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NBA PM: How Holds, Rights Affect the Cap

Salary cap guru Eric Pincus explains how cap holds and player rights affect an NBA team’s salary cap.

Eric Pincus

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In July, the NBA’s salary cap is expected to jump from the current $70 million to $92 million, dramatically increasing spending power throughout the league.

Most teams will be armed with cap room, but to project how much exactly will take more than just looking at the salaries of players under contract for the 2016-17 season.

A variety of cap holds factor into a team’s salary.  Some can be removed via renouncement, others are set in stone.

Empty Roster Charges

In fact, a team with absolutely no players has 12 cap holds at next season’s rookie minimum of $543,471.  That’s a total of just under $6 million, which would give a team with no players $86 million in space under a $92 million cap.

The logic behind 12 empty roster charges has to do with the regular-season minimum of 13 players on the roster.  The idea is: what is the absolute most available to that 13th player, if everyone else on the roster is making the least a team can possibly spend?

Of course, no teams have zero players this summer, but they will have empty roster charges to reach 12.

Actual Salaries

A players’ salary counts against the cap, with any incentives earned in 2015-16 considered “likely” for 2016-17.  Unlikely incentives do not go against a team’s cap.

The Indiana Pacers have 11 players under contract for next season.  While both Glenn Robinson III and Shayne Whittington are non-guaranteed, their salaries go against the cap unless waived.

The Pacers have $59.3 million in salaries, and one empty roster charge, leaving $32.2 million in space.

Cutting Whittington would reduce the team’s salary by $980,431, less than an empty roster charge ($543,471) – giving the Pacers just an extra $436,960 in cap space.

First-Round Salary Scale

The Indiana example is not entirely complete.  The team also holds the No. 20 overall pick in the 2016 NBA Draft.

Until a first-rounder is signed, their base salary, as defined in the Collective Bargaining Agreement, is their cap hold for the team.

In most cases, first rounders will sign for the maximum of 120 percent of their scale salary.  Once they do sign, that becomes their cap number.

For the Pacers, their pick has a cap hold of $1.3 million, which takes the place of the aforementioned empty roster charge.

Instead, with 11 rostered players and the draft pick, Indiana has $61.1 million in salary with $31.4 million in cap space.

If a drafted player agrees not to sign for the entire season, in writing, that cap hold can be removed from the books.  The pick can also be renounced outright (an extremely rare occurrence in the first round).

Unsigned second-round picks do not take up any cap space.  In fact, they can be signed at the rookie minimum in place of empty roster charges, without reducing cap room.

Exceptions

Teams over the cap can use a variety of exceptions including the Mid-Level ($5.6 million for 2016-17), Bi-Annual ($2.2 million) and any Trade or Disabled Player Exceptions that may have been generated.

Teams can renounce their exceptions or elect to hold onto them to stay over the cap, although they automatically evaporate if the team is unable to reach the salary cap.

With the Pacers, if they would add the Mid-Level and Bi-Annual to their cap figure, it would take the place of any empty roster charges.

The revised total would be $68.4 million in salary.  Since the team would still be $23.6 million under the cap, the exceptions would automatically expire.

Before they do, free agent cap holds needs to be added to the puzzle.

Free Agents

Teams can spend up to the salary cap but they can also go over the to re-sign their own players.

To do so, the team must account for their own free agent with a cap hold – the number based on their previous year’s salary and the players’ rights.

Players with Non-Bird Rights, after one season with their team, have a cap hold of 120 percent of their previous salary – the maximum a team can pay without using either cap room or an additional exception.

Should Arron Afflalo opt out his contract with the New York Knicks, his cap hold will be $9.6 million – 120 percent of his $8 million salary.

For Early Bird Rights, after two seasons, the cap hold formula is 130 percent.  Players can sign up to 175 percent of their previous salary, or 104.5 percent of the league’s average salary (the exact figure won’t be computed until the end of the July moratorium).

Marvin Williams’ Early Bird cap hold with the Charlotte Hornets, based on his $7 million salary, is $9.1 million.

