On June 15, 2018, the Houston Texans announced an agreement on a contract extension had been reached with veteran inside linebacker Benardrick McKinney. Contract terms were not made available at that time, but now we have the details. Today’s analysis will cover all aspects of the contract including comparisons against other contracts at the inside linebacker position. Initial media reports announced the contract as a 5 year extension worth $50 million with $21 million guaranteed.

McKinney’s 2018 cap charge increased from $1,700,721 up to $7,700,721. McKinney is 25 years old heading into the 2018 season.

History

McKinney was entering the final year of his 4-year rookie contract (worth total value of $5.35 million) signed in 2015, scheduled to earn $1,163,880 in salary for the 2018 season with a salary cap charge of $1,700,721. McKinney has outperformed his rookie contract through the first 3 years of service, and routinely has been one of the best deals in the league when measured on the snaps per cap dollar metric (per Overthecap).

McKinney has played in 46 of 48 available regular season games for seasons 2015 through 2017 including starting in 43 of those games. McKinney has been remarkably durable for the Texans through this stretch. McKinney took over defensive play call duties in 2017, and became the defensive leader as well.

2016 was McKinney’s best performance pulling in 129 tackles (79 solo) with 5 sacks. McKinney is a run stuffing linebacker with excellent pass rush abilities playing off defensive line stunts. Paired with the speedy Zach Cunningham and versatile Dylan Cole, the Texans potentially have one of the better inside linebacker groups in the league.

Contract Details

McKinney’s contract is a 5 year extension worth $50,000,000 in new money with a total value of 6 years $51,163,880. The contract structure is the usual Chris Olsen special, utilizing a hybrid model of a small signing bonus with a large year 1 roster bonus. The contract is very close to a straight cash model, aligning the cap charge with the cash received in each year of the contract. The contract is also flat with small cash increases in the first 4 years of the contract.

Salary cap table breakdown below:

Year Salary SB RB PGRB Cap Charge Cash Cash Flow 2018 $1,163,880 $1,286,841 $5,250,000 $0 $7,700,721 $10,163,880 $10,163,880 2019 $6,000,000 $750,000 $0 $750,000 $7,500,000 $6,750,000 $16,913,880 2020 $6,000,000 $750,000 $0 $750,000 $7,500,000 $6,750,000 $23,663,880 2021 $7,000,000 $750,000 $0 $750,000 $8,500,000 $7,750,000 $31,413,880 2022 $8,750,000 $750,000 $0 $750,000 $10,250,000 $9,500,000 $40,913,880 2023 $9,500,000 $0 $0 $750,000 $10,250,000 $10,250,000 $51,163,880

SB = signing bonus pro-ration

PGRB = per game roster bonus

RB = roster bonus (lump sump)

P5 salaries in 2018 and 2019 are full guaranteed at signing. The P5 salary in 2020 is guaranteed for injury only (details on vesting date still unknown). Expect the 2020 salary to become fully guaranteed in March 2019. McKinney will receive a $3,750,000 signing bonus and a lump sum roster bonus of $5,250,000 in the coming days. McKinney can earn up to $750,000 per year in bonuses, paid $46,875 per game active, in 2019 through 2023.

McKinney is now scheduled to earn an additional $10 million for 2018 versus the initial $1.163 million from his rookie contract. Compared to the market this is a solid contract ranking in the top 4 in many of the standard contract metrics.

McKinney did make a few concessions, specifically in two areas of the contract: length and large per game roster bonuses. The player giving his rights to the team for 6 years, in today’s NFL, is not the best tactic. The life cycle of a top of the market or near the top of the market for NFL players is 2 to 3 years. The player’s performance either drops off causing the team to move on from the player, or the market value of the position increases beyond what the player is scheduled to earn leading to a hold out.

