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Why second-round NBA draft picks might get paid more than first-rounders this year

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Jordan Mickey had high hopes for the 2015 NBA draft, but his agent warned him: If you fall outside the top half or so of the first round, you’re better off going in the second round. Teams picking high in the second round offer a better fit and more flexibility.

Mickey heard the message.

He just didn’t care.

“The recognition, guys want to say they were a first-round pick,” Mickey said. “That’s something I wanted.”

“I just felt that, the way I play, I deserve it.”

Mickey slipped out of the first round to the Celtics at No. 37. Like many players, he still carries a grudge for the teams that passed on him.

“It’ll probably be with me until I’m done playing the game,” Mickey said.

What separates Mickey from other second-rounders: He received one of the biggest perks usually afforded only to first-rounders  – a higher salary – despite going in the second round.

It’s the product a salary cap increasing higher than ever imagined when this Collective Bargaining Agreement was signed, and this summer’s projected $94 million cap will intensify the effect. Expect several 2016 second-round picks to make more than some of their first-round counterparts next season.

The system

First-round picks are bound by a salary scale negotiated by the league and union into the 2011 CBA. The scale is a set amount for each pick, increasing slightly each year. Teams can pay a player between 80% and 120% of his scale amount, and 120% is so common, it’s practically the set number.

Second-round picks are free to negotiate any contract. Teams must use cap space or an exception – e.g., mid-level or minimum-salary – to sign them.

So, with the salary cap skyrocketing, the proportions for first-round picks have become out of whack. In 2011, the first year of the CBA, the No. 1 pick earned 8.86% of the salary cap ($58,044,000). If the salary cap comes in as projected this year ($94 million), the No. 1 pick will earn 6.28% of the salary cap. That same effect is felt throughout the first round.

Meanwhile, second-round picks are free to partake in the newly available TV money.

There’s an unsaid – sometimes, said – tension behind every contract negotiation between teams and second-round picks. To retain a second-rounder’s rights, a team must extend him a required tender. A required tender is a one-year contract offer, and because that’s the only requirement, it’s always for the minimum and fully unguaranteed.

Teams want to sign players to longer contracts with little to no guaranteed money. That way, if the player pans out, he’s cheap and can’t go anywhere. If he doesn’t pan out, he can be waived for minimal cost.

Second-rounders have varying interests. Some want a long-term deal with more money guaranteed or scheduled if not released. Others want to hit free agency sooner, so they can bargain with all 30 teams rather than just the one that drafted him. For most, both desires apply. Receive enough over a long-term contract, and free agency becomes far less important. Face a cheap long-term deal, and the player can always threaten to sign the required tender.

K.J. McDaniels, the No. 32 in the 2014 draft, famously accepted the required tender rather than sign long-term with the 76ers. He then signed a three-year, $6,523,127 deal with the Rockets last summer. Despite getting just the minimum his first year, McDaniels has already made more than half of the players selected in the first round ahead of him. Next season, he’ll pass a few more in earnings. Plus, he’ll either become a free agent a second time before 2014 first-rounders do so once (if Houston declines his 2017-18 team option to make him restricted) or an unrestricted free agent before scaled 2014 first-rounders (if Houston exercises his team option).

McDaniels’ plan carried risk. If he got cut in his first training camp, he could’ve walked away with nothing.

Still, there’s already a school of thought that players are better off going early in the second round rather than late in the first, that the freedom to negotiate a shorter contract trumps the lower initial salary.

Now, second-round picks can probably have their cake and eat it too – a higher initial salary and more freedom.

Precedent runs deeper than Mickey

Mickey became the first second-round pick under this CBA to sign the year he was drafted and earn more his first year than a first-round pick.

Players that were stashed overseas had done it, but their stock changed from the time of the draft – either because they developed or were ready to jump to the NBA. We’re looking at only players to sign the year they were drafted.

Mickey actually made more than four first-round picks last season: No. 27 pick Larry Nance Jr., No. 28 pickR.J. Hunter (Mickey’s own Celtics teammate), No. 29 pickChris McCullough and No. 30 pickKevon Looney.

Put another way, Mickey received 1.67% of the 2015-16 cap. The No. 20 pick Thursday will receive 1.66% of the projected 2016-17 cap.

