Franchise Tag Position Problems

By Michael Gertz
Friday, March 7, 2014

The franchise tag the Saints have put on Jimmy Graham has raised several questions about the franchise tag itself. It also shines a light on other similar issues with the franchise tag position breakdown.

Franchise Tag Position Problems

Below are the franchise tag values for 2014 for each position in millions of dollars. When franchise tagged, a player will receive that amount of money on a 1-year contract. The numbers are based on the average of the top 5 NFL salaries at each position.

Quarterback: 16.192
Running back: 9.540
Wide receiver: 12.312
Tight end: 7.035
Offensive lineman: 11.654
Defensive end: 13.116
Defensive tackle: 9.654
Linebacker: 11.455
Cornerback: 11.834
Safety: 8.433
Kicker/punter: 3.556

The tight end distinction is among the least egregious of the problems with this system. The most glaring is the complete ignorance of the difference between the 4-3 and 3-4 defenses. While most teams play forms of these defenses which are ultimately very similar, they give different positional names to players. A 4-3 defensive end is nearly equivalent to a 3-4 outside linebacker, while many 3-4 defensive ends function essentially as a defensive tackle. Because pass rushers are more valuable than true linebackers and defensive tackles, this has major implications on franchise tags.

The top-5 NFL salaries contributing to the franchise value for linebackers are annually dominated by 3-4 outside linebackers. Therefore, all other linebackers that don't primary pass rush will very rarely ever be franchise tagged. And the salaries contributing to the franchise value for defensive ends is dominated by edge rushers, so 3-4 defensive ends that are interior rushers will rarely be tagged. Because most teams use both the 4-3 and 3-4 defensive, or some form of hybrid, the franchise tag position definitions give the average team an incentive to claim that it runs a 3-4 if it may have to franchise tag an edge rusher that it could claim is an outside linebacker rather than defensive end. There is also an incentive for a team to claim it runs a 4-3 if it may have to franchise tag an interior lineman that it could claim to be 4-3 defensive tackle rather than a 3-4 defensive end.

A similar effect comes into play on the offensive line due to the lack of positional distinctions. The values are mostly set by salaries from left tackles, so centers, guards, and even right tackles will rarely have enough value to be franchise tagged. Finally, kickers and punters being able to be tagged seems to go against the theory of the franchise tag "giving teams another opportunity to avoid losing their most important players to free agency". Any argument to include kickers and punters in the franchise tag would also be valid for including fullbacks and long snappers, or even other kick returners or special teams players who are not included.

Most of the positional issues above never get challenged by tagged players because the general effect is positive for certain players, in that the mislabeling makes them less likely to be franchise tagged. The 3 exceptions are 3-4 outside linebackers that want to be labeled defensive ends, 4-3 defensive tackles that want to be labeled 3-4 defensive ends, and tight ends that want to be labeled wide receivers. The 3-4 outside linebackers probably have the best case, as they play a role most similar to those top-5 players that the franchise value is based on. But it is difficult to argue that your team actually plays a scheme different than the one the coaches claim to run.

What is a Tight End?

A tight end is historically a player who is an eligible receiver but lines up right next to the offensive line. Over the years however, teams started to use tight ends in more versatile roles, including essentially lining up at wide receiver or fullback for certain plays. Jimmy Graham lined up out wide for about 2/3 of his snaps last season, and the NFL rules seem to say that a franchise player is judged by his position for the majority of his snaps. But does that make him a tight end lining up out wide or a wide receiver on those plays?

The NFL could reasonably argue that the job description of a tight end is to sometimes line up inside and sometimes line up outside. After all, it would seem strange to have 2 players both labeled as wide receivers, when 1 of them lines up next to the offensive line on 1/3 of his plays and the other doesn't. Both sides of the argument make sense, and there doesn't seem to be a concensus on how the arbitrator will rule.

Will Another Team Sign Graham to an Offer Sheet?

One thing we do know for certain is that another team will not sign Jimmy Graham to an offer sheet at the expense of two 1st round picks. And it goes to show how little the media knows that the idea of a team signing him has been floating around. Many people seem to think that a player's trade value is solely determined by the quality of the player. But trade value is all about how underpaid a player would be for the team acquiring him.

The whole reason draft picks have value in the first place is because the rookie wage scale underpays players on their rookie contracts. The trade value of a top-10 pick was much lower prior to the most recent CBA than it is today, because those players received contracts that gave them twice the salary of a current top-10 pick.

The main reason players generally have a trade value similar to their quality as a player is that better players receive bigger signing bonuses. For instance, the Browns drafted Trent Richardson in 2012, paid him a $13 million signing bonus, and then traded him to the Colts in 2013. In both real money and against the cap, the signing bonus stayed completely with the Browns while only upcoming salaries got transferred to the Colts. So his value to Indianapolis was largely due to the fact that for them his future salaries are a fraction of what they would have been with the signing bonus included.

Later in contracts, base salaries can be so high that the signing bonus can't even offset a player's trade value. DeMarcus Ware is still a good player, but has virtually no trade value because his upcoming salaries are so high. In these cases, teams often restructure a player's contract to pay them less, extend their contract at a cheaper rate, or simply cut them.

If the Saints signed Jimmy Graham to a fair market, let's say 5-year, $45 million contract today and gave him a $20 million signing bonus, he would instantly have immense trade value, even perhaps that of the two 1st round picks it would take to sign him to an offer sheet. That is because any team trading for him would essentially have just signed him to a 5-year, $25 million contract. The $20 million discount in real money and cap space would provide the trade value.

Now let's consider what signing Graham to an offer sheet would entail. Graham might give a team a slight discount in order to get out of earning only $7 million in 2014, and the risk involved with a 1-year contract, but the maximum discount he would reasonably take would probably max out at around $5 million over the course of a long-term contract. The average 1st round draft pick is probably underpaid by at least $5 million over the course of their rookie contract, meaning even if Graham gave a team the biggest discount he reasonably could, his value would maybe max out at one 1st round pick, and be nowhere near the two 1st round picks that it would take to sign him to an offer sheet.