Full Bird Rights are more complex.  While players can be paid up to the maximum (with the amount determined by years of service), their cap hold is based on the “estimated” average salary, which is currently set at $5.7 million.

Additionally, first-round picks coming off their first contract are treated differently than other free agents.

For first-rounders, if they earned less than the estimated average salary, their cap hold is 250 percent of their previous salary.

Bradley Beal of the Washington Wizards had a salary of $5.69 million for 2015-16.  His cap hold this summer is $14.2 million.

If a first-rounder earned the estimated average salary or higher, their cap hold is 200 percent of their previous salary.  No one in the 2012 draft class fits this criterion this past summer. Had Beal earned an additional $44,326 last season, he would have reached the estimated average salary, and his cap hold would have shrunk to roughly $11.5 million.

For players with Bird Rights, who are not first-round picks coming off their first contracts, the percentages are 190 percent for those below the estimated average salary and 150 percent for those above.

Al Horford’s cap hold, with the Atlanta Hawks, will be $18 million – 150 percent of his $12 million earned last season.

Courtney Lee’s cap hold, with the Charlotte Hornets, will be $10.8 million – 190 percent of his $5.7 million earned last season.

Rights transfer via trade, in most cases.  A player’s cap hold will not be more than the maximum salary for the coming season.

A player on a minimum contract works differently; their cap hold is the minimum whether they have Non-Bird, Early Bird or Full Bird rights.

Once that player re-inks, their actual salary is their cap hold; if they are renounced, or leave for another team, their hold comes off completely.

As if it wasn’t already complex, there are other caveats, like declined first-round options, non-first round restricted free agents, and starter criteria that add further wrinkles to computing a players’ cap hold.

Pacers forward Solomon Hill’s option was declined, making his cap hold the $2.3 million he would have made had the team taken the option.

Undrafted Miami HEAT guard Tyler Johnson has a cap hold of $1.2 million, provided Miami makes him restricted with a qualifying offer before July.

Los Angeles Lakers guard Jordan Clarkson will have a $2.7 million cap hold once he receives a qualifying offer – based on the number of games he started, and minutes played, last season.

Until a team renounces a players’ rights, they have a cap hold.  The Oklahoma City Thunder still have a cap hold for Derek Fisher at a minimum salary of $980,431 for next season.  Renouncing is strictly a clerical task, but by and large, teams don’t take that step until necessary.

Waived Players

The Los Angeles Clippers previously waived and stretched out the salaries of Carlos Delfino, Jordan Farmar and Miroslav Raduljica.

Combined, the team’s trio of former players will take up $1.4 million in cap space.

Example: Pacers’ Cap Position

At the last tally, the Pacers had $68.4 million in salary, including the Mid-Level and Bi-Annual Exceptions.

Indiana also has Non-Bird rights on Jordan Hill, who earned $4 million last season, yielding a cap hold of $4.8 million.

Ian Mahinmi also made $4 million, but with Bird Rights, his cap hold is $7.6 million.

Ty Lawson’s hold is just the minimum at $980,431.  Solomon Hill’s cap hold was previously listed as $2.3 million.

All-inclusive, the Pacers reach just $84.1 million in team salary, which is $7.9 million below the cap.  Since the team is under, they will lose their Mid-Level and Bi-Annual Exceptions, reducing their total to $76.2 million with $15.8 million in spending power.

Indiana can max out their space by waving Robinson and Whittington, while also renouncing their free agents.  The team can also look to draft a player who agrees to stay overseas for a year.

If so, the Pacers would have nine players with three empty roster charges of $543,471 each, $58.9 million in team salary and $33.1 million in cap room.

Perhaps more realistically, the team might keep Robinson, Whittington, along with Mahinmi’s cap hold and will draft a player at No. 20 to join the team immediately.

That combination would give the Pacers $23.8 million in cap space, slightly under the projected maximum ($25.9 million) for players with seven-to-nine years of NBA experience (like guard Memphis Grizzlies guard Mike Conley).

