LABOR UNCERTAINTY CLOUDS CELTICS FUTURE

By Paul Flannery

The Celtics and Jeff Green will have to wait for a nw labor agreement before deciding their future. (AP)
While the NBA gears up for Thursday’s draft, a bigger story will play out earlier this week in New York. On Tuesday, the league and the player’s union are meeting in what appears to be pivotal talks in the hope of coming to an agreement on a new Collective Bargaining Agreement.

If the two sides can’t reach a deal by June 30, the NBA is expected to lock out the players, and the league will be in danger of missing games for the first time since the 1998-99 season.

Unlike the prosperous NFL — which seems to be making steady progress toward a new labor agreement — the NBA has claimed that it is collectively losing millions (the league estimated a $300 million loss this season) because of rising player salaries. The player’s union naturally disputes the amount and the accounting practices the league is using for their figures.

At the heart of the matter is the revenue split between the owners and players. Currently the players receive 57 percent of basketball-related income (BRI) in salaries before expenses. As CBSSports Ken Berger has reported, the league wants to make it a 50-50 split, which would in effect cut player salaries by a third.

The remedy proposed by the league is a hard cap that could either limit or eliminate exceptions such as Bird rights that allow teams to go over the cap to re-sign their own free agents and the mid-level exception that allows teams over the cap to sign free agents from other teams. (Those are the fundamental mechanisms of a “soft cap.”) The union naturally wants no part of a hard cap and advocates a modified revenue-sharing plan among the owners.

There are several other side issues in play. Among them a “franchise tag,” for lack of a better term, as reported by SI’s Zach Lowe, a one-time amnesty provision and shorter contracts. It has also been reported that the NBA has proposed a gradual phasing-in process that would take place over the next two-to-three years.

While there have been hints of optimism here and there — the NBA dropped the issue of trying to eliminate guaranteed contracts last week — there has not been any fundamental movement on either side. “I really think that the time to have an optimistic or pessimistic view is at the close of the day on Tuesday,” commissioner David Stern told reporters last week.

With so many moving parts, a new CBA will have a tremendous impact on the Celtics both for this year and beyond as they attempt to remain in contention for a championship while also rebuilding for the inevitable transition period that will take place soon.

HOW A NEW CBA AFFECTS THE CELTICS THIS SEASON

There is no question that current agreement has been beneficial for the Celtics for the simple reason that the team’s owners have been willing to exceed the luxury tax — a dollar-for-dollar penalty — to continue using cap exceptions to sign free agents and their Bird rights to retain their core.

Since the team acquired Kevin Garnett and Ray Allen in the summer of 2007, the Celtics have been over the cap. That hasn’t stopped them from signing veteran free agents like Rasheed Wallace and Jermaine O’Neal for the full mid-level exception. In 2007 they used the exception to sign James Posey and Eddie House. They also used what’s known as the bi-annual exception to sign Marquis Daniels and add other veterans for the minimum.

In addition, the Celtics signed Kevin Garnett to a contract extension after they acquired him from Minnesota, used their Bird rights to lock in Rajon Rondo to a five-year deal and re-signed Paul Pierce and Ray Allen. All of this spending has the left the Celtics over the cap, with a little more than $64 million committed to six players for next season.

In order to add pieces for a run in 2011-12, the Celtics need cap exceptions. While it’s fun to speculate about free agents prizes like Tyson Chandler (who will almost certainly be priced way out of their market), Sam Dalembert, Jamal Crawford or J.R. Smith until a new CBA is hammered out, their offseason plans are in limbo.

Then there is the issue of their free agents, particularly Jeff Green and Glen Davis.

Green is a restricted free agent. Under the old rules they could sign him to an extension or simply extend him the qualifying offer — roughly $6 million — and retain the right to match another team’s offer or work out a sign-and-trade. Davis is an unrestricted free agent, and while his postseason play left much to be desired, he’s still just 25 years old and coming off his most productive regular season.

Until the new rules are hashed out, the team and the players don’t know the contract parameters in terms of money and years. The Celtics will also want to spend wisely this summer because they could be set-up for a dramatic overhaul after next season.

HOW A NEW CBA AFFECTS THE CELTICS IN THE FUTURE

Garnett, Allen and O’Neal are all entering the final seasons of their contracts, which leaves them with three players signed for 2012-13: Rondo, Pierce and Avery Bradley. The Celtics have been cautious about over-extending their salary commitments beyond next season, a long-term strategy that likely cost them Tony Allen and played a part in the Kendrick Perkins trade.

In order to keep that flexibility the Celtics will have to be careful about how they spend money this summer and until a new deal is worked out they won’t know how much that flexibility is actually worth.

Under the current agreement, the salary cap is set each year based on revenues and that 57 percent figure. As a frame of reference the cap was $58 million this past season and the Celtics are committed to just over $29 million in salaries next summer. That $29 million in potential cap space will diminish rapidly if the cap number is reduced substantially in a new CBA or if they are forced to overspend this summer.

Looming in the shadows is Orlando center Dwight Howard, who can opt out of his contract after next season. Howard has said that he wants to stay with the Magic, but he also told them he wouldn’t sign an extension and was prepared to hit free agency. Although it’s way too early to handicap Howard’s ultimate destination, the Celtics could at least be a factor in the race.

This was already going to be a tricky offseason for Danny Ainge and the front office as they attempt to add on to the present while maintaining their ability to maneuver in the future. A new CBA could make it that much harder.

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