviously are counting on the salary cap to surge upward in the near future. If it doesn’t, Mahomes’ contract might prove prohibitive to contention, no matter how good he is. And secondly, they’re going all-in on the 2020 season, presumably in an attempt to become the first back-to-back Super Bowl champions since the New England Patriots in 2003 and 2004.
What can the 49ers learn from this? First and foremost, it pays to have people in place that know how to get creative with the cap. Paraag Marathe certainly would qualify, so San Francisco is in good shape there.
Additionally, finding key contributors in the draft is essential to filling out a top-heavy roster. That’s an area where the Chiefs have had plenty of success, and the 49ers have done well, too.
More specifically, however, signing the likes of George Kittle, Fred Warner, Nick Bosa and other key players to contract extensions might not prove as impossible as it seems. Depending on how the contracts are structured, they theoretically could be balanced against one another so as to not pile huge salary commitments on top of one another in any given season.
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Ultimately, that takes two to tango. Players have to agree to the contracts that are offered to them, and their personal priorities don’t necessarily match up with those of the team often. That said, clearly, the tone has been set in the Chiefs’ locker room. Many of their players, even stars like Mahomes and Jones, have made sacrifices so as to maintain what might remain as the most formidable roster in the league.
If the 49ers hope to do the same — and ultimately eclipse the Chiefs — it likely will take a similar combination of buy-in, creativity and risk to make it happen.