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How the Portland Trail Blazers Can Use a Salary Dump to Improve Flexibility

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The Blazers do not have any cap space heading into the 2017 NBA draft, but they still have some options to tweak their roster. Eric Griffith explains.

NBA: Golden State Warriors at Portland Trail Blazers Troy Wayrynen-USA TODAY Sports

The Portland Trail Blazers have no salary cap space this summer.

Everyone who knows anything about the NBA has read that sentence repeatedly over the last several months. Blazer’s Edge has already reviewed the complete impossibility of Portland obtaining high-cost or even medium-cost free agents this summer without dumping tens of millions in salary. But even without the cap space, the Blazers do still have options to tweak their roster.

Option 1: Taxpayer Midlevel Exception

The Blazers have nearly $134 million in guaranteed salary next year—well over the luxury tax limit ($121 million) and tax apron ($127 million). Per league rules, teams over the apron do not get a midlevel exception (MLE) or bi-annual exception to sign free agents, but they do get a $5.3 million taxpayer MLE.

President of Basketball Operations Neil Olshey can use the taxpayer MLE to sign any free agents or second round draft picks to a contract of up to three years. The exception can also be spread out to multiple players.

A $5.3 million contract will not attract a big name free agent, but the Blazers may be able to use it to lure a veteran player who can still, hopefully, make an impact but has been overlooked by other teams. Last year notable veterans signing in the $5-6 million range included Matt Barnes and Brandon Jennings. Someone like Javale McGee, who acquitted himself well on a veteran minimum contract, may be interested in signing for the taxpayer exception this summer.

The Blazers could also pursue a younger player who washed out with another team but still has some potential. Seth Curry and Dewayne Dedmon both proved themselves to be value signings last summer on small deals. Of course, the Blazers already have multiple draft picks and several young players on cheap contracts (e.g. Jake Layman, Pat Connaughton, and Shabazz Napier) so they may prefer to stick with internal development and use the taxpayer exception for other purposes.

Option 2: Minimum Salary Contracts

The NBA allows any team that is not hard capped to sign players to minimum salary contracts. Last year players like Marreese Speights, Jarrett Jack, and Anderson Varejao signed minimum salary contracts. Olshey could use a minimum salary to take a flyer on someone like Larry Sanders who is nearly out of the league but has potential to be a difference maker.

Minimum contracts can be partially or non-guaranteed to start the season, making them low-risk, high-reward propositions. The downside would be that if the Blazers did improbably get a “hit” on someone like Sanders they would not have the player’s Bird Rights to retain him next season. Minimum contracts should be viewed strictly as one-year rents.

Option 3: Salary Dump - A Better Option Than Expected?

The idea of sending out an overpaid player like Meyers Leonard with a draft pick in return for nothing has drawn derision from Blazers fans, but a salary dump would create some advantages:

  1. The Blazers have no open roster spots —they’re going to have to cut Tim Quarterman and Pat Connaughton just to sign their first round picks. A salary dump would open up a spot to use on a taxpayer MLE free agent without having to sacrifice a player already under contract.
  2. A salary dump would alleviate the luxury tax penalty of any free agent signing. As of now, the Blazers would pay in excess of $20 million in tax and salary to sign someone to the full taxpayer MLE. Paying near max money for a 15th man would be a bitter pill to swallow, even for Paul Allen. Eliminating Leonard’s salary, for example, would cut the tax payment roughly in half and make a modest free agent signing more palatable.
  3. A salary dump would create a traded player exception (TPE) for the Blazers. The TPE would be for the value of the outgoing player’s salary and could be used to acquire players in future trades without having to send out any salary in return. It would expire after one year. For example, if the Blazers traded Leonard and a draft pick for heavily protected second round pick on July 17, 2017 they would generate a $9.9 million TPE that could be used to take on another player in trade for nothing until July 17, 2018.

Combining a Salary Dump and Taxpayer MLE

A salary dump may seem unappealing on the surface but it does open up several avenues of flexibility for the Blazers. For example, as of now it’s impractical for the Blazers to use the taxpayer MLE, but if they made a $10 million salary dump in mid-July they could save over $40 million in salary and tax for the 2017-18 season and open up a roster spot.

The roster spot and salary could then be translated into a free agent using the taxpayer MLE. The TPE could then still be used to acquire an impact player in trade during the season or even during the 2018 free agency period. Using the TPE to bargain for a trade would also be more appealing as it alleviates any financial burden on the trade partner. Olshey could also use a salary dump to bump a draft pick to a future season if he can’t find a player the Blazers want in the late first round this season.

Ultimately, whether or not the upside of a salary dump would justify sacrificing a draft pick will depend on how well Olshey can use the added flexibility to upgrade the roster and if Paul Allen has ordered the team to cut salary in preparation for Jusuf Nurkic’s free agency next summer.

Eric Griffith | @EricG_NBA


Readers - Is a salary dump worth it? Who should the Blazers sign using the taxpayer MLE? Let us know what you think in the comments!