Waiving Robinson and Whittington pushes that space up to $25.3 million, but the Pacers wouldn’t have to make those decisions until they actually have a free agent commitment that requires additional space.

The Pacers can also look to make trades to open up more spending power.  Player buyouts can also be an option.

Should Indiana find a taker for what could be roughly $25 million in spending power, they would then have the ability to go over the cap to re-sign Mahinmi to a contract starting above his $7.6 million cap hold.

Finally, once teams like the Pacers go over the cap, they gain the $2.9 million Room Exception to sign player(s) for a maximum of two seasons.

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Is LeBron Enough For Cavs To Get Through The East?

Cleveland’s offense has struggled through the first two games of the playoffs. Can the four-time MVP consistently bail them out? Spencer Davies writes.

Spencer Davies

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After a less-than-encouraging series opener versus the Indiana Pacers, LeBron James responded emphatically and led the Cleveland Cavaliers to a bounce back 100-97 victory to even things up at one game apiece.

Scoring the first 13 points of the game itself, The King was a one-man wrecking crew out of the gate and carried that momentum throughout all four quarters of Game 2. His 46 points were James’ second-highest scoring mark between the regular season and the playoffs. In addition, he shot above 70 percent from the field for the sixth time this year.

The four-time MVP pulled down 12 rebounds total, and but all but one of those boards were defensive—the most he’s had since Saint Patrick’s Day in Chicago a month ago.

What James did was another classic instance where LeBron reminds us that through all the injuries, drama, and on-court issues, whatever team he’s on always has a chance to go all the way. But having said all of that—can the Cavaliers realistically depend on that kind of spectacular effort for the rest of the postseason? It’s a fair question.

Kevin Love is a solid secondary go-to guy, but he’s struggled to find his rhythm in the first two games. He’s done a solid job defensively between both, but he’s getting banged up and is dealing with knocked knees and a reported torn thumb ligament in the same hand he broke earlier in the season.

Love has admitted that he’d like more post touches instead of strictly hanging out on the perimeter, but it’s on him to demand the ball more and he knows it. But finding that flow can be challenging when James has it going and is in all-out attack mode.

Kyle Korver came to the rescue for Cleveland as the only shooter that consistently converted on open looks. Outside of those three, and maybe J.R. Smith, really, there hasn’t been a tangible threat that’s a part of the offense during this series.

We all pondered whether or not the “new guys” would be able to step up when their respective numbers were called. So far, that hasn’t been the case for the most part.

Jordan Clarkson looks rushed with tunnel vision. Rodney Hood has had good body language out there, but seems reluctant to shoot off dribble hand-offs and is second-guessing what he wants to do. The hustle and effort from Larry Nance Jr. is obvious, but he’s also a good bet to get into foul trouble. Plus, he’s had some struggles on an island against Pacer guards.

As for George Hill, the good news is the impact on the floor just based on his mere presence on both ends (game-high +16 on Wednesday), but he hasn’t really done any scoring and fouled out of Game 2.

Maybe these things change on the road, who knows. But those four, the rest of the rotation, absolutely have to step up in order for the Cavaliers to win this series and fend off this hungry Indiana group, which brings us to another point.

Let’s not forget, the offensive issues aren’t simply because of themselves. After all, the Cavs were a team that had little trouble scoring the basketball in the regular season, so give a ton of credit to the Pacers’ scheme and McMillan’s teachings to play hard-nosed.

Unlike many teams in the league, the strategy for them is to pressure the ball and avoid switches as much as possible on screens. The more they go over the pick and stick on their assignments, the better chance they have of forcing a bad shot or a turnover. That’s what happened in Game 1 and in the majority of the second half of Game 2.

Cleveland has also somewhat surprisingly brought the fight on defense as well. In the first two contests of the series, they’ve allowed under 100 points. Lue’s said multiple times that they’re willing to give up the interior buckets in order to secure the outside, and it’s worked. It doesn’t seem smart when there’s a yellow-colored layup line going on at times, but it certainly paid off by only allowing 34 percent of Indiana’s threes to go down.

