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A (CELTICS FRIENDLY) GUIDE TO THE NEW CBA
by bobheckler Thu Dec 22, 2016 10:35 am
http://www.celticshub.com/2016/12/18/celtics-friendly-guide-new-cba/
A (CELTICS FRIENDLY) GUIDE TO THE NEW CBA
By Ryan Bernardoni
On December 18, 2016
How to Read This Guide
This post is designed to lay out all of the details of the new CBA that have been reported to date. For each item I’ve tried to provide analysis at both the “big picture” league level and specifically for the Celtics. I’ve also highlighted some unknowns on each topic that could change the analysis when we have more details.
Please note that I am not a reporter. Everything I’ve written below is based on reporting from Eric Pincus, Tim Bontemps, Zach Lowe, Marc Stein, Adrian Wojnarowski, David Aldridge, and Brian Windhorst. HoopsHype does a good job of collecting news and rumors on the new CBA. In my opinion, this piece by Bontemps for the Washington Post is the best reporting done since the agreement was finalized. (EDIT 12/18: Eric Pincus has published some great reporting that included specifics from an actual NBA document.) The fact that I’m relying on the reporting of others means that in some cases I have to interpret or infer information from what’s been written. All of the details of the new deal are not known, and there will likely be mistakes in the reporting, so use this as a guide but do not assume that all of the analysis will hold up when the complete CBA is known.
Table of Contents
The Salary Cap Edited 12/19
Luxury Tax Apron
The Moratorium and Offer Sheets Edited 12/19
Maximum Contracts
Over-38 Contracts
Mid-level, Bi-annual, and Minimum Exceptions Edited 12/19
Rookie Scale Exception Edited 12/19
Free Agent Cap Holds Edited 12/22
Raise Structures
Designated Veteran Players Edited 12/19
Traditional Veteran Extensions Edited 12/20
Draft Eligibility
Two-way D-League Contracts and Expanded Rosters
Trade Rules Edited 12/22
The Salary Cap
What Has Been Reported
The current cap projections are:
2017-18: $103M
2018-19: $107M
2019-20: $111M
2020-21: $120M
The definition of “Basketball Related Income” that the salary cap is based on is changing, with additional revenue streams being included
The salary cap will be set before July 1
Big Picture
The salary cap likely will see further increases with the expanded definition of BRI. Whether that will apply to 2017-18 is currently unknown. It could be that the expanded definition does not immediately apply, that the way BRI is estimated pushes the increase out a year, or that the new CBA sets a specific salary cap figure for 2017-18 before reverting to a percentage basis beyond that. It may also be that the reporting is incomplete, and the salary cap actually will turn out to be substantially higher than the current projection.
We’ve seen that large cap increases can facilitate the forming of “super teams” while other rules in the agreement appear designed to incentivize players to not change teams. It has been speculated that the new agreement could take steps to stop large single-season increases in the future, but that has not been part of the reporting so far. If the definition of BRI does expand, and start to apply all at once, we could have another season with a large cap increase coming.
Celtics Outlook
In the pursuit of forming a super team in Boston, we want the cap to go as high as possible in 2017-18. In that sense, no immediate reporting of a higher cap is a disappointment but it’s still possible that will come to pass. At a $103M cap, the team could be left with some hard(-ish) decisions if they’re lucky enough to reel in another prime free agent. Because of how max salaries get warped by an increasing cap, the team will have plenty of salary flexibility to use in trades, if they don’t first use it on a free agent.
Luxury Tax Apron
What Has Been Reported
The hard cap that teams can invoke by taking certain actions will increase from $4M over the salary cap to $6M over, with a schedule for further increases beyond that
Big Picture
As contracts increase across the league, it simply makes sense to increase static figures like this. The Clippers in particular, who have a gift for hard capping themselves, will appreciate the change.
Celtics Outlook
It’s unlikely that the Celtics have to deal with this restriction next year, and will possibly never have to in the life of the CBA if they take certain building paths. If they are able to attract another star and then move to fill out a title contending roster, it would have to be considered, though still likely only in future years.
The Moratorium and Offer Sheets
What Has Been Reported
The moratorium will now end at noon on July 6 each season
Teams will only have two days to match an offer sheet instead of three
Teams can still unilaterally rescind qualifying offers, but must now do it by 7/13 instead of 7/23
Offer sheets can now be signed during the moratorium, but the two day clock to match will not start until the moratorium ends
Big Picture
Initial reports on changes to restricted free agency were misleading. The timeframe for RFA decisions has been shortened, but not in a way that fundamentally changes how it works. Yes, it’s now somewhat more likely for an RFA to change teams, but if the major free agents make their decision at a “normal” speed it won’t be a big deal for most teams. Teams may be able to extend offer sheets as early as July 1, but it will be rare to see it done that early as the team will be committing to a contract for as long as eight days before they’ll know if the offer has been matched. Team are not going to commit to that, watching as all the unrestricted free agents sign, just to see them lose out on their target at the end.
Celtics Outlook
Kelly Olynyk will be a restricted free agent this summer and if the team falls into a long holding pattern on higher profile targets, another team could come in and poach him. That’s always a possibility if things really drag out, but free agency usually moves fast enough where a team could play both sides. The initial reports on restricted free agency made it seem like an RFA could have their offer sheet deadline come up as early as July 3. New reports show that the earliest decision time is now July 8 at noon, which is enough time for other decisions to be done or well understood.
There were also early, erroneous reports that offer sheets could no longer be unilaterally rescinded. The date where the team can rescind has moved up ten days, but it does still exist. July 13 is pretty early to have to make that decision, so I believe we’ll see a few more players have their offer sheet defensively rescinded than in the past.
Restricted free agency rules are more important to the Celtics than the average team because they will have a procession of non-max young players and picks coming up for re-signing over the course of the six year agreement. The team has been less willing than most to seriously discuss rookie extensions, but as their cap space potentially dries up and the RFA rules become somewhat less team friendly, their thinking may shift on that.
Maximum Contracts
What Has Been Reported
Maximum salaries will be increasing due to a change in the way they are calculated
The tiers will still be described as 25%/30%/35% of the salary cap, but now they actually will match those descriptions
The “years experience” tiers will not be changing from 0-6/7-9/10+
Big Picture
Measure.........................................Current CBA......................New CBA........................Difference
Salary Cap.....................................103,000,000......................103,000,000 -
0-6 Years Experience........................24,583,300.......................25,750,000.....................(1,166,700)
7-9 Years Experience........................29,499,900.......................30,900,000.....................(1,400,100)
10+ Years Experience.......................34,416,600.......................36,050,000.....................(1,633,400)
The change is good simply for ease of understanding because 25%/30%/35% of the cap is simpler than the max being (the cap/.4414*.4214*.35).
The change is a bit of a stealth way for the best players to get more. It’s hard to argue that the best players don’t deserve more in relation to their on-court value, but more to the top and bottom (more on that in a minute) means less to the upper-middle class or long-serving, non-max veterans. It’s interesting that when a mid-tier player was head of the NBPA the odd, old way of doing the calculation was kept but now that the union is run by superstars it was “corrected.” Personally I think the change is a good one that won’t make a huge difference but does more accurately reflect player value.
An increased max makes it harder to put together a super team via free agency. When LeBron James and Chris Bosh joined Dywane Wade in Miami they first had to agree to each take a slight contract discount before having enough leverage to force Cleveland and Toronto to play along in sign-and-trades. If the maxes had been the true 30% figure, that team may not ever have quite come together.
Celtics Outlook
If Boston is hoping to lure someone like Blake Griffin or Gordon Hayward via free agency, a higher max salary is bad. The team has ways to clear enough cap space to sign a max player but it does involve making sacrifices and every million you add to the max is another million that would need to be cut. This was going to be the case even under old assumptions, but to sign a full 35% max free agent the Celtics would almost certainly have to move a piece that most fans see as part of their “core.”
The flip side to it being harder to clear max cap space is that existing bargain contracts become even more of a deal. Al Horford will make at least $3M less than the max salary for 7-9 year veterans next season; the Isaiah Thomas, Jae Crowder, and Avery Bradley triumvirate will become even more woefully (or wonderfully) underpaid (in pro sports terms, at least). If Crowder plays out his entire contract, he could be making something like $25M less than a player of similar experience making the maximum.
Ultimately, this shift isn’t good news for Boston, but it could have been worse. A change to the experience tiers or a large increase in salary basis percentages could have functionally closed the door on signing a non-superstar, max free agent like Gordon Hayward.
