Photo: Jamie Squire (Getty)

Compensatory picks have been a low-key feature of the NFL draft since 1994, the year after free agency finally became a thing. But this offseason, more and more teams appear to be finessing the free agency system in an attempt to to stockpile comp picks. And it’s created something of a freeze on the free agent market.

Each year, the league awards 32 comp picks to teams that lost more in free agency during the previous offseason than they gained, up to a maximum of four picks per team. These picks get slotted at the end of rounds 3 through 7, and they’re determined based on a secret formula that factors in a player’s average per year (APY) earnings upon signing, playing time, and postseason honors. A team may earn a comp pick in a given round based on the rank of a lost player’s earnings that hasn’t been canceled out by a similar acquisition. If you’re still confused, Overthecap.com has a handy guide for projecting comp picks, in addition to charts that display how each team’s free agent losses and acquisitions can cancel each other out.

Most of the big-name free agents got scooped up last month, soon after the start of the 2019 league year. But 20 of NFL.com’s top 101 free agents remain unsigned, including four of the top 50—a list that includes Ndamukong Suh, Ziggy Ansah, and Zach Brown. Jason La Canfora of CBS Sports was first to notice this trend, based on comments he’d heard from three different player agents:

  • “All anyone wants to offer now is a minimum-salary benefit deal. It’s the same thing from every team—we don’t want to pay more now, and lose a comp pick.”
  • “Comp picks have become a much bigger factor in free agency. Totally. I hear it much more now than ever before.”
  • “The guy who is getting squeezed is the second-tier veteran player. The teams know how cheap the draft picks are, and they can use the comp pick formula for leverage, too, and they know it’s a gamble for the player to wait until after the draft when they don’t count against the formula, because that need might not still be there.”

Advertisement

That last quote gets to the heart of the issue, which comes down to timing, volume, and (what else?) cost control. Timing is important because any free agents signed after May 7—the second Tuesday after the draft—won’t count against a team’s comp pick formula. As a result, teams would prefer to wait things out, and so veteran free agents run the risk of losing a potential roster spot to a much cheaper draft pick. Volume matters because the draft tends to be a crapshoot, even for consistently good teams, so stocking up on additional picks—which creates additional opportunities to acquire good players—is a sound strategy. Cost control is relevant because it’s always relevant to NFL teams. Plus, draft picks are cheaper and younger than veteran free agents, and the rookie wage scale provides teams with cost certainty for as many as four to five years.

As the analyst Warren Sharp recently wrote:

Two keys to building great rosters. Don’t overpay other team’s players in free agency and do try to accumulate more draft picks.

The “kill two birds with one stone” mechanism to exploit both keys?

Compensatory picks.

Using the “draft points” concept developed by Chase Stuart of Football Perspective, which values a pick based on how high in the order it is, Sharp determined which teams added the most “average draft-pick equivalents” going back to 2015. Sharp described his methodology this way:

This concept is simple. The average draft pick is pick 128 of 256 and it has a certain value assigned to it based on draft points. By totaling the number of draft points a team acquired over the last 5 years and dividing by the value of pick 128, it is possible to compute the number of “average draft-pick equivalents” a team has gained.

Advertisement

Sharp’s data revealed that the Patriots (who else?) led the league by adding 7.7 “average draft-pick equivalents” in the last five years. The three teams right behind them? The Ravens (6.8), Broncos (6.7), and Seahawks (6.5). That’s four of the last five teams to win a Super Bowl. And the Eagles—the only recent Super Bowl winner not on that list—are set up to receive a pair of comp picks this year, in addition to being on pace to get two more next spring. Also, the Eagles recently traded for running back Jordan Howard, who’s entering a contract year. As Michael David Smith of Pro Football Talk noticed, the Eagles are counting on Howard to provide value on the field this year, and on his potential future value as comp pick capital if he were to walk in free agency next year. “[T]hey’re planning for several seasons down the road,” Smith wrote. “That’s what smart teams do.”

