Texans Remove Final Three Seasons From Stefon Diggs’ Contract

APRIL 5: One benefit from this unexpected move will come in the form of 2024 cap space. The Texans replaced the Diggs years with three void years, adding a fourth to spread out the wide receiver’s cap hit through 2027. Diggs’ 2024 cap number has dropped to $5.88MM, ESPN.com’s Field Yates tweets. A restructure could have created this cap space as well, and the Texans now have a $16.64MM dead money number — in the event Diggs does not sign an extension before the 2025 league year — staring at them.

APRIL 4: A day after trading for Stefon Diggs, the Texans are making an interesting adjustment to the Pro Bowl wide receiver’s contract. Diggs’ Bills-constructed deal ran through 2027; that is no longer the case.

The Texans are removing the 2025, 2026 and 2027 season from the contract, ESPN.com’s Adam Schefter reports. Diggs is now set to become a free agent in 2025. The Texans moved $3.5MM in 2025 guarantees up to 2024, running that amount to $22.52MM. This was a mutual decision, The Athletic’s Dianna Russini tweets.

[RELATED: Texans’ Offer Changed Bills’ Stefon Diggs Plan]

Teams do not exactly make a habit of ceding contractual control, so nixing three years of a high-profile player’s contract represents an unusual development. The Texans will certainly ensure Diggs is motivated to succeed in 2024, as a fourth contract would stand to await him next year. But they now run the risk of losing the six-time 1,000-yard receiver after one season.

Houston does, however, hold exclusive negotiating rights with Diggs until March 2025. The parties could work out another deal. Unless something is already in place, the team has introduced a unnecessary risk into this equation. As SI.com’s Albert Breer notes, Diggs checking in with a $22.5MM cap number would spike his 2025 franchise tag figure north of $27MM. That would make a tag prohibitive for Houston. Because the Texans adjusted Diggs’ deal, they would not be entitled to a compensatory pick if he departs in 2025.

The Bears did not adjust Keenan Allen‘s contract upon trading for the longtime Chargers WR, who drew interest from the Texans. While teams have made trade-and-extend moves for wideouts in the recent past — Tyreek Hill, A.J. Brown, Davante Adams each signed new deals upon being moved in 2022 — those players all had one season left on their previous contracts or, in Adams’ case, were franchise-tagged. Diggs was tied to a four-year, $96MM deal that featured four remaining years, separating this decision from those early-2020s calls.

When the Bills acquired Diggs from the Vikings in 2020, he remained on his Minnesota contract — a $14.4MM-per-year deal that ran through the 2024 season — over his first two Buffalo seasons. The Bills and Diggs huddled up on the above-referenced $24MM-per-year deal in 2022, and the extension years were just set to begin. Diggs, 30, now has an unexpected opportunity to become a first-time free agent next year.

At the time of the trade Wednesday morning, it appears the Texans would have Diggs’ $24MM-AAV contract aligned with C.J. Stroud‘s remaining rookie-deal seasons. Stroud must be kept on a rookie contract through at least 2025. The Texans had the ability to easily escape from Diggs’ deal after the 2024 season. While removing these years could reignite Diggs — who offered a low-wattage conclusion to his 2023 season — a rebound season would also stand to up his value ahead of free agency. That would work against Houston, even if Stroud presents a nice drawing card for the nine-year veteran.

As it stands, the Texans certainly appear confident they will be able to retain Diggs beyond 2024. If not, they sent a Vikings-obtained second-round pick to Buffalo for one year of Diggs, who will turn 31 in November.

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