Tag: Basketball Related Income

NBPA Meet To Discuss Current CBA Offer

Billy Hunter outlines labor deal, steps remaining in memo

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You have questions… but mostly they revolve around finding a way for your favorite team to trade for Dwight Howard or maybe Rajon Rondo.

NBA players have questions about the new NBA Collective Bargaining Agreement, too. Theirs mostly revolve around, “When can we get back to work and get paid? And how much are we going to get paid?”

Billy Hunter tried to explain both the deal and the process to the players in a memo obtained by Sam Amick of Sports Illustrated.

As for the timing, first the players have to vote to reform the union (remember the union formally dissolved to make way for the antitrust lawsuits against the league). That process should have started Tuesday, Hunter says in the memo. Once that happens the details of the CBA will be hammered out between the two sides.

Hunter says the players will get to vote on the new CBA next week. With training camps and free agency set to open next Thursday, you can bet that gets done early in the week.

Then Hunter gets around to explaining the money.

Over the course of the 10-year agreement, collective player salaries and benefits will increase from $2.17 billion in 2010-11 to more than $3 billion by the end of the deal. If revenues exceed modest growth, we expect that collective player salaries will likely grow to over $3.5 billion. The average player salary will approach $8 million by the end of the deal.

Although players will not receive 57% of BRI as under the 2005 CBA, collective player salaries should experience the same annual salary growth as the last deal.… Nonetheless, thanks to the enormous success projected for the NBA, league revenues should grow so high that our collective annual salary increases will favorably compare to the increases we received under the 2005 CBA. On average, under the last deal, the players received annual collective salary increases of $70 million per season. Under the new agreement… the players will receive collective annual increases averaging at least $85 million each year over the term of the 10-year agreement. Beginning in 2012-13, we expect that collective salaries will increase by more than $100 million per season.

Hunter goes on to explain the challenges of the increased luxury tax but how they were able to maintain some flexibility for teams to spend who are paying the tax. The goal was to allow more player movement despite the tax, he said.

Go read the deal. Not all the players will like it and the memo is certainly Hunter selling it to his constituents. But at the end of the day they are not going to get a better offer and it’s not worth losing more pay to fight over the scraps.

Great, we have a handshake deal. So now what happens?

NBA Labor Basketball

David Stern and Billy Hunter shook hands. Figuratively, but there is a handshake deal in place for an NBA labor settlement. The framework for a full blown new NBA collective bargaining agreement is in place.

But that is a long way from an actual signed deal and NBA games starting on Christmas Day.

So, what happens next?

First, the negotiations never stop. Stern and Hunter may get to sleep in for a day but the attorneys for the two sides will be meeting long hours over the next week to 10 days to hammer out the “B-List” issues. Those are things like the draft age, the drug testing program, who can be assigned to the D-League and a host of other issues that need to be resolved. The two sides don’t always agree on those things, but none are deal breakers. They horse-trade these items for a while.

Meanwhile, the players will ask to have their anti-trust lawsuit in Minnesota dismissed and the owners will ask to have their preemptive lawsuit in New York on decertification issues dismissed as well.

Not long after, the NBA players union will be reformed. Just as it was before. As if nothing had happened.

Eventually the deal will be finalized and put to separate votes of the players and the owners. In both cases the vote will not be unanimous, there are hardliners on both sides that think their side gave up too much. But in both cases a majority want games and can live with this deal, and barring some dramatic turn it will pass.

Right after that, team facilities will re-open to players and coaches can contact their charges and start talking about the season.

Then training camps will open on Dec. 9, the same day that maybe the most wild and frenzied free agency period in NBA history will open. The talent on the market this year is not what it was in years past, but teams will move fast to get their free agents in place and into camp working with their new teammates.

Then on Christmas Day — tip off.

And while this season promises to be a roller coaster, it will be much more fun than the ups and downs of the lockout.

What was finally decided with those “thorny” system issues?

NBPA Meet To Discuss Current CBA Offer
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It was the most confounding part of this constantly confounding NBA lockout.

The owners and players got to a point a few weeks ago where they essentially agreed on the money side of the equation — how to split up the revenue coming into the league — but could not get close on the “system” issues that essentially came down to player movement concerns (the mid-level exception, Bird rights, the sign and trade rules, etc…).

Sometime early Saturday morning in New York — in the hours when the city that never sleeps even starts to close its eyes — they two sides reached a deal that will mean games on Christmas day and a 66 game season.

Where did those system issues land? Here is what we based on multiple reports.

• Next year the salary cap line will be at $58 million and the luxury tax line will be about $70 million, both where they were last season. One key difference is teams have to spend up to 85 percent of that salary cap line now, which means the minimum salary level for teams next season will be $49 million (last season it was more like $44 million). Also, the luxury tax on teams that exceed that tax line will be more stiff (it had been $1 for $1 over the line, now it will start at $1.50 for each $1 and escalate from there).

• Teams can only have one max-salary player that takes up to 30 percent of a team’s salary cap space.

• Larry Bird rights, the ability of a team to go over the salary cap or luxury tax line to re-sign their own players, remain essentially as it had been.

• Contract lengths are four years for free agents, but teams can add a fifth season for Bird rights players.

• Teams have only three days to match offers to restricted free agents, down from seven days in the old deal.

• The extend-and-trade remains, which means a team can sign a player to a Bird-rights size contract then instantly trade him — the stick that Carmelo Anthony used to force Denver to trade him last season without a financial loss for him.

Nobody is happier about that than Dwight Howard and Chris Paul, the current big free agents to be. Maybe Deron Williams too, but the Nets want to be buyers, not sellers.

• There will be a mid-level exception, reports Adrian Wojnarowski of Yahoo. Teams under the luxury tax can go for $5 million a season up to 4 years. For teams over the tax it is $3 million for up to 4 years.

• However, around the luxury tax line the mid-level will also impact Bird rights, reports Zach Lowe at Sports Illustrated reports:

If you use the full mid-level to get to or approach that barrier looming $4 million over the tax line, you cannot cross it by re-signing your own free agents via Larry Bird Rights. You can cross it to sign rookies or guys on veteran minimum contracts.

To use Lowe’s practical example, if the Boston Celtics used the mid-level to bring in someone like Jason Richardson to help on the wing that would take them over the tax line next season (to about $71 million total) and they would not be able to re-sign Jeff Green or Glen “Big Baby” Davis to anything more than minimum deals.

It means big spending teams will not just be able to take risks on free agent role players to go around their stars and not have consequences if it doesn’t work out (like the Lakers with Luke Walton, for example).

• There will be a $2.5 million exception for teams just below salary cap to go over the cap, reports Wojnarowski at Yahoo. However, those teams lose the right to the mid-level exception, too.

• There is no real change for the rookie deal or minimum salaries (which increase with years of service).

• There will be a “stretch” provision in the deal that allows a team to buy out a player and waive him, but spread his deal over a longer period of time (double the length of the contract plus one year) so as not to be such a cap hit. For example, if a player has three years, $30 million left on a deal and the teams want to waive him, they would have him on the official books for seven seasons at $4.3 million. It will look weird to see a guy on the books who was let go years before, but that space allows the team to not be completely hamstrung by a bad deal.

Call it the Eddy Curry rule.

• There also will be an amnesty clause in this deal that will allow teams to waive one player and wipe that salary almost totally off the books (75 percent goes away). This is similar to what was done in 2005, although then it only counted as savings against the luxury tax, now it counts as savings against the cap as well.

The Orlando Magic will have to choose between Gilbert Arenas or Hedo Turkoglu for this one. Tough decision.