NBA Sets New Salary Cap And Luxury Tax Numbers; What Does It Mean For The Blazers?
by Storyteller on Jul 7, 2010 6:47 PM PDT
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PrintThe NBA has set new salary cap and luxury tax numbers and they are slightly above most projections. Check out this fanshot for full details.
One major implication for the Blazers lies not in where the league is setting the salary cap, since the Blazers are well above it, but rather where they are setting the luxury tax threshold. The new threshold of $70.3 million means that after the Blazers sign Elliott Williams (they’ve already signed Luke Babbitt), Portland will be $3.6 million under the tax threshold with 13 roster spots filled. A week ago, it looked like signing Williams would put the Blazers very near the tax threshold, now they can not only sign Williams and stay out of luxury tax territory, but they can sign other players like Patty Mills or Armon Johnson and still stay below the threshold.
Of course, if the Blazers aren’t worried about paying tax and are willing, for example, to use the full MLE on a free agent, then this discussion isn’t as dramatic. The only difference is that they’ll pay less tax than previously expected. But the option of staying below the tax line is probably more realistic now.
Secondly, in regards to the situation with New Orleans and Chris Paul – the deal to send Mo Peterson to OKC looked last week to put the Hornets just above the tax threshold. Now they look to be just below that line. I’m not saying that the team isn’t still looking to clear financial responsibility to guys like Chris Paul, James Posey and Emeka Okafor. But I think it would be fair to say that they are less concerned about it now that they don’t look to pay luxury tax next year without having to make one final move. Does this make it less likely that Portland can convince New Orleans to send them Chris Paul? I’d say yes.
Thirdly, there was talk about Chicago sending Luol Deng to Portland for Przybilla and Bayless. One of the supposed motivations for this trade was to clear just a little more cap space so that the Bulls could sign a second player, one making $16.6 million in 2010-11 (as opposed to the $12-13 million that Boozer looks to get). After the negotiations with Boozer, Chicago looked like they might have enough cap room to make a max offer, but now Chicago definitely doesn’t need to make a trade to clear up that cap space, as they have enough to offer LeBron James a max deal. I don’t know if this kills the trade proposition or not, but it’s worth mentioning.
One last thing – Brandon Roy will now be making a little more money than expected. I need to calculate what his ‘max’ deal will be, but in the 2010-11 season he’ll probably make $13.6 million instead of the $13.15 million I was predicting. His yearly raise over the course of the contract will also be a bit higher, so in the end he looks to earn a couple of million more than if the initial prediction of $56.1 by David Stern had come true.
What other implications do you see?
-- Storyteller
EDIT: Thanks to dan_the_man in the comments for pointing out my math error in the first paragraph. The Blazers will not be $1.0 under the tax threshold as I originally wrote but closer to $3.6 million. Gotta watch that math with cap holds!
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Now that we've cut Gomes
I’m getting us about 3.7 million below the tax, including signing both our first rounders to 120% contracts. Did you include cutting Gomes in those numbers?
Still on the Rex bandwagon.
You are correct
I mistakenly kept the cap holds for the Euros in my formula, and they’ll drop off once the season starts. Thanks for pointing it out!
Lockout now all but assured in 2011
The players were openly sceptical about Commish’s $400mil in losses. Now w/a Cap higher than last yr,MUCH higher than teams were told last Feb,the crazy FA signings,the players are going to be a whole lot less interested in taking the owners’ proposals.
at first, yes
but it really doesn’t change the fact that the owners can go a LOT longer without games than the player can. the most obvious result I can see is that it will lengthen the lockout, as the players will start more resolved, leaving further to go to get to an agreement.
The real problem isn’t the league’s total revenue – it’s the distribution. On the aggregate, the league and the 30 teams make money. But the problem is that unlike the NFL, where (almost) ALL teams make money, you have a much bigger disparity between the haves (Lakers, Knicks at the top) and the have nots (Griz, Hornets, etc). I haven’t seen the numbers in a while, but last I heard 12 teams made money (many of them LOTS of money), and 18 teams lost money.