Over-38 Contracts
What Has Been Reported
The existing “Age 36” rule that limited the contract length for player past that age has been changed to “Age 38”
Big Picture
There are benefits to being the NBPA President! The two players most directly impacted by the Age 36 restriction were going to be Chris Paul and LeBron James. Paul is the NBPA President and James was much more involved in the CBA process this time than last. This rule change looks like the superstars flexing their muscles a bit. Signing old players to massive contracts rarely works out well, but it’s hard to complain too much if the players who power the league’s growth and over perform their max contracts get an extra payday at the end of the line.
Celtics Outlook
Al Horford could theoretically be impacted by this on his next contract, but I don’t think he’s the level of player who teams will be lining up to max in his mid-30s.
Mid-level, Bi-annual, and Minimum Exceptions
What Has Been Reported
Existing cap exceptions will increase by 45% over the previous schedules for next season
2017-18 Exception Values
Mid-level Exception: $8.4M
Taxpayer MLE: $5.2M
Room Exception: $4.3M
Bi-annual Exception: $3.3M
The MLE, MMLE, RME, and BAE will move in concert with the salary cap, maintaining a set percentage
The “incomplete roster charge” will continue to be based on a 12 player minimum
Players scheduled to make less than the league minimum will have their contracts amended up to the minimum, and will carry a cap charge for their revised salary
Big Picture
This was an overdue change; the league was obviously caught out by the scale of the increase in the salary cap or they would have expressed all the exceptions as a percentage of the cap back in the last CBA.
A generation of players ago, the MLE more often turned into a bad contract than a good one. The simple reality is that, in a league with an artificially capped maximum and pre-defined deals for early career players, the average salary for an average player really isn’t a cost effective way to spend. Increasing the MLE will make it more useful to teams, but also increase the likelihood that a team regrets a signing they use it on.
The paired increase in the Taxpayer Mid-level and Room Exception might make bigger news in the first season of the new agreement. The Warriors will have to go below the cap to re-sign Kevin Durant, meaning a larger RME could help them add a valuable veteran after they have to let players like Andre Iguodala and Zaza Pachulia go. Similarly, the Cavaliers and Clippers could be contending teams in the tax, so increasing their version of the MLE could result in an important signing.
The increase to minimum contracts is good from a pure quality of life. No one making $500k a year is going hungry, but players making that are usually hanging on in the league and may not have long careers. The players this may have the biggest impact on are the ones who sign one or two 10-day contracts after a season making $25k in the D-League. For them, a 45% increase in the value of a 10-day can make their year. Higher minimum salaries also make the NBA somewhat more competitive for players who may be considering foreign leagues over taking a D-League shot or trying to hang on the back end of a roster.
Higher minimum also means higher “incomplete roster” holds, making it slightly harder for a team to strip down a roster to nothing and then re-fill it with a few max contract stars. The increase in minimum contracts could even end up being the difference between the Warriors keeping or having to renounce Shaun Livingston, though I think they’ll be able to work something out to keep at least him.
Celtics Outlook
In general, I think that the Celtics benefit from the kind of “double-edged sword” tools like the MLE/BAE. The better run franchises are less likely to mess up with them, and in a zero-sum world like a sports league that’s a benefit.
If the team finds itself in position to sign a 30% max free agent this summer, the higher minimum contracts used to fill out incomplete roster holds will cost them some space, and probably Jordan Mickey and Demetrius Jackson. With the current roster it looks like this won’t be too much of a problem, but it’s close and it could change if the salary cap is lower than expected or the team makes some additional moves.
Rookie Scale Exception
What Has Been Reported
Rookie scale will increase by 15% over the previous schedules for next season
Scale contracts will increase by 5% in year two, then 30% in year 3, and 45% more in year 4
Unsigned, non-stashed rookies will carry a cap hold of 120% of scale, equal to their maximum salary amount
Rookie scale will be defined as a percentage of the salary cap in future seasons
Players signed to rookie scale deals from the current CBA will receive raises that do not count against the salary cap
Teams will now have two “designated player” slots to use on players coming off their rookie scale deals
What We Don’t Know
What are the percentages that will be used in the future?
Will the guaranteed scale contracts of “stashed” first round picks from prior drafts be adjusted to the new scale amounts or to some lower figure?
Is anything being done to increase the options for signing second round picks, beyond the “2-Way” D-League contract (see below)?
Big Picture
As with the other exceptions, rookie scale had simply fallen out of historic alignment with the massive increase in the salary cap. This was a necessary correction, and tying it to the cap for future seasons will keep the misalignment from developing again.
The salary increase was originally reported to be 45%. A 15% increase still results in a smaller salary in relation to the cap than rookies used to. Any increase could be looked at as a punishment against future picks, but this is such a modest increase compared to what has happened with the salary cap that it’s very hard to see it that way. Rookie scale contracts will continue to be a great deal for the team, as long as the player can contribute.
The change to using a rookie’s maximum salary instead of their slot salary makes a bigger difference. It’s still not the 45% increase in cap hold that was originally being reported, but a 38% increase is not insubstantial.
Celtics Outlook
There are changes being made in this CBA that will lead to teams increasing the value they place on picks more than a reasonable increase in scale will decrease the perceived value. In that way, I don’t think the totality of the CBA hurts the trade value of the picks they currently hold.
If the team does go the draft-and-develop path, the addition of a second designated player slot for signing a 5-year extension could be important. For example, if Jaylen Brown is developing a year ahead of Markelle Fultz and both look great, but Fultz a bit better, having two available slots will make extension negotiations much easier.
Early reports seemed to indicate that rookie scale contracts would be increasing by 45%, which could have created an incentive for the Celtics to try to bring Ante Zizic (or Yabusele though that seemed less likely) to the NBA this January. That would have opened some additional cap space for the team next season while getting Zizic an off-the-cap raise and to free agency a year earlier than if he waits. This thought seemed validated by a decision the team made in how to handle the two rookies over the summer. The most recent reports are that rookie scale is increasing by 15%, so even with the added 20% that will be counted in future rookie holds, signing Zizic this year would only save $200k off next season’s cap figure.
Ante Zizic Contract Options By Signing Season
Year................Sign 2016-17 (Cap)...................Sign 2017-18 (Cap).................Sign 2016-17 (Paycheck).................Sign 2017-18 (Paycheck)
2016-17...........1,382,280...........................................................................1,382,280
2017-18...........1,444,440................................1,645,200..............................1,661,106.....................................1,645,200
2018-19...........1,506,720................................1,943,400..............................1,958,736.....................................1,943,400
2019-20...........2,556,904................................2,261,160..............................3,707,511.....................................2,261,160
2020-21...........RFA........................................3,837,120...............................RFA.............................................3,837,120
TOTAL..............6,890,344................................9,686,880..............................8,709,633.....................................9,686,880
Free Agent Cap Holds
What Has Been Reported
The cap hold for players coming off the fourth year of their rookie scale deal will increase from 200% of their previous salary for players making more than the league average and 250% for players making less than that to 250% and 300%, respectively
The cap hold changes will apply starting in 2018-19
What We Don’t Know
Are cap holds for other types of free agents being adjusted?
Big Picture
The idea here is to make it harder for teams to play the shell game of agreeing to a new contract with a player on a low cap hold but not finalizing it until other business that benefitted from the low cap hold is complete.
I do not think the increase is large enough, or the logic for how to define cap holds is smart enough, to really stop this. Yes, it will make some difference but the “small potatoes” nature of the change says to me that the league wants to say they did something about this but really they don’t care. They want to reward teams that build up from the draft, so why do something that hurts that idea too much?
If the league really wanted to target the Golden State Warriors, which I think would be a bad precedent to set, they would have come up with a rule that would increase the holds of veteran players like Steph Curry. That would have made it very hard for them to re-sign Kevin Durant to his max salary. If there does turn out to be a change like this it doesn’t necessarily mean they were targeting the Warriors, but that’s how it would be viewed and they would be a negatively impacted team.
Celtics Outlook
In the immediate future, this change would have increased Kelly Olynyk’s cap hold by about $1.5M but it’s not being put in place for another year. Realistically, if the Celtics make a major splash in free agency it’s likely going to mean letting Kelly go anyway.
There is a long-term effect on the Celtics if they don’t make a major trade that sends out a collection of young players and picks. Boston will already be seeing Marcus Smart, then Terry Rozier, then Jaylen Brown, and then the players acquired with the Nets picks all hitting the end of their rookie deals under the terms of this new CBA. Seeing the cap hit for every one of them increase is not ideal, but it’s also impossible to project what the team’s situation will be out in the future.
The increased hold may make a Marcus Smart extension more likely next year. He isn’t looking like a max contract player, and the team has generally not completed extensions like this, but if his cap hold ends up being close to a figure he would agree to sign for then an extension is possible. That could equally apply to all those other future negotiations, but for Smart I can see a reasonable way for it to happen less than a year from now.
