What are the Packers’ options with Clay Matthews this offseason?

One of the most difficult decisions of the 2018 offseason for the Green Bay Packers will be what to do with veteran outside linebacker Clay Matthews. The 2009 first-round pick will enter his tenth season this fall and he turns 32 in May.

Matthews had a nice resurgence in 2017, playing in 14 of a possible 16 games while rarely showing up on the injury report with the sort of nagging muscle injuries that have hampered him in years past. He recorded 7.5 sacks, his highest total since 2014, and finished among the top 20 edge rushers (3-4 outside linebackers and 4-3 defensive ends) in terms of backfield penetrations per snap, as calculated by Justis Mosqueda.

Matthews’ contract is set to pay him $11.4 million in 2018 — that is in the form of a $10.4 million base salary plus $500,000 in a workout bonus and another $500k in per-game active roster bonuses. Due to the length of the contract, which he signed in 2013, his $20.5 million signing bonus has already been fully amortized against the salary cap and thus has no impact in 2018.

On Friday via the @theapcpod Twitter account, we asked followers to vote on what the Packers should do with Matthews this offseason. We’ll discuss the results of that poll here.

Option 1: Play out the contract

The easiest thing to do is to do nothing. Gutekunst could let Matthews play out the final year of his deal, then see about signing him to a new contract in next year’s free agency period (or let him depart and potentially pick up a compensatory pick in 2020). However, that $11.4 million is still a big cap hit, currently 14th-highest among edge rushers for next season, and it is understandable that it would be a tough pill to swallow.

The Packers have certainly done something like this before. Many Packers fans and media members expected the Packers to either release or restructure Julius Peppers’ contract before the 2016 season, his final year in Green Bay. That deal had $2.5 million in signing bonus money remaining on the cap, with a total hit of $10.5 million. They could have cut the 35-year-old to save $8 million, but instead let him play out the deal.

About 40% of people voting on Twitter chose this option.

Option 2: Release him outright

Again, since Matthews’ signing bonus has already been fully spread out on the cap, cutting Matthews would leave no dead money on the table for 2018. Thus the Packers could get out from under his contract scot-free.

As of publishing, only about 14% of voters in our Twitter poll favored this course of action.

The question with this move is the problems that this would have on the roster. We discussed his performance in 2017 earlier, and he provided valuable energy and a veteran presence while rushing the quarterback from multiple positions. Cutting Matthews without a handshake agreement to sign him to a new deal would leave the outside linebacker group perilously thin, with Nick Perry being the only player remaining under contract who has ever recorded more than three sacks in a season.

The Packers famously did cut and re-signed A.J. Hawk in 2011 after their Super Bowl win, releasing him to avoid paying out a roster bonus that would have been guaranteed at the start of the league year. They then brought him back on a contract that was nearly identical to his old deal, minus that bonus. However, Matthews does not have a roster bonus like that, which makes this option an unnecessary one; there is no bonus deadline, so if the team wants to negotiate a new deal with him, they could do so at any time.

This brings us to the following option:

Option 3: Restructure Matthews’ contract

It would be a much more likely proposition to simply restructure Matthews’ deal without cutting him than to try to cut him and bring him back afterwards. The Packers could add another year or two onto Matthews’ contract and by converting some of his base salary in 2018 to a signing bonus, some of that $11.4M cap hit can be spread out over the later years of the deal.

I’m working under the assumption here that Matthews would want to receive the same amount in cash in 2018 as on his current deal. Therefore, his signing bonus plus base plus other bonuses in 2018 must remain equal to the $11.4M value.

Three years, $21.4 million total

One possibility would be the following contract structure, which would convert $7.5 million of Matthews’ base salary into a signing bonus. As is the Packers’ modus operandi, the signing bonus money would be the only guaranteed money in this scneario. That spreads out that bonus money on the cap evenly as $2.5M each season:

• 2018: $7.5M signing bonus, $2.9M base salary, $500k active roster bonuses, $500k workout bonus; CAP HIT $6.4 million
• 2019: $3.5M base, $500k active roster bonuses, $500k workout bonus; CAP HIT $7 million
• 2020: $4.5M base, $500k active roster bonuses, $500k workout bonus; CAP HIT $8 million

This proposal would make the total value of the deal worth $21.4 million over three years, though it has just two years and $10 million in new money. That might be a little tough for Matthews to swallow, as the deal could be perceived as just $5 million per year.

These were the terms of the third option we posed on Twitter, and 46% of people responding preferred this approach.

Three years, $25.4 million total

However, let’s say Matthews (and/or his agent) pushes for a bit more money in the latter years, maybe another two million dollars per season. The Packers could still keep his cap hit under $10 million each year by making the signing bonus just $6 million; that also would leave just $2 million in dead money on the final year of the deal instead of $2.5M. Here’s how that might look:

• 2018: $6M signing bonus, $4.4M base, $500k active roster bonuses, $500k workout bonus; CAP HIT $7.4 million
• 2019: $5.5M base, $500k active roster bonuses, $500k workout bonus; CAP HIT $8.5 million
• 2020: $6.5M base, $500k active roster bonuses, $500k workout bonus; CAP HIT $9.5 million

A deal like this still opens up another $4 million in cap space this season and gives the Packers plenty of flexibility to cut or restructure Matthews again before the 2020 season if his play declines precipitously. Also, the overall terms of this deal — three years and $25.4 million — look remarkably close to the three-year, $26 million contract that they gave to Peppers, although the structure here is more front-loaded than Peppers’ was. Considering that the cap has continued to rise steadily, a $9.5 million hit for an age-34 Matthews in 2020 could certainly look like a good deal compared to the $10.5 million hit for a 35-year-old Peppers back in 2016, provided he is still playing reasonably well. If he’s not, cutting him then is easy and won’t leave the team in financial trouble.

For this author, the third course of action seems the best way to go, even if Matthews insists upon the higher dollar amount. With the cap continuing to increase and Matthews still providing significant value to the defense, the Packers should try to reduce his cap hit this season and give him some certainty for the future at the same time.