So, the problem is real. Most teams are losing money. The obvious paths are to go the baseball route where about 1/4 of the league can outspend the other 3/4 5 to 1, but competitiveness takes a beating, or the NFL route, where the owners from the big markets subsidize the owners from the small markets. Hard to see that flying though. Can you see Buss or Dolan agreeing to send checks to Paul Allen?
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
last I heard, yes they still are
they were really close to break even last year I understand. But now our payroll is up about 10 million this year already
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
they just need more home playoff games
and viral logo merchandise sales in May-June to make up that difference
that’s why Paul gets cranky when the team loses in the first round
When reached 40 years of following Portland basketball you have, be as passionate of the Trail Blazers you will not!
LMA's contract will increase as well as I understand it
If I’m not mistaken his deal was based on a percentage of the maximum contract.
Couldn’t be happier to hear that the Deng trade is that much less likely. That trade made absolutely no sense on the Blazers end.
Disappointed to hear the chances of CP3 coming to Portland dropped from 0.01% to 0.001%. All hope is not lost however.
I don't think that's possible on Aldridge
Someone will correct me if I am wrong, but I don’t think the CBA allows “% of next years max” in the contract language. They may have came up with the number based on a percentage of what the assumed max was going to be, but I don’t think it can have actual language adjusting the amount later once that max changes. But I could be wrong.
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
There was some discussion about that possibility
when they were in the negotiation phase last summer, but in the end, they settled on a firm number.
LMA's contract
they reached a number based on what percentage of “max” they thought he was, and what the sides eventually agreed “max” would be. his deal is now a lower percentage of that max contract for him. :)
by Rodney Gustafson on Jul 7, 2010 7:05 PM PDT via mobile reply actions
The cap space available
I been saying this was a smart move all along. Dumping a wishy washy Webster to gain a 16th pick and dump Gomes for a million to clear up $3.7 mil?
So we could sign a lower tier player then sign a player at the mid level exception?
We need Tom Penn back. With this kinda change, he could make something BIG happen!
With that said
Couldn’t we use the 3.7 mil and add it to what is allowed for the mid level exception? Making it about 10 mil? Hmm.. that is some big scratch to get a big player still available or some sign and trades?
no as we are alerady over the salary cap.
we are only below the Luxury tax line. you can only use the BAE, MLE and Bird rights once over the salary cap.
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((o))
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As i understand it
we are 3.7 mil below the luxury tax not the Cap, and No you can not combine Cap space and Exceptions
Is it to much to ask that we build a championship roster and stay below the luxury tax...
Storyteller, break it down for us
What do we have to work with?
What can we do besides a trade?
What is the likely outcome once we sign our rookies and resign Patty Mills?
What will be left over after signing the rookies?
Won’t signing the two extra’s put us over the player allowance?
I'll try
What the Blazers have to work with is trading players, or using exceptions to sign free agents (the MLE, the BAE or the minimum salary exception).
I think it’s likely that the Blazers use part, if not all, of their MLE to sign a FA.
The Blazers are over the cap, so there’s really ‘nothing left’ after signing the 1st round draft picks. If the team wants to stay below the luxury tax threshold, then they can sign a minimum player or two.
Signing both Mills and Johnson would put the roster at 15, which is the maximum when the season starts. The team can carry more than 15 players during the summer.
Diener, Howard
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
and Martell of course
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
Should resign
Howard. Good veteran who was brought on NOT to even play, but had to, and held his own for his age and caliber. We need him back for the leadership.
It won't happen
If he comes back, it will be as a coach. There is talk of free agents, our 2nd rounder, and Patty. There just isn’t room for Howard.
Still on the Rex bandwagon.
heh. simultaneous posting
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
other than trading
We are already over the salary cap, so signing our rookies have NO impact on our ability to sign non-rookies (other than roster spots of course). Since we are over the cap, we can sign free agents one of three ways:
we have the 5.77 MLE to offer, which can be given to one player or split among multiple players
we have he 2.08 BAE to offer, which can be given to one player or split among multiple players
we can offer minimum contracts, which vary in amount by years of service.
