Chargers Instant Reaction: Mike Williams Gets Multi-Year Extension
All the attention today was towards the Broncos acquiring quarterback Russell Wilson via trade with the Seahawks. Not even five minutes after this was reported, we received word that Mike Williams would be returning to the Los Angeles Chargers on a 3 year, $60 million contract. We do not have all of the details quite yet, but we will get into what we know, how this impacts the Chargers throughout free agency and the draft, and if I believe this is a good contract.
At first, I was slightly concerned but also happy about the numbers that I saw. The Chargers are the first team in the NFL to have two different receivers making an average of $20 million per year with Williams and Keenan Allen. I was concerned about this, but I believe this is going to become the norm across the NFL. Williams is now tied with Amari Cooper for 5th in the NFL in average money per year earned, just behind his best bud. I understand that contracts will always rise every year since the cap goes up, but I did not like that upfront. I was hoping for a deal similar to Kenny Golladay from last season at the most, maxing out at $18 million per year.
I was happy because I did not want Williams to play on the franchise tag with around $18 million going against the cap. I was also happy to see that it was a 3-year deal instead of a 4 year deal like many were anticipating. Williams is legitimately a difference-maker that had by far his best season with the new staff using him in a different way. With knowing that, we could very well see a very high-valued contract a year from now if Williams continues to get better, and as more receivers look to get bigger paydays. This was my initial reaction before I had more time to really think about it and the impact on the team. All in all, I was content, but not overly excited about what I saw.
What We Know
I do want to start this off but reiterating what I just said, Williams had a career year. He set career highs in receptions and receiving yards, receptions being exceeded by a monumental amount. He scored 9 touchdowns as well which was 1 off his career-high. My favorite part about Williams this past year was he was so much more well-rounded than previous years, he was running more of the route tree and became a more complete receiver. So, what we know is he stayed healthy for the entire season, had a career year, and made a lot of clutch plays throughout the season. Williams has worked extremely hard and deserved to get paid what he deserved, and the Chargers followed through on it.
Getting into the contract, we know that there is $40 million guaranteed, all of that being in the first 2 years of the contract. You could essentially look at it as a 2-year contract with an option for that 3rd year since there won’t be any guaranteed money there, which is exceptional value. His guaranteed percentage of his contract sits at 66.67%, which is exceptionally high for any receiver, regardless of talent or status in the league. To put it in perspective, Allen’s guaranteed percentage is 40%. So, while there is some benefit to the 3-year deal, the amount guaranteed came at a cost. We do know that Williams is going to be earning $28 million this season alone, this number is not a reflection of how much is going to be against the cap.
We do not have a ton of concrete information on what the cap hit will be, but there have been a few projections from well-informed individuals. Chargers fan/PFF Research Intern Arjun Menon stated via Twitter today that he projects the cap hit to be around $14.67 million. A Chargers reporter predicted that it would be around $15.68 million, to which the Twitter account for Spotrac responded. He stated that he believes that the cap hit will be significantly lower than that. The minimum cap hit for the contract for this season would be $6.4 million. Spotrac is unsure of what the cap hit will be, but seemed fairly confident it is going to be much lower than others are predicting, and they are as plugged into these things as anyone. If the cap hit is anywhere between $6-12 million, it is a huge win for a team that has a lot of cap space and is in win-now mode.
Now, we get to where we go from here. It is still difficult to know what they can fully do until we know what the cap hit is, but there are still things that can be speculated. The talk for the past week with the NFL Combine is who the Chargers are going to go after in the draft. Does the extension of Williams, along with still having Josh Palmer and Allen under contract for multiple seasons, take the Chargers out of the running to go get a receiver in round 1 of the draft? What if standout receivers Chris Olave or Jameson Williams are sitting there at pick 17, do the Chargers still go for a more pressing need? Obviously, it completely depends on what they do throughout the rest of free agency, but if the cap hit is as low as Spotrac is suggesting it could be, then the Chargers can essentially do whatever they want.
This is more about the Williams contract and what value the Chargers got and if it is a positive or negative, but this has ramifications for years down the line since they elected to extend instead of using the franchise tag. I do not believe that the Chargers extending Williams means that they won’t consider drafting a receiver in the first round. If the Bengals taught us anything, an elite receivers group can do so much for a team. Unless a premier talent at corner, offensive tackle, or edge rusher is there at pick 17 (which seems unlikely) then I would elect to go receiver to solidify this group with the newly signed Williams.
After being able to analyze things more and understand things better, I am in favor of this deal to extend Williams. If the cap hit is as low as it could be for this year, then I love the deal. Being franchise-tagged was essentially a guarantee if this deal didn’t happen, since the cap hit would’ve been over $18 million, anything below $14 million is incredible and gives the team more options. I wasn’t exactly wanting the Chargers to extend Williams for a while. However, when it comes down to it, despite the limitations that Williams has, I am happy to see the Chargers rewarding their own after a career year. Williams is a great locker room guy and seems to be super close with a lot of teammates, all this does is help continuity on the team. The Chargers have set themselves up to be in a good position if Williams doesn’t happen to live up to the contract the next few years, which helps me feel better about it. I believe the Chargers did extremely well on this contract extension.