Raise Structures
What Has Been Reported
Maximum annual raises will be increasing from 7.5% for Bird/Early Bird/Extension and 4.5% for other non-Arenas signings to 8% and 5%, respectively.
Big Picture
The increase in raises isn’t a huge deal. Raises on medium and large contracts, if they’re outpacing growth in the salary cap, can turn ok contracts bad. If the cap settles into a more flat growth track during the course of this CBA, larger raises could lead to slightly more “bad” contracts.
Celtics Outlook
I don’t see the change has having any major impact on the Celtics. The difference in raise amounts for a free agent re-signing or changing teams is still 3%. The team will have contracts to sign in the future, just like everyone else, and increased raises means players later in a contract will take up more cap space and potentially be worse contracts than they otherwise would have been. Everyone is on a level playing field, though.
Designated Veteran Players
What Has Been Reported
A new 5-year contract starting at the 35% max will be created for qualifying players, designated by their team
To qualify, a player must:
Be signing an extension or re-signing with the team that drafted them, or traded for their rookie contract
Be entering their 8th or 9th season for an extension, or 9th or 10th season for a re-signing
Have been MVP in the past three seasons, or have been DPOY or All NBA the prior season or two of the past three seasons
If signing an extension, be three years past the signing of their last contract (free agent re-signings do not have this restriction)
A team can only have two players signed using the Designated Exception on their roster at one time
A designated contract can only be signed during the offseason
A player signed using the designated veteran exception cannot be traded for one year
A special rule is in place to allow players like Russell Westbrook and James Harden to waive their player option season to sign a DVE extension
What We Don’t Know
Does eligibility for the DVE change a player’s cap hold if they are a free agent?
Big Picture
This is the change receiving the most attention, though it may end up being less used than it seems. Based on the rules as we currently understand them, and the state of play in the NBA this season, it looks like only DeMarcus Cousins and Stephen Curry will be eligible for the DVE next summer. Blake Griffin and Paul George didn’t make an All NBA team last season so unless they do this year, they will not be eligible for the DVE contract in free agency. Gordon Hayward is unlikely to make All NBA, but even if he did he’ll only be entering his 8th season, not enough for a free agent to qualify. Kevin Durant and Chris Paul have both changed teams and will already be the 10+ year bracket.
A collection of players who sit on the fringe of All NBA will have their contract fates decided by media voting. Players like Kemba Walker, Jimmy Butler, and Kyrie Irving will have a season where they really want to make All NBA during this CBA. Someone like Kawhi Leonard should qualify easily, but we thought Anthony Davis would easily get a Rose Rule extensions and then he got injured in the wrong season. Maybe Davis will make some of that up with a DVE extension further down the road.
One player who may be kicking himself is Russell Westbrook, who looks certain to make All NBA this season, and would therefore have been eligible to sign a 5 year / $209M contract with OKC this summer if he hadn’t done a renegotiate-and-extend a few months ago. A change to the max tiers was always the biggest financial risk in signing that deal.
If the Kings want to commit their future to Cousins this is good news for them. Their ability to offer that same 5/$209M contract to Boogie when other suitors couldn’t come anywhere close to that total value might be enough to keep him there. It’s possible that the Kings won’t want to make that commitment and will look to trade him anyway, or that Cousins will be willing to walk away from tens of millions of dollars to escape, but you would now have to bet on him staying for at least a while longer. If I had to guess, the Kings will take the plunge and offer the full extension only to see Cousins start agitating for a trade whenever that restriction ends. On a giant, long contract, the Kings will find it surprisingly hard to move their mercurial star for real value. Meanwhile, the 76ers, owners of the Kings pick the season after Cousins is scheduled to become a free agent, may see Sacramento win a few more games than they hoped.
Maximum Contract Types; 7-9 Years Experience; $103M Cap
Year.................................Designated Exception...........................Bird Re-signing...................................Free Agent Signing
2017-18...........................36,050,000.........................................30,900,000........................................30,900,000
2018-19...........................38,934,000.........................................33,372,000........................................32,445,000
2019-20...........................41,818,000.........................................35,844,000........................................33,990,000
2020-21...........................44,702,000.........................................38,316,000........................................35,535,000
2021-22...........................47,586,000.........................................40,788,000........................................Free Agent
TOTAL..............................209,090,000.......................................179,220,000.......................................132,870,000
Before he decided to undergo knee surgery, Blake Griffin might have looked at this rule and thought he needed to do a little stat hunting. The forward spots are incredibly deep, but if Blake can make it back onto an All NBA team the Clippers will give him the 5/$209 and probably keep their core together while blasting deep into the luxury tax, and Steve Ballmer’s pockets. With the surgery, this is now highly unlikely.
At first reading, this rule appeared to incentivize the best rookies to sign three year deals after their rookie contract. More recent reports say that a player must be further along in their career to qualify, meaning that the league also saw this potential issue and structured the rule to encourage rookies to sign four or five year deals after their rookie contract to maximize their potential career earnings. This is an intelligent structure for the rule, if that’s the intention.
One final thing to watch for is the limit on the number of designated players a team can have at one time. The Warriors may have to make a decision between designating Draymond Green or Klay Thompson at some point in the future. There may also be a team in the later years of the CBA who have two DVEs and are therefore blocked from trading for a third who they might otherwise have had an opportunity to acquire.
Personally, I think this rule change goes too far. I think a reasonable compromise would have been to make it so designated player extensions are only available to the team that meets this criteria, but if a player makes it to free agency having me the designated criteria they should be able to sign with any team using the 35% max with only their current team able to offer a 5-year deal with the higher 8% raises. That would align DVE free agency with the existing rules. If a designated eligible player made it to free agency and their team already had two designated players on the roster, their current team should be able to offer a 4-year deal at the 35% max and 5% raises, just like anyone else, so they’re not limited to a smaller offer than other teams could.
Celtics Outlook
None of the current Celtics will be DVE eligible, maybe ever. Isaiah Thomas and Al Horford came to Boston after their rookie deals. Avery Bradley and Jae Crowder are unlikely to ever make All NBA or win DPOY. There might be some slim chance that Marcus Smart stays in Boston long-term and makes All NBA in 2021, but you’d have to get awfully long odds to bet on that. If the Celtics ever take advantage of the DVE in the six years this CBA will last, I would bet it’s a player they trade for on their rookie deal in a rebuild, but even that would play out far down the line.
The issue for the Celtics is that the DVE is meant to keep stars with their current team and the Celtics desperately want to pull a star away. DeMarcus Cousins has been a much-discussed trade target but he may want to stay in Sacramento now (or even more if he already did) and the Kings have to think they have a much better shot to keep him if that’s what they want. If Blake Griffin makes All NBA, now a very long-shot with his surgery, whatever slight chance there is of him coming to Boston almost certainly disappears.
Meanwhile, we can look at a player like Paul George and be in the odd position of desperately wanting to acquire a player who we don’t want to make All NBA. Basically we’re hoping to be able to sign someone we admit isn’t a top-6 forward, in a league where titles usually go to top-5 overall players.
In creating the DVE, the league is trying to incentivize teams to draft and develop, but current rookies won’t even be eligible for DVE status until after this CBA has come and gone. It may be that this rule lives on for future agreements, but there’s no guarantee of that.
Traditional Veteran Extensions
What Has Been Reported
Non-designated veteran extensions can now be for four additional seasons instead of three
Extensions can now be signed two years after the signing of a three or four year deal, instead of three years after
Non-designated veteran extensions can now have a first year salary of up to 120% of the salary of the final year of their existing contract
Big Picture
The criteria for a DVE extension compared to the rather modest changes in extension rules leaves a large gap for teams trying to retain star players who don’t make the All NBA team. If the salary cap flattens out at some point the problem may become less acute, but that only applies to contracts signed after the cap flattens so if we’re a few seasons away from that and contracts run 3-5 years, we’re talking about this being a persistent problem.
Even a max contract signed before the cap climb ends will not be a good baseline for an extension if they can only offer a 20% raise. For example, if Paul George makes the All NBA team this season and the Pacers offer him the DVE extension he would have to really want to leave Indiana not to take it. If he doesn’t make All NBA, he would be crazy to take the extension offer that the Pacers would be allowed to make. It’s a massive difference; it’s so large as to make me wonder if we’re missing a key piece of information.