Based on that precedent, more than third of the first round could make less next season than a second rounder.

There are deeper ways to evaluate a second-rounder’s contract than first-year salary as a percentage of the salary cap. Future salaries, length, guarantees, options and incentives all matter. But for a quick reference, we’ll go by first-year salary as a percentage of the salary cap.

Several second-round picks under this CBA – Mickey, Richaun Holmes, Chandler Parsons, Draymond Green, Joseph Young, Montrezl Harrell, Allen Crabbe, Jerami Grant, Joe Harris, Roy Devyn Marble, Kyle O'Quinn Tyler Honeycutt and Damien Inglis – have signed the year they were drafted and received a first-year salary relatively higher than what at least one first-rounder projects to make this year.

Here’s everyone on the same scale, the highest paid second-rounders colored by year with 2016 first-round picks interspersed in black:

    • 2015: green
    • 2014: blue
    • 2013: silver
    • 2012: yellow
    • 2011: red

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Previous contracts inform future contracts. If numerous second-rounders previously received starting salaries greater than 1.20% of the cap, agents will demand similar amounts this year. Those amounts will just happen to be worth more than first-rounders can receive.

A couple related factors beyond simply a higher cap conspire to boost second-round salary even further this year:

1. Nearly every team will have cap space. Because teams don’t receive an exception for second-round picks, many teams just didn’t have the ability to pay a second-rounder more even if they wanted to. That will rarely be an excuse now.

2. Many players are locked into contracts signed before the new TV money kicked in. That leaves more money for everyone else.

Well, almost everyone else. The rookie scale prevents first-rounders from enjoying the windfall.

Meanwhile, second-rounders will cash in.

The No. 30 pick will make $1,171,560 next season if he signs in the NBA. How many second-round picks can say “Give me $1.2 million (or more), or I’ll sign the required tender” and have the team acquiesce? I’m betting on several. Plenty of teams will have that much money lying around without a place to spend it, maybe even needing to spend it to reach the floor. Securing their own second-rounders seem as good a use as any.

It’s too late to change the system for this year, but either side can opt out of the CBA after next season by giving notice by Dec. 15, 2016. The rookie scale should be revisited in the next agreement.

A simple solution: Tying the rookie scale, like the cap itself, to revenue rather than ascribing a prefixed amount. Owners avoid the hassle of draft confusion, and players get more money to the players that deserve it.

“There’s no question that the contracts, the salary scale for first first-round picks is outdated,” said agent Mark Bartelstein, who represented two first-round picks who made less than Mickey last year (Larry Nance Jr. and R.J. Hunter).

But what about in the meantime?

Prepare for second-round saga in ’16

The 2016 draft is already hectic with several players having wide draft ranges. The second-round issue only adds uncertainty.

Will agents try to steer their players from the first round to the second round?

“If you’re projected to be a low first-rounder, it would be absolute lunacy not to work out with teams in that range, because you can easily fall,” said agent Keith Kreiter, who represented Richaun Holmes, the second-highest-paid second-rounder last year. “If you don’t work out for teams in the lower first and they pass on you, and some teams in the 30s end up passing on you – there’s no guarantee they’ll take you – then you’re in the 40s and 50s and you could be running the risk of straight minimums with very little guaranteed.”

Though there’s more money to be made in the high second round, there might be big downside to falling further. For players on their first NBA contracts, playing it safe makes some sense.

“A first-round deal isn’t so terrible in this world,” Kreiter said.

But there’s still wiggle room to work the system.

“One of the things I could see happening is you have a wonderful workout for a team in the 30s, high 30s, a team says, ‘Would you be willing to shut it down, and we’ll take you?'” Kreiter said. “There are some people that would maybe take that risk, although it’s a huge risk.”

Until Thursday, the question is which players this affects. Then, with everyone selected, it’ll turn into the magnitude of the effect.

How many second-rounders get more favorable contracts than first-rounders? How much more favorable? Will second-round negotiations become more contentious with more at stake?

It could become chaos, and Mickey is the trendsetter.

“It’s always a great thing to be the first at something,” Mickey said. “Hopefully, other players can do it.”

I suspect plenty will.

