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Should the Cowboys cut Romo, or hold him, could there be a third option?

In the endless articles about Tony Romo’s situation – and I’ve written quite a few of them myself – most of the discussion has been about cutting him, or holding out for a trade, while the Cowboys , Tony Romo, and any potential trading partner appear to be locked in a stalemate that might last for some time.

Is there another option that might resolve the current impasse and work out well for all parties? I think there could be if Tony Romo were willing to cooperate.

The Dallas Cowboys should try to renegotiate Tony Romo’s contract.

The reason Tony Romo hasn’t moved is that everyone knows Tony Romo’s contract is too rich for the Cowboys to carry if he’s only a backup quarterback. After all, he’s due a $14 million salary this year on top of the $5 million in pro-rated signing bonus and $5.7 million in restructured bonus the Cowboys will have to pay regardless.

So any team thinking they want Romo’s services in 2017 just has to wait for Dallas to cut him, and then they can swoop in and sign Romo without giving any compensation to the Cowboys. The only reason a team would trade for Romo in those circumstances is if they feared they would lose Romo as a free agent to another team.

On the other hand, Tony Romo is too valuable as a player for the Cowboys to just cut him loose without receiving anything back. If he stayed healthy in 2017, he would be the most valuable free agent to change teams this offseason. If anyone doubts it, just look at what Oakland looked like in the playoffs without Derek Carr , or how well Texas fared with Brock Osweiler .

From the Cowboys’ standpoint, there is also no reason for them to help out a rival NFL team by letting them get Romo for free now when they can sign him and put him through the full offseason workouts. Dallas should wait all the way through OTAs, training camp, and even pre-season before cutting him if no trading partner emerges before then, because they will gain the same cap relief if they cut him tomorrow, or the day before the season starts.

If the Cowboys were able to renegotiate Tony Romo’s contract, they might get nearly as much cap relief as they would by making him a June 1st cut. This would require Romo’s cooperation, and we will get to that below. But for now, let’s look at how this could work financially.

Tony Romo’s cap hit in 2017 is $24.7 million. That is made up of:

$14 million in salary

$5 million in pro-rated signing bonus

$5.7 million in restructured bonus (from converting his salary into signing bonus in past years to spread the cap hit out over several years).

If you cut Romo after June 1, the dead money cap hit is $10.7 million in 2017 – the latter two numbers. But there are still two more years of restructured bonuses totaling $8.9 million that would come due as dead money in 2018.

If you cut Romo before June 1st, the Cowboys can take the entire hit in 2017: $5 million + $5.7 million + $8.9 million = $19.6 million.

But what if the Cowboys were able to renegotiate Romo’s contract? If they could get Tony Romo to agree, they might reduce his salary to $5 million or so, thereby saving $9 million. (This is just a number for discussion’s sake. It’s obviously not set in stone.) The contract could add in playing incentives that would enable him to earn more, but as these would not likely to be earned (because he hasn’t played much in two years), they would count nothing against the Cowboy’s 2017 cap.

If you cut Romo’s contract salary by $9 million, the cap hit would go from $24.7 million down to $15.7 million for 2017. Admittedly this is $5 million more than the cap hit the Cowboys would bear from cutting or trading him as a post June 1 cut, but it’s still $9 million less than is on their books now, and that’s $9 million they could either spend this year, or roll over into 2018. It’s also $3.9 million less ($19.6 million minus $15.7 million) than if the Cowboys cut or traded Romo and took the full dead money hit in 2017.

Under this scenario, the Cowboys would still be on the hook for the 2018 dead cap hit of $8.9 million if they moved on from Romo next year. But they are going to have to eat that eventually anyway.

Under this plan, the only cost to the Cowboys that they would not incur by cutting or trading him is whatever base salary the Cowboys and Romo agree to. Ideally, that might be even less than $5 million, with more of the potential compensation for Romo coming in play-time incentives.

Whatever that salary number is, it would be offset by any salary the Cowboys might give to another backup quarterback. Kellen Moore has just been re-signed by Dallas, but he might not be expected to be the primary backup this year.

