Reuters

The Saints have applied the franchise tag to tight end Jimmy Graham. The NFL’s Management Council has concluded that Graham is indeed a tight end and not a receiver for purposes of the tag.

As to what happens next, Saints G.M. Mickey Loomis isn’t really sure.

“We haven’t been through this process [before],” Loomis told Rich Gannon and Bruce Murray of SiriusXM NFL Radio. “All we do is franchise him, and it’s out of our hands.”

Pressed for details on the actual procedure for making the case for tight end versus receiver, Loomis likewise explained that the Saints are in uncharted waters.

“I haven’t been through this process,” Loomis said. “That remains to be seen.”

Loomis nevertheless remains confident that things will work out.

“These negotiations are always a process, and Jimmy’s been a great player for us for the last four years,” Loomis said. “Look, I had hoped and I’m sure he had hoped we’d come to some conclusion on a longer-term deal before this. But we haven’t yet, and hopefully we will. . . . We’ll just let it play out, and I’m sure we’ll get something resolved.”

Absent a resolution in the near term, the question of whether Graham should get the tight end tender of $7.035 million or the receiver tender, which is $5.277 million higher, will be resolved by a System Arbitrator.

The question ultimately will turn on identifying “the position . . . at which the Franchise Player participated in the most plays during the prior League Year.” Put simply, Graham should argue that, when a tight end lines up in the slot, he’s a receiver. The Saints will argue that, when a tight end lines up in the slot, he’s still a tight end.

According to Pro Football Focus, Graham lined up tight to the tackle 33 percent of the time in 2013, in the slot 45 percent of the time, and split wide 21 percent of the time. The position into which those slot plays fits will determine whether Graham is a tight end or a receiver.

For both sides, it makes sense to control the outcome and strike a deal that pays Graham an annual rate in the middle of $7.035 million and $12.312 million per year. If the Saints and Graham both feel confident in their position, there will be no middle ground.

Which means that both sides will be making a gamble on $5.277 million per year — which will quickly become a much larger number on a multi-year contract.