NBA Chat With Larry Coon 4/25/14

Larry_Coon_ChatLarry Coon the noted author of the CBAFAQ, will answer your Salary Cap and Collective Bargaining Agreement questions. Larry will answers your questions about the Salary Cap, NBA trades and the CBA at 3:00pm et

  1. Deven

    You said that the Salary Cap and the Luxury Tax will be going up for next season. So I was wondering: How do both of those increase or decrease before every NBA season?

    • Larry Coon

      The league does an audit in early July that determines (among other things) how much revenue it receives. It then has formulas it applies to set the new values for the cap and tax.

      The formulas essentially take a percentage of revenues, subtract benefits, and divide by 30. The percentages are 44.74% for the cap, and 53.51% for the tax. There are also adjustments that can change the results.

  2. Park Barkly

    It seems like with all of the trading and cap rules, the NBA is the funnest sport to play GM for a math geek. Have you ever broken down any other leagues?

    If Pau Gasol signed a one year veterans minimum deal, and the Lakers get a solid player this year and then get KLove next summer, could Pau Gasol do a big extension at the end of the summer (after Love is signed) that would put the Lakers back over the cap?

    Can a team that was under the cap still use the mid tier exception in the same year as long as they don’t go over the apron?

    Thanks.

    • Larry Coon

      As I said elsewhere in this chat, it’s enough work just to keep on top of the NBA, and I really don’t have any interest in doing that with other leagues.

      In your Gasol scenario they wouldn’t be able to do an extension, because an extension can’t be signed for three years after the contract was first signed. But theoretically they could do it by signing a one-year contract and then re-signing him as a free agent with Bird rights next summer. But Gasol would have to be willing to take a very small salary, and the Lakers would have to deal with Gasol’s diminishing skills and increasing injury susceptibility over the long term.

      If a team goes far enough under the cap to have actual cap room, then they lose their exceptions for the year.

  3. Deven

    How much money can Pau Gasol make somewhere else?

    • Larry Coon

      He’s eligible to sign for up to at least $20,250,142, and more likely around $20.66 million, with any team — whether it’s the Lakers or someone else. In a multi-year deal he could get bigger raises (7.5% vs. 4.5%) with the Lakers than with another team. And he could sign for five years with the Lakers, or four somewhere else.

      That said, Gasol’s days of making max salary are over. I think a more likely deal for him would be two years, $20 million total, but I think the second year would be a problem for the Lakers.

  4. Deven

    What’s the difference between a protected pick and an unprotected pick?

    • Larry Coon

      Protection. :-)

      Let’s say you’re the Heat, and you trade LeBron James this summer to Mikwaukee for their first round pick in 2015 (next year’s draft). If that’s the extent of the deal — the pick goes to Miami no matter what, then that’s an unprotected pick.

      But let’s say Milwaukee says, “We’re getting shafted here if that pick turns out to be one of the top three. How about if it’s 1, 2, or 3 then we keep it, and give you our first round pick the following year?” That’s a protected pick — it’s only conveyed under certain circumstances.

  5. Deven

    What should the Pacers do with their roster this summer? They are out of sorts right now.

    • Larry Coon

      They’re in a funk that’s lasted half the season, but they didn’t really make any changes in personnel that would have made a difference. Granger for Turner isn’t going to send the team into a tailspin. Andrew Bynum might, but he wasn’t there long enough to have that kind of effect.

      So whatever’s going on is personality related rather than player talent related. I couldn’t say what to do to fix it without insight into the personality issues.

  6. Charlie

    The Bulls clearly need help on offense. With how the cap is going to work out, and the moves they can make, is there enough room to add both Carmelo and Mirotic next year, or would it be one or the other?

    • Larry Coon

      It would be very hard for the Bulls to clear out enough room to sign Melo. There are essentially three ways to do it:

      1. Clear out enough cap room to sign him directly. This would me either getting $23 million under the cap, or convincing Melo to take whatever room they are able to create. This would be the hardest of the three options, and they wouldn’t be able to sign Mirotic if they did this — they’d need to clear additional room by getting Mirotic’s hold off their cap, which means signing a letter saying they won’t sign him this year.

      2. Clear out less than the needed room, and send the remaining salary to New York in a sign and trade. For example if they amnesty Boozer and dump their non-guaranteed salaries (Mike James et al), they could be far enough under the cap to send, say, Taj Gibson and pick(s) to the Knicks for a signed-and-traded Melo, and as a result of the trade, still end up under the cap. However, in this scenario they’d also need to clear additional room by getting Mirotic’s hold off their cap.

      3. Stay above the cap, and complete a sign-and-trade by sending enough salaries to meet the over-the-cap trade requirements. This would be a tall order for the Knicks — they’d have to send away around $18 million, which means Gibson, the three non-guaranteed players (who were signed for this purpose, BTW, so they can trade them and the other team can simply waive them with no obligation), and another $6 million. The question is where that $6 million comes from. Maybe the Bulls take Butler and Dunleavy, and Melo takes a little less. Or maybe they eat the last year of Boozer’s contract.

      The problem is, once you start adding salary New York needs to take on to make a deal work, New York starts losing its motivation to do a sign-and-trade, which means Chicago has to sweeten the pot even more. Maybe they start asking for Mirotic?

      The bottom line is that I think it would be very difficult to sign both Melo and Mirotic this summer.

  7. nik

    NBA has per player hard salary cap (limits how much a player can get paid according to experience)and a soft team salary cap. Essentially a double cap.

    Any other leagues cap both salaries and payroll?

    Is this a major obstacle to trades and free agency where teams simply decide to tank and gamble on a lottery pick?

    • Larry Coon

      (Sorry about the delay — I had to take a phone call.)

      I can’t speak for other leagues — it’s enough work just understanding the NBA. However, I will say that it’s not really a “double cap.” The two limits (salary cap and maximum salaries) serve two different purposes. The intent of one is to level the playing field across the teams, which has a secondary effect of limiting salaries. The maximum salaries have a primary effect of limiting salaries.

      I’m one of those people who think that the league would be more interesting without maximum salaries. GMs would have to employ much more strategy.

  8. Charlie

    With the sixth pick, the lakers draft…

    • Larry Coon

      Assuming Wiggins, Parker, Exum, Embiid and Gordon are already taken, as Chad Ford indicated in his latest mock?

      The Lakers are in “blow it all up and rebuild it from scratch” mode, and really aren’t drafting for need — they’ll take the BPA and work the rest out as they enter free agency. Nor do they need the most NBA-ready player, since they’re building for the next few years, not right now. I think Vonleh makes sense.

  9. Harry

    Hi Larry! Long time listener, first time caller. I often read your twitter qna’s and shake my head at the stupidity of some of the questions. Don’t you? Second question, Miami can resign the big 3 and Melo this offseason, right?

    • Larry Coon

      No, I don’t, and I wouldn’t call them stupid, either. I figure that for every question I’m asked, there are a hundred others out there who also want to know the answer, and that 99% of the basketball fans out there don’t know the answer either. It’s not “stupid” to not have a sophisticated understanding of how the league functions, and I’m an educator at heart.

      As for your Miami question….wow, what a stupid thing to ask. :-)

  10. Jimmy

    Were GMs surprised by the expected cap for next year? How much will that change next year’s free agency?

    • Larry Coon

      Keep in mind that the number they had ever since the All-Star break was $61.9 million. Moving to $62.3 million didn’t change it all that much from what they were already expecting.