And plenty of other teams are getting in on the action. Nick Korte of Overthecap.com has a strong grasp of the comp pick system, and he’s calculated that as many as 20 teams may be holding off on signing potential free agents until May 7 because it might affect their standing to acquire comp picks. Korte’s got 15 teams on this chart (click to view in its entirety) ...

Advertisement

... with the Bengals, Chiefs, Cowboys, Bucs, and Packers all even on free agents gained and lost. Since 1994, the Bears, Saints, Browns, Texans, and Washington are five of the six teams with the fewest total comp picks. As things now stand, all project to gain at least one comp pick next year—as good an indication as any that teams have caught on to how advantageous comp picks can be.

Though the exact comp pick formula is not publicly available, Korte has been able to gauge enough of its contours to reveal how it’s affecting mid-tier NFL veterans. Per Korte, APY appears to be the the formula’s dominant factor, and the threshold seems to be somewhere in the top half of the league—roughly $1 million. “That’s not too far above the minimum salary benefit amount of $895,000 for players with 4-6 accrued seasons,” Korte wrote, “and players are naturally reluctant to have to settle for such a deal at this time of year.”

Advertisement

There are a few loopholes for teams to exploit to manipulate the comp pick system, and more teams appear to be getting wise to this, too. J.I. Halsell, an ex-agent and former senior cap analyst for Washington, picked up on one of these loopholes back in February:

And guess what? In recent years, more teams have structured contracts with team options, which allows them to exploit this mechanism. Tracking cuts versus declined options can be tricky, but Pro Sports Transactions does it fairly reliably. As recently as 2015, just two teams declined options on four veteran players between Jan. 1 and the second Tuesday after the draft. In 2016, there were zero. But in 2017—the year comp picks were first allowed to be traded, which enhanced their value—five teams declined options on six players. In 2018, eight teams did it on nine players. And this year, 11 teams did it on 15 players. Only four of those 15 have since signed on somewhere else.

Advertisement

As Korte told me, the Broncos, 49ers, and Eagles have most frequently structured deals in recent years with an option bonus or a guarantee that would vest in February or March, thus forcing the team to decide on whether to trigger the option. But the Patriots also like to do this—and they may have been the first to discover its advantages.

In 2014, the Pats signed star cornerback Darrelle Revis after Revis had been cut by the Bucs—a move that did not cancel out the Pats’ loss of Aqib Talib that year in free agency, thus netting them a third-round comp pick for 2015. Revis’s contract had a 2015 team option, and when the Pats declined it and Revis signed a megadeal with the Jets, New England essentially double-dipped on him by picking up a third-round comp pick for 2016, too. (There really is no end to Bill Belichick’s ways of sticking it to the Jets.)

Advertisement

Another comp pick loophole for teams to exploit is to cut a player who might count against them. As Korte explained to me, if a qualified free agent is cut before Week 10 and not re-signed by that same team, the player no longer counts as a player gained. Here again the Patriots have set the trend. This offseason, they’ve signed safety Terrence Brooks, running back Brandon Bolden, and nose tackle Mike Pennel. But, as Korte told me via email:

Right now, the Pats’ three CFA signings (Brooks, Pennel, and Bolden) are preventing them from getting the max of four comp picks. If they lose one more CFA that qualifies before May 7, they’ll open up that fourth pick, which would be another sixth rounder. If that doesn’t happen, don’t be surprised if one of those three gets cut before Week 10 of the regular season if they’re not performing as well as hoped. That’s a practice that Belichick has regularly done in recent years.

The rookie wage scale was supposed to benefit NFL veterans by creating fixed costs for drafted rookies. There is certainly a lot more money flowing to more and more veteran players, and new benchmarks were set this spring for players at several positions. But if the league’s middle class began slowly vanishing thanks to contract mechanisms like injury splits, per-game-roster bonuses, one-year “prove it” deals, and contracts with voidable years, the comp-pick craze—which the rookie wage scale incentivizes—is only exacerbating the problem.