There is a fallacy in thinking the Cowboys would be better off by waiting to sign Dak until next year. DeMarcus Lawrence would have signed last year for 5 years, $85M and thought he got a good deal. This year, it cost the Cowboys a 5-year, $105M deal to get him signed. The Cowboys lost $20M by refusing to give him the deal last season.
If Dak is wililng to sign a 5 year extension for $28M per season now, then if he has another Pro Bowl season next year and wins in the playoffs again, his asking price will be in the $31-32M range. If he wins a Super Bowl, it is likely to be $35M per season (remember Joe Flacco?). So, the Cowboys have to choose between a $140M extension now, or a $160M extension later. Unlike Lawrence, who had only one good year before entering last season, Dak won Rookie of the Year in 2016, made the Pro Bowl in 2016 & 2018, and has led the team to 3 consecutive winning seasons, and a playoff win last year. He doesn't need a "Prove It" year to show consistency.
Given that Dak is scheduled to make $2M this season, let's take a look at how a $28M/season extension would impact the Cowboys - $140M with $75M guaranteed.
2019 - $37.025M cash paid - $2.025M Salary + $35M signing bonus
2020 - $25M cash paid - $1M Salary + $24M restructure bonus
2021 - $15M cash paid - $15M Salary
2022 - $18M cash paid - $18M Salary
2023 - $20M cash paid - $20M Salary
2024 - $27M cash paid - $27M Salary
Here are what the Salary CAP numbers look like over the same period with a 5-year, $140M extension, with $75M guaranteed:
2019 - CAP hit = $9,120,848 ($2,025,000 salary + $7,095,848 prorated bonuses) - DEAD Money = $75,095,848
2020 - CAP hit = $12.8M ($1M salary + $11.8M prorated bonuses) - DEAD money = $68M
2021 - CAP hit = $26.8M ($15M salary + $11.8M prorated bonuses) - DEAD money = $55.2M
2022 - CAP hit = $29.8M ($18M salary + $11.8M prorated bonuses) - DEAD money = $28.4M
2023 - CAP hit = $31.8M ($20M salary + 11.8M prorated bonuses) - DEAD money = $16.6M
2024 - CAP hit = $31.8M ($27M salary + 4.8M prorated bonuses) - DEAD money = $4.8M
Note that the Cowboys get two more seasons of relatively low CAP hits at the QB position, then 1 year at $26.8M CAP hit; but, they are only actually paying Dak $15M in 2021 - much lower that what is likely to be the going rate of about $30-31M per season by then.
Also, starting in 2022, the DEAD Money CAP hit is actually less than the projected CAP hit, giving the Cowboys ways out of the contract in 2022 and 2023 if Dak's performance craters, and the Cowboys move on. So, CAP savings if Dak is cut or traded are:
- 2022 - $1.4M
- 2023 - $15.2M
- 2024 - $27M
The advantages to doing the deal now are 5-fold
- Dak is happy because he gets paid, and isn't under the weight of having to perform and worry about his contract status
- The Cowboys have a much more manageable situation for their salary CAP by being able to spread the signing bonus over 2019, in addition to 2020-2024
- The Cowboys ultimately save money
- The Cowboys get an earlier out on the contract if Dak's performance craters.
- With Dak's contract done, the Cowboys can start working on extensions for Amari Cooper, Anthony Brown and Byron Jones***
But they will be "stuck" with Dak for the next 3 seasons - something most fans and the front office are more than willing to risk.
That is a better deal than waiting for another season. If Dak remains consistent, which includes his inaccuracy and fumble issues, but also includes him leading the team to winning records, and winning playoff games, then you can expect his price tag next season to be in the $31-32M price range. Let's say they sign him next year to a 5-year $157.5M deal - averaging $31.5M per season. Even with signing bonuses, the CAP hits become much more problematic for the Cowboys. And if Dak happens to win a Super Bowl this coming season, his price likely goes to $35M per season. Even if Dak remains a mediocre QB, other mediocre QB's (like fellow 4th round pick Kirk Cousins) are getting $27M per season guaranteed contracts. That was last year. So $28M per season will soon be seen as a low starting salary for a top QB, and an average salary for an average QB.
*** Amari Cooper, Anthony Brown and Byron Jones extensions are higher priority than Elliott and Jaylon Smith. Elliott can be retained by exercising his 5th year option, and Jaylon Smith is a restricted free agent next season, and Cowboys can tender him at a 1st round level to secure his services.