Paul George Contract Options; $106M 2017-18 Cap
Year.....................................Traditional Extension..................Designated Exception..................Bird Re-signing..............Free Agent Signing
2017-18................................19,508,958...............................19,508,958................................19,508,958...................19,508,958
2018-19................................23,410,750...............................37,100,000................................31,800,000...................31,800,000
2019-20................................25,283,610...............................40,068,000................................34,344,000...................33,390,000
2020-21................................27,156,470...............................43,036,000................................36,888,000...................35,059,500
2021-22................................29,029,330...............................46,004,000................................39,432,000...................36,812,475
2022-23................................Free Agent...............................48,972,000.................................41,976,000...................Free Agent
5-Year Total...........................124,389,118.............................185,716,958................................161,972,958.................156,570,933
6-Year Total...........................124,389,118.............................234,688,958................................203,948,958.................156,570,933
As you can see, if George doesn’t make all NBA this season his maximum extension would be between $30-60M less than the potential max contracts(only in the four extension years) that he could sign by just waiting until free agency. This put the Pacers in the same position with PG-13 as the Thunder were with Durant. George is not Durant, but he’s what the Pacers have and they’ll feel awfully aggrieved if the Kings are able to lock up Cousins and they feel backed into a corner and having to trade George just because forward is a deeper position than center in awards voting.
This is why using awards voting is going to become a huge issue. Not only will close votes cost certain players huge sums of money, like it just did with Anthony Davis, it may alter the outlook of entire franchises. We may be seven months away from watching the Clippers break up because Blake Griffin finishes seventh in All NBA voting for forwards instead of sixth. This will be a problem during the course of this CBA, unless there are additional rules that have not been leaked yet.
It looks like the message being sent is that the league wants to block the formation of Warriors-esque “hyper teams” but still leave the door open for “super teams” and keep free agency exciting. If every team had the massive signing advantage that DVE status gives on all of their top free agents, no one would ever move and the NBA would cease to be a “12 month season.” Instead, the league is setting aside a select elite and sending the message that “draft, develop, and trade” is what they want teams to focus on because free agency is going to be possible, but not for the players that really win titles.
Celtics Outlook
While the DVE rules look likely to take some potential star targets off the market, the limited increases in traditional extensions means some All Star caliber players might still be out there. I’ve highlighted Paul George already, but it looks unlikely that Blake will qualify for the DVE and Gordon Hayward is not eligible, though both could opt to sign a 1+1 with their current teams in an attempt to qualify for 2018. If that’s the case, the set of signing and trade targets the Celtics may have been working on are nearly unchanged. It’s hard to know what the Kings and Cousins will do, but I’m also not sure how interested Boston is in Boogie to begin with.
The biggest obstacle these rules put in place is that a player like George may really not want to be traded next summer. If he isn’t eligible for a DVE extension, he’ll know that if he can make All NBA in 2017-18 he’d be eligible for a DVE re-signing, but only if he’s still on the Pacers. Will he make it known that he actively doesn’t want to be traded to keep that possibility open? Will John Wall see it that way too, even though he’s a year further away from eligibility?
What’s clear is that if the Celtics are going to continue chasing max contract veterans, the best thing they can hope for is that none of Griffin, George, Hayward, Wall, or any other target they might be considering makes All NBA.
Draft Eligibility
What Has Been Reported
The rules for who is eligible for the draft has not changed; players one year past their high school graduation can declare
The league would like to change the draft to “two and done” meaning a player would have to be two years past their high school graduation
The union suggested a “zero or two” system meaning a player could declare out of high school, but if not they would wait at least two years
The league and union plan to continue this discussion beyond the signing of the CBA
What We Don’t Know
How close they have come to a compromise?
What would happen to a player who declared out of high school but was not drafted?
Could a player who is drafted out of high school choose to go to college and re-declare later, like in baseball?
Big Picture
No matter the system, there will always be players who don’t quite fit. In that way, a “zero or two” system seems like a good one because giving players two options instead of one should work for more of them. If the league were to do this they would need to have an understanding with the NCAA in place. For example, if a high school player is drafted in the first round maybe they cannot go to college and would be subject to all the normal draft rules we see now. However, if they were drafted in the second round they could elect to go to college for at least two two years with their drafting team retaining their rights. If the player is undrafted, they can still go to college for three or more years before re-entering the draft. Every system would have drawbacks and unintended consequences, the point is just that it’s more complex than saying “two and done” or “zero or two.”
There’s also nothing inherently wrong with “one and done.” The league has had a fantastic run of young players enter the draft since instituting that rule. That’s not to say those players would not have succeeded had they entered the league directly out of high school, but it’s obviously not hurting the league. I hate the idea of having to work with the scummy NCAA, but that’s the reality for the foreseeable future.
Celtics Outlook
An immediate change to this rule would be terrible for the Celtics. The 2017 draft would be unchanged because that’s determined by the current CBA, but the Celtics are hoping to have another high pick from Brooklyn in 2018 and if that became the “gap year” where all the best would-be sophomores entered the year before and all the best freshman aren’t eligible, you end up with a class where Andrea Bargnani goes #1 overall.
It’s possible that we still will have a gap year which could impact the Celtics, but it would do the same to everyone else too. If the Celtics decide to break up the veteran core and go young at some point, any gap year would be a negative. If they consolidate their position and get good, it would hurt them less than many other teams, unless one of their other future picks like the one from Memphis is good and in that year. It’s simply too hard to project beyond the Nets picks.
Two-way D-League Contracts and Expanded Rosters
What Has Been Reported
Rosters will expand from a maximum of 15 to 17 spots
Teams will now be required to carry 14 players instead of 13
Teams are limited to at most 15 NBA contracts and at two “two-way” D-League contracts
Two-way contracts will have a minimum salary of $75k
What We Don’t Know
Who will be eligible for a two-way contract?
How will the two-way contracts actually work?
Can a player on a two-way contract be “called up” to the NBA and how does that impact a team with 15 NBA contracts?
How many two-way contracts can be included in the 14 rostered player minimum?
Big Picture
With the league a record distance from expansion, players playing longer, and more international players entering the league, the NBA needed to do something to expand rosters. The issue has come to a head this season as every team has hit the 15 player cap at some point, and only one team entered the season with an open spot. A number of players that teams would have preferred to sign or retain could not be.
The D-League is not an attractive financial option. Players will still be able to make a lot more than $75k in foreign leagues, but the promise of an NBA spot and some mechanism for being called directly up to the NBA will hopefully entice more players to stay in the US.
At this point, we just don’t know enough about how this will work to make any assessment. I don’t even know who will be eligible for the contracts; I assume 1st round picks who are still eligible for scale contracts will not be. I would like to have seen a new exception for second round picks, set at the minimum with two guaranteed years and a third season team option, created to allow teams to establish full Bird Rights with their picks, but nothing else appears to have been done on that front. Two-way contracts sound good for players drafted late in the second round, or signed as UDFAs, but high second round picks are still going to have leverage against their teams that late first round picks do not have.
Celtics Outlook
It would have been nice to have this for this season. Considering how much Demetrius Jackson is making it probably wouldn’t have mattered for R.J. Hunter, but Abdel Nader and Ben Bentil would have had different options. It will be interesting to see if players like Nader, drafted under the current CBA, will be eligible for the new contract structures.
Boston doesn’t have their own second round pick this season (assuming they swap with Brooklyn) but do have picks from the Timberwolves, Clippers, and Cavaliers. Those two-way contracts may be the solution to keeping those future draftees in the system.
Trade Rules
What Has Been Reported
Contracts signed after the new CBA will only have guaranteed salary counted for money matching
Non-guaranteed or partially guaranteed contracts will have their full value counted for the receiving team but only the guaranteed part counting for the sending team
The class of trades that previously required a 150%+$100k trade match will now use 175%+$100k as the rule
Players and teams can now agree to waive trade kickers
Big Picture
The inability to trade non-guaranteed contracts can be seen as closing a loophole, but it may cool parts of the trade market. In the past, teams like the Celtics that anticipated being near the cap would sign players with non-guaranteed future years. These players could be used to make a salary match after the season ended, or into the new season (depending on guarantee date) as a “super expiring.” Any player signed under the current CBA with a non-guaranteed year in 2018-19 or 2019-20 could find themselves a hot trade commodity as they will not be subject to this rule change.
The other changes are relatively minor. The 150% bracket for trades only applied to teams over the cap but under the luxury tax making relatively small salary swaps. It will loosen up the low end of the trade market, and make creative structures that spawn trade exceptions slightly easier to work out. The ability to waive trade kickers if all parties agree is just common sense.
