Salary-cap gymnastics behind the Heat’s pursuit of Carmelo Anthony

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The NBA just ratified a new Collective Bargaining Agreement that, among other things, limits a team’s ability to acquire multiple highly paid stars.

Yet, the Heat might chase Carmelo Anthony to join LeBron James, Dwyane Wade and Chris Bosh in Miami.

How can that happen?

There infinite ways the Heat could make room for Melo, but let’s examine a few baseline scenarios. Let’s begin with Miami’s starting position.

Heat’s current 2014-15 situation

Miami has seven players who might be under contract for next season: LeBron, Wade, Bosh, Udonis Haslem, Chris Andersen, Norris Cole and Justin Hamilton.

LeBron ($20,590,000), Bosh ($20,590,000) and Wade ($20,164,000) have early termination options, which are functionally similar to player options. Haslem ($4,620,000) and Andersen ($1,448,490) have player options. Cole’s salary ($2,038,206) is fully guaranteed, and Hamilton’s ($816,482) is fully unguaranteed. The Heat also have two draft picks – Nos. 26 and No. 55.

Hamilton is good as gone. Miami could easily dump Cole and its first-round pick, which comes with a guaranteed salary, without taking back salary. If Andersen and Haslem opt in, I believe the Heat could also trade them without returning salary – perhaps attaching the first-round pick to Haslem as a sweetener if necessary.

Free agents continue to count against the cap, but other than LeBron, Bosh and Wade – who would terminate their contracts in almost any plan –  Miami could easily renounce everyone else.

Essentially, if required to sign Melo, I believe the Heat could fairly easily pare their roster to just LeBron, Wade and Bosh.

There might be some emotional attachment to casting off Haslem and even Andersen and Cole. But remember, Pat Riley practically gave away Michael Beasley in 2010, just two years removed from Miami drafting Beasley No. 2 overall and one year from him making the All-Rookie team, in order to pursue LeBron and Bosh. I think Riley would overcome any internal dilemma based on nostalgia if it meant getting Melo.

So, the rest of this post will suppose the Heat clear their roster to just LeBron, Wade and Bosh.  It also uses the latest projected salary cap, $63.2 million with a $77 million luxury tax, for 2014-15 and predicts the cap will continuously rise by the same amount it’s projected to increase this year.

How much money would everyone sacrifice?

Once Miami’s roster is down to just LeBron, Wade and Bosh – all of whom terminated their contracts in this scenario – cap holds will leave the Heat over the cap. LeBron, Wade and Bosh would each count at 150 percent of their previous salary, and Miami would have nine roster charges (equal to the rookie minimum salary) to reach the minimum roster of 12.

Once LeBron, Wade and Bosh re-sign, though, their 2014-15 salaries would replace their free agent amounts. Then Miami could use its remaining cap room to sign Melo.

Under that scenario – if everyone wants to get paid the same amount, which we’ll call the equality plan – each of the now-big four would make $14,658,494 in 2014-15.

If LeBron, Wade and Bosh re-sign first, they could get higher raises (7.5 percent vs. 4.5 percent) and longer contracts (five years vs. four years) than Melo, so maybe Miami’s original big three would take lower starting salaries and arrange to be on par with Melo over the long run. But for now, we’ll focus on matching salaries only next season.

Of course, $14,658,494 is much less than any of the four could make next season.

Here’s:

  • Max for Melo – both if he stayed with the Knicks or left – and his salary in the equality plan (gold)
  • Max for each  LeBron, Wade and Bosh – they have the same possible max – and their salary in the equality plan (red)

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Melo 2015 2016 2017 2018 2019 Total
Max if re-signs $22,458,402 $24,142,782 $25,827,162 $27,511,542 $29,195,922 $129,135,810
Max if signs elsewhere $22,458,402 $23,469,030 $24,479,658 $25,490,286   $95,897,375
Equality plan $14,658,494 $15,318,126 $15,977,758 $16,637,391   $62,591,769

 

LeBron, Wade, Bosh 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Total
Max if
re-sign
$20,659,633 $22,209,105 $23,758,578 $25,308,050 $26,857,523   $98,133,256
Equality plan $14,658,494 $15,757,881 $16,857,268 $17,956,655 $19,056,042   $69,627,847

Melo would be forgoing about $67 million over his max with the Knicks or $33 million over his max elsewhere. LeBron, Wade and Bosh would each be surrendering about $29 million.

For the Heat, this would be a huge bargain. The salary cap would restrict their ability to sign all four players – and there’s nothing Micky Arison could do about it. Essentially, the rules prevent him from spending, so if LeBron, Wade and Bosh want to pursue this plan, they would have no standing to even negotiate for higher collective salaries.

Miami would then have the room mid-level exception ($2,732,000) and minimum contracts to fill its roster. By design, it’s difficult for teams to add salary quickly once they’ve gone under the salary cap.

The luxury tax would be no concern at all.