Timberwolves working on (max?) extension for Andrew Wiggins

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Andrew Wiggins is eligible for a contract extension that projects to be worth $148 million over five years. The Timberwolves could even include a clause that increases Wiggins’ compensation up to a projected $153 if he makes an All-NBA team or wins Defensive Player of the Year next season.

Jerry Zgoda of the StarTribune:

The Wolves have until October to complete a negotiation that shouldn’t take all that much negotiating if Wiggins accepts a contract that’s expected to approach $150 million.

Timberwolves president/coach Tom Thibodeau appears to be talking just generally about an extension. Zgoda brings up a max offer. It’s unclear whether Zgoda is reporting or supposing Minnesota has offered/plans to offer that much.

I’d hesitate to offer Wiggins the full max.

He’s a high-volume scorer with below-average efficiency (carrying enough of a load where that tradeoff is helpful). But his rebounding and defense lag WAY behind where his athleticism suggests those skills should be. For someone who dominated the ball, he’s not much of a distributor.

On the other hand, Wiggins is just 22 and possesses the physical tools to grow into a complete player. It’s reasonable to bet on him getting there, and an extension should be based on what Wiggins will do in future seasons, not what he has done already.

Plus, a max salary is the only allowable rate for a five-year extension. Offer any less, and the Timberwolves would be limited to a four-year extension. Do they really want to face his unrestricted free agency – in the midst of his prime – a year sooner.

It’s not as if they’d lose him now by forgoing an extension, though. Wiggins would be a restricted free agent next summer, and Minnesota could always extend a maximum qualifying offer, which would mean any offer sheet must be for three or four years (not including option years). The Timberwolves would also have a five-year max contract on the table (which would carry the same terms as a five-year max extension signed this offseason). Wiggins could accepted the $9,846,619 one-year qualifying offer and become an unrestricted free agent in 2019, but that would be an unprecedented risk with so much money on the table.

Minnesota can all but guarantee locking him up for the next four seasons (including the final year of his rookie-scale contract this year). A max extension would secure him for the five (six if it doesn’t include a player option).

Ultimately, I’d lean toward offering Wiggins less than a max extension. It’s a tight market with the salary-cap stagnating in coming years, and a max offer sheet might not be available to him in restricted free agency. The Timberwolves could evaluate him another season and offer Wiggins the max next summer if he deserves it. If Wiggins wants security now, he can take a slight discount. That might come with complications down the road, but so would overpaying a one-dimensional player. A five-year max extension wouldn’t be terrible – if Minnesota doesn’t grant a player or early termination option.

By the way, don’t worry about another Kevin LoveRicky Rubio situation. The new Collective Bargaining Agreement allows teams to sign two designated-player rookie-scale extensions, so the Timberwolves could still offer Karl-Anthony Towns (who more clearly deserves it) one after giving Wiggins one.

Celtics add toughness with Aron Baynes and Marcus Morris

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WALTHAM, Mass. (AP) Aron Baynes and Marcus Morris are happy to be coming to Boston at the same time, if only so they don’t have to play against each other.

Baynes signed with the Celtics as a free agent on Wednesday, and he already has a familiar face in the team’s locker room: Morris, who was acquired in a trade for Avery Bradley on July 7. Baynes said Morris “brings a lot of toughness” to the court, and Celtics assistant general manager Mike Zarren said the 6-foot-10 Australian can do the same.

“Red Auerbach said, `Get the instigators, not the retaliators,”‘ Zarren said before introducing Baynes to the media. “He’s definitely an instigator.”

The two former Pistons shared the day, with the Celtics announcing Baynes’ signing an hour before a media call with Morris. Bradley, the longest-tenured member of the team and the only remnant from the New Big Three era, needed to go to clear the salary cap space for prize free agent catch Gordon Hayward.

Baynes and Morris join a team that earned the No. 1 seed in the East last season but lost to the Cleveland Cavaliers in the conference finals in five games. Baynes, who averaged 15.5 minutes last season for a team that missed the playoffs, said coming to Boston was “a basketball decision.”

“Hopefully, I’m a piece that helps them bring the puzzle together,” he said. “You always want to be able to play more. I didn’t see myself having much bigger a role than I’ve had the past two years.”