Celtics Outlook
Boston has tried to make use of non-guaranteed contract trades in the past, and still hold the contracts of Tyler Zeller, Jordan Mickey, and Demetrius Jackson who are all non-guaranteed after this season. The rule will not apply to those three players, but it does prevent the franchise from playing this game in the future. It wouldn’t surprise me if some day the Celtics acquire a player with a future non-guaranteed year from this CBA just to have that extra chip in their back pocket.
bob
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A (CELTICS FRIENDLY) GUIDE TO THE NEW CBA
By Ryan Bernardoni
On December 18, 2016
How to Read This Guide
This post is designed to lay out all of the details of the new CBA that have been reported to date. For each item I’ve tried to provide analysis at both the “big picture” league level and specifically for the Celtics. I’ve also highlighted some unknowns on each topic that could change the analysis when we have more details.
Please note that I am not a reporter. Everything I’ve written below is based on reporting from Eric Pincus, Tim Bontemps, Zach Lowe, Marc Stein, Adrian Wojnarowski, David Aldridge, and Brian Windhorst. HoopsHype does a good job of collecting news and rumors on the new CBA. In my opinion, this piece by Bontemps for the Washington Post is the best reporting done since the agreement was finalized. (EDIT 12/18: Eric Pincus has published some great reporting that included specifics from an actual NBA document.) The fact that I’m relying on the reporting of others means that in some cases I have to interpret or infer information from what’s been written. All of the details of the new deal are not known, and there will likely be mistakes in the reporting, so use this as a guide but do not assume that all of the analysis will hold up when the complete CBA is known.
Table of Contents
The Salary Cap Edited 12/19
Luxury Tax Apron
The Moratorium and Offer Sheets Edited 12/19
Maximum Contracts
Over-38 Contracts
Mid-level, Bi-annual, and Minimum Exceptions Edited 12/19
Rookie Scale Exception Edited 12/19
Free Agent Cap Holds Edited 12/22
Raise Structures
Designated Veteran Players Edited 12/19
Traditional Veteran Extensions Edited 12/20
Draft Eligibility
Two-way D-League Contracts and Expanded Rosters
Trade Rules Edited 12/22
The Salary Cap
What Has Been Reported
The current cap projections are:
2017-18: $103M
2018-19: $107M
2019-20: $111M
2020-21: $120M
The definition of “Basketball Related Income” that the salary cap is based on is changing, with additional revenue streams being included
The salary cap will be set before July 1
Big Picture
The salary cap likely will see further increases with the expanded definition of BRI. Whether that will apply to 2017-18 is currently unknown. It could be that the expanded definition does not immediately apply, that the way BRI is estimated pushes the increase out a year, or that the new CBA sets a specific salary cap figure for 2017-18 before reverting to a percentage basis beyond that. It may also be that the reporting is incomplete, and the salary cap actually will turn out to be substantially higher than the current projection.
We’ve seen that large cap increases can facilitate the forming of “super teams” while other rules in the agreement appear designed to incentivize players to not change teams. It has been speculated that the new agreement could take steps to stop large single-season increases in the future, but that has not been part of the reporting so far. If the definition of BRI does expand, and start to apply all at once, we could have another season with a large cap increase coming.
Celtics Outlook
In the pursuit of forming a super team in Boston, we want the cap to go as high as possible in 2017-18. In that sense, no immediate reporting of a higher cap is a disappointment but it’s still possible that will come to pass. At a $103M cap, the team could be left with some hard(-ish) decisions if they’re lucky enough to reel in another prime free agent. Because of how max salaries get warped by an increasing cap, the team will have plenty of salary flexibility to use in trades, if they don’t first use it on a free agent.
Luxury Tax Apron
What Has Been Reported
The hard cap that teams can invoke by taking certain actions will increase from $4M over the salary cap to $6M over, with a schedule for further increases beyond that
Big Picture
As contracts increase across the league, it simply makes sense to increase static figures like this. The Clippers in particular, who have a gift for hard capping themselves, will appreciate the change.
Celtics Outlook
It’s unlikely that the Celtics have to deal with this restriction next year, and will possibly never have to in the life of the CBA if they take certain building paths. If they are able to attract another star and then move to fill out a title contending roster, it would have to be considered, though still likely only in future years.
The Moratorium and Offer Sheets
What Has Been Reported
The moratorium will now end at noon on July 6 each season
Teams will only have two days to match an offer sheet instead of three
Teams can still unilaterally rescind qualifying offers, but must now do it by 7/13 instead of 7/23
Offer sheets can now be signed during the moratorium, but the two day clock to match will not start until the moratorium ends
Big Picture
Initial reports on changes to restricted free agency were misleading. The timeframe for RFA decisions has been shortened, but not in a way that fundamentally changes how it works. Yes, it’s now somewhat more likely for an RFA to change teams, but if the major free agents make their decision at a “normal” speed it won’t be a big deal for most teams. Teams may be able to extend offer sheets as early as July 1, but it will be rare to see it done that early as the team will be committing to a contract for as long as eight days before they’ll know if the offer has been matched. Team are not going to commit to that, watching as all the unrestricted free agents sign, just to see them lose out on their target at the end.
Celtics Outlook
Kelly Olynyk will be a restricted free agent this summer and if the team falls into a long holding pattern on higher profile targets, another team could come in and poach him. That’s always a possibility if things really drag out, but free agency usually moves fast enough where a team could play both sides. The initial reports on restricted free agency made it seem like an RFA could have their offer sheet deadline come up as early as July 3. New reports show that the earliest decision time is now July 8 at noon, which is enough time for other decisions to be done or well understood.
There were also early, erroneous reports that offer sheets could no longer be unilaterally rescinded. The date where the team can rescind has moved up ten days, but it does still exist. July 13 is pretty early to have to make that decision, so I believe we’ll see a few more players have their offer sheet defensively rescinded than in the past.
Restricted free agency rules are more important to the Celtics than the average team because they will have a procession of non-max young players and picks coming up for re-signing over the course of the six year agreement. The team has been less willing than most to seriously discuss rookie extensions, but as their cap space potentially dries up and the RFA rules become somewhat less team friendly, their thinking may shift on that.
Maximum Contracts
What Has Been Reported
Maximum salaries will be increasing due to a change in the way they are calculated
The tiers will still be described as 25%/30%/35% of the salary cap, but now they actually will match those descriptions
The “years experience” tiers will not be changing from 0-6/7-9/10+
Big Picture
Measure.........................................Current CBA......................New CBA........................Difference
Salary Cap.....................................103,000,000......................103,000,000 -
0-6 Years Experience........................24,583,300.......................25,750,000.....................(1,166,700)
7-9 Years Experience........................29,499,900.......................30,900,000.....................(1,400,100)
10+ Years Experience.......................34,416,600.......................36,050,000.....................(1,633,400)
The change is good simply for ease of understanding because 25%/30%/35% of the cap is simpler than the max being (the cap/.4414*.4214*.35).
The change is a bit of a stealth way for the best players to get more. It’s hard to argue that the best players don’t deserve more in relation to their on-court value, but more to the top and bottom (more on that in a minute) means less to the upper-middle class or long-serving, non-max veterans. It’s interesting that when a mid-tier player was head of the NBPA the odd, old way of doing the calculation was kept but now that the union is run by superstars it was “corrected.” Personally I think the change is a good one that won’t make a huge difference but does more accurately reflect player value.
An increased max makes it harder to put together a super team via free agency. When LeBron James and Chris Bosh joined Dywane Wade in Miami they first had to agree to each take a slight contract discount before having enough leverage to force Cleveland and Toronto to play along in sign-and-trades. If the maxes had been the true 30% figure, that team may not ever have quite come together.
Celtics Outlook
If Boston is hoping to lure someone like Blake Griffin or Gordon Hayward via free agency, a higher max salary is bad. The team has ways to clear enough cap space to sign a max player but it does involve making sacrifices and every million you add to the max is another million that would need to be cut. This was going to be the case even under old assumptions, but to sign a full 35% max free agent the Celtics would almost certainly have to move a piece that most fans see as part of their “core.”
The flip side to it being harder to clear max cap space is that existing bargain contracts become even more of a deal. Al Horford will make at least $3M less than the max salary for 7-9 year veterans next season; the Isaiah Thomas, Jae Crowder, and Avery Bradley triumvirate will become even more woefully (or wonderfully) underpaid (in pro sports terms, at least). If Crowder plays out his entire contract, he could be making something like $25M less than a player of similar experience making the maximum.
Ultimately, this shift isn’t good news for Boston, but it could have been worse. A change to the experience tiers or a large increase in salary basis percentages could have functionally closed the door on signing a non-superstar, max free agent like Gordon Hayward.
Over-38 Contracts
What Has Been Reported
The existing “Age 36” rule that limited the contract length for player past that age has been changed to “Age 38”
Big Picture
There are benefits to being the NBPA President! The two players most directly impacted by the Age 36 restriction were going to be Chris Paul and LeBron James. Paul is the NBPA President and James was much more involved in the CBA process this time than last. This rule change looks like the superstars flexing their muscles a bit. Signing old players to massive contracts rarely works out well, but it’s hard to complain too much if the players who power the league’s growth and over perform their max contracts get an extra payday at the end of the line.
