Is Kam Chancellor underpaid? A breakdown of the NFL's strong safety market

Last August, reports surfaced that Kam Chancellor was considering a holdout as leverage to re-negotiate and modify his contract with the Seahawks.

Chancellor was just one year into his new deal, and many questions and claims from fans and media swirled around the holdout: How can a player do this one-year into his deal? Was Chancellor being selfish? Is he actually underpaid? Did the Seahawks really swindle him? Are his teammates in support of him? When's Chancellor coming back?

We all know how the story goes: Chancellor sat out two games, both of which the Seahawks lost, and the holdout had a largely negative impact upon the team as a result of his missed presence. The team was set back because his absense, chemistry was missing, and the Seahawks were now the main source of the national media's attention. Now, a year later, Kam is still likely not satisfied with his contract -- and may still be arguing with the Seahawks behind closed doors about modifying his contract.

But the question remains: Is Chancellor truly underpaid?

I don't think this is a fully subjective question. In fact, I think this is a factual question. So let's approach this question, factually -- absent as much bias as possible. I'm going to give you three main methods to evaluate Chancellor's contract (and contracts in general) -- via both a simple approach and two more analytical approaches. However, the two latter approaches are much more useful, as they are the types of verbiage agents and team negotiators are actually discussing behind closed doors. Once the numbers have been presented, we can then make an accurate, educated claim to his contract. Let's get right into it.

Method #1: APY or Average Per Year

Whenever a new contract gets leaked to the media, if you scroll through Twitter, you'll typically read reporters throwing around the term "APY". APY stands for Average Per Year. The term is extremely simplistic in understanding, and is an effective way of communicating ballpark figures for a contract. However, it doesn't do much more than that. For example, let's say fictional linebacker Kenny Delly agrees with the Rams on a deal worth $20M over four years. The APY of Delly's contract would be $5M APY. Simply take the total value of the contract and divide by the years of the contract. In this case, its $20M divided by four years, equaling $5M a year.

Does that make sense? Pretty self-explanatory. Once again, this is an easy way for mainly media members to communicate ballpark figures to the fans, but has many limitations beyond that. Additionally, agents and team negotiators aren't using this term consistently, if at all, during negotiations. APY does not reveal the structure, guarantees, and other intricacies essential to the true value of NFL contracts. Realistically, APY is just a handy-dandy term solely used by reporters. It's not a bad term to throw around, it's just important to understand the limitations of APY.

So, how does Kam stack up in APY as compared to other strong safeties?

Top 5 Strong Safeties based on APY
Reshad Jones	$7,003,000
Kam Chancellor	$7,000,502
Donte Whitner	$7,000,000
Aaron Williams	$6,501,961
Morgan Burnett	$6,187,500

The top five paid strong safeties in the NFL are Reshad Jones, Kam Chancellor, Donte Whitner, Aaron Williams, and Morgan Burnett. Technically, Kam Chancellor isn't the highest paid strong safety based on APY. However, Kam only makes an average of $3,000 less than Reshad Jones annually (chump change to NFL players).

Factual Conclusion from Method #1: Evaluated by APY, it's factually accurate to say that Kam Chancellor is paid at the top of the strong safety market.

Method #2: Percentage of Guarantees

Contrary to other sports, NFL contracts aren't fully guaranteed. Most of the time, but unique to each contract scenario, NFL teams carry extreme amounts of leverage over players. A player never knows when his time may come to an end. Often times, it comes unexpectedly (kind of what we saw with Clint Gresham the other day). Many teams can cut most players with almost zero repercussions. A player can be released via three forms of terminations: skill termination, salary cap termination, and injury termination. In order to fully understand guarantees, we must define a couple of terms first.

We have two forms of guarantees: full guarantees and total guarantees. Full guarantees protect the player against all three forms of termination and, barring any substance abuse or the player going to prison, is virtually guaranteed to enter the player's pocket at some point in time. Total guarantees typically protect against one or two forms of termination but never all three (it would then be a full guarantee). Simply put, full guarantees are better because they protect the player against all three forms of termination. In the history of the NFL, there has never been a sizable, fully guaranteed contract.

