Patrick Mahomes’ contract isn’t all that ‘team-friendly’ when you dig into its structure

Like clockwork, each NFL offseason seems to see a new highest-paid quarterback in the league — generally reflecting a team locking up their starter while he is on a rookie contract.

Earlier this month, it was Jacksonville Jaguars passer Trevor Lawrence’s turn to reset the market. The first selection of the 2021 draft signed a monster extension worth $55 million per season, tying him with Joe Burrow of the Cincinnati Bengals for the position’s highest average annual value (AAV).

Another inevitability of the quarterback market is that when a new lucrative deal is announced, focus will circle back to Patrick Mahomes’ relatively low AAV.

The league’s biggest star signed a 10-year pact for $450 million in 2020. Four years later, an exponentially growing quarterback market has seen Mahomes’ $45 million per season fall to only the ninth-highest in the league.

Be well aware, however, Mahomes is not giving the Kansas City Chiefs a massive hometown discount. His status as the ninth-highest paid quarterback in the league is a fantasy that only exists for accounting purposes.

After Burrow signed his extension last offseason, the Chiefs did a major adjustment to Mahomes’ decade-long deal. While the original contract is technically still in effect, money scheduled to be earned after 2027 was moved forward to pay Mahomes on average $52.7 million for the 2023-27 seasons.

In return for effectively giving out a raise less than three years into a 10-year contract, the Chiefs gained valuable flexibility in how the money is charged for salary cap purposes. While the deal is undoubtedly “team-friendly,” that overused term should not be confused with the actual compensation being a financial bargain.

Most who follow NFL contracts know that the reported average per year is often a meaningless number, and the true measure lies in guaranteed money. With the restructure, Mahomes set a record with $210 million guaranteed over a four-year period.

On first glance, Mahomes lags well behind his peers in average salary. The apparent travesty, however, only exists as a technicality as he can still expect to make more money than his peers during the course of their seemingly more lucrative contracts.

But Mahomes is still signed through 2031, right? The best answer to that question would be “It’s complicated.”

The restructure kept the original contract in place, meaning he technically is signed to the original length. However, there are two key reasons Mahomes’ deal effectively now only exists through 2027.

The face of the league gained strong leverage over the team with cap structure over the coming seasons. 2025 will begin a trio of years when Mahomes is currently slated to count for more than $60 million of the Chiefs’ salary cap. Kansas City will soon need to also turn their attention to some talented young players who have helped deliver back-to-back championships — such as cornerback Trent McDuffie.

At some point — possibly before facing a $66.3 million charge to a single player in 2025 — Chiefs general manager Brett Veach will negotiate a completely new contract with his quarterback. The Chiefs cannot afford to ride Mahomes’ contract as is and continue fielding a championship-caliber roster.

Even if ownership ghoulishly decides Kansas City has had enough playoff success and adopts an austerity approach to survive the cap crisis, Mahomes’ current deal has a similar shelf life.

The $45 million AAV frequently cited to justify the idea that he’s underpaid depends on a near-impossible scenario happening. In 2027, Mahomes is scheduled to earn $52.9 million in actual money. 2028 is the first year that money was “borrowed” from to fund the 2023 restructure. In that year, he is currently scheduled to only earn $27.2 million in actual compensation.

Does anyone truly believe the league’s most recognizable player — after what will by then have been a decade of all but printing money for the NFL — is going to accept a $25 million pay cut because of a contract that will then be seven years old?

Mahomes should have a new record-setting deal long before that can become an issue. On his next contract, expect an unprecedented structure, as his first extension had. Do not be surprised if it covers another 10-year period to maximize windows to restructure large salaries and to spread out cap hits.

Expect to hear the same group of pundits lament that Mahomes is allowing the Chiefs to underpay him, especially if he doesn’t hit market-topping thresholds for the imaginary value that is AAV.

And know that the future Pro Football Hall of Fame selection does plenty of charity work, but Kansas City’s front office is not a recipient. The salary details might be unconventional for the remainder of his career — but his true earnings will reflect his status in the sport from here on.

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