Celtics Outlook
Al Horford could theoretically be impacted by this on his next contract, but I don’t think he’s the level of player who teams will be lining up to max in his mid-30s.
Mid-level, Bi-annual, and Minimum Exceptions
What Has Been Reported
Existing cap exceptions will increase by 45% over the previous schedules for next season
2017-18 Exception Values
Mid-level Exception: $8.4M
Taxpayer MLE: $5.2M
Room Exception: $4.3M
Bi-annual Exception: $3.3M
The MLE, MMLE, RME, and BAE will move in concert with the salary cap, maintaining a set percentage
The “incomplete roster charge” will continue to be based on a 12 player minimum
Players scheduled to make less than the league minimum will have their contracts amended up to the minimum, and will carry a cap charge for their revised salary
Big Picture
This was an overdue change; the league was obviously caught out by the scale of the increase in the salary cap or they would have expressed all the exceptions as a percentage of the cap back in the last CBA.
A generation of players ago, the MLE more often turned into a bad contract than a good one. The simple reality is that, in a league with an artificially capped maximum and pre-defined deals for early career players, the average salary for an average player really isn’t a cost effective way to spend. Increasing the MLE will make it more useful to teams, but also increase the likelihood that a team regrets a signing they use it on.
The paired increase in the Taxpayer Mid-level and Room Exception might make bigger news in the first season of the new agreement. The Warriors will have to go below the cap to re-sign Kevin Durant, meaning a larger RME could help them add a valuable veteran after they have to let players like Andre Iguodala and Zaza Pachulia go. Similarly, the Cavaliers and Clippers could be contending teams in the tax, so increasing their version of the MLE could result in an important signing.
The increase to minimum contracts is good from a pure quality of life. No one making $500k a year is going hungry, but players making that are usually hanging on in the league and may not have long careers. The players this may have the biggest impact on are the ones who sign one or two 10-day contracts after a season making $25k in the D-League. For them, a 45% increase in the value of a 10-day can make their year. Higher minimum salaries also make the NBA somewhat more competitive for players who may be considering foreign leagues over taking a D-League shot or trying to hang on the back end of a roster.
Higher minimum also means higher “incomplete roster” holds, making it slightly harder for a team to strip down a roster to nothing and then re-fill it with a few max contract stars. The increase in minimum contracts could even end up being the difference between the Warriors keeping or having to renounce Shaun Livingston, though I think they’ll be able to work something out to keep at least him.
Celtics Outlook
In general, I think that the Celtics benefit from the kind of “double-edged sword” tools like the MLE/BAE. The better run franchises are less likely to mess up with them, and in a zero-sum world like a sports league that’s a benefit.
If the team finds itself in position to sign a 30% max free agent this summer, the higher minimum contracts used to fill out incomplete roster holds will cost them some space, and probably Jordan Mickey and Demetrius Jackson. With the current roster it looks like this won’t be too much of a problem, but it’s close and it could change if the salary cap is lower than expected or the team makes some additional moves.
Rookie Scale Exception
What Has Been Reported
Rookie scale will increase by 15% over the previous schedules for next season
Scale contracts will increase by 5% in year two, then 30% in year 3, and 45% more in year 4
Unsigned, non-stashed rookies will carry a cap hold of 120% of scale, equal to their maximum salary amount
Rookie scale will be defined as a percentage of the salary cap in future seasons
Players signed to rookie scale deals from the current CBA will receive raises that do not count against the salary cap
Teams will now have two “designated player” slots to use on players coming off their rookie scale deals
What We Don’t Know
What are the percentages that will be used in the future?
Will the guaranteed scale contracts of “stashed” first round picks from prior drafts be adjusted to the new scale amounts or to some lower figure?
Is anything being done to increase the options for signing second round picks, beyond the “2-Way” D-League contract (see below)?
Big Picture
As with the other exceptions, rookie scale had simply fallen out of historic alignment with the massive increase in the salary cap. This was a necessary correction, and tying it to the cap for future seasons will keep the misalignment from developing again.
The salary increase was originally reported to be 45%. A 15% increase still results in a smaller salary in relation to the cap than rookies used to. Any increase could be looked at as a punishment against future picks, but this is such a modest increase compared to what has happened with the salary cap that it’s very hard to see it that way. Rookie scale contracts will continue to be a great deal for the team, as long as the player can contribute.
The change to using a rookie’s maximum salary instead of their slot salary makes a bigger difference. It’s still not the 45% increase in cap hold that was originally being reported, but a 38% increase is not insubstantial.
Celtics Outlook
There are changes being made in this CBA that will lead to teams increasing the value they place on picks more than a reasonable increase in scale will decrease the perceived value. In that way, I don’t think the totality of the CBA hurts the trade value of the picks they currently hold.
If the team does go the draft-and-develop path, the addition of a second designated player slot for signing a 5-year extension could be important. For example, if Jaylen Brown is developing a year ahead of Markelle Fultz and both look great, but Fultz a bit better, having two available slots will make extension negotiations much easier.
Early reports seemed to indicate that rookie scale contracts would be increasing by 45%, which could have created an incentive for the Celtics to try to bring Ante Zizic (or Yabusele though that seemed less likely) to the NBA this January. That would have opened some additional cap space for the team next season while getting Zizic an off-the-cap raise and to free agency a year earlier than if he waits. This thought seemed validated by a decision the team made in how to handle the two rookies over the summer. The most recent reports are that rookie scale is increasing by 15%, so even with the added 20% that will be counted in future rookie holds, signing Zizic this year would only save $200k off next season’s cap figure.
Ante Zizic Contract Options By Signing Season
Year................Sign 2016-17 (Cap)...................Sign 2017-18 (Cap).................Sign 2016-17 (Paycheck).................Sign 2017-18 (Paycheck)
2016-17...........1,382,280...........................................................................1,382,280
2017-18...........1,444,440................................1,645,200..............................1,661,106.....................................1,645,200
2018-19...........1,506,720................................1,943,400..............................1,958,736.....................................1,943,400
2019-20...........2,556,904................................2,261,160..............................3,707,511.....................................2,261,160
2020-21...........RFA........................................3,837,120...............................RFA.............................................3,837,120
TOTAL..............6,890,344................................9,686,880..............................8,709,633.....................................9,686,880
Free Agent Cap Holds
What Has Been Reported
The cap hold for players coming off the fourth year of their rookie scale deal will increase from 200% of their previous salary for players making more than the league average and 250% for players making less than that to 250% and 300%, respectively
The cap hold changes will apply starting in 2018-19
What We Don’t Know
Are cap holds for other types of free agents being adjusted?
Big Picture
The idea here is to make it harder for teams to play the shell game of agreeing to a new contract with a player on a low cap hold but not finalizing it until other business that benefitted from the low cap hold is complete.
I do not think the increase is large enough, or the logic for how to define cap holds is smart enough, to really stop this. Yes, it will make some difference but the “small potatoes” nature of the change says to me that the league wants to say they did something about this but really they don’t care. They want to reward teams that build up from the draft, so why do something that hurts that idea too much?
If the league really wanted to target the Golden State Warriors, which I think would be a bad precedent to set, they would have come up with a rule that would increase the holds of veteran players like Steph Curry. That would have made it very hard for them to re-sign Kevin Durant to his max salary. If there does turn out to be a change like this it doesn’t necessarily mean they were targeting the Warriors, but that’s how it would be viewed and they would be a negatively impacted team.
Celtics Outlook
In the immediate future, this change would have increased Kelly Olynyk’s cap hold by about $1.5M but it’s not being put in place for another year. Realistically, if the Celtics make a major splash in free agency it’s likely going to mean letting Kelly go anyway.
There is a long-term effect on the Celtics if they don’t make a major trade that sends out a collection of young players and picks. Boston will already be seeing Marcus Smart, then Terry Rozier, then Jaylen Brown, and then the players acquired with the Nets picks all hitting the end of their rookie deals under the terms of this new CBA. Seeing the cap hit for every one of them increase is not ideal, but it’s also impossible to project what the team’s situation will be out in the future.
The increased hold may make a Marcus Smart extension more likely next year. He isn’t looking like a max contract player, and the team has generally not completed extensions like this, but if his cap hold ends up being close to a figure he would agree to sign for then an extension is possible. That could equally apply to all those other future negotiations, but for Smart I can see a reasonable way for it to happen less than a year from now.
