When the Jets signed Chad Pennington to a seven-year, $64 million contract two years ago, they thought they had solved their quarterback needs for the rest of the decade. Two rotator cuff surgeries and 16 missed starts later, that contract looks like an expensive millstone around the Jets’ necks, and the best decision for both Pennington and the franchise would be to go their separate ways.

The Jets owe Pennington a $3 million bonus if he is on the roster on March 3. They don’t want to give that kind of money to a quarterback whose throwing shoulder might never heal completely, so Pennington has two weeks to decide whether he’ll restructure his contract or get cut. If Pennington would take a sharp pay cut this year, the Jets would love to have him back, but there’s no reason for the quarterback to agree to that. If the Jets release him, some quarterback starved franchise will make him a good offer, even with the questions surrounding his health.

Though the Jets will most likely cut Pennington, it won’t make much difference to this year’s salary cap. Because of the NFL’s accounting procedures, Pennington will count more than $10 million against the Jets’ 2006 cap whether he’s on the team or not. But since the Jets are unlikely to contend for the playoffs next season, they should be looking to the future.

Cutting Pennington now would remove his high salary from the Jets’ books starting in 2007, when they’re more likely to fight for a spot in the playoffs. The Jets are already more than $25 million over the salary cap for next year, which means they can’t afford to pay Pennington while they wait to see if his shoulder recovers. Keeping him would just retard the team’s rebuilding process.

Leaving New York will allow Pennington to find a patient team that can wait while he rehabilitates his shoulder. If he’s on the Jets’ roster, they’ll want him to contribute this coming season, and rushing back from his injury might just inflame it. Pennington is only 29, so he’d be a better fit on a team that sees him as the quarterback of the future, not the quarterback of the present.

Sadly, Pennington’s tenure in New York has to be considered a major disappointment. Even though he had an incredible breakout season in 2002, when he led the NFL with a 104.2 passer rating in his first year as a starter, he didn’t contribute nearly enough to merit the amount he cost the team. He made about $30 million in his six seasons with the Jets, but started only 37 games.

If the Jets release him, Pennington will become an unrestricted free agent at a time of great uncertainty in the league. The free agent market will be unsettled until the owners and the players can agree on a new collective bargaining agreement, which currently calls for the salary cap to end after the 2006 season. Some teams will feel paralyzed by the uncertainty of having no agreement with the players and avoid offering Pennington a big contract. But a team with a deep-pocketed owner and a need at quarterback (perhaps the Baltimore Ravens) will offer a lot of money to Pennington in the hopes that the league allows unfettered spending in 2007.

Meanwhile, the Jets have a wide range of options in finding a new starting quarterback. They might make an offer to a free agent, like San Diego’s Drew Brees, Cincinnati’s Jon Kitna, or Arizona’s Josh McCown. Brees is the best of that group, both because of his accurate arm and because he has a familiarity with new Jets offensive coordinator Brian Schottenheimer, who was previously the Chargers’ quarterbacks coach. But Brees suffered a serious shoulder injury in the last game of the 2005 season, and it seems unlikely the Jets would want to release one high-priced quarterback with a bad shoulder just to sign another.

An alternative is picking up a quarterback in a trade. Possibilities include backups Philip Rivers of the Chargers, Matt Schaub of the Atlanta Falcons, and Patrick Ramsey of the Washington Redskins. All have shown flashes of talent and have reasonably low salary-cap costs, but they also are unproven. Minnesota’s Daunte Culpepper might be available in a trade, but his high salary and serious 2005 knee injury make him less than attractive.

Or the Jets could draft a quarterback. This year’s draft has three quarterbacks who are considered top-tier players: USC’s Matt Leinart, Texas’s Vince Young, and Vanderbilt’s Jay Cutler. With USC running back Reggie Bush almost assured of being the first player taken, one of the three quarterbacks will be available when the Jets draft with the fourth pick. That draft pick isn’t necessarily a good thing for the Jets, though. Whoever they select will command a contract guaranteeing at least $20 million. That’s the kind of salary-cap pressure the team is trying to avoid by releasing Pennington. The Jets would be wise to move down in the draft and select a less expensive player, but it’s unlikely they’ll find many teams interested in trading.

As Gang Green tries to recover from a 4-12 season and reshape its roster while operating under the salary cap, it doesn’t make sense to keep Pennington around. Even though there’s a chance he will once again rank among the league’s top quarterbacks, it’s not a chance the Jets can afford to take.

Mr. Smith is a regular writer for FootballOutsiders.com.