McKinney is scheduled to earn up to $750,000 in bonuses in each year starting in 2019 through 2023 via per game roster bonuses. For each game McKinney is on the 46-man game day roster, he will earn $46,875. Given McKinney’s history is rarely missing games; this is an area McKinney decided to concede on for the team to give more cash in the first three years of the contract. The Texans generally include per game roster bonuses in all their veteran contracts, but at a lesser value. 7.5% of the new money is tied to McKinney’s ability to stay healthy and be available for game days. That is a large concession at 7.5%, especially compared to the contracts at the position.

Market Comparisons

The market for veteran contracts at the inside linebacker is a small group. Luke Kuechly and Bobby Wagner are undoubtedly the best two inside linebackers in the game. Both Kuechly and Wagner received top market extensions in 2015 and three years later both contracts are still number 1 and number 2 at the position. There was never an expectation for McKinney to eclipse those contracts. The contract does put McKinney has a Top 5 contract at the position when compared to the market.

Five players used for market comparisons are: Luke Kuechly, Bobby Wager, Alec Ogletree, Erick Kendricks, Christian Kirksey, and Anthony Hitchens. Note that Hitchens was a free agent when he signed with Kansas City versus the other four players who received contract extensions.

The below table shows four metrics: New Money, New Money APY, Paper Total Value, and Paper APY.

Player Type New Money New Money APY Total Value Paper APY Benardrick McKinney Extension $50,000,000 $10,000,000 $51,163,880 $8,527,313 Luke Kuechly Extension $61,795,295 $12,359,059 $74,958,560 $10,708,366 Bobby Wagner Extension $43,000,000 $10,750,000 $43,977,427 $8,795,485 Alec Ogletree Extension $42,000,000 $10,500,000 $50,369,000 $10,073,800 Eric Kendricks Extension $50,000,000 $10,000,000 $51,138,080 $8,523,013 Christian Kirksey Extension $38,000,000 $9,500,000 $39,797,000 $7,959,400 Anthony Hitchens Free Agent $45,000,000 $9,000,000 $45,000,000 $9,000,000

New money is defined as money scheduled to be received beyond what the player was originally scheduled to receive. McKinney was scheduled to earn $1,163,880 in 2018 as part of his rookie contract, and $50 million in new money as part of his extension. Adding the old money with the new money gives the paper total value of the contract.

New money APY (average per year) is the standard metric utilized by agents and teams when comparing contracts at the position and across the league. As you can see Kuechly is far ahead of anyone else at the position at $12.3 million per year. Kuechly was a first round draft selection in 2012 and has received 4 First Team All-Pro selections along with 5 Pro-Bowl selections. Wagner has received 3 First Team All-Pro selections with 4 Pro-Bowl selections. These two players should be considered Elite/1st Tier at the position, with the other players (including McKinney) on the 2nd Tier.

McKinney and Kendricks both received extensions this offseason, and their contracts are almost identical in value. McKinney and Kendricks however are different linebackers. McKinney is more of a run stuffing and blitzing linebacker versus Kendricks who drops into coverage more often. In 2017 McKinney had 319 snaps in coverage versus Kendricks with 532 snaps in coverage per ProFootball Focus. McKinney was targeted only 29 times versus Kendricks with 78 targets.

The below table shows four metrics: Full Guarantee (at Signing), Full Guarantee Percentage, Total Guarantee (vesting), and Total Guarantee Percentage.

Player Type Full GTD Full % Total GTD Total % Benardrick McKinney Extension $16,163,880 32.3% $21,000,000 42.0% Luke Kuechly Extension $27,000,000 43.7% $36,363,324 55.6% Bobby Wagner Extension $8,977,427 20.9% $21,977,427 51.1% Alec Ogletree Extension $18,907,529 45.0% $31,369,000 74.7% Eric Kendricks Extension $11,638,080 23.3% $22,938,080 45.9% Christian Kirksey Extension $14,797,000 38.9% $20,000,000 52.6% Anthony Hitchens Free Agent $21,290,000 47.3% $25,090,000 55.8%

Contract structure varies greatly between teams making it the guarantee numbers not a true metric. But felt it was pertinent to provide the information in this comparison. Contracts with a heavy signing bonus structure may not yield a large true guarantee but does offer strong virtual guarantees. A virtual guarantee example could be Bobby Wagner’s contract. Seattle utilized an option bonus in year 2 of the contract making the dead money strongly outweigh the yearly cap charge, virtually guaranteeing Wagner’s roster spot. This table does highlight the contract, from a guarantee % standpoint, Alec Ogletree received from the Rams in 2017.

