The CBA and the Potential Impacts on the Toronto Raptors


By all accounts the NBA players association, or what WAS the NBAPA, won't accept the terms of the last offer the owners put forth during recent negotiations.

But if they did for some reason?

Dhackett is back to look at how that would impact the Dinos...

Several days ago, the NBAPA disclaimed interest in what was the owners' apparent final proposal regarding an updated CBA, and everything went down the toilet.

But there is a chance (however slim) that the two parties will come to an agreement before the season is completely gone, and there's a good chance that if that happens soon, the agreement would be very closely based on the most recent owners' offer.

So I thought I'd take a look at what the Toronto Raptors' roster would look like, in terms of salary, under the paradigm of that offer.

Here is a summary of my breakdown of this years' salaries that I put together in detail over at RaptorsForum.  Check the thread there for some clarifications on the various cap holds:  11-2012 Salaries: 

Jose Calderon $9,780,991

Andrea Bargnani $9,250,000

Leandro Barbosa $7,600,000

Amir Johnson $5,500,000

Linas Kleiza $4,605,000

DeMar Derozan $2,625,000

Jerryd Bayless $3,042,280

Ed Davis $2,063,040

James Johnson $1,833,120

Solomon Alabi $830,000

Jonas Valanciunas: $2,543,947 (cap hold - 2005 CBA rookie scale adjusted to 50% BRI)

Roster slot cap hold (slot 11): $490,180

Roster slot cap hold (slot 12): $490,180

Total: $50,653,738

Salary Cap: $58 million

Tax Threshold: $70 million

 

Cap Holds: (can be waived)

 

Chris Bosh TPE: $9,025,560 (until some undefined date)

Reggie Evans: $10,160,000

Julian Wright: $8,574,171 (point of reference - JW's QO amount is $3,952,653)

Alexis Ajinca: $2,263,409

Sonny Weems: $1,091,100 (QO - $884,293 if QO revoked)

Joey Dorsey: $884,293 (no QO extended)

Rasho Nesterovic: $2,388,000

Pape Sow: $884,293

Patrick O'Bryant: $884,293

Uros Slokar: $788,872

Now, the latest proposal had several important changes to it compared to the 2005 CBA.

1) A new luxury tax system.  The luxury tax moved from a dollar-for-dollar tax to a tiered system: $1.50 per dollar for the first 5 million over the tax, $1.75 for the second, $2.50 for the third, and $3.25 for the fourth.  Every $5 million increment after that is another $0.50 per dollar above the previous tier.  The luxury tax will be at $70 million for the first two seasons of the deal, and at 53.5% of BRI thereafter.

2) New minimum salary.  The minimum salary will move up to 85% of the cap in the first two years of the deal, and 90% from the third year on.  Cap will be $58 million in first two years of deal, and set at 44.7% of BRI thereafter.

3) Amnesty clause.  Any contract that already exists can be waived and removed completely from the team cap calculation.  The salary will still be paid in full to the player, and count against BRI sharing calculations.

4) Stretch clause.  Any contract signed under the new CBA can be waived and have the resultant cap hit applied over twice the length of the contract for half the per year cap hit.

5) Severe limits on tax teams, including no sign and trades, a limited MLE, and no Bi-Annual Exception.

There are many more items, but those are the big ones.

Now, the way this impacts the Raptors is questionable - it really depends on what the team does with that amnesty, and what the team wants to do with its cap space.

First, as seen above, the Raps have about $50.6 million on the books right now in contracts and cap holds.  Without the mandatory cap holds, the team is closer to $47.1 million in committed salaries.  This number has two impacts - the cap impact and the tax impact. Tax-wise, the team is well clear, and that won't be a concern until a few years from now at least.  The cap is a more interesting question.

The new minimum salary will be 85% of $58 million, which is $49.3 million.  As you can see above, the team needs to sign 3 more players to fill its roster to the minimum 13 spots, and needs to spend at least $2.2 million doing so to reach the team minimum.  The penalties for not paying the team minimum in the last CBA were not clear - at the very least the team would pay the difference between their salary and the cap minimum to the players, but further penalties may exist as well.

The new cap level is the same as the old, so the Raptors have about $7.4 million in cap space if they waive all of their non-mandatory cap holds.  Or, alternatively, if they hold onto all their cap holds, and only the Bosh TPE expires, their cap hit is closer to $78.9 million.  This is not the team's actual salary, so it won't affect their tax calculation, but it does put the team over the cap, meaning they could use exceptions to resign players if that would give them more effective cap room.  But I think in the Raps' case it is a toss-up, and going the 'cap room' route also allows them to spend all that cap room on one player, rather than living within the limits of the MLE and BAE.

So here are a few scenarios to better examine the team's situation.

1) Colangelo decides to keep the cap room.

Let's say there are no free agents this offseason that Colangelo wants to go after.  In that case, all he needs to do is go after 3 minimum contract guys and offer them $2.2 million combined, bringing the team salary up to the minimum.

In this case, no one would be waived this year with the amnesty clause.  The amnesty could still be used at a later date on the same players it could be used on now, so you don't lose that option, and you stay within a stone's throw of the minimum salary.  So in this case the team would probably sign those minimum salary guys to one year contracts, wait until next offseason for Barbosa to expire, and waive Jose's salary at that point (or someone else's) to clear huge cap room for the summer of 2012 - which seems to be almost as good a market as 2010.  We'll look at the 2012 salary numbers below.

