NBA Salary Cap Chat With Larry Coon 6/8/12

1. Matthew 'EL CAMPEON' Crawford

   Hello Larry, love your chats and your knowledge of the cap.

   could you explain the differences in the Mini-MLE and the regular one? I know the Mini is around 3.1M and the regular MLE is around 5. Fuzzy on the rest of it.

   Could also explain how the Bi-annual exception works? Thank in advance!

   • Larry Coon

     The idea is that they wanted to provide extra disincentive for taxpaying teams. One of the disincentives is that they get a smaller mid-level exception. Non-taxpaying teams can offer four years starting at $5 million. For taxpaying teams they made it three years starting at $3 million (the starting salary of both goes up yearly).

     Toward the end of negotiations they set the bar a little higher. Now, instead of the disincentives being triggered when the team crosses the tax line, they made it happen when the team is more than $4 million over the tax line — a point they call the “apron.”

     The Bi-Annual (like the rest of the exceptions) is explained in Question #25 of my FAQ at . But in brief, it can be used to offer a two-year contract with a lower starting salary than either of the mid-levels. It also cannot be used two years in a row, so teams using it this year can’t use it next year. It’s also one of the disincentives for taxpaying teams — teams over the apron can’t use it.

2. Luka

   Pistons are team with lot of bad contracts.Joe dumars doesnt have balls to make a risky trade.What to do about their cap space to make them competetive and watchable.Please dont say wait 2years to contract expire.Would you take some trade high risk high reward trade?

   • Larry Coon

     I haven’t seen anything over the last several years to make me think Dumars has a consistent plan. I think they need to dump as much as they can and start over. I don’t see their current roster competing any time soon.

3. Andrew U

   Can teams use money from their MLE’s to bid on players who get amnestied?

   • Larry Coon

     Nope. The ability to bid on amnestied players is a reward for teams under the cap.

4. Dave

   To make a draft day trade so you have to fit it under current year cap AND next years on July 1?

   • Larry Coon

     Trades are always based on the salaries, cap levels, etc., on the day of the trade. A draft day trade will be legal if it works on the basis of the 2011-12 salaries and cap level. They don’t use 2012-13 numbers until July.

5. Jimmy

   Is there any chance the Thunder could sign Harden and Ibaka and stay below the luxury tax threshold?

   • Larry Coon

     Right now the Thunder are set to be $7.3 million under the tax level next season when Russell Westbrook’s extension takes effect — but they will add more salary between July 1 and the start of the 2012-13 season. They will probably stay under the tax line next season, but not by much. Fast forward to 2013-14 when Ibaka and Harden have new extensions — replace Harden’s $5.8 million with his new salary (max or near max), and Ibaka’s $2.3 million with whatever he will make in his extension (significantly more than $2.3 million). I don’t see how they do it.

6. o2cats

   Hi Larry, I had a couple questions, if that is OK? Do you know if the roster size is still 13, under the new CBA? I saw that you can not use the MLE in a S&T, but you can use Bird rights, can you also use the Early Bird exception to S&T a player? Thanks

   • Larry Coon

     The roster size was, and still is 15. The ACTIVE roster size was 12 under the previous CBA. As a transition rule for the 2011-12 season only they increased the active roster size to 13. it was supposed to go back to 12 part-way through the season, but they decided to extend it for the entire season. They later decided they liked it enough to make it a permanent fixture, although the Board of Governors has not formally approved it yet. I suspect it will stay 13.

     Early-Bird is a form of Bird rights, so the answer to your second question is yes. Teams can use any exception in a sign-and-trade other than the Non-Taxpayer Mid-Level, the Taxpayer Mid-Level, and any exception that does not allow the player to be signed to a three-year contract (such as the Bi-Annual).

7. Lorin

   Who would be easier for the Bucks to trade, Brandon Jennings or Monta Ellis? Who would be more likely?

   • Larry Coon

     I think the answer to both questions is Jennings.

8. Grant

   Hi Larry,

   let’s say the 76ers use their amnesty clause on Elton Brand. Phoenix offers him 1 year @ 10 million and Brooklyn offers him 2 year @ 5 million. Where would Brand end up?

