Baltimore Ravens head coach John Harbaugh made an interesting revelation on Monday at the AFC coaching breakfast during the NFL’s annual league meeting. He said the Ravens have had internal discussions about a contract extension for quarterback Lamar Jackson.
“There’s been conversations about that internally, I know,” Harbaugh said. “How far along that is or whatever, I don’t know. I definitely think it’s an obvious point … that’s going to continue to have to be addressed, really with all those guys. You just kinda manage that dance, the salary cap dance, and Lamar is the main part of that because he’s the franchise player. That’s a possibility, I think. Sooner or later, definitely is gonna have to happen.”
Jackson, who represents himself and has never had an agent, is entering the third year of a five-year, $260 million contract he signed in 2023 after being designated as a franchise player. He is scheduled to make $43.5 million in 2025 on a $43.5 million salary cap number.
The $52 million per year deal, which included a then record $72.5 million signing bonus, made Jackson the NFL’s highest paid player. Out of the $260 million, there were $185 million in guarantees where $135 million was fully guaranteed at signing.
Jackson has a no-trade clause. There’s also a provision preventing the Ravens from designating Jackson as a franchise or transition player when his contract expires after the 2027 season.
Jackson shouldn’t be in a rush to get a deal done. Although Jackson has dropped to the NFL’s ninth-highest-paid player by average yearly salary, it’s a different story with actual cash. Only Dallas Cowboys quarterback Dak Prescott, who is the NFL’s highest-paid player at $60 million per year, is making more than Jackson’s $155.25 million from when he signed in 2023 running through the 2025 season. Prescott is making $165 million during this three-year span. Kansas City Chiefs quarterback Patrick Mahomes is third at $152.6 million. It was supposed to be $156 million for Jackson but he didn’t earn his $750,000 workout bonus in 2024.
Jackson already has a tremendous amount of contract leverage thanks to his performance. His leverage will be even greater in 2026 when his $74.5 million cap number is the NFL’s third highest.
Jackson has taken his game to another level since signing the contract. He was named the NFL’s MVP in 2023, which was the second time he won the award.
Surprisingly, Jackson didn’t repeat as MVP. He had a historic 2024 season. Jackson was the first ever to throw for at least 4,000 yards and run for at least 900 yards. His 4,172 yards passing (sixth in NFL) were a career high as well as his 41 touchdown passes (tied for second), 8.8 yards per pass attempt (first) and 119.6 passer rating (first). The 915 yards rushing were his most since the 2020 season. Jackson’s 119.6 passing rating was the fourth-best mark ever in a season. He also led the NFL with 6.6 yards per carry.
No player in NFL history had led in both yards per pass and yards per run at the same time until Jackson. With only four interceptions, Jackson had an outrageous touchdown-to-interception ratio of more than 10 to 1. Nobody with 40 or more touchdown passes has thrown fewer interceptions in the same season.
One thing Jackson doesn’t have to worry about is his place in the NFL salary hierarchy. “The value is the top,” Harbaugh said. “When Lamar gets paid, he’s going to be the highest-paid player in football, just like he was last time. I think every contract he signs till he decides to hang up his cleats, he’s going to be that guy.”
The Aaron Donald approach
Jackson should wait until 2026 when the NFL salary cap could be approaching $300 million, if not more, unless a new deal this year is on his terms. Otherwise, Jackson could recommend that the Ravens exercise their contractual rights to convert salary into signing bonus to create 2025 cap space rather than getting some room through a new deal.
Jackson should suggest the Aaron Donald approach so he can try to have his cake and eat it too if the Ravens initiate contract discussions with him this offseason.
The Los Angeles Rams did something for Donald in 2022 that almost never happens in the NFL. The three-time NFL Defensive Player of the Year’s remaining three contract years worth $55 million were essentially ripped up and replaced with a three-year, $95 million deal making him the NFL’s highest-paid non-quarterback at $31,666,667 per year rather than giving him a contract extension where new years were included.
Donald got a $40 million raise over his existing three contract years in his new deal. His 2022 compensation went from $14.25 million to $46.25 million because of the renegotiation. Donald made $60 million over 2022 and 2023 instead of the originally slated $33.25 million.
Going this route, Jackson should want $42.5 million added to his three remaining contract years worth $147.5 million. The $190 million total would make Jackson the league’s highest-paid player at $63,333,333 per year. This $190 million added to the $112.5 million he negotiated in the first two years of his current deal, 2023 and 2024, would be $302.5 million over the five years from 2023 through 2027, which is $60.5 million per year.
The Ravens would have to add more than $16.5 million to Jackson’s 2025 compensation for him to be the cash leader this year. Los Angeles Chargers quarterback Justin Herbert is 2025’s top earner with $60 million.
The Josh Allen renegotiation/A.J. Brown extension model
The Ravens should balk at the Donald approach. Jackson’s alternative should be having three years added so he’s under contract for a total of six years. It doesn’t really matter whether it’s classified as a renegotiation like 2024 NFL MVP Josh Allen’s recent deal with the Buffalo Bills or a three-year contract extension with three years remaining like the Philadelphia Eagles did for wide receiver A.J. Brown last April. There’s a sweet spot where both sides can position the deal advantageously.
