HOUSTON - During Bill O'Brien's end-of-season news conference, the Houston Texans coach (and now general manager) wouldn’t publicly address the future of quarterback Deshaun Watson, who is expected to receive a massive new contract this offseason.
But, O'Brien was quick to say, “I can tell you publicly, though, that we obviously want Deshaun Watson here for a long, long time.”
“We want him to be a Houston Texan for his career,” O’Brien said. “He is a great person, he's a great football player and he means a lot to this organization, to this city, to this league. I just don't want to get into the nuts and bolts of when you would do that and all those different things. Those things take time, but we want him here for a long time."
So, how big could that contract be?
First, there are three quarterbacks who could break NFL contract records this offseason: Watson, Patrick Mahomes and Dak Prescott. Dallas could use the franchise tag on Prescott, as the sides tried and failed to reach a new deal before the start of the 2019 season. Prescott is the only one of the three who could potentially hit free agency this offseason if no agreement is reached.
If Prescott is tagged, that leaves Watson and Mahomes to set the market. Both were drafted in the first round in 2017. To set the record, they would have to top Seattle Seahawks quarterback Russell Wilson, who signed a four-year, $140 million ($35 million per year) contract in April. Los Angeles Rams quarterback Jared Goff, picked No. 1 overall in 2016, has the record for guaranteed money: $110 million included in the four-year, $134 million extension he signed in September.
With an MVP award and AFC title already on his résumé, it's likely Mahomes will get the largest deal. While Watson has had a lot of success in Houston and played his way into the MVP conversation during the 2019 season, Mahomes has been the best quarterback to come out of the 2017 draft.
But the timing could be key for the Texans: Who will sign first? Will Mahomes’ camp and Watson’s representatives wait each other out to let the other set the market, then try to top it? But as ESPN’s Jeremy Fowler wrote earlier in the month while looking at whether Mahomes could sign a deal worth $40 million per season, “Mahomes must decide how long he's willing to make the Chiefs sweat, which one veteran NFL agent says won't be long because agents Leigh Steinberg and Chris Cabott will be eager to close on such a headlining deal.”
If that’s the case, Houston might want to be proactive and get a Watson deal done early in the offseason rather than letting Mahomes set the market, which would let Watson’s agents use that number in negotiations.
However, Chiefs chairman Clark Hunt said this week that signing Mahomes is a priority, but it could be a year away.
Regardless of what the market is, a new Watson deal would eat up a huge chunk of the Texans' cap space. Houston currently has $57,018,866 available, but the team also has several holes it will have to fill in free agency, and there's also a desire to lock up left tackle Laremy Tunsil to a long-term deal this offseason. Houston doesn’t have first- or third-round picks in this year’s draft, so any upgrades to the team would likely have to come through free agency or hitting on late-round picks.
Watson made less than $3.8 million in 2019, which was just 4.88% of the Texans’ cap. Houston has big salaries for DeAndre Hopkins, J.J. Watt, Whitney Mercilus, Will Fuller and Tunsil on the books for 2020, and even though the team was three quarters away from its first AFC Championship Game, the Texans have a long list of free agents. And they are not expected to be able to retain many of them because they must earmark cap space for Watson and Tunsil.
Watson still has another season remaining on his rookie contract, and after that, the Texans could exercise a fifth-year option. So technically there is no rush for the new contract, but keeping your franchise quarterback satisfied early in his career and making sure he’s locked in for the long term is hugely important from a number of perspectives.
While having Watson locked in could help recruit and retain free agents who want to play with him, it’s also a way to reward Watson, who has outplayed his rookie contract.
The Texans historically have signed players they’ve drafted and want to keep to extensions after their fourth seasons, but they chose to sign Watt to an extension a season earlier than that, in 2014. The Rams signed Goff to an extension after three years. The Seahawks did it with Wilson and the Eagles did it with Carson Wentz. A deal at this point has become what young superstars expect, especially the quarterbacks.
So while Watson’s new contract might not kick in until 2021, a hypothetical salary of $36 million is approximately a $32 million increase on his 2019 earnings. If Tunsil matches Johnson’s record contract, that’s an $8 million increase, and that would kick in immediately in 2020. That would leave the Texans with little wiggle room when factoring in signing their draft picks.
Houston could get creative in creating salary-cap space in a couple of ways. Watt’s contract has just one year remaining with no guaranteed money, and the Texans could negotiate his annual number lower and bump up the guarantee to help create cap space. Guard Zach Fulton is owed $7 million in non-guaranteed money, and if Houston cuts him, they could save that cap space. The Texans could also choose to cut or negotiate new contracts for Fuller and/or cornerback Vernon Hargreaves, who are both scheduled to play on their fifth-year options.
This is new territory for the Texans because O'Brien now has the GM title and they no longer have Chris Olsen, who was reportedly let go last week. He negotiated contracts for Houston as its senior vice president of football administration and played a key role in the team's general manager-by-committee approach. When the Texans fired GM Brian Gaine in June, team owner Cal McNair said in his statement that Olsen was in charge of the team’s football operations in the interim. Olsen worked with the Texans for 13 years.
The Texans have no doubt that they can depend on Watson, and O’Brien said in his news conference that his quarterback is “going to just keep getting better.” Now, after three seasons of paying Watson on a rookie contract that allowed the team to build around him, the Texans will have to figure out how they can take the next step despite Watson taking up a much larger portion of their salary cap.