Salary Cap Chat With Larry Coon 1/18/12

1. Bill

   Clarification: What is the method that lower echelon teams – Milwaukee, Charlotte, Toronto, etc can use to get to playoffs and beyond. Are these teams required to spend their luxury tax dollars received from other teams on player salaries?

   • Larry Coon

     No, there’s no requirement that tax proceeds be used to fund player salaries. The money just goes into the team’s coffers, and in many cases, just offsets losses.

     Of course, the hope is that the tax proceeds will allow teams to add more salary, which will make them more competitive. The system is set up to allow that, but it doesn’t require it.

2. Jake

   With a shortened season, if a team with cap space or the $5M MLE available, how would a contract look if a team signed X player to a 3 year deal for $15M? Would the player earn the full $5M this year and would the full $5M hit the cap this season? Or would it be pro-rated and at what amount? What is the date when a team would not be eligible to pay the player the full $5M?

   • Larry Coon

     Exceptions start pro-rating downward on January 10 of each season (except the minimum salary, which starts pro-rating downward on the first day of the season). This season (due to the late start) the date is February 10. So the exception itself gets a little smaller every day, but it never gets so small that the player can’t be signed for more than the pro-rated amount. For example, a team can sign a player at the mid-level exception right before the last game of the season, give him the full amount of the exception, and he’ll earn a lot more than one game’s worth of salary for his one game on the roster. It’s a matter of negotiation between the team and player if the team wants to further reduce his salary due to the late signing.

3. Alex

   Hi Larry,
   what do you think of this trade? (deadline trade)

   Atlanta trades: Al Horford, Zaza Pachulia, Jason Collins, Jerry Stackhouse

   Phoenix trades: Marcin Gortat, Steve Nash, Grant Hill, Robin Lopez

   Atlanta gets a floor general, a very good center and defensive minded at SF, a center prospect and true leadership. They also get rid of Pachulia’s contract.

   Phoenix starts the rebuilding process and uses Horford as a building block with role players like Dudley, Price or Frye and a top pick in 2012 as nice additions.

   • Larry Coon

     I think Atlanta plans on keeping Horford as its franchise cornerstone, Nash & Hill are too old to build around, and neither Gortat nor the Lesser Lopez are enough to excite them. Despite the fact that Horford is on the shelf for a while, Atlanta says no to that deal.

4. dre

   what players should the Cavs target out this 2012 draft to help jump start Cleveland rebuild even more?

   • Larry Coon

     Cleveland has to right to swap their pick with Miami’s, which they’re obviously not going to do. They also have a chance of getting Sacramento’s pick this summer, but it’s top-14 protected, so it’s likely they’ll just have their own, which looks to be a mid 1st round pick in a deep draft.

     I’m not that big of a draft guy, so you’re much better off talking to some of our guys who ARE draft experts on specific players. I will say that I’m almost never in favor of drafting for need over drafting for talent. You take the best talent on the table, and make adjustments afterward.

5. Chris

   With the new trade rules (150% or 100% + $5mil) for non taxpaying teams…is it possible to break up a trade into multiple trades, executed simultaneously? For example, trading 3 guys of $10mil each for 3 guys of $15mil each instead of counting it as one trade of $30mil for $45mil, which wouldn’t be allowed.

   • Larry Coon

     The new trade rules are….weird. They patched it up after they initially came to terms (because under certain situations, taxpaying teams could get more than non-taxpaying teams), and for non-taxpaying teams, it now reads:

     “A Team whose post-assignment Team Salary would be equal to or less than the Tax Level for the then-current Salary Cap Year may replace a Traded Player with one (1) or more Replacement Players whose Player Contracts are acquired simultaneously and whose postassignment Salaries for the then-current Salary Cap Year, in the aggregate, are no more than an amount equal to the greater of: (y) the lesser of: (A) 150% of the pre-trade Salary of the Traded Player, plus $100,000; or (B) the pre-trade Salary of the Traded Player, plus $5 million; or (z) 125% of the pre-trade Salary of the Traded Player, plus $100,000.”

     That’s just a convoluted mess.

     As you said, it’s always been possible to break a trade up into multiple, smaller, parallel, simultaneous trades, so long as those smaller trades are individually legal. This rule would seem to allow each of those smaller trades to have a $5 million buffer, if the trade is within the narrow band in which the $5 million is within “the greater of the lesser of…” It’s something I need to clarify with the league.

6. Ricardo Vaz

   People keep saying that the Magic risk losing Dwight for “nothing” if they don’t deal him prior to the deadline. But how realistically can the Lakers, Mavs or Nets (who also want to re-sign D-Will) sign him under the cap without requiring a sign-and-trade?