Raise Structures
What Has Been Reported
Maximum annual raises will be increasing from 7.5% for Bird/Early Bird/Extension and 4.5% for other non-Arenas signings to 8% and 5%, respectively.
Big Picture
The increase in raises isn’t a huge deal. Raises on medium and large contracts, if they’re outpacing growth in the salary cap, can turn ok contracts bad. If the cap settles into a more flat growth track during the course of this CBA, larger raises could lead to slightly more “bad” contracts.
Celtics Outlook
I don’t see the change has having any major impact on the Celtics. The difference in raise amounts for a free agent re-signing or changing teams is still 3%. The team will have contracts to sign in the future, just like everyone else, and increased raises means players later in a contract will take up more cap space and potentially be worse contracts than they otherwise would have been. Everyone is on a level playing field, though.
Designated Veteran Players
What Has Been Reported
A new 5-year contract starting at the 35% max will be created for qualifying players, designated by their team
To qualify, a player must:
Be signing an extension or re-signing with the team that drafted them, or traded for their rookie contract
Be entering their 8th or 9th season for an extension, or 9th or 10th season for a re-signing
Have been MVP in the past three seasons, or have been DPOY or All NBA the prior season or two of the past three seasons
If signing an extension, be three years past the signing of their last contract (free agent re-signings do not have this restriction)
A team can only have two players signed using the Designated Exception on their roster at one time
A designated contract can only be signed during the offseason
A player signed using the designated veteran exception cannot be traded for one year
A special rule is in place to allow players like Russell Westbrook and James Harden to waive their player option season to sign a DVE extension
What We Don’t Know
Does eligibility for the DVE change a player’s cap hold if they are a free agent?
Big Picture
This is the change receiving the most attention, though it may end up being less used than it seems. Based on the rules as we currently understand them, and the state of play in the NBA this season, it looks like only DeMarcus Cousins and Stephen Curry will be eligible for the DVE next summer. Blake Griffin and Paul George didn’t make an All NBA team last season so unless they do this year, they will not be eligible for the DVE contract in free agency. Gordon Hayward is unlikely to make All NBA, but even if he did he’ll only be entering his 8th season, not enough for a free agent to qualify. Kevin Durant and Chris Paul have both changed teams and will already be the 10+ year bracket.
A collection of players who sit on the fringe of All NBA will have their contract fates decided by media voting. Players like Kemba Walker, Jimmy Butler, and Kyrie Irving will have a season where they really want to make All NBA during this CBA. Someone like Kawhi Leonard should qualify easily, but we thought Anthony Davis would easily get a Rose Rule extensions and then he got injured in the wrong season. Maybe Davis will make some of that up with a DVE extension further down the road.
One player who may be kicking himself is Russell Westbrook, who looks certain to make All NBA this season, and would therefore have been eligible to sign a 5 year / $209M contract with OKC this summer if he hadn’t done a renegotiate-and-extend a few months ago. A change to the max tiers was always the biggest financial risk in signing that deal.
If the Kings want to commit their future to Cousins this is good news for them. Their ability to offer that same 5/$209M contract to Boogie when other suitors couldn’t come anywhere close to that total value might be enough to keep him there. It’s possible that the Kings won’t want to make that commitment and will look to trade him anyway, or that Cousins will be willing to walk away from tens of millions of dollars to escape, but you would now have to bet on him staying for at least a while longer. If I had to guess, the Kings will take the plunge and offer the full extension only to see Cousins start agitating for a trade whenever that restriction ends. On a giant, long contract, the Kings will find it surprisingly hard to move their mercurial star for real value. Meanwhile, the 76ers, owners of the Kings pick the season after Cousins is scheduled to become a free agent, may see Sacramento win a few more games than they hoped.
Maximum Contract Types; 7-9 Years Experience; $103M Cap
Year.................................Designated Exception...........................Bird Re-signing...................................Free Agent Signing
2017-18...........................36,050,000.........................................30,900,000........................................30,900,000
2018-19...........................38,934,000.........................................33,372,000........................................32,445,000
2019-20...........................41,818,000.........................................35,844,000........................................33,990,000
2020-21...........................44,702,000.........................................38,316,000........................................35,535,000
2021-22...........................47,586,000.........................................40,788,000........................................Free Agent
TOTAL..............................209,090,000.......................................179,220,000.......................................132,870,000
Before he decided to undergo knee surgery, Blake Griffin might have looked at this rule and thought he needed to do a little stat hunting. The forward spots are incredibly deep, but if Blake can make it back onto an All NBA team the Clippers will give him the 5/$209 and probably keep their core together while blasting deep into the luxury tax, and Steve Ballmer’s pockets. With the surgery, this is now highly unlikely.
At first reading, this rule appeared to incentivize the best rookies to sign three year deals after their rookie contract. More recent reports say that a player must be further along in their career to qualify, meaning that the league also saw this potential issue and structured the rule to encourage rookies to sign four or five year deals after their rookie contract to maximize their potential career earnings. This is an intelligent structure for the rule, if that’s the intention.
One final thing to watch for is the limit on the number of designated players a team can have at one time. The Warriors may have to make a decision between designating Draymond Green or Klay Thompson at some point in the future. There may also be a team in the later years of the CBA who have two DVEs and are therefore blocked from trading for a third who they might otherwise have had an opportunity to acquire.
Personally, I think this rule change goes too far. I think a reasonable compromise would have been to make it so designated player extensions are only available to the team that meets this criteria, but if a player makes it to free agency having me the designated criteria they should be able to sign with any team using the 35% max with only their current team able to offer a 5-year deal with the higher 8% raises. That would align DVE free agency with the existing rules. If a designated eligible player made it to free agency and their team already had two designated players on the roster, their current team should be able to offer a 4-year deal at the 35% max and 5% raises, just like anyone else, so they’re not limited to a smaller offer than other teams could.
Celtics Outlook
None of the current Celtics will be DVE eligible, maybe ever. Isaiah Thomas and Al Horford came to Boston after their rookie deals. Avery Bradley and Jae Crowder are unlikely to ever make All NBA or win DPOY. There might be some slim chance that Marcus Smart stays in Boston long-term and makes All NBA in 2021, but you’d have to get awfully long odds to bet on that. If the Celtics ever take advantage of the DVE in the six years this CBA will last, I would bet it’s a player they trade for on their rookie deal in a rebuild, but even that would play out far down the line.
The issue for the Celtics is that the DVE is meant to keep stars with their current team and the Celtics desperately want to pull a star away. DeMarcus Cousins has been a much-discussed trade target but he may want to stay in Sacramento now (or even more if he already did) and the Kings have to think they have a much better shot to keep him if that’s what they want. If Blake Griffin makes All NBA, now a very long-shot with his surgery, whatever slight chance there is of him coming to Boston almost certainly disappears.
Meanwhile, we can look at a player like Paul George and be in the odd position of desperately wanting to acquire a player who we don’t want to make All NBA. Basically we’re hoping to be able to sign someone we admit isn’t a top-6 forward, in a league where titles usually go to top-5 overall players.
In creating the DVE, the league is trying to incentivize teams to draft and develop, but current rookies won’t even be eligible for DVE status until after this CBA has come and gone. It may be that this rule lives on for future agreements, but there’s no guarantee of that.
Traditional Veteran Extensions
What Has Been Reported
Non-designated veteran extensions can now be for four additional seasons instead of three
Extensions can now be signed two years after the signing of a three or four year deal, instead of three years after
Non-designated veteran extensions can now have a first year salary of up to 120% of the salary of the final year of their existing contract
Big Picture
The criteria for a DVE extension compared to the rather modest changes in extension rules leaves a large gap for teams trying to retain star players who don’t make the All NBA team. If the salary cap flattens out at some point the problem may become less acute, but that only applies to contracts signed after the cap flattens so if we’re a few seasons away from that and contracts run 3-5 years, we’re talking about this being a persistent problem.
Even a max contract signed before the cap climb ends will not be a good baseline for an extension if they can only offer a 20% raise. For example, if Paul George makes the All NBA team this season and the Pacers offer him the DVE extension he would have to really want to leave Indiana not to take it. If he doesn’t make All NBA, he would be crazy to take the extension offer that the Pacers would be allowed to make. It’s a massive difference; it’s so large as to make me wonder if we’re missing a key piece of information.
