Several weeks ago, the Pittsburgh Steelers restructured the contract of safety Minkah Fitzpatrick, freeing up some 2023 salary cap space to use during the free agency signing period. With Fitzpatrick’s restructure now out of the way, there’s a real good chance that the Steelers will restructure the contract of outside linebacker T.J. Watt as well but later in the summer. Now is a great time to peek ahead at what Watt’s restructure is likely to look like.
Let’s start with a look at Watt’s current contract structure following his partial restructuring last September.
Watt is scheduled to earn a base salary of $20 million in 2023. His current bonus proration amounts in all three remaining years of his deal is $9,368,694. Those proration amounts include the original signing bonus that was given to him when he signed his current deal in September 2021 and another smaller signing bonus that was issued as part of his restructuring in September 2022.
Assuming the Steelers do a full restructure on Watt later this offseason, a max amount of $18.92 million of the $20 million that he is set to earn in 2023 can be turned into a signing bonus. Why is that the maximum amount? Because the minimum that Watt’s base salary can be in 2023 is $1.08 million for his credited seasons in the NFL, which is six. You can see that table from the CBA below.
If the plan is for the Steelers to do a full restructuring of Watt’s contract with no new void years added, the $18.92 million given to him as a signing bonus would then be prorated over the three years of his current contract, 2023-2025. With $18.92 million not being able to be cleanly divided by three, the first two years (2023, 2024) should count as prorated bonus amounts of $6,306,666 with the third-year prorated amount for 2025 then being $6,306,668. These prorated amounts get tacked on to Watt’s previous proration amount totals in each designated year.
Below is what Watt’s contract should look like after a full restructuring. Notice how the proration amounts in all three years have increased by $6,306,666 in 2023 and 2024 and by $6,306,668 in 2025. Additionally, pay notice to how his 2023 base salary has decreased from $20 million to $1.08 million.
Watt’s new 2023 salary cap charge as part of a full restructuring would be $16,755,360, down from $29,368,694. That’s a decrease in his 2023 salary cap charge of $12,613,334.
Could the Steelers manage to do less than a full restructure of Watt’s contract later this offseason? While that is possible, the restructure would still likely need to be close to a fully allowed one, especially when you consider that the team still needs to account for several things closer to Week 1 such as a 16-man practice squad, a 52nd and 53rd player on the roster, draft and undrafted class signing offset amounts and an in-season injury replacement fund of around $9 million.
Additionally, there’s a good chance that the Steelers will sign fellow outside linebacker Alex Highsmith to a contract extension this summer. If they do, his 2023 cap charge will go up some as a result of such a transaction. While the Steelers will likely have some deletions of players currently counting in their Rule of 51 by Week 1, the cap savings potentially produced by such terminations isn’t likely to be very much.
Should the need arise, for whatever reason, the Steelers could add up to two more void years to Watt’s contract as part of a restructuring process to clear a tiny bit more cap space for 2023. To be exact, two additional voidable years would free up just $2,522,666 in additional salary cap space for 2023. That’s not really worth doing unless an extreme situation calls for it.
As previously mentioned in this post, Watt’s 2022 restructure was done right before the start of the regular season. Unless something unexpected happens as we move into the later stages of free agency and closer to the NFL Draft, odds are probably good that another Watt restructuring might not happen until close to the start of the 2023 season. It’s not really a matter of whether the Steelers will restructure Watt’s contract this offseason. It’s more of a matter of when and whether it’s a full one or not.