For a year.

LeBron, Wade and Bosh can get paid again soon

If LeBron, Wade and Bosh re-sign, Miami would retain their bird rights. A key facet of bird rights: A team can go over the cap to re-sign players with the.

However, because free agents continue to count against the cap until signing, teams have a very limited ability to sign outside free agents and then exceed the cap to re-sign their own free agents. Hence, LeBron, Wade and Bosh would have to cut their salaries to make room for Melo this offseason.

But they wouldn’t need to make room for Melo next offseason.

LeBron, Wade and/or Bosh could sign a one-year deal – rather than a five-year deal – with the same starting salary as the equality plan. Then, next offseason, they could re-sign for max contracts – and significant raises.

Realistically, they would sign a two-year contract with a player option. That way, they could still become free agents in 2015 but would have an extra year of salary protection in case they determine their stock had fallen. (Options can only occur in the final year of a contract, so any deal longer than two years would delay getting a new max contract.)

The Heat would not hold Melo’s bird rights for three years, so he couldn’t take advantage of this plan until 2017. He’d likely receive a four-year contract with a player option regardless.

Here’s:

  • Annual salaries for each LeBron, Wade and Bosh in the equality plan and if they opt out as quickly as possible to re-sign for the max (red)
  • Annual salaries for Melo in the equality plan and if he opts out as quickly as possible to re-sign for the max (gold)

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Melo 2014-15 2015-16 2016-17 2017-18 2018-19 Total
Max if re-signs $22,458,402 $24,142,782 $25,827,162 $27,511,542 $29,195,922 $129,135,810
Max if signs elsewhere $22,458,402 $23,469,030 $24,479,658 $25,490,286   $95,897,375
Equality plan $14,658,494 $15,318,126 $15,977,758 $16,637,391   $62,591,769
Equality plan with early opt out $14,658,494 $15,318,126 $15,977,758 $25,093,282 $71,047,660

 

LeBron, Wade, Bosh 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Total
Max if
re-sign
$20,659,633 $22,209,105 $23,758,578 $25,308,050 $26,857,523   $98,133,256
Equality plan $14,658,494 $15,757,881 $16,857,268 $17,956,655 $19,056,042   $69,627,847
Equality plan with early opt out $14,658,494 $22,137,516 $23,797,830 $25,458,143 $27,118,457 $28,778,771 $127,290,716

New contract from one signed in 2014 is italicized

Projecting the 2017-18 salary cap – and therefore Melo’s max as a free agent in 2018 – is so difficult this far ahead, I didn’t even bother with how a multi-year max contract signed then would play out over its duration.

In the same vein, though far less turbulent of an estimate, LeBron, Wade and Bosh would be relying on the salary cap making another large jump 2015-16. I think that’s quite possible, but there is risk.

There’s also risk in accepting a one-year or even two-year deal with a player option. If a player gets hurt or struggles for other reasons, he might make less than had he just accepted a five-year guaranteed contract. Remember, I’m examining max salaries under these scenarios. Players aren’t guaranteed the max.

But if this worked, LeBron, Wade and Bosh could sacrifice about $6 million each in 2014-15 and then make similar salaries in coming years to the max possible had they signed this offseason.

Melo would sacrifice about $24 million over the next four seasons. So, if they plan to opt out in a year, it would make even more sense for LeBron, Wade and Bosh to accept lower starting salaries than Melo.

If LeBron, Wade and/or Bosh opt out next summer to seek bigger contracts, that could make this pursuit much more expensive for Arison. Would he go for it?

What about a plan that gets expensive for the Heat owner immediately?

Signing-and-trading for Melo

Miami could also acquire Melo in a sign-and-trade. That would make the apron – $4 million above the luxury-tax line – rather than the salary cap the key threshold. With a project cap of $63.2 million and luxury tax of $77 million, that’s a lot of extra wiggle room – and money to pay a big four.

In a sign-and-trade route, if they each want the same starting salary, LeBron, Wade, Bosh and Melo could each make $18,190,703 in 2014-15. That’s a significant jump from the $14,658,494 they could each make by signing Melo through cap space (especially because raises in future seasons are based on initial salary).

If the big four collectively maximizes its salary in a sign-and-trade scenario, there would be a host of complications. The Heat would have no room to sign anyone other than nine minimum-salary players and couldn’t add any salary in a trade for a year.

Of course, completing a sign-and-trade for Melo alone would be complicated. Miami, New York and several players would have to agree – making this a big longshot.

Essentially, the Heat would have to sign-and-trade their own free agents – other than LeBron, Wade and Bosh, of course – to the Knicks.

All players signed-and-trade must receive three-year contracts, but only the first year must be guaranteed. Fortunately for the Knicks if they want to go this route, they won’t have cap room this offseason anyway, even if they lose Melo. So, taking a guaranteed year of salary should be no problem. The Heat can structure all their outgoing contracts so they’re fully unguaranteed for 2015-16 and 2016-17, allowing New York to waive them and maximize its 2015 cap room.

