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Jim Irsay confident that Andrew Luck deal will be done soon
0:56 | NFL
Jim Irsay confident that Andrew Luck deal will be done soon
Tuesday June 21st, 2016

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Andrew Luck will be the Colts’ quarterback for a long time to come. What’s up in the air is how much they will pay him to hold that role.

Luck is set to play the 2016 season on the fifth-year option of his rookie contract worth $16.155 million, a no-brainer pickup by the Colts last off-season. Beyond that, the wheels are in motion on long-term contract extension talks, with the aim being to reach a deal before Week 1 rolls around. The early reports indicate that Luck’s new deal will set NFL records for total earnings and guaranteed money, but on-the-record comments from either side of the negotiations have been hard to come by.

How much is Luck worth? How much should he get? A lot goes into figuring out those answers.

Marcio Jose Sanchez/AP

The NFL contract landscape

NFL contracts are borderline nonsensical—they can be David Lynch-level mindbenders, where nothing is quite as it seems. There are three key numbers to look at when these contract discussions take place:

1. The guaranteed money, and even this is a two-parter. There is the “fully guaranteed” portion that a player will receive over the life of his contract, almost no matter what. Then there is the injury guarantee, which promises a chunk of what the player is owed should he get hurt. Cam Newton’s $100 million extension, for example, included $60 million in guarantees, but nearly half of that falls under the injury umbrella. Either way, guaranteed money is the key.

2. The total money, a largely symbolic number encapsulating the entire deal. Because NFL contracts are not 100% guaranteed, as is the case in, say, baseball, players often do not see all the money (sort of) promised to them when they sign. Take Colin Kaepernick: He still will have upwards of $75 million left on his massive $114 million extension with the 49ers when the season ends, yet there is little to no chance he sees it. A touch less than $5 million is guaranteed to him beyond the 2015 season.

3. The per-year salary. As much as players and agents aim for the splashy totals—“Is so-and-so the next $100 million man?!”—this figure is more important. Jay Cutler has the largest overall contract in the league at $126.7 million, but with that figure spread out over seven years, Cutler’s $18.1 million per year actually ranks middle of the pack (14th) among NFL quarterbacks. Joe Flacco ($21.3 million) and Aaron Rodgers ($22 million) hold lesser “total money” deals but higher per-year earnings.

In theory, Luck will take aim at all of the top numbers, meaning a contract that runs north of $126.7 million, $22 million per year and $60 million guaranteed. Is he worth it? More on that in a bit.

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Phelan M. Ebenhack/AP

The salary cap

The league’s cap jumped again this off-season, from the $143 million range for 2015 to $155.27 million for ’16. Even assuming a more moderate increase, as OvertheCap.com does in projecting a $166 million cap in ’17, would leave the Colts with an abundance of space—approximately $60 million for the moment.

There are not a lot of pressing issues among the Colts’ impending free agents, either. The list of Indianapolis players set to hit the market following the coming season includes Robert Mathis, Darius Butler, Erik Walden and Mike Adams. As things stand, Mathis remains the biggest name, but he will turn 36 next February.

In other words, no Colts aside from Luck need a lucrative, long-term deal in the coming weeks.

The continued uptick in cap space from year to year is a main reason why contracts are escalating, at all positions. Even if Luck resets the market now, he eventually will be surpassed—Rodgers could be in line for his own monstrous extension as early as next summer.

Al Tielemans/SI

The Colts

While their plans backfired in 2015, for a number of reasons, the Colts are built to win now. They qualified for the playoffs in each of Luck’s first four seasons, reaching the AFC title game two years ago.

More pertinent to this conversation, though, is that GM Ryan Grigson has devoted a great deal of his team’s resources to complementing Luck. The Colts spent a first- (center Ryan Kelly), third- (tackle Le’Raven Clark) and fifth-round (G/T Joe Haeg) pick on the offensive line this past April, after selecting Jack Mewhort in the second round two years ago and extending OT Anthony Castonzo on his own $50 million contract.

Grigson also re-signed talented tight end Dwayne Allen (four years, $29 million, $16 million guaranteed); last off-season, he brought in veteran RB Frank Gore and used his first-round pick on speedy wide receiver Phillip Dorsett.

The apparent upgrades along the O-line will be critical to success in Indianapolis this season. Luck was battered during the 2015 season, missing nine games with a string of injuries. The worst of those, a lacerated kidney, cut Luck’s season short in November.

“Obviously, we need to protect our quarterback better,” Grigson said back in February at the NFL combine. “There’s a lot of different ways to do that. I think that every team in this league knows, no matter if you have a line full of ones, your quarterback’s going to get hit. You have to find ways, whether it be through acquiring better talent, smarter players, schemes. There’s a lot of different ways to protect your quarterback.

“When we had our quarterback [on the field], we felt like we had the pieces to get where we wanted to go. But you’re always trying to get better.”

