Well, it has been up for grabs for a while. We just didn't know it. The reported contract extension that Payton signed last year never was approved by the NFL, and the league ultimately will decide if he's a coaching free agent after 2012, barring a new contract.
No one knows how this will end. Let's look at the different scenarios.
Payton's current contract "tolls" to 2013
If you didn't know what "toll" meant before Sunday, you probably do now. Payton's current contract runs through 2012. There is some disagreement if Payton's suspended 2012 season would count toward completing that deal or if it would carry over into next season like it would for a suspended player.
Payton's camp will argue that the contract ends after this season. ESPN has steadfastly reported Payton will be a coaching free agent in 2013, barring a new deal. The NFL Coaches Association says the matter is unclear. The NFL's statement indicated the matter will be up to NFL Commissioner Roger Goodell.
It would be surprising for the NFL to simply set Payton free. It will be a bad look for Payton if he enters his "contract year" after this drama. If Goodell decided that Payton's contract indeed "tolled" into 2013, we'd expect the Saints and Payton to work out a long-term deal.
Payton re-signs with the Saints before the end of 2012
This is the most likely scenario by far. The news on Payton's contract was released with purpose Sunday. Logic says Payton's camp wanted to pressure the Saints to move forward on a situation that has been in the air for a while. Payton's agents want some sort of movement here; they want long-term security.
Payton says he "plans" to coach in New Orleans in 2013, but Jason Cole of Yahoo! Sports wrote there "are others in Payton's camp who wonder exactly how this is going to go."
The stakes are clear. Fox Sports insider and NFL Network contributor Jay Glazer reports that Payton expects to be the highest-paid coach in football. Despite Payton's suspension, he has the leverage, and he knows it. And despite the suspension, Payton and the Saints can negotiate a contract extension, a source told The Times-Picayune.
Re-signing with the Saints makes the most sense for many reasons, starting with the presence of quarterback Drew Brees. It also might be hard for Payton to gain as much power in another organization. Then again ...
Payton becomes a free agent and leaves for Philadelphia
Peter King raised this possibility on SI.com. It's a long shot -- and would require the Eagles' free fall to continue -- but it makes some sense. Payton worked in Philadelphia before. He's one of the only coaches who wouldn't feel like a step down from Andy Reid. The Eagles are an attractive organization for any coach, and they are willing to make bold moves.
Payton becomes a free agent and leaves for Dallas
Payton and Cowboys owner Jerry Jones reportedly maintain a close relationship. Jones was willing to cede power to Payton's mentor, Bill Parcells, and he could do the same with Payton in theory. Jones should be ready to make a move if the Cowboys finish under .500, and Payton could see quarterback Tony Romo as young enough to salvage. Payton's family lives in Dallas -- it's almost all a little too perfect.
If nothing else, the Cowboys could provide a whole lot of leverage points in negotiations for Payton.
Sean Payton leaves for the booth
Payton becomes a free agent and leaves for anywhere else
Consider this the least likely scenario. To leave a situation like New Orleans, Payton will be able to be picky. There's no reason to think the San Diego Chargers, Kansas City Chiefs, Cleveland Browns, Tennessee Titans or any other possible team making a coaching change would be a fit. Heck, they might not be able to afford Payton.
Straight out of Parcells' playbook
Parcells was Payton's biggest NFL influence. He constantly created drama and leverage for his job changes through strategic use of media leaks. He invited drama when it came to contracts. He knew it was good for business to be the belle of the coaching ball. He liked to change jobs at just the right moment, and you could argue Payton never has looked more valuable to the Saints.
Sunday's news was the first volley in a now-public bid for a new contract for Payton. Don't think it was a coincidence that the news came out before a "Monday Night Football" telecast.
We think Payton will stay in New Orleans because it makes too much sense to leave. Just like with Brees' contract situation, things might just have to get ugly first.
Follow Gregg Rosenthal on Twitter @greggrosenthal.