   • Larry Coon

     I think history shows that when a player receives two offers, and one offers double the yearly salary of the other, that players generally take the higher salary.

9. Jason (Santa Barbara)

   Assuming that the Nets come to the realization that they lack the pieces to acquire Dwight, would Lakers management consider a deal sending Bynum in a trade for D-Will and Brook Lopez? Would the Nets consider this good value? Can the Nets still sign and trade a RFA under the new CBA?

   • Larry Coon

     Over the last year, the Nets’ opinion has been that they want to keep Deron, and if worst comes to worst and they lose him, then they lick their wounds, pick up the pieces, and start over. The question becomes, is it better to start with a piece like Bynum, or is it better to gut the roster and start from scratch. My personal opinion is that centers of Bynum’s size & ability are hard to come by (injury concerns notwithstanding), and if a player like that is available, you take advantage of the opportunity.

     Do the Lakers do it? That’s a harder question to answer — it’s not clear they move Bynum for anyone other than Howard. They’d much rather send Gasol in the deal, of course, but Pau obviously doesn’t make as much sense for the Nets. If they did move Bynum then they’d have to figure out the Pau/Lopez combo and how that would work out (Pau should really be a five to be most effective — but does that mean they put Lopez at four?). And as Pau gets older, they have to revisit the big man problem again soon.

10. Q

    I know you’re a money trail guy BUT, assuming that MIA wins who do u have MIA or OKC and why?

    • Larry Coon

      I have OKC over either Miami or Boston, but like any good scientist I’m willing to reverse my position on the basis of new, compelling evidence that comes in. LeBron showed me a lot with his performance last night, and if he keeps it up in Game 7, I might change my mind. If he shows that he can do what all the truly great players can do — find a way to will his team to victory — then Miami is going to be a lot tougher to beat.

      Still, a lot depends on Bosh, on how Miami is going to contain both Westbrook AND Harden, and a number of other factors. We’ll see what Game 7 of the ECF tells us.

11. dan

    what chance would u put on one of the 2 sides opting out of the cba?

    • Larry Coon

      I think pretty high. The labor settlement resulted in an agreement both sides were willing to live with — not one that made economic sense for everyone. I think chances are pretty high that one side or the other (or even both) will feel like they’re in an untenable situation and opt out. Part of the problem is that owners got some of what they wanted — the players getting a lower percentage of BRI — but not all the mechanisms to make the salary system work under those conditions.

12. Kevin

    How much longer before teams substantially over the salary cap have before the new rules come in? and if it’s this year do you think teams will just eat it?

    • Larry Coon

      If you’re talking about the new luxury tax rules, teams get another season until the progressive tax rates kick in. Starting 2013-14, there will be a progressive rate, but the repeater rate won’t kick-in until 2014-15.

      We’re already seeing teams make roster decisions on the basis of the looming tax changes. We’ll see more of it this summer. A few teams may tax more than a year or two to re-tool, and consequently have to pay a higher tax for a short time, but I don’t see any teams consistently spending tons of tax money — except maybe the Knicks.

13. Shane

    Do you think the Pistons will amnesty anyone this summer to make room for some salary cap? Maybe a Ben Gordon or Charlie V?

    • Larry Coon

      Are they going to be able to sign someone with that cap room? If not, then there’s not much point in using amnesty. I don’t see them using it on Gordon under any circumstance, but Villanueva is a possibility. But remember, they still have to pay the player.

14. Pablo

    Playing with the ESPN Trade Machine I realized that I do not understand how do draft picks level the difference of salaries between traded player. For instance, imagine a Knicks-Kings operation trading Stoudemire (18 millions) for I. Thomas (less than 0.5 millions). Can draft picks be thrown to the trade so that it works salary cap wise?

    • Larry Coon

      Draft picks always count $0 in trade. They can level the “basketball value” of a trade, but they don’t apply at all for salary matching.

15. Farhan

    what do you think about Stoudmire for Boozer trade Chi & Ny?

    • Larry Coon

      Not a chance.

16. bolo

    Mr. Coon,

    I read of a rumor that the Mavericks are trying to work something out with Odom’s camp so they have can move the contract termination date from June 29, into July, which would somehow help the Mavs and the Lakers out, if Odom really is indeed heading back to LA. Can you please elaborate on how modifying the contract could help out both parties?