Whether or not the Colts actually have accomplished that remains to be seen, but they found their franchise quarterback in 2012 and are in year five of working to fit the right pieces around him. This is, for better or worse, Andrew Luck’s team.

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The quarterback

Back to the question of what Luck deserves in his new contract ... and it is a difficult question.

Quarterbacks who have proven themselves over the long-term are usually rewarded with money that lines up with their counterparts—think Philip Rivers’s four-year, $83.25 million deal or Eli Manning at four years and $84 million. Other times, teams pay for what they hope their starting QB can become—this is where we find the likes of Ryan Tannehill (four years, $77 million) and Brock Osweiler (four years, $72 million).

Luck was downright mediocre last season, when he played. He threw 12 interceptions in just seven games, tossing a turnover on 4.1% of his throws, the second-highest mark in the league behind only Peyton Manning’s 5.1%. If there is any pause within the Colts’ front office with regard to breaking the bank on Luck, it likely was borne out of witnessing Luck’s frustrating, injury-riddled 2015 performance.

But in 2014, Luck led the league with 40 touchdown passes (tainted somewhat by 16 interceptions and an AFC title-game meltdown at New England). By the end of that season, Luck had collected three Pro Bowl invites in three years, had thrown for almost 13,000 yards with 86 touchdowns and was the owner of a 33–10 regular-season record.

Whether or not you put stock in a quarterback’s record, it was beyond obvious that the Colts were on the upswing with Luck as their star. And enough general managers around the league have gone mad seeking out a legitimate No. 1 quarterback in the past to help set Luck’s value going forward.

He will turn 27 on Sept. 12, one day after he opens his fifth NFL season with a home game against the Lions. Health willing, Luck should be entering his prime. He’s also headed into something of a prove-it season, after the wolves circled as he flailed in 2015.

Will his contract issue be cleared up by Week 1, or will it provide him extra motivation?

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Road map to a deal

Even those not fully on board with proclaiming Luck as a top QB—a numerous group following last season—have to recognize his value. Should the unthinkable happen and Luck hit free agency, no fewer than half the teams in the league would dream of landing him, in some cases ahead of their own presumed franchise signal-callers.

But he’s not going to hit free agency. The Colts have the franchise tag in their back pocket, should the two sides fail to agree to a long-term deal before next March. The tag number for this year settled at $19.95 million, and it is expected to move into the mid-$20 million range next season. That’s around where Luck could wind up with his annual salary anyway, so it certainly would not out of line for Indianapolis to use the tag in a pinch.

Grigson even could apply the franchise tag to Luck in back-to-back years, with the 2018 salary coming at a 120% increase on this season (likely $27-28 million). In reality, though, both sides should be motivated to get this deal done and out of the way before the ’16 season begins.

So, what does that mean in terms of numbers?

Luck is at the same point in his career, experience-wise, that Newton was when he landed his five-year, $100 million extension, with $60 million total guaranteed and $31 million fully guaranteed. One year later, given the adjustments both to the salary cap and the QB market, that’s a fair starting point. Newton ranks sixth in total guarantees and seventh in year-by-year average salary.

Criticize Luck if you must, but $100 million contracts surpassing $20 million per year are quickly becoming the norm for even remotely proven quarterbacks. Luck could be—could be, as in he is not yet—one of the game’s dominant players at his position, so undercutting those numbers would be pointless.

Personally, I wouldn’t sail much above those, but it is easy to sit outside the organization and clamor for the Colts to ride the franchise tag or limit Luck’s overall value. Off his 2015 play, Luck does not deserve more than Newton got. But take Luck’s upside, the QB contract landscape and the Colts’ own cap situation into account, and there is room to move beyond what the reigning league MVP makes.

How long the Colts want to commit to Luck is another issue here. Do they limit this contract to a four-year extension through 2020? He would be 31 by then, theoretically still within the window to score big again. Or do they push it out further, to five or even six years, with a little wiggle room to find cap relief come ’20 or ’21 should they need it.

If Luck is willing, the Colts may as well see how deep into the future they can roll this contract, because—as mentioned above—the money keeps flooding into team bankrolls, with QBs in particular profiting. What looks like a massive deal now may be rather run-of-the-mill by 2020.

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So let’s set the Colts’ ideal starting point on Luck at five years and $105 million, with $40 million guaranteed—slight inflation-based increases on Newton’s deal. Even if there is very little indication Luck would sign such an offer, the front office has the benefit of time with Luck coming back from all those injuries and the franchise tag still on the table. Eliminating a major distraction and keeping Luck happy are the main reasons to act now.

The actual guess, then, as to where Luck’s new deal comes in when all is said and done: five years and $120 million, $80 million guaranteed and $65 million fully guaranteed (topping Ndamukong Suh’s record-setting number of $60 million fully guaranteed in his 2015 deal with the Dolphins).

Those totals would make Luck the new standard for quarterback contracts. All he would have to do then is live up to the billing.

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