   • Larry Coon

     The Lakers have no shot without a sign and trade. The Mavs will be able to generate the cap space — they need to waive Vince Carter (half man, half salary dump) and Lamar Odom, who have partially-guaranteed contracts. They also need to use their amnesty waiver on Brendan Haywood. They’d then be able to give Howard a max deal. Word has it they want to move Shawn Marion for an ending contract as well, which would clear nearly enough to go after both Howard and Deron Williams, which would have to be considered their “Plan A.”

     New Jersey will have enough cap room to retain Deron Williams and sign Howard.

     So of the three, the only team that really needs the Magic’s help is the Lakers. The Clippers are in the same situation as the Lakers, if you want to include them on your list.

     So if you’re Orlando, do you could on Howard needing them to facilitate a sign and trade, when two of his top three teams don’t need one, or do you get something for him while you can? Thought so.

7. bryan

   Hello Larry,

   What is the contract status of Wilson Chandler and JR Smith–do the Nuggets still own their rights? Could the Lakers
   sign either one with the Odom TPE?

   Thanks!

   • Larry Coon

     Second question first — a team can’t sign anyone with a trade exception.

     Both Chandler & Smith went to China as free agents. The Nuggets still have Bird rights to both players (K-Mart too).

8. Tyson Giordano

   hey i was wondering where u see the utah jazz in the future

   • Larry Coon

     I’ll see them at Staples Center on March 18….

     Okay seriously, at 9-4 they’re doing better than I expected, but part of that is due to their home-heavy schedule (8 of 13 have been at home) and the fact that they’re so tough to beat in front of their home crowd (they’re 7-1 at home, with their only loss coming against the Lakers). We’ll see how they really look around mid-March.

     They’ve made a good transition from the Deron Williams/AK-47 era, but having Al Jefferson anchoring the team still gives me pause. Most of their contracts (including Jefferson, Devin Harris and Paul Millsap) run out by 2013. That’ll likely be the point where they try to make big changes to take the next step.

9. Joseph

   I have been hearing that there is a contract restructuring provision in the new CBA… is this true? If so do you see any teams/players using this to add more pieces?

   • Larry Coon

     It’s was blown out of proportion. The rule is simply that if a contract is extended, then the salary in the first year of the extension can’t drop by more than 40%.

10. Papa Legba

    With the Bobcats fielding the leagues first d-league team, is Michael Jordan clearing space to sign free agents or building thru the draft?

    • Larry Coon

      Teams that are trying to rebuild through the draft usually stockpile picks. The only pick they may be owed is Portland’s which is protected until 2016. It’s not entirely clear to me what Jordan’s plan is.

11. Christopher

    Are you worried about Amar’e in NY’s system formerly knows as an offense? Knowing your background in LA, I can’t imagine you’re hopeful that Baron Davis is the answer…

    • Larry Coon

      Baron is nothing more than a low-risk gamble, and a stopgap at best.

      I agree, the team looks ill-conceived, but that’s because they didn’t put the pieces together using a top-down plan. Instead they had to give Denver all they could in order to land Melo, and then pick up the pieces afterward. What you’re now seeing is the “afterward,” and they are in the process of filling out the team. It’s going to take awhile.

      I know Mark Warkentien is a fan of George Patton, who said (paraphrasing), “An imperfect plan executed violently right now is better than an imperfect plan executed next week.” They had the chance to land Melo and they jumped on it. Their current lineup is the result of it being an imperfect plan.

12. Jason

    Eric Gordon for Paul George. Who says no? Gordon goes home and New Orleans gets a solid prospect on a cap friendly contract for the next three years.

    • Larry Coon

      I think I roll the dice on Gordon if I’m Dell Demps, although he’s going to want a max extension, and that gives me pause.

13. Sweet Dee

    My current “Coaches Worst Nightmare Team” stars: DeMarcus Cousins at center, Michael “Supercool” Beas at PF, Metta World Peace at SF, JR Smith at SG, and Gilbert Arenas at PG. What’s your team look like?

    • Larry Coon

      Reminds me of an old joke about policemen, chefs and mechanics in heaven vs. hell.

      I suppose mine might be the same players with Arenas at center and Cousins at the point.

14. Kevin

    Can the Derrick Rose Extension Rule be applied to more than one player on the same team?

    • Larry Coon

      One player they drafted, and one player they acquired through trade.

15. Jason

    Are there any ways the Lakers can get creative with sweetening the offer of Bynum for Howard?

    • Larry Coon

      They don’t want to give up both Bynum and Gasol (nor should they), but it may be possible to arrange a muti-way deal where both go out, with Bynum goes to the Magic, Gasol goes to a third team, and in addition to Howard, the Lakers get assets at one and four. But it seems like quite a stretch.