    • Larry Coon

      Odom’s $8.2 million salary is only partly guaranteed right now — I think the amount is $2.4 million. But the guarantee changes to full if he’s not waived by June 29th or so (I don’t have that date in front of me right now either). If Dallas wants to trade him, there’s no way they are going to risk letting him become fully guaranteed first — for one, his trade value goes down if he’s fully guaranteed. Two, if they don’t get a deal done then they’re stuck with him at his full salary.

      If they’re going to do a deal with the Lakers then they have to wait until after July 1, because the Lakers can’t re-acquire a player they traded away in the same season. So the only way to do both of these things — trade him to the Lakers, but do it while he’s partially guaranteed — is to change the guarantee date from June 29th (or whatever) to sometime in July.

      They can do this if both sides agree. The last time I remember something like this being done was when the Lakers & Vlade Divac changed the guarantee date on his contract a few years ago.

17. Mark

    50/50, 60/40, 40/60, 70/30 that howard is traded for bynum this offseason??

    • Larry Coon

      Interesting question. I guess it depends on three other questions:

      1. Is New Jersey still in the driver’s seat, or have they lost too many assets?

      2. Is Howard more open to joining other teams, like the Lakers?

      3. If Howard is still against it, then with Bynum also on the last year of his contract, do the Lakers pull the trigger anyway?

      If the answer to question 1 is “no” and question 2 is “yes,” then the odds are a lot higher. If 1 is “no,” 2 is “no,” and 3 is “yes,” then the odds are also higher.

      I’m pretty certain that Howard will be traded this offseason, unless he has a change of heart and decides to stay. If Brooklyn is out, then the Lakers probably have one of the best offers if they are willing to move Bynum.

18. Shawn

    I have a question about rookie contacts for 1st round picks. It is set out guaranteed contract but the 5th year confuses me.

    Let’s look at Kevin Durant for example:

    Year 1 (2007-08)
    4,171,200

    Year 2 (2008-09)
    4,484,040

    Year 3 (2009-10)
    4,796,880

    Year 4 (2010-11)
    6,053,663

    Year 5 (2011-12)
    15,506,632
    (didn’t receive full because of the lockout)

    I thought year 5 was another option with an increase of 30.5% over the previous year? How was he able to get max money in year 5? Shouldn’t this occur in year 6?

    • Larry Coon

      No. Rookie contracts for first round picks are for four years. What you see in the scale for the fifth year is the percentage increase for the QUALIFYING OFFER, which is just a pro forma offer teams make to their restricted free agents. OKC and Durant were able to agree on a maximum extension (the negotiation must have taken all of two minutes) which took effect in his fifth season.

19. Mark

    not sure if this question got through:

    do you think the days of having a ‘dynasty’ are over in the NBA? will we ever see a run like the bulls in the 90′s or the celtics in the 60′s? thanks.

    i bet you noone will want to watch the hornets vs OKC in the WFC in about 5 years…

    • Larry Coon

      One of the ideas behind the new CBA was to bring economic parity – to have teams in all 30 markets able to make a profit and compete for a championship. With economic parity will come basketball parity — I think teams will no longer be able to spend their way to long championship runs.

20. Jeff

    After the lakers’ season came to an end shorter than they hoped it would, obviously some changes need to be made to the team. Obviously the lakers main flaws are the point guard and small forward position, and their lack of depth.
    What moves do you see them making in the offseason?
    What rumors have you heard?

    • Larry Coon

      A lot depends on what happens with Sessions. If he opts-in, then they have a serviceable — but not great — point guard. If he opts-out, then they probably don’t re-sign him, and instead get to work on signing or trading for one.

      Even with Sessions on the roster the team has a lot of holes to fill. Since Pau Gasol really isn’t working all that well at four under Mike Brown’s system and he still has a lot of trade value, I expect he’ll be the most likely guy to be traded. Look for a move that brings back a replacement four (one who will coexist with Bynum — more of a stretch four) and a couple solid wing or bench pieces.

      The Lakers do a really good job at keeping rumors from spreading. If something gets out, it’s either from the other side (not likely) from agents (a little more likely) or just made up out of whole cloth (most likely).