The Los Angeles Rams will have many difficult personnel and financial decisions to make this offseason. One of those decisions centers on whether or not to exercise WR Tavon Austin's fifth-year option.
January 4th marked the first day of the fifth-year option exercise period for first round selections from the 2013 NFL Draft. For the team to exercise the option, it must give written notice to the player no earlier than January 4, 2016, and no later than May 2, 2016.
What is a "fifth-year option"? Every player selected in the first round of the NFL Draft will automatically have a fifth-year team option added into his contract. This option cannot be separately attached to the player contract. The option allows a team to retain a player’s rights for five years rather than four, which is the bonus of selecting a player in the first round. The fifth-year option is non-negotiable, and the non-compensation terms from a player’s rookie contract will also be included in the fifth-year option.
What are the fifth-year option compensation terms for players selected with one of the top ten picks in the NFL Draft?
From the 2011 NFL/NFLPA Collective Bargaining Agreement:
(e) Fifth-Year Option for First Ten Selections in Round One. (i) For a Drafted Rookie selected with one of the first ten overall picks in the Draft, the Paragraph 5 Salary for the player's Fifth-Year Option shall equal the Transition Tender that applies in the League Year that is the fourth year of the Rookie's Contract (as calculated pursuant to Article 1 0, Section 4) for players at the same position (using the categories in Article 1 0, Section 7(a)) at which the Rookie participated in the most plays during his third League Year. No other Salary (other than the minimum offseason workout per diem and compensation for community relations/sponsor appearances or promotional activities (subject to the maximum amounts permitted in Section 3(b) (iv) above)) is permitted for the Fifth-Year Option
The Transition Tender (Tag) differs from the Franchise Tender (Tag) in that it allows the team to secure the right to match any offer a player may receive as a Free Agent, but offers no compensation to the team if they don't match the offer. The Transition Tag for wide receivers was $10.971 million in 2015. Depending on league-wide salary cap figures for 2016, the Transition Tag for WR's should rise to an estimated $11.6 million in 2016. If the Rams do indeed exercise Tavon Austin's 5th year option, it would cost them $11.6 million in 2017. $11.6 million would put Austin among the top ten highest paid WR's in the league.
It's a unique situation for the Rams. The Rams picked up fifth-year options on both Robert Quinn and Michael Brockers in the past two years. But because they were selected outside of the top ten picks in their respective drafts, the option for each was virtually half of what Tavon Austin's will cost. As an aside, I'll be taking a look at Alec Ogletree's fifth-year option in a future article. It, too, will be on a par cost-wise with both Brockers and Quinn.
There are numerous ways the Rams can handle the Tavon Austin contract situation:
- The Rams can decline to exercise Austin's fifth-year option, let him play out the final year of his rookie contract (2016) and allow him to become a Free Agent in 2017 (without attempting to re-sign him).
- The Rams can decline to exercise Austin's fifth-year option and attempt to sign him to a long-term contract before he becomes a Free Agent in 2017.
- The team can exercise the fifth-year option and attempt to sign him to a long-term contract before he becomes a Free Agent in 2018.
- The team can exercise the fifth-year option and attempt to sign him to a long-term contract before the option year becomes fully guaranteed (which occurs if Austin's on the 2017 opening day active roster).
Is the $11.6 million cost associated with exercising Tavon Austin's fifth-year option too steep a price to pay for securing his services for an additional year? Do the Rams take the big risk of potentially losing him to Free Agency after only four seasons with the team if they don't exercise the option?
How much is he really worth to the Rams?
(Update) February 29, 2016
The league has announced the franchise and transition tenders (tags) for 2016. The transition tag for wide receivers is $12.268 million. This is the amount it would cost the Rams for Tavon Austin in 2017 if they indeed exercised his 5th year option.