An undrafted free agent who won an NBA title with the Spurs in 2014, Baynes averaged 5.2 points and 4.1 rebounds in his five-year career. He played in 75 games last year for the Pistons, starting two, averaging 4.9 points and 4.4 rebounds.

After working out at the team’s facility in the morning, Baynes came out to greet children at a basketball camp taking place on the practice court. A noted BBQ enthusiast who tweeted out a request for recommendations in the area, Baynes said he hadn’t tried the local offerings yet.

“There’s a few lobster rolls around here,” he said.

Morris averaged 14 points last season in Detroit, where he was a mainstay in the starting lineup. He saw the Celtics up close while watching his twin brother, Markieff, play for the Wizards in a seven-game Eastern Conference semifinal series against Boston last year.

Morris said coming to Boston cushioned the blow of being traded.

“How can I be upset about being a Boston Celtic?” he said. “At the end of the day, I’m a competitor. I want to play against the best. I want to play for championships.”

Morris said he reached out to longtime Celtics star Paul Pierce after learning he was traded.

“He said I’m going to love it,” said Morris, who like Pierce went to Kansas. “That’s all I needed to hear.”

More AP NBA: https://apnews.com/tag/NBAbasketball

Adam Silver on sports gambling: “My sense is the law will change in the next few years”

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This isn’t new ground for NBA Commissioner Adam Silver. He has called legalized sports gambling in the United States “inevitable” and advocated in the New York Times for the federal government to put in a framework to control it. He’s not been shy about telling the heads of the other major sports leagues what he sees coming. Mark Cuban has Silver’s back on this one.

The commissioners of the four major sports were all on hand for a panel called “GameChangers: Creating the Future of Sports” in New York on Wednesday, and Silver’s position hasn’t changed, reports ESPN.

“My sense is the law will change in the next few years in the United States,” Silver said when asked about gambling.

He also stressed the importance of in-game wagering to fan engagement, noting, “People want to bet throughout the game … It results in enormous additional engagement with the fans.”

I’m not sure about “the next few years” timeline. I would rather be forced to watch The Emoji Movie than try to predict what the current Congress will do, but with its current conservative makeup legalizing sports betting seems unlikely.

But in the next decade or two… it feels like Silver may be right. The Supreme Court is taking up the case of whether the federal government can block states — in this case, New Jersey specifically — from allowing sports gambling. That could open the door for other states to follow.  Governments state and federal will not see it as a moral issue so much as a new revenue generator — they can tax it. So it will happen. Eventually.

With that Silver is right, professional sports leagues need to be prepared for that reality. The NBA seems to be out in front of that, ready to ride the wave when it crests. For now, they are just paddling around waiting for the right wave to ride.

Wizards’ owner Ted Leonsis: “My prediction is John Wall will sign his extension”

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John Wall is one of the handful of NBA players who qualifies for the new designated veteran “super max” contract extension — and the Wizards want to give it to him. A four-year, $170 million extension of his current deal is on the table (it would kick in after the two years, $37 million on his current contract).

Wall has yet to sign it. He said at the time it was offered he wanted to talk about it with his family and see what the Wizards did this offseason. He’s not unhappy, he just wants to be sure before he locks himself in with Washington through his prime.

Washington owner Ted Leonsis told Candace Buckner of the Washington Post he thinks Wall will sign.

Maybe, but there’s not a lot of motivation for Wall to sign right now. Wall can bet on himself that he will make the All-NBA team again next year — there’s a deep class of guards but if he stays healthy he stands a good chance — at which time he’s still eligible for a designated veteran “super max” contract extension that would be five-years, roughly $200 million (and would kick in after the one year on his current deal).

That delay would also keep pressure on the Wizards to find ways to improve the roster. Washington is largely capped out and didn’t make any major moves this summer other than re-signing Otto Porter to a max extension (they matched a Brooklyn offer sheet). Washington is good, likely the third or fourth best team in the East, but a notch below Cleveland and Boston right now. Wall wants to push them to get another star and help Washington move up into contender status — he pushed for the Wizards to chase Paul George and have him replace Porter (a deal that was never going to happen, but you can see what Wall is thinking about being one star player short).

Ultimately, I think Leonsis is right, Wall will sign. It’s just a matter of when. Does he take this deal now, or wait until next summer and do it?