Still, looking ahead to what the Cavaliers can do in the playoffs as a whole, it doesn’t bode well. They’re not only locked in a tug-of-war with Indiana, but if they get past them, they could have a Toronto Raptors group chomping at the bit for revenge.

If they’re having this much trouble in the first round, what should make us believe they can barrel through the Eastern Conference as they’ve done in the past?

It’s not quite as obvious or as bad as Cleveland’s 2007 version of James and the rest, but it feels eerily similar for as much as he’s put the team on his back so far. The organization better hope improvement comes fast from his supporting cast, or else it could be a longer summer than they’d hoped for.

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2017-18 NBA Report Card: Third-Year Players

Among the third-year players a few budding superstars have emerged, along with some role players who are helping their teams in the 2017-18 NBA Playoffs.

Mike Yaffe

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The 2015 NBA Draft has provided the league with a limited quantity of talent so far. After Terry Rozier (at 16th), it’s unlikely that anyone remaining has All-Star potential. Despite the lack of depth, the highest draft slot traded was at number 15, when the Atlanta Hawks moved down to enable the Washington Wizards to select Kelly Oubre Jr.

But placing a definitive “boom” or “bust” label on these athletes might be premature as the rookie contract is standardized at four seasons with an option for a fifth. If their employers are given a fourth year to decide whether a draftee is worth keeping, it seems reasonable to earmark the NBA Juniors’ progress for now and see how they’ve fared after next season’s campaign before making their letter grades official.

The Top Dogs

Karl-Anthony Towns, Minnesota Timberwolves: Given the dearth of premier choices and their glaring need up front, it’s hard to envision the T-Wolves drafting anyone but KAT if they had to do it again. Although his scoring average is down from last season (21.3 vs. 25.1 PPG), that trend could be explained by the addition of Jimmy Butler and the team’s deliberate pace (24th out of 30 teams).

To his credit, Towns had career highs in three-point percentage (42.1 percent) and free throws (85.8 percent), while finishing second overall in offensive rating (126.7). His continued improvement in these areas could explain why the Timberwolves ended their 14-year playoff drought.

Nikola Jokić, Denver Nuggets: Although he was a 2014 draft pick, Jokić’s NBA debut was delayed due to his last year of commitment to the Adriatic League. His productivity as a rookie was limited by both foul trouble and a logjam at the center position, but he still managed 10.0 PPG.

With Joffrey Lauvergne and Jusuf Nurkic off the depth chart, Jokić became the clear-cut starter this season and rewarded Denver’s confidence by averaging 18.5 points and 10.7 rebounds per game. And by chipping in 6.1 APG, he provides rare value as a center with triple-double potential.

Kristaps Porzingis, New York Knicks: Although he has never played a full season since joining the league, Porzingis has provided enough evidence that he can be a force when healthy. Before his junior campaign was derailed, the Latvian was enjoying career highs of 22.7 PPG and 39.5 percent shooting from behind the arc.

Unfortunately, the Knicks haven’t provided much support at point guard to help with Porzingis’ development. Trey Burke looked impressive down the stretch in Zinger’s absence, but that was in a score-first capacity. Meanwhile, both Frank Ntilikina and Emmanuel Mudiay have underwhelmed. On the plus side, Porzingis’ outside ability paired nicely in the frontcourt with Enes Kanter, who prefers to bully his way underneath.

Devin Booker, Phoenix Suns: Like Porzingis, Booker’s third year in the NBA was cut short by injuries, but that didn’t stop him from achieving career highs in points (24.9 per game), assists (4.7) and three-pointers (38.3 percent) on an otherwise moribund Suns team. Indeed, cracking the 40-point barrier three times in 54 contests was an achievement in and of itself.

While his short-term prospects would’ve been far better on a team like the Philadelphia Sixers (who might have taken him instead of Jahlil Okafor in a re-draft), Booker can still become a franchise cornerstone for the Suns if they are able to build around a young core that also includes T.J. Warren and Josh Jackson.