Paul George Contract Options; $106M 2017-18 Cap
Year.....................................Traditional Extension..................Designated Exception..................Bird Re-signing..............Free Agent Signing
2017-18................................19,508,958...............................19,508,958................................19,508,958...................19,508,958
2018-19................................23,410,750...............................37,100,000................................31,800,000...................31,800,000
2019-20................................25,283,610...............................40,068,000................................34,344,000...................33,390,000
2020-21................................27,156,470...............................43,036,000................................36,888,000...................35,059,500
2021-22................................29,029,330...............................46,004,000................................39,432,000...................36,812,475
2022-23................................Free Agent...............................48,972,000.................................41,976,000...................Free Agent
5-Year Total...........................124,389,118.............................185,716,958................................161,972,958.................156,570,933
6-Year Total...........................124,389,118.............................234,688,958................................203,948,958.................156,570,933
As you can see, if George doesn’t make all NBA this season his maximum extension would be between $30-60M less than the potential max contracts(only in the four extension years) that he could sign by just waiting until free agency. This put the Pacers in the same position with PG-13 as the Thunder were with Durant. George is not Durant, but he’s what the Pacers have and they’ll feel awfully aggrieved if the Kings are able to lock up Cousins and they feel backed into a corner and having to trade George just because forward is a deeper position than center in awards voting.
This is why using awards voting is going to become a huge issue. Not only will close votes cost certain players huge sums of money, like it just did with Anthony Davis, it may alter the outlook of entire franchises. We may be seven months away from watching the Clippers break up because Blake Griffin finishes seventh in All NBA voting for forwards instead of sixth. This will be a problem during the course of this CBA, unless there are additional rules that have not been leaked yet.
It looks like the message being sent is that the league wants to block the formation of Warriors-esque “hyper teams” but still leave the door open for “super teams” and keep free agency exciting. If every team had the massive signing advantage that DVE status gives on all of their top free agents, no one would ever move and the NBA would cease to be a “12 month season.” Instead, the league is setting aside a select elite and sending the message that “draft, develop, and trade” is what they want teams to focus on because free agency is going to be possible, but not for the players that really win titles.
Celtics Outlook
While the DVE rules look likely to take some potential star targets off the market, the limited increases in traditional extensions means some All Star caliber players might still be out there. I’ve highlighted Paul George already, but it looks unlikely that Blake will qualify for the DVE and Gordon Hayward is not eligible, though both could opt to sign a 1+1 with their current teams in an attempt to qualify for 2018. If that’s the case, the set of signing and trade targets the Celtics may have been working on are nearly unchanged. It’s hard to know what the Kings and Cousins will do, but I’m also not sure how interested Boston is in Boogie to begin with.
The biggest obstacle these rules put in place is that a player like George may really not want to be traded next summer. If he isn’t eligible for a DVE extension, he’ll know that if he can make All NBA in 2017-18 he’d be eligible for a DVE re-signing, but only if he’s still on the Pacers. Will he make it known that he actively doesn’t want to be traded to keep that possibility open? Will John Wall see it that way too, even though he’s a year further away from eligibility?
What’s clear is that if the Celtics are going to continue chasing max contract veterans, the best thing they can hope for is that none of Griffin, George, Hayward, Wall, or any other target they might be considering makes All NBA.
Draft Eligibility
What Has Been Reported
The rules for who is eligible for the draft has not changed; players one year past their high school graduation can declare
The league would like to change the draft to “two and done” meaning a player would have to be two years past their high school graduation
The union suggested a “zero or two” system meaning a player could declare out of high school, but if not they would wait at least two years
The league and union plan to continue this discussion beyond the signing of the CBA
What We Don’t Know
How close they have come to a compromise?
What would happen to a player who declared out of high school but was not drafted?
Could a player who is drafted out of high school choose to go to college and re-declare later, like in baseball?
Big Picture
No matter the system, there will always be players who don’t quite fit. In that way, a “zero or two” system seems like a good one because giving players two options instead of one should work for more of them. If the league were to do this they would need to have an understanding with the NCAA in place. For example, if a high school player is drafted in the first round maybe they cannot go to college and would be subject to all the normal draft rules we see now. However, if they were drafted in the second round they could elect to go to college for at least two two years with their drafting team retaining their rights. If the player is undrafted, they can still go to college for three or more years before re-entering the draft. Every system would have drawbacks and unintended consequences, the point is just that it’s more complex than saying “two and done” or “zero or two.”
There’s also nothing inherently wrong with “one and done.” The league has had a fantastic run of young players enter the draft since instituting that rule. That’s not to say those players would not have succeeded had they entered the league directly out of high school, but it’s obviously not hurting the league. I hate the idea of having to work with the scummy NCAA, but that’s the reality for the foreseeable future.
Celtics Outlook
An immediate change to this rule would be terrible for the Celtics. The 2017 draft would be unchanged because that’s determined by the current CBA, but the Celtics are hoping to have another high pick from Brooklyn in 2018 and if that became the “gap year” where all the best would-be sophomores entered the year before and all the best freshman aren’t eligible, you end up with a class where Andrea Bargnani goes #1 overall.
It’s possible that we still will have a gap year which could impact the Celtics, but it would do the same to everyone else too. If the Celtics decide to break up the veteran core and go young at some point, any gap year would be a negative. If they consolidate their position and get good, it would hurt them less than many other teams, unless one of their other future picks like the one from Memphis is good and in that year. It’s simply too hard to project beyond the Nets picks.
Two-way D-League Contracts and Expanded Rosters
What Has Been Reported
Rosters will expand from a maximum of 15 to 17 spots
Teams will now be required to carry 14 players instead of 13
Teams are limited to at most 15 NBA contracts and at two “two-way” D-League contracts
Two-way contracts will have a minimum salary of $75k
What We Don’t Know
Who will be eligible for a two-way contract?
How will the two-way contracts actually work?
Can a player on a two-way contract be “called up” to the NBA and how does that impact a team with 15 NBA contracts?
How many two-way contracts can be included in the 14 rostered player minimum?
Big Picture
With the league a record distance from expansion, players playing longer, and more international players entering the league, the NBA needed to do something to expand rosters. The issue has come to a head this season as every team has hit the 15 player cap at some point, and only one team entered the season with an open spot. A number of players that teams would have preferred to sign or retain could not be.
The D-League is not an attractive financial option. Players will still be able to make a lot more than $75k in foreign leagues, but the promise of an NBA spot and some mechanism for being called directly up to the NBA will hopefully entice more players to stay in the US.
At this point, we just don’t know enough about how this will work to make any assessment. I don’t even know who will be eligible for the contracts; I assume 1st round picks who are still eligible for scale contracts will not be. I would like to have seen a new exception for second round picks, set at the minimum with two guaranteed years and a third season team option, created to allow teams to establish full Bird Rights with their picks, but nothing else appears to have been done on that front. Two-way contracts sound good for players drafted late in the second round, or signed as UDFAs, but high second round picks are still going to have leverage against their teams that late first round picks do not have.
Celtics Outlook
It would have been nice to have this for this season. Considering how much Demetrius Jackson is making it probably wouldn’t have mattered for R.J. Hunter, but Abdel Nader and Ben Bentil would have had different options. It will be interesting to see if players like Nader, drafted under the current CBA, will be eligible for the new contract structures.
Boston doesn’t have their own second round pick this season (assuming they swap with Brooklyn) but do have picks from the Timberwolves, Clippers, and Cavaliers. Those two-way contracts may be the solution to keeping those future draftees in the system.
Trade Rules
What Has Been Reported
Contracts signed after the new CBA will only have guaranteed salary counted for money matching
Non-guaranteed or partially guaranteed contracts will have their full value counted for the receiving team but only the guaranteed part counting for the sending team
The class of trades that previously required a 150%+$100k trade match will now use 175%+$100k as the rule
Players and teams can now agree to waive trade kickers
Big Picture
The inability to trade non-guaranteed contracts can be seen as closing a loophole, but it may cool parts of the trade market. In the past, teams like the Celtics that anticipated being near the cap would sign players with non-guaranteed future years. These players could be used to make a salary match after the season ended, or into the new season (depending on guarantee date) as a “super expiring.” Any player signed under the current CBA with a non-guaranteed year in 2018-19 or 2019-20 could find themselves a hot trade commodity as they will not be subject to this rule change.
The other changes are relatively minor. The 150% bracket for trades only applied to teams over the cap but under the luxury tax making relatively small salary swaps. It will loosen up the low end of the trade market, and make creative structures that spawn trade exceptions slightly easier to work out. The ability to waive trade kickers if all parties agree is just common sense.
Celtics Outlook
Boston has tried to make use of non-guaranteed contract trades in the past, and still hold the contracts of Tyler Zeller, Jordan Mickey, and Demetrius Jackson who are all non-guaranteed after this season. The rule will not apply to those three players, but it does prevent the franchise from playing this game in the future. It wouldn’t surprise me if some day the Celtics acquire a player with a future non-guaranteed year from this CBA just to have that extra chip in their back pocket.
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bobheckler- Posts : 61303
Join date : 2009-10-28
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