2) The team goes hunting - no amnesty use.

In this case, the team decides to add a free agent or get a high paid player through trades.  In this case there are a couple options.  The team could just use the $7 million in cap space to absorb salary in a trade, or sign a player (they would have closer to $7.9 million to sign a FA). 

With $7.9 million in free agent space, the team wouldn't be able to target players like Chandler, Nene, DeAndre Jordan, or Marc Gasol, and even young risky wings like Thad Young or Wilson Chandler will need big offers to pry them away in restricted free agency. 

The team may be able to look at players like Arron Afflalo, Grant Hill, maybe Shane Battier or even Caron Butler at a stretch, or cheaper options like Ronnie Price, CDR, or maybe Kelenna Azubuike.

Of course, trades could bring any variety of players here, and $7.4 million isn't bad for a buffer if you need to absorb some salary to make it work.  There are so many options here I can't even begin to list them.

3) The team goes hunting - amnesty.

If the team wanted to target a big free agent like I listed above, or take a shot at one of the big names that are rumoured to be traded, say Chris Paul or Dwight Howard, then the team will likely need more than $7.9 million in cap space.  And there is only one mechanism to get it right away - the amnesty clause. 

So who gets amnestied?  Franchise had a post covering this a while back, so let's go over his suggestions and which make sense here.  Keep in mind that the team will still have to pay the full value of the contract, it just doesn't count against the cap.

- Linas Kleiza: $4.6 million off the books this year, giving the team $12 million in useable cap space (12.5 million minus the cap hold associated with having to fill another spot on the roster).  Removes 4.6 million from the cap for the next two seasons as well.  Leaves the team with only James Johnson at SF.

- Jose Calderon: $9.781 million off the books this year, giving the team $17.2 million in cap space this year.  Clears another 10.6 million of the books in 2012 as well.  Leaves the team with only Bayless at PG.

- Leandro Barbosa: $7.6 million off the books this year, giving the team $15 million in cap space.  No additional cap space in future years.  Leaves the team with only DeRozan at SG.

- Amir Johnson: $5.5 million off the books this year, giving the team $12.9 million in cap space.  Saves $6M, $6.5M, and $7M in cap space in the next three years.  Leaves the team with Ed Davis and Andrea Bargnani at PF.

- Andrea Bargnani: $9.25 million off the books this year, giving the team $16.7 million in cap space.  Saves $10M, $10.75M, and $11.5M in the next 3 seasons as well.  Leaves the team with Ed davis and Amir Johnson at PF, and Solomon Alabi at C.

Kleiza seems like the best option right now if you wanted to free up $10M+ to throw at a solid young C or wing this offseason, and there's no knowing what contribution he would make on the court or if he could net the team anything at all in a trade.

There seems to me to be no reason to clear more cap space than that this year, so I would do that and keep everyone else, if the amnesty is going to be used this year.  Everyone else might have some trade value, especially the expiring and soon-to-be expiring contracts of Barbosa and Calderon.  The trade market for Bargnani has to be explored, and Amir Johnson is a keeper.

If the amnesty is used next year... well that's a different question altogether.

---

So, if Colangelo pursues option 1, here's what our situation will be like next summer.

2012-2013 Salaries:

Jose Calderon $10,561,982

Andrea Bargnani $10,000,000

Amir Johnson $6,000,000

Linas Kleiza $4,600,000

DeMar DeRozan $3,344,250 (TO)

Jonas Valanciunas: $2,543,947

Ed Davis $2,207,040 (TO)

James Johnson $2,812,006 (TO)

Solomon Alabi $890,000 (TO)

2012 First Round Pick: $2,632,985 (cap hold)

Roster slot cap hold (slot 12): $490,180

Roster slot cap hold (slot 13): $490,180

 

Jerryd Bayless $4,164,882 (QO)

Total including Bayless: $50,653,738

So, if we assume all the team options get picked up, and we extend a QO to Bayless, and any free agents we are able to sign in 2011 are limited to one-year deals, we would be looking at 7.3 million in cap space.  Seem familiar?

However, consider the amnesty options now - if you really wanted to clear cap space, it would be really easy.  Amnesty Bargnani and don't bring back Bayless - that gives you 21.5 million in cap space.  Enough for a maximum salary and a 7 million dollar player, while still having DeRozan, Ed Davis, Jose, Amir, JJ, Val, and the first rounder from that year to lure a big free agent here.  Or you waive Jose instead if you think you have a shot at Chris Paul in free agency.  Of course, you could just waive Kleiza and keep Bayless, giving you about $12 million to play with.

Here are the top free agents available that summer:

- Dwight Howard (Early termination option)

- Chris Paul (Player option)

- Deron Williams (PO)

- Steve Nash

- Andrew Bynum (Team option)

- Gerald Wallace (PO)

- Tim Duncan

- Kevin Garnett

- Ray Allen

And in terms of restricted free agents:

- Derrick Rose

- Russell Westbrook

- Nicolas Batum

- Roy Hibbert

- JJ Hickson

- Eric Gordon

- OJ Mayo

- Kevin Love

- Javale McGee

- George Hill

- Courtney Lee

- Landry Fields

- Danilo Gallinari

- Rudy Fernandez

- DJ Augustin

- Omer Asik

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