Of course, that assumes that the Cowboys would keep Tony Romo under this scenario.

Just think about how this could change the dynamic. If Tony Romo agreed to this cut, the Cowboys would then have every incentive to keep Tony Romo for 2017 as a mentor to Dak, and in case Dak were to get hurt.

To pry Romo away from the Cowboys at that point would take some real draft and/or player capital.

Not only would Romo be more valuable to the Cowboys, he would be more valuable to any acquiring team because they would not be on the hook for his $14 million deal in a trade. Instead, they would only be on the hook for the contract they would have been hoping to sign him for as a free agent – a low-salary, high-incentive deal to protect themselves against any potential future injury to Romo.

In this scenario, the threat of Dallas keeping Romo would no longer be a bluff. The Cowboys could tell any suitor – “pony up, or we’re keeping him.”

What do you think Houston might do at that point when they are looking at Tom Savage  (who couldn’t stay healthy), Brandon Weeden, maybe Jay Cutler (who might cost more in salary), and/or a drafted rookie quarterback to lead them next season? Think their tune might change?

But of course, this hinges on a very big caveat —

There are a few reasons why Romo might agree to this.

First, Romo wants to play. If Dallas went to him and said – “Tony, if no one trades for you, we’re just going to sit on you until the end of pre-season” – this would really mess up his chances of landing with a new team on a good contract, because he would have much less value to them that late in the lead-up to the 2017 season. That’s essentially what the Cowboys are already doing, except that most commentators don’t expect the Cowboys to hold out that long, even if it makes the most sense.

But if Romo were to agree to renegotiate now, he could help break that impasse and increase his chances of landing with a team much earlier, perhaps before the April draft. The reasons are outlined above — a cheaper Romo could be kept by Dallas, and therefore any team that wants Tony will have to trade for him and will gain nothing by waiting.

Second, by being willing to strike a new deal, Tony Romo could negotiate for his salary to be guaranteed. As it is now, his $14 million salary for 2017 is not guaranteed, and all the bonuses that make up Dallas’s cap hit are already in Tony Romo’s bank account. It’s fairly apparent by now that no one is going to trade for Romo and take on that $14 million salary, and Romo certainly can’t expect he’ll ever see that money. Once Dallas cuts Romo, he’s only going to make what he can get on the open market, and if Dallas stalls to reduce his value, taking a renegotiated deal now might be the best contract he’ll get.

Third, if there’s any goodwill that is owed here, it is Tony Romo to the Dallas Cowboys, not the other way around. Tony has been handsomely compensated for his 10 years in Dallas, including the last two seasons when he didn’t play. It would make sense for Romo to make the right move with his contract to facilitate a trade, so that he can move on and Dallas can receive fair value in return.

Fourth, going in the opposite direction, is it completely unrealistic for Tony Romo to change his mind about needing to start, and decide instead to stay in Dallas and support Dak Prescott and the Cowboys? This would be the only way for that to happen. Jerry Jones might love this scenario.

Frankly, this just makes too much sense for all concerned. It really is the best solution.

A final note

We’re going to mention it here because it’s certain to come up in the comments. If Dallas were to try to strike a renegotiated deal with Romo, should they also try to entice him with the chance to compete with Dak Prescott and return as the starting quarterback of the Cowboys?

The answer to that has to be a firm NO. It’s possible that Romo, if no trade worked out and he ended up staying, could be called on if Dak fell flat on his face in his second season. But it would have to be a monumental flop by Dak. The Cowboys appear to have made their starting quarterback decision last year, and will likely stick with Dak and give him more than enough rope to play through any challenges he has.

The point of this scenario is ultimately not to keep Romo, but to get fair value for him in trade, and to move him to another team when he’s most valuable to them. That’s the only solution fair to all parties, and one that’s unlikely to be reached under the present dynamic.

Sign and trade deals are done often in other sports. Just because they aren’t common in football makes this unusual, not unrealistic.