Solid Potential

Myles Turner, Indiana Pacers: Despite an inconsistent freshman season at Texas, Turner has become a stabilizing influence at center for the Pacers, whose blueprint consists of surrounding a go-to scorer with role players. While he hasn’t shown drastic improvement in any particular area, he has produced double-digit PPG averages all three years as a pro.

Although Turner’s shot-blocking ability fuels his reputation as a defensive maven, the reality is his 104.8 defensive rating (which is just OK) was skewed by his 110.9 d-rating in losses (it was 100.8 in wins). In order to merit consideration for the NBA’s all-defensive team, he will need to bridge the gap in this discrepancy and impact his team’s ability to win more games in the process.

D’Angelo Russell, Brooklyn Nets: Following their respective trades, Russell has fared better in the Big Apple than his 2015 lottery counterpart Emmanuel Mudiay, as the Los Angeles Lakers were forced to cut bait to draft Lonzo Ball. While Ball has shown promise as a rookie, the Lakers’ perception of Russell may have been premature, as the former Buckeye has stabilized a Nets backcourt that had been characterized more by athleticism than consistency.

Despite missing a significant stretch of mid-season games, Russell provided similar numbers for Brooklyn to that of his sophomore season; but without a pick until number 29 in the upcoming NBA Draft, the Nets will have to bank on improved production from DLo and his raw teammates to contend for the eight-seed in the East.

Terry Rozier, Boston Celtics: Injuries have paved the way for Rozier to showcase his talent, most recently with a 23-point, 8-assist effort in game two against the Milwaukee Bucks. But Rozier was already making headlines as a fill-in for Kyrie Irving whenever he was injured. Now that the starting point guard reins have been handed to the former mid-round pick, he has become one of the more pleasant surprises of the 2017-18 NBA season.

The biggest impediment to Rozier’s success might be the regression to limited playing time once Irving returns. While the Celtics could “sell high” and trade Rozier on the basis of his recent performances, they may opt to retain him as insurance while he is still cap-friendly.

Best of the Rest

Larry Nance Jr., Cleveland Cavaliers: Following the trade deadline, Nance has provided a spark for a Cavs frontcourt that has been bereft of viable options aside from Kevin Love.

Josh Richardson, Miami HEAT: A jack-of-all-trades at the small forward position, Richardson has evolved into a three-and-D player that has meshed well with the HEAT’s shut-down focus.

Willie Cauley-Stein, Sacramento Kings: Thrust into the starting center role after the trade of DeMarcus Cousins, WCS has provided serviceable (albeit unspectacular) play as the next man up.

Delon Wright, Toronto Raptors: A key contributor for the East’s top seed, Wright was instrumental in the Raptors’ game one victory over the Washington Wizards with 18 points off the bench.

Bobby Portis, Chicago Bulls: The former Razorback has flashed double-double potential, but playing time at his true position (power forward) has been limited by the emergence of rookie Lauri Markkanen.

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NBA Daily: Looking At The 2018 Draft Class By Tiers

The NBA Draft is a hard thing to predict, especially when it comes to draft order and individual team needs, Basketball Insiders publisher Steve Kyler takes a look at how this draft looks in tiers.

Steve Kyler

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Looking At The 2018 Draft In Tiers

While Mock Drafts are an easy way to look at how the NBA Draft might play out, what they do no do is give a sense of what a specific player might be as a player at the next level. With that in mind, we’re going to take a look at how some of the notable NBA draft prospects project.

It’s important to point out that situation and circumstance often impact how a player develops, even more so than almost any other variable.

So while the goal here is to give a sense of how some NBA teams and insiders see a draft prospect’s likely potential, it is by no means meant to suggest that a player can’t break out of his projection and become more or sometimes less than his he was thought to be.

Every draft class has examples of players projected to be one thing that turns out to be something else entirely, so these projections are not meant to be some kind of final empirical judgment or to imply a specific draft position, as each team may value prospects differently.