As it stands, we have 12 players signed, including Babbit. Assuming we sign Williams we are at 13. Barring any trades, that leaves us with 2 spots to decide upon between Mills, Johnson, and any veteran free agents we want to sign using one of the above methods. I am of the opinion that barring trades, it is highly unlikely we keep both Mills and Johnson.
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
I am of the opinion that barring trades, it is highly unlikely we keep both Mills and Johnson.
Now that KP is gone, I tend to agree. Kevin and PA used to collect PGs, and the roster has had 4 of them before (Blake, Jack, Rodriguez and Green)
When reached 40 years of following Portland basketball you have, be as passionate of the Trail Blazers you will not!
dont forget last year too
Miller, Blake, Bayless, and Mills (assuming you call Bayless a PG, which is a debate I won’t enter tonight)
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
I was thinking of that
but by the time Patty was healthy, Steve was gone
When reached 40 years of following Portland basketball you have, be as passionate of the Trail Blazers you will not!
and then it was time to ring the Deiner bell
it’s a good thing they give Portland 15 roster spots, so they’ll never run out of PGs
When reached 40 years of following Portland basketball you have, be as passionate of the Trail Blazers you will not!
I'm not Storyteller, but ...
We have no cap space to work with. For signing free agents, we can use the MLE (~5.7 mil) and the BAE (~2 mil). They can’t be combined, but they can be split up to sign multiple players, for no more than the total of the given exception. We can also sign players to minimum contracts, and we can sign any of our first round draft picks from the last few years (the Euros, who aren’t likely to be Blazers this season). That’s what we can do besides a trade.
If we sign all 3 rookies (we’re signing both 1st rounders- they’re guaranteed, but we have the option on our 2nd rounder) and Patty, we’re at 15 players. If we do anything else, it has to be via a trade.
After signing the 1st round rookies we are way above the cap, and ~3.7 mil below the luxury tax line. Signing our 2nd rounder and Patty would likely use about 1.5 million. That would leave us about 2.2 mil below the tax line, but without any roster spaces left over for a free agent.
Still on the Rex bandwagon.
technically, we don't have to sign Williams
we will of course, but in theory we could decide not to sign him, making him a free agent
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
True
We don’t have to sign him. I guess I shouldn’t have said he’s guaranteed. Just guaranteed money once we do sign him. Like you say, we will sign him, so it’s not really an issue.
Still on the Rex bandwagon.
hehe. how about that
;-)
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
StoryTeller
What does this mean for Miami and the possibility of signing Lebron? would the 3 still have to take a pay cut (assuming its a sign and trade for Bosh for Beasley/Chalmers)?
Is it to much to ask that we build a championship roster and stay below the luxury tax...
some of this was discussed earlier:
http://www.blazersedge.com/2010/7/7/1557690/stein-espn-salary-cap-58m
Basically, Miami is still about 2 million short of a 3rd max deal. Getting rid of Beasley would be enough. Chalmers alone would not
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
If Miami can get LeBron to commit
and they want to keep both Beasley and Chalmers, the big 3 will have to take about a million less than the max (in 2010-11). This would translate to several millions less than max over the length of the contract.
douglast has it right on the other issues.
Could the Heat
use a sign in trade with the Cavs or Raptors to get all 3 players max deals? How does the CBA regulate a deal between an over the cap team and an under the cap team? For example, could the Heat sign Wade and LBJ to max deals, then make a deal with the Raptors where they sign Bosh, and trade him to the heat for nothing but a trade exception?
Unless I am mistake the max deal that Bosh could sign with the Raptors would have a lower 1st year salary than if he signed with the Heat out right, somewhere about 1 million less. Must the Heat have the full amount of cap space left to absorb Bosh’s new deal, or is there some wiggle room like the 125% +100,000 rule?
Ben II Blazersedge.com || New to Blazers' Edge?
Miami must have cap room to absorb whatever Toronto were to sign Bosh for in a sign and trade deal.
