Over The Cap recently added Luke Wattenberg’s four year extension to its database, and it is really telling as to how it’s a tale of two stories when it comes to cash payment versus cap dollar management–a theme that’s become regular for the team.
When I had forecasted a possible extension for Wattenberg back in July, I did not go into much detail on contract structure, as I figured it would be an easy and boring contract to structure. In addition to being what I consider to be team friendly compensation, I was indeed correct that the annual cash flow was boring, as follows:
- 2025, via a signing bonus: $2 million
- 2026: $11 million
- 2027: $12 million
- 2028: $11 million ($510,000 of which is in per game roster bonuses)
- 2029: $12 million ($510,000 of which is in per game roster bonuses)
As can be seen, these are nice, round numbers that give Wattenberg a very even flow of pay as long as he is under this contract. Not much else to say there.
The guarantee structure is also boring: his 2026 compensation is guaranteed at signing, and his 2027 vests soon after the start of the 2026 league year, making it a likely guarantee. Then there is a small $2 million vesting guarantee on 2028 due at the start of that season.
However, the method in which the Broncos could account for this compensation on their salary cap, however, is much more complicated.
Aside from CBA mandated minimum base salaries under Article 26, Section 1, all of the rest of Wattenberg’s salary not tied to per gamers is contained in seven option bonuses, which are as follows:
- 2026: $9.785 million, with its exercising range between the 1st and 5th days of the 2026 league year
- 2027: $3.5 million, with its exercising range after decision on Option 1, and before the first 2027 regular season game
- 2027: $7.24 million, with its exercising range after decision on Option 2, and before the first 2027 regular season game
- 2028: $3 million, with its exercising range after decision on Option 3, and before the first 2028 regular season game
- 2028: $6.185 million, with its exercising range after decision on Option 4, and before the first 2028 regular season game
- 2029: $3.25 million, with its exercising range after decision on Option 5, and before the first 2029 regular season game
- 2029: $6.805 million, with its exercising range after decision on Option 5, and before the first 2029 regular season game
In sum, while Option 1 will highly likely be exercised, due to it being guaranteed at signing and with a short range to make a decision on, the subsequent six contain considerable flexibility for the Broncos to prorate out each amount over the maximum of five seasons with void years already established at signing, over a much larger time span.
It should also be noted that despite being structured as option bonuses, the actual payment schedule for Wattenberg will be the same as the standard 36 week game check structure applicable to base salary, under Article 26, Section 5 of the CBA.
This is now standard practice for the Broncos, as it was first seen in the recent extension for Garett Bolles, and has also been used in recent extensions for Nik Bonitto, Wil Lutz, and Malcolm Roach. And it’s a practice that should become more standard leaguewide.
Take caution against cap space hot takes
There is always a lot of conversation about how much cap room teams will have to work with going into the next season and beyond. This discourse, however, can easily get people misled without looking at the whole picture. The two examples I like to use to illustrate this are the Saints and Eagles.
The Saints have earned notoriety for seemingly being “over the cap” almost every single upcoming season, and thus get talked about this a lot. 2026 is going to be no exception. However, this talk always elides the fact that the Saints also usually have high restructure potential–and again, 2026 will be no exception. Thus, every season we see their alleged huge salary cap overage disappear with the usual mass restructures of base salaries into prorated bonuses, a practice Mickey Loomis has run for a very long time.
The Eagles, on the other hand, rarely end up showing themselves as over the cap. That’s because, under Howie Roseman’s recent usage of singular annual option bonuses to secure maximal proration of cap dollars in advance, it’s presumed that the restructuring will already take place. Thus, there are much fewer scare stories written about their cap dollar allocation (also aided, of course, by making wise signings and being a regularly competitive football team, currently defending Super Bowl champs).
The Broncos, however, are positioning themselves in a different realm altogether. Unlike with the Eagles or other teams that use option bonuses, the presence of multiple option bonuses contained within the same season cannot as easily be presumed that each option will actually be exercised. They may very well do so, but they may also see that their expenditures in any given season aren’t as high as forecasted, and decide to take some cap dollar charges in the present in lieu of having more space in the future. And this would apply to any other teams that do the same as the Broncos here.
For this reason, while I always recommend to watch cold, hard, cash payments more than cap dollars, I would exceptionally recommend this when talking about the Broncos from here on out. This will pose a challenge for sites like OTC as to how to project accounting for what they might do in the future. We don’t have a crystal ball to know the answer for sure, and the Broncos themselves might not know now, either–hence the extensive flexibility they’ve built for themselves.
The next CBA should simplify this
All this being said, it’s quite an inscrutable method to achieve maximal cap dollar allocation flexibility. The whole rigamarole of option bonuses and explicitly negotiated void years should not need to exist to provide this flexibility.
What I would like to see instead is a tweak of Article 13, Section 6 that allows teams to unilaterally restructure the cap dollars assigned to base salaries in any proportion they like at any time, to be prorated over as many seasons as they like, up to the current maximum of five. If the number of prorated seasons desired exceeds the contract length, void years are automatically added. The payment schedule still automatically operates on the 36 week game check structure, unless the player and team wish to negotiate a swifter schedule, which can also be done via traditional roster bonuses. The key demand for the player for this tweak is to make sure that the amount prorated remains being guaranteed in exchange for yielding negotiation rights for some of the unilateral actions added here.
This I think would develop a more accurate picture in better aligning cash payment with cap dollars. Continuing with Wattenberg as an example, it would start off clear that he is getting paid a clean amount of $11 million to $12 million per season. If the Broncos later wanted to clear cap space for whatever transaction they might want to pursue, it can be done quickly without a lot of complicated contract details needing to be secured at signing.