So, with that in mind, let’s look at the 2018 NBA Draft in Tiers.

The Potential Future All-Stars

DeAndre Ayton – Arizona – C – 7’0″ – 245 lbs – 20 yrs
Luka Doncic – Real Madrid – SG – 6’7″ – 218 lbs – 19 yrs
Michael Porter Jr – Missouri – SF/PF – 6’10” – 216 lbs – 20 yrs

Maybe Stars, But Likely High-Level Starters

Jaren Jackson Jr. – Michigan State – PF – 6’10” – 225 lbs – 19 yrs
Marvin Bagley III – Duke – PF – 6’11” – 220 lbs – 19 yrs
Wendell Carter – Duke – PF – 6’10” – 257 lbs – 19 yrs
Mohamed Bamba – Texas – C – 7’0″ – 216 lbs – 20 yrs
Collin Sexton – Alabama – PG – 6’2″ – 184 lbs – 19 yrs
Mikal Bridges – Villanova – SG/SF – 6’7″ – 210 lbs – 22 yrs
Robert Williams – Texas A&M – C – 6’9″ – 235 lbs – 21 yrs
Miles Bridges – Michigan State – SF/PF – 6’7″ – 230 lbs – 20 yrs
Dzanan Musa – Cedevita – SF – 6′ 9″ – 195 lbs – 19 yrs
Shai Gilgeous-Alexander – Kentucky – SG – 6′ 6″ – 181 lbs – 20 yrs
Trae Young – Oklahoma – PG – 6’2″ – 180 lbs – 20 yrs

Maybe Starters, But Surely Rotation Players

Kevin Knox – Kentucky – SF – 6’9″ – 206 lbs – 19 yrs
Troy Brown – Oregon – SG – 6’6″ – 210 lbs – 19 yrs
Khyri Thomas – Creighton – SG – 6′ 3″ – 210 lbs – 22 yrs
Zhaire Smith – Texas Tech – SG – 6′ 5″ – 195 lbs – 19 yrs
Rodions Kurucs – FC Barcelona B – SF – 6′ 9″ – 220 lbs – 20 yrs
Aaron Holiday – UCLA – PG – 6′ 1″ – 185 lbs – 22 yrs
Jacob Evans – Cincinnati – SF – 6′ 6″ – 210 lbs – 21 yrs
De’Anthony Melton – USC – PG – 6’4″ – 190 lbs – 20 yrs

The Swing For The Fence Prospects – AKA Boom-Or-Bust

Lonnie Walker – Miami – SG – 6’4″ – 206 lbs – 20 yrs
Mitchell Robinson – Chalmette HS – C – 7′ 0″ – 223 lbs – 20 yrs
Anfernee Simons – IMG Academy – SG – 6′ 5″ – 177 lbs – 19 yrs
Jontay Porter – Missouri – C – 6′ 11″ – 240 lbs – 19 yrs
Lindell Wigginton – Iowa State – PG – 6′ 2″ – 185 lbs – 20 yrs
Bruce Brown – Miami – SG – 6’5″ – 191 lbs – 22 yrs
Isaac Bonga – Skyliners (Germany) – SF/SG – 6’9″ – 203 lbs – 19 yrs
Hamidou Diallo – Kentucky – SG – 6’5″ – 197 lbs – 20 yrs

Players not listed are simply draft prospects that could be drafted, but don’t project clearly into any of these tiers.

If you are looking for a specific player, check out the Basketball Insiders Top 100 Prospects list, this listing is updated weekly.

More Twitter: Make sure you are following all of our guys on Twitter to ensure you are getting the very latest from our team: @stevekylerNBA, @LangGreene, @EricPincus, @joelbrigham, @TommyBeer, @MokeHamilton , @jblancartenba, @Ben_Dowsett, @SpinDavies, @BuddyGrizzard, @JamesB_NBA, @DennisChambers_, @mike_yaffe, @MattJohnNBA, and @Ben__Nadeau.

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