NFL players want security: security in their job, security in their families, and security in their future. Full and total guarantees provide that security. Let's look at the NFL's top five strong safety contracts in regards to negotiated guarantees. It's important to note that we will be looking at their guarantees in percentages - since larger contracts are bound to typically have large volume guarantees. Evaluating contract guarantees on percentages provide a more accurate, comparative foundation. The guarantees listed are the guarantees provided at signing. Please note that if the Total GTE matches the Full GTE, this simply means the player has no total GTE protections beyond the full GTE in his contract.

Top 5 Strong Safety Contracts Based on Guarantees (% of contract)
Player	Full GTEs	Total GTEs
Reshad Jones	54%	54%
Kam Chancellor	28%	61%
Donte Whitner	40%	40%
Aaron Williams	34%	34%
Morgan Burnett	33%	33%

(Note: with limited contractual information from the media, we have to work with what we got. Some of these numbers could be more accurate if we had full access to the contractual framework (but we don't).)

The top-five Strong Safety with the best full guarantee is Reshad Jones, with nearly 54% of his total contract fully guaranteed. That was good work by Reshad's agent. Kam Chancellor comes in at the lowest in full guarantees - at 28%. However, with Kam Chancellor, it's very important to note that his contract has "rolling guarantees". Essentially, a few days after the Super Bowl in 2014 and 2015, Kam's base salaries become guaranteed. However, those were not guaranteed at signing. In regards to total guarantees, the contract with the highest percentage of total guarantees is Kam Chancellor at 61%. The lowest is Morgan Burnett of the Packers at 33%.

Factual Conclusion from Method #2: Evaluated by guarantee percentage, it's factually reasonable to say that Kam Chancellor might be slightly underpaid in regards to his full guarantees. However, it's also factually accurate to say Kam is definitely not underpaid in regards to his total guarantees. Considering Kam's rolling guarantees throughout his contract, it is hard to absolutely justify Kam as underpaid in the guarantee department.

Method #3: Cash Flow

Let me be 100% clear: along with guarantees, cash flow is the most critical contractual topic discussed between agents and team negotiators. Cash flow is defined as the rate at which money is doled out to the player. Players want more money up front, and teams want more money back-loaded. If large portions of the contract are back loaded, this gives you a hint towards the team's intended future moves - as there is a very strong chance the player never sees that money. The more money up front, the more likely the player sees that money. Obviously, players want cash in their pockets sooner than later. Here's the top five strong safety contracts based on cash flow. Please note that year 0 refers to the year the player signed the contract.

In year 0, Morgan Burnett receives the most cash: approximately $8.25M. Kam Chancellor receives the third most cash: approximately $6.5M.

In year 1, Aaron Williams jumps ahead to approximately $13.7M total. Burnett comes in 2^nd in Year 1 at $11.5M total. Kam closely follows Burnett at $11.2M.

In year 2, Aaron Williams leads at a cumulative $17.4M. Kam Chancellor comes in 2^nd at $15.77M.

In year 3, Donte Whitner leads with a $21.7M cumulative total. Aaron Williams follows him up, then Reshad jones, then Kam (at $20.87M), and lastly Morgan Burnett.

In the final year of their contracts, the top three contracts in Jones, Kam, and Whitner all catch up to each other. The difference between the three is a total of approximately $10,000.

Factual Conclusion from Method #3: Evaluated on cash flow structure, it is again hard to justify Kam as underpaid. The cash flow and structure of his contract place him right in the top 2-to-3 highest paid strong safeties.

Post Analysis Conclusion:

Studying Kam's contract through more analytical lenses gives us better insight into his contract, the nature of the strong safety market, and his potential future as a Seahawk. When comparing Kam's 2015 on field production to these analytical measures, it's very difficult to justify Kam Chancellor as being underpaid.

Whether it was due to missed practices, a declining body, or just having a bad year -- it was clear Kam's 2015 play took a step backwards. In regards to APY, Kam is currently paid at the top of strong safety market, has moderately strong guarantees throughout his contract, and benefits from a top 2-to-3 cash flow structure. I'm not saying Kam Chancellor is an unreasonable person or a bad player. Rather, it's just very difficult to make the claim that Kam's contract underpays him.