The below table shows the running cash flow broken down by each year of the contract. Year 0 is used for contract extensions. McKinney’s contract was signed in 2018, but from a measurement standpoint year 1 of the extension starts in 2019.

Player Type Year 0 Year 1 Year 2 Year 3 Year 4 Benardrick McKinney Extension $9,000,000 $15,750,000 $22,500,000 $30,250,000 $39,750,000 Luke Kuechly Extension $13,836,735 $21,200,059 $29,300,118 $39,800,177 $50,600,236 Bobby Wagner Extension $8,000,000 $15,500,000 $20,500,000 $31,500,000 $43,000,000 Alec Ogletree Extension $3,000,000 $13,000,000 $23,000,000 $33,000,000 $42,000,000 Eric Kendricks Extension $10,500,000 $15,000,000 $22,500,000 $31,000,000 $40,500,000 Christian Kirksey Extension $8,000,000 $13,000,000 $20,000,000 $28,750,000 $38,000,000 Anthony Hitchens Free Agent $0 $14,800,000 $21,500,000 $30,000,000 $36,500,000

This metric shows the yearly cash of McKinney’s contract compared to the market. Excluding Kuechly’s contract, McKinney’s 3-year cash flow ($30.25 million) is close to market value. McKinney actually exceeds Wagner’s deal through Year 2 of the extension, making the cash flow positive for McKinney comparatively. McKinney’s cash flow is identical to Kendricks through Year 2. Expected McKinney to have a stronger 3-year cash flow given the concessions he made on length and PGRB’s. The Texans were able to keep the contract salary rate in 2019 (Year 1) to 2020 (Year 2) flat at $6 million each, with a small raise in 2021 (Year 3) at $7 million.

Final Thoughts

Who won on this contract…the player or the team? In most cases if a contract was executed between a player and team that would mean both sides won. A successful partnership on contracts between the player and team heavily rely on give and take or concessions. Each side has specific aspects of the contract they want to reach or achieve.

The Texans were able to lock down a 25 year old inside linebacker for 6 years with a flat contact structure; conceding $21 million in possible guarantees while paying McKinney over $23 million through the 2020 season. In return, the team received the additional length of the contract as well large per game roster bonuses worth 7.5% of the total contract value. The flat P5 structure gives the team the opportunity to retain the player at below market value in the additional years of the contract.

McKinney conceded the length and structure in exchange for the solid guarantee amount as well as the expected cash flow through Year 3 of the contract. Players will always need to make concessions if they sign a contract with years left on their previous contract.

McKinney’s cap charge in 2018 is less than 4.5% of the team cap, and drops below 4% (projected) in 2019 and 2020. That marks great value for the team allowing additional expenditures at other positions.

McKinney likely could have eclipsed Kuechly’s contract if he declined the extension and bet on himself as well as putting together a solid campaign in 2018; allowing him to reach the open market in 2019. McKinney determined that the contract offered by the team met his requirements in both future guarantee for him and his value as well as the monetary value of the deal.

The McKinney contract marks the third contract in the past four offseasons that the team locked down a core player on a long-term deal of 6 years or longer. J.J. Watt received a 6-year extension in 2015, Deandre Hopkins received a 5-year extension in 2017, and now McKinney with a 5-year extension.

The Texans did not front load McKinney’s contract as much as was expected, but the team continues to be consistent with their structure and methodology on their long-term player contract. Consistency is one of many factors to successfully managing a team salary cap in the NFL.

-TC

Information Sources:

Over The Cap

ProFootball Focus

Pro Football Reference