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Why the 49ers contract with Jimmy Garoppolo is a bargain

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NFL: San Francisco 49ers at Los Angeles Rams Jayne Kamin-Oncea-USA TODAY Sports

Thursday it was reported that Jimmy Garoppolo of the San Francisco 49ers had agreed to terms with the team on a five year contract that would make him the highest paid player in NFL history, at least for the next few weeks until Kirk Cousins of the Washington Redskins hits free agency. With just seven starts under his belt, including just five since the Niners acquired him from the New England Patriots, many fans felt the contract for Garoppolo was ridiculous when the overall size was reported yesterday. Now that the specifics are available, we can take a little deeper dive into the structure and examine what the contract means for the Niners.

That’s not laid out the prettiest, so here it is in table format similar to how the fantastic site OverTheCap.com would present it.

Jimmy Garoppolo contract breakdown

Year Salary Pro Rated Bonus Roster Bonus Workout/Per Game Bonuses Cap Hit
Year Salary Pro Rated Bonus Roster Bonus Workout/Per Game Bonuses Cap Hit
2017 $6.2M $1.4M $28M $1.4M $37M
2018 $17.2M $1.4M $1.4M $20M
2019 $23.8M $1.4M $1.4M $26.2M
2020 $24.1M $1.4M $1.4M $26.5M
2021 $24.2M $1.4M $1.4M $26.6M

The key thing to take note of is that the Niners used their massive cap space - they had been slated to have over $100M in cap space in 2018 - to front load the contract for Garoppolo. In particular, while Garoppolo received only a $7M signing bonus, he will receive a $28M roster bonus. There is no difference to Garoppolo between the two, but the difference for the 49ers is very large. The signing bonus will be amortized in five equal pro rated amounts of $1.4M, while the roster bonus will be recognized in one big chunk in 2018.

Effectively, what that large roster bonus does is immediately use up half of the $56M in salary cap rollover the 49ers were scheduled to bring into 2018 and give it to Garoppolo. In a sense, the team can justify the contract by arguing that the $28M signing bonus came out of the 2017 cap, leaving the remaining $109.5M of the contract to be recognized over the course of the 2018 through 2022 league years. Obviously, the $28M bonus will come out of the 2018 salary cap, but in terms of functionality, the team could have paid Garoppolo a $28M salary for 2017 and it would have had the same effect.

In any case, back to the contract. The giant signing bonus that is recognized in 2018 serves another major purpose as well - it eats up a huge portion of the potential dead money on the contract. Garoppolo could turn out to be another Ryan Leaf or Rick Mirer, and it would not hurt the Niners all that much because they could walk away after 2018 with just $13.1M in dead money. That dead money would come in the form of $7.5M in fully guaranteed base salary and the unamortized $5.6M of the signing bonus. To put that $13.1M in comparison, that is barely more dead money than the Seattle Seahawks may end up recognizing for Kam Chancellor ($12M), and is less dead money than the Hawks recognized when they unloaded Percy Harvin to the New York Jets ($14.1M).

And it only gets sweeter for the Niners from there. After the 2019 season the 49ers could release or trade Garoppolo with just $4.2M in dead money. Yes, that number is correct - only $4.2M, or basically nothing. Thus, while the Niners are indeed taking a risk by giving the largest contract in NFL history to a quarterback with seven career starts, they also have the ability to move on relatively inexpensively if he does not continue to play at a level that warrants a franchise quarterback contract. In short, given the absolutely massive amounts of cap space the 49ers had, it’s a pretty reasonable deal for the team.

In short, Garoppolo signed a deal that will make him the highest paid player in NFL history for about five weeks, but gives the 49ers easy, inexpensive outs pretty much anytime after the first year of the contract.

Of particular note regarding something that has been touched on briefly here in the past is that San Francisco has absolutely minimal dead money of only $2.8M if they are forced to move on prior to 2021. The reason that is important is because 2021 is when a new CBA will likely be in effect, and there is the potential for the salary cap to stagnate just as it did in the early years of the current CBA. For the Niners that should not be much of an issue, as the structure of this deal ensures them they will have the flexibility to adjust Garoppolo’s contract or move on should either of those prove to be the necessary next step.

So, is the contract expensive up front? Absolutely, but that is the price the Niners paid to have the flexibility that is build into the later years of the contract, and they had the available cap space to take on that kind of structure. In addition, Jimmy G is a winner. He’s already got two Super Bowl rings, though in fairness he kind of owes one of those to Russell Wilson.