But they could also include Beasley in the trade if Toronto would take him.
by BlazerFanSince1970 on Jul 8, 2010 9:05 AM PDT up reply actions
which Toronto insists they wont
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
the must have cap room
they could in theory acquire Bosh through a S/T with Toronto that is slightly less than a “max” deal, but would still net Bosh the same total amount as signing with Miami outright, due to the higher raises each year. Let’s break that down:
Max w/ Miami: 5 years, 96,099,672, starting at 16,568,909 year 1
Max w/ Toronoto: 5 years, 100,241,899, starting at 16,568,909 year 1
S/T Toronoto, same total as Miami Max: 5 years, 96,099,670, starting at 15,884,243 year one
So, this would save 684,666 off Miami cap number year 1. Still not enough to fit all 3 with max deals however. Even dumping Chalmers doesn’t give them enough. It remains either move Beasley or one or more of the big 3 has to take less than max money.
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
it should be noted
Bosh could also get a 6th year through the S/T, so what about that possibilty.
6 year max deal would be 125,509,486, with the same starting salary. What if he took a 2 million hit in year 1 but got the 6 years? That would put him at 6 years, 110,359,485. This would be his payoff for taking less than max and allowing Wade/LeBron to both get max. They get more money up front, he gets an extra year and more money total. (of course Wade could sign 6 years at max as well, since he’s staying with his same team).
So maybe Wade and Bosh both agree to take a 6 year deal starting at 1 million less than max to start, to allow LBJ to sign 5 year max deal. Let’s look at that:
LeBron: 5 years, 96,099,672, starting at 15,568,909
Wade: 6 years, 117,934,486 starting at 14,568,909
Bosh: 6 years, 117,934,486 starting at 14,568,909
LeBron’s salary would be higher the first 3 years, they would be about the same in year 4, then Wade/Bosh would be higher year 5 (and only they would have year 6) Of course LeBron could always sign a 3 year deal with options, in which case it would be moot as he could resign using Bird rights after that and get even more.
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
Don't you think Cleveland will want to get in on the S&T trade exception too?
Lebron could get more money and a 6 yr deal that way too.
by BlazerFanSince1970 on Jul 8, 2010 9:23 AM PDT up reply actions
Ok this is getting close to what i was thinking
So if doing a sign and trade with the Raptors could save $600+K in salary cap room, I can assume that doing the same with the Cavs would save the same amount, making a total savings of $1,369,332, Chalmer’s deal is for $854.389, adding the two together we get $2,223,721 in savings if the Raptors or the Cav’s would take him back in a deal. Would this work? If I added right that would make the 1st year salares if LBJ, Wade, and Bosh total $48,337,395, while Beasley is at $4,962.240 for a total of $53,299,635. But only 4 players under contract, and I am unsure of the cap holds in place. Anyone know if this would work?
Ben II Blazersedge.com || New to Blazers' Edge?
yes, it appears to work
cap holds are 473,604 each.
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
Cleveland has been pretty firm about not doing a S/T
but of course once LeBron announces tonight, they could quickly change their tune
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
and now to blow this all up
Apparently, Miami has offered Mike Miller 5 years, 27-30 million and says they are "confident" LeBron is coming. This means his salary would have to start around 3 million bucks. Big 3 taking another 1 million less each?
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
spreadsheet error
starting salary would be closer to 4 million
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
Mike Miller is a good player
and I guess they will need a scorer/facilitator off the bench, but don’t they have more pressing needs at PG and Center?
Ben II Blazersedge.com || New to Blazers' Edge?
To make that happen, Beasley
has to be traded I would think. I can’t believe Wade, Bosh and LBJ would all take way less than the MAX, especially Wade who is going through a divorce, and is 28, so he is looking at his last big contract.
Ben II Blazersedge.com || New to Blazers' Edge?
and conveniently enough
there is a new rumor of a 4-team trade that would dump Beasley. Doing that, giving Wade/Bosh/LeBron all the max would leave exactly enough room to give Mike Miller a starting salary of 3.7 million – which equates to 5 years, 27 million
"I want to be traded to a contender" is almost always code-speak for "I'm a loser."