The Bills renegotiated Allen’s contract although he had four years worth $154,554,595 remaining on the six-year, $258 million extension, averaging $43 million per year (worth a maximum of $288 million through incentives), he signed in 2021. It’s extremely unusual for a team to effectively rip up a contract with four years left like the Bills did. The maximum value of the deal is worth $333 million because of a $500,000 annual incentive for winning the Super Bowl. The contract has an NFL-record $250 million of guarantees. The $147 million fully guaranteed at signing is the second most ever in an NFL contract.
Allen was clearly focused on cash flow as opposed to maximizing the average yearly salary. At $55 million per year, Allen is tied as the NFL’s second-highest-paid player with Joe Burrow (Cincinnati Bengals), Trevor Lawrence (Jacksonville Jaguars) and Jordan Love (Green Bay Packers). Allen’s $220 million from 2025 through 2028 is the best four-year cash flow ever in an NFL contract. It surpassed the previous high of $219 million (2024 through 2027) in Prescott’s four-year, $240 million extension signed last September that made him the NFL’s first $60 million-per-year player.
Brown signed for $96 million over three years, which made him the NFL’s highest-paid wide receiver at $32 million per year until the Minnesota Vikings gave Justin Jefferson a $35 million-per-year extension last June. Brown set a wide receiver record with $84 million in guarantees, which Jefferson shattered. The $51 million fully guaranteed at signing was the second most ever for a wide receiver.
The Eagles were proactive in eliminating a potential problem with Brown’s new deal. It probably wasn’t going to sit too well with Brown that fellow Eagles wide receiver DeVonta Smith signed a three-year, $75 million extension a couple of weeks before, averaging the same $25 million per year as in his 2022 extension, if his deal had been left intact. Brown’s 106 receptions in 2023 were six fewer than Smith’s 2023 targets.
The sweet spot for Jackson would be a new $342.5 million deal over six years. The Ravens could characterize the renegotiated contract as averaging $57,083,333 per year where he is behind only Prescott’s $60 million-per-year extension or new-money average. Since Jackson is making $147.5 million for the remaining three years of his contract running through 2027, the $195 million of new money over the three new contract years (2028 through 2030) is a three-year extension, averaging $65 million per year.
Jackson’s $52 million-per-year contract adjusted for the 24.2% increase of the salary cap since he signed in 2023 is a little more than $64.5 million per year. Prescott’s $60 million per year was 9.09% more than the $55 million-per-year-quarterback-salary standard prior to his deal. This increase applied to Prescott’s $60 million is just under $65.5 million per year.
Jackson’s cumulative cash after each year could be $60.5 million (2025), $120 million (2026), $175 million (2027), $230 million (2028), $285 million (2029) and $342.5 million (2030). He would be $2.5 million, $7 million, $9 million, $10 million, $12.5 million and $12.5 million ahead of Allen in each of the six respective years. With these figures, Jackson would have 42.31% of his new money after his first new contract year (2028) and 70.51% after the second new year (2029).
The total guarantee would be $230 million, the cash in the first four years. For simplicity’s sake, $175 million, the first three years would be fully guaranteed at signing.
The no-trade clause and the prohibition against a franchise or transition tag would be included in the new deal whether signed in 2025 or 2026. That’s what happened with Prescott. These items from his 2021 deal were also part of his 2024 contract extension.
Unique salary escalator
Since Harbaugh opened the door to Jackson perpetually being the NFL’s highest-paid player, he should insist on a clause ensuring that happens during the new contract years (2028 through 2030). I’ve previously asked my NFL sources whether a salary escalator making a player the highest paid at his position, his side of the ball (offense or defense) or in the league would be permissible. The consensus has been this type of escalator is permitted. A player having enough leverage to get such an unprecedented provision is the bigger issue.
One way the clause could operate is if Jackson is named NFL MVP or the Ravens win the Super Bowl with Jackson meeting a certain regular season or playoff offensive playtime threshold in any prior year, a fully guaranteed fifth day of the league year roster bonus would be added in the appropriate new contract year equal to the amount that would put Jackson in a tie as the NFL’s highest-paid player.
For example, if the Ravens won the Super Bowl in the 2025, 2026 or 2027 season and the NFL’s highest-paid player is at $67.5 million per year at the end of the 2027 regular season, then a $7.5 million March 2028 roster bonus would be added to Jackson’s contract. Jackson’s new money for the three new years would increase from $195 million to $202.5 million for an average of $67.5 million per year. With a $70 million-per-year highest-paid player at the end of the 2028 regular season, a March 2029 roster bonus for another $7.5 million would be added to make the new money total $210 million over these years, which is $70 million per year. Obviously, if $67.5 million per year remained the league’s salary benchmark in 2028, there wouldn’t be an additional escalation.
Final thoughts
The Ravens are smart to be considering an extremely early contract extension for Jackson. History indicates that the longer a team waits to address the contract of an All-Pro-caliber player, the more it will cost. Jackson definitely fits that bill.
Whatever Jackson would be willing to accept this year will probably be obsolete in 2026, especially if he continues to play at an MVP level. The Ravens should expect Jackson to drive a harder bargain next offseason knowing that carrying his massive cap number will be next to impossible.