The Joe Flacco Trade

No trades can be completed until the start of the 2019 league year on March 13th. However, it appears that when the league year starts, Joe Flacco will be traded to the Denver Broncos for a 4th round pick in the 2019 NFL Draft.

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Flacco has three years remaining on his contract. He is scheduled to make $18.5 million in 2019, $20.25 million in 2020, and $24.25 million in 2021. This is all base salary, and none of it is guaranteed.

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In this post we will evaluate the trade from the perspective of both teams, including an evaluation of what the Broncos may elect to do with Case Keenum, assuming that Flacco will be the Broncos starting quarterback. Let’s get to it.

Denver Broncos

As Flacco’s salary is not guaranteed, this is essentially trading for a quarterback for one year with the ability for the Broncos to keep the player for up to two additional years. If the Broncos want to move on after the season, they can trade or release Flacco with no cash or salary cap impact beyond the 2019 season.

Though not part of the trade, Denver still has Keenum on their roster. Keenum is scheduled to make an $18 million salary in 2019 (including $7 million guaranteed). His total cap hit for 2019 is scheduled to be $21 million (including the remaining $3 million proration from his signing bonus). How the Broncos proceed with Keenum will have a major impact on the Broncos’ salary cap and cash situation.

Flacco Trade and Keenum Trade

Denver will absorb Flacco’s non-guaranteed salary of $18.5 million for 2019 from a salary cap and cash perspective.

If Denver trades Keenum they will off-load all of Keenum’s salary for 2019 to the new team from a cash and cap perspective but will take a dead money salary cap hit of $3 million (half of his two year signing bonus proration). The new team would be responsible for Keenum’s full 2019 salary of $18 million (including the $7 million guaranteed) from both a cash and salary cap perspective.

From a salary cap perspective…

If Denver trades Keenum, the salary cap hit for their starting quarterback will be Flacco’s $18.5 million salary plus the $3 million signing bonus dead money from the Keenum contract, for a total of $21.5 million. If neither the Flacco or Keenum transactions were to occur, the Keenum salary cap charge for the Broncos for 2019 would be $21 million. So a minor salary cap impact of $500,000.

From a cash perspective…

Trading Keenum and installing Flacco as the Broncos starting quarterback will result in a cash outlay by the Broncos of $18.5 million (Flacco’s salary). Keenum’s cash hit would have been $18 million. If Denver believes that they have a better chance to win with Flacco then with Keenum, an additional $500,000 cash hit is a no brainer.

By trading for Flacco and trading Keenum, the Broncos salary cap hit and its cash expense both increase by $500,000 for 2019.

Flacco Trade and Keenum Release

If Denver is not able to trade (or renegotiate) his contract and instead releases Keenum, the salary cap and cash impact is much different for the Broncos.

From a salary cap perspective…

Upon releasing Keenum, the dead money cap hit related to Keenum’s contract would be $10 million ($3 million signing bonus already paid and the $7 million 2019 guaranteed salary that Denver would have to pay) and Denver would save $11 million against the cap (salary cap hit of $21 million minus the $10 million in prorated bonus and guaranteed salary leaves $11 in non-guaranteed salary that the Broncos would avoid by releasing Keenum).

The Broncos would also have to account for the $18.5 million salary for Flacco, which would bring the total salary cap charge to $28.5 million, an increase of $7.5 million versus if these two transactions did not happen.

From a cash perspective…

Releasing Keenum would result in an additional cash charge of $7 million to account for the guaranteed portion of Keenum’s 2019 salary (the $3 million allocation for the signing bonus was paid last year). Flacco’s cash charge would be his entire 2019 salary of $18.5 million.

Thus, the total cash charge for 2019 would be $25.5 million, versus $18 million if the two transactions did not happen.

By releasing Keenum, the salary cap and the cash expense are much more impactful than if Keenum is traded. In this scenario, the Broncos salary cap hit and the cash expense would be an additional $7.5 million versus keeping Keenum and not trading for Flacco, and would be an additional salary cap hit and cash expense of $7 million versus trading for Flacco and trading Keenum.

Baltimore Ravens

It was clear by the end of the 2018 season that Flacco was not in the Ravens long term plans and that they were going to install Lamar Jackson as their starting quarterback for 2019.

Trading (or releasing) Flacco will result in a dead money salary cap hit of $16 million to account for the remaining signing bonus proration on Flacco’s contract. However, when combining this salary cap hit with Jackson’s salary cap hit for 2019 of $2.15 million, the Ravens total cap charge for their starting quarterback will be $18.15 million. If they had kept both quarterbacks next year (absent a restructure of the non-guaranteed money owed to Flacco) the cap hit would be $28.65 million (Flacco’s $26.5 million and Jackson’s $2.15 million). Thus the cap savings by trading (or releasing) Flacco is $10.5 million. The Raven’s will also save the $18.5 million cash salary that they would have paid Flacco as salary in 2019. The Ravens will still need to pay their backup quarterback, which will decrease the cap and cash savings.

With the salary cap and cash hit that would have applied in 2019 if they had kept Flacco, it is clear that keeping Flacco on the roster as a backup player for an additional $18.5 million (his non-guaranteed salary) was not going to happen. Not only would it be a huge number to carry for 2019, but if this is truly Lamar Jackson’s team moving forward, the best thing for everyone would be for Flacco to be playing somewhere else in 2019.

For this analyis, please keep in mind that other CBA rules could be applicable based on the circumstances. It is impossible to review all scenarios in a blog post without it being very long and confusing. Please review my CBA summary for additional insight.

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