-Dave, 2/5/2010: http://www.blazersedge.com/2010/2/5/1297509/no-amore-for-amare
ofcourse
the Heat would then need, a starting PG, starting Center, and at least 2 more serviceable backups all for the minimum. Hrm…who could they get in this inflated market?
Maybe D. Fish from the lakers, but he seems to be worth more than the minimum still.
Jannero Pargo is a guy they might be able to get to play backup point.
But I’m drawing a black on any big man, save the Anthony Tolliver’s of the world that they could get.
Ben II Blazersedge.com || New to Blazers' Edge?
I thought I read somewhere
that he agreed to terms with a team already.
Ben II Blazersedge.com || New to Blazers' Edge?
Maybe save those for next year when they have cap exceptions again?
I could imagine them deciding that a good 1 or 5 can’t be obtained with their remaining cap space or the vet minimum this year and deciding to just get some stop-gap players. And then plugging the holes next year when they can offer more money in a presumably more rational market.
For instance, don’t you think Przy would be willing to sign for the MLE next year? Presuming he has a full recovery, he’d make a perfect 5 for that team.
If Miami gets LBJ they’ll obviously be very good this year. But just imagine how nasty they can be in a few years after they get a chance to spend a couple of MLEs, assuming the new CBA retains them, of course.
"...it was like he brought his own personal cross-wind to the arena." - Dave
Can you teach me oh wise one?
No seriously, I wanna understand salary caps, collective bargaining, etc. better. Thanks for the great post!
The Kings have the best bench I’ve seen. There are easily 14 guys on this team good enough for every bench in the league. Now if we could only get some starters, I’d totally jizz in my pants.
Kings fan
I can teach you to be a salary cap guru in one easy step
There is only one rule to the salary cap: Your team salary figure cannot exceed the salary cap.
That’s it. If you understand that rule, you understand the salary cap.
Understanding the ten or so exceptions to that basic rule of the salary cap? That’s more complex and that’s probably what you’re getting at. The undisputed master for us amateurs is Larry Coon and you can read his FAQ on the issue here. 10 years ago, when I knew nothing about exceptions, I started learning by reading his FAQ and I still refer back to it constantly.
If you’re really ambitious, you can read the actual CBA here.
I was just writing a long post, recommending Larry Coon's FAQ
But you’re too fast. Don’t forget, you need a good list of current salaries to make any of that information useful. Oh, look. It’s Storyteller’s site
Still on the Rex bandwagon.
It must be nice
when a surprise “minor salary adjustment” brings you an extra 450K/year……..
"You be realistic," Oden said. "I’m going to stay happy. All right?"
Hmm. While this saves PA some money and gives us a little more wiggle room before luxury tax hell,
I think overall this is a minor blow to us. Teams are going to be less likely to give us their players for cheaper. And I think this might shut the door on the CP3 scenario. It just got a little easier for Nawlans’ to keep him.
"What people need to know is that those pictures were taken a year and a half ago, and I've grown since then." - Greg Oden
BTW
Teams under the luxury tax threshold get $3.7 million from the rebate this year. Guess we know where Paul Allen got the money to move up to #34…..
When is the "deadline" for this rebate?
I’m thinking that the team could use their MLE and exceed the LT threshold in July, but turn around and shed a salary before February (assuming there are any teams left with capspace who want an EC, by then) and sneak back under the bar and still get their kicker check. Any chance of that?
If not, they’ll probably just offer a FA the sum of the remaining amount that they’re below the threshold plus the Euro cap holds and come in under the luxury tax wire with pennies to spare
Sucks to be right, sometimes. I saw this coming with Paul’s sister and the Vulcans talking about “breaking even” and then the team failed to make it out of the first round again, so they didn’t generate any “extra” home playoff game revenue or PTB merchandise sales
When reached 40 years of following Portland basketball you have, be as passionate of the Trail Blazers you will not!
It's based on salaries
as of the last day of the regular season, with a few adjustments for later incentives/bonuses.
So, yes, the team could go over the threshold this summer and reduce the team salary between now and February. A number of other teams have done that in recent years.
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