But Miami can’t just re-sign one free agent to a salary equal to Melo’s and send him to New York. Anyone in a sign-and-trade whose salary increases by more than 20 percent brings up base-year-compensation issues and probably requires a third team to make the deal work.

However, the Heat might have enough free agents to complete a sign-and-trade on their own. (Even if renounced, a team can sign-and-trade its own free agents.) If Miami signs-and-trades Mario Chalmers, Shane Battier, Toney Douglas, James Jones, Michael Beasley and Greg Oden on contracts equal to 120 percent of their 2013-14 salaries, that would be enough to acquire Melo with a 2014-15 salary of $18,190,703 – his equality-plan number in a sign-and-trade scenario.

Of course, those six players must agree to leave Miami for New York. Why would they? The way Chalmers has struggled in the Finals, he might not make $4.8 million elsewhere any other way. Battier could participate and then retire, a way to leave an even stronger legacy in Miami. Douglas, Jones, Beasley and Oden are bit players who probably couldn’t get more money elsewhere. They’re just in the right place at the right time. (If Haslem opts in, the Heat could use him in place of Chalmers. Haslem would have no say in it.)

And why would the Knicks agree? For one, Melo would have to convince them he’s leaving regardless. The Heat would also have to send draft picks to make it worth their while. But remember, if everything else comes together, it’s easy to structure a dual sign-and-trade as not to interfere with New York’s 2015 cap space.

As before, Melo would be subject to a short contract and smaller raises than the Heat’s current big three, but all four players come out ahead of the cap-space model.

Here’s:

  • Annual salaries for each LeBron, Wade and Bosh in the equality plan and if Miami gets Melo in a sign-and-trade (red)
  • Annual salaries for Melo in the equality plan and if he joins the Heat in a sign-and-trade (gold)

image

Melo 2014-15 2015-16 2016-17 2017-18 2018-19 Total
Max if re-signs $22,458,402 $24,142,782 $25,827,162 $27,511,542 $29,195,922 $129,135,810
Max if signs elsewhere $22,458,402 $23,469,030 $24,479,658 $25,490,286   $95,897,375
Equality plan $14,658,494 $15,318,126 $15,977,758 $16,637,391   $62,591,769
Equality plan with early opt out $14,658,494 $15,318,126 $15,977,758 $25,093,282 $71,047,660
Equality plan with S&T $18,190,703 $19,009,285 $19,827,867 $20,646,448   $77,674,303

 

LeBron, Wade, Bosh 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Total
Max if
re-sign
$20,659,633 $22,209,105 $23,758,578 $25,308,050 $26,857,523   $98,133,256
Equality plan $14,658,494 $15,757,881 $16,857,268 $17,956,655 $19,056,042   $69,627,847
Equality plan with early opt out $14,658,494 $22,137,516 $23,797,830 $25,458,143 $27,118,457 $28,778,771 $127,290,716
Equality plan with S&T $18,190,703 $19,555,006 $20,919,309 $22,283,611 $23,647,914   $86,405,840

New contract from one signed in 2014 is italicized

However, what’s a win for LeBron, Wade, Bosh and Melo is not a win for Arison, at least not directly. Acquiring Melo in a sign-and-trade and filling the team to the hard cap of the apron would give the Heat a 2014-15 payroll of $87 million, including luxury-tax payments. On the hook for so much guaranteed money, they’d likely face the tax annually – and the repeater penalty.

This sign-and-trade plan, though it offers substantially higher salaries than using cap space, can be combined with the opt-out plan to get even more money to LeBron, Wade and Bosh as soon as 2015 and Melo as soon as 2017.

But a sign-and-trade, with all the moving parts, is so unlikely, let’s just stop here.

A compromise

No matter what, LeBron, Wade, Bosh and Melo must collectively compromise to make this happen. That’s the new Collective Bargaining Agreement working.

The document just can’t completely prohibit players from sacrificing salary to build a team as they see fit.

So many variables remain, including what each of the four key players desires, where the cap is set and whether Miami moves its other players. There’s a lot to sort out.

But – scaled up or down depending on other influences – here’s what might work best if LeBron, Wade, Bosh and Melo are committed to making a big four:

  • No sign-and-trade. It’d be difficult, though not impossible, to get everyone else on board.
  • Haslem and Andersen opt out.
  • Miami trades Cole and its first-round draft pick for future picks.
  • Wade signs a four-year contract that starts higher than the equality-plan salary, because he gave up the most money in 2010. It’s the last major deal of his career.
  • Melo signs a four-year contract with a player option that starts higher than the equality-plan salary, because he has the most to gain by signing elsewhere and gets the smallest annual raises. After the third year, he opts out and re-signs to get a higher salary, potentially the max.
  • LeBron and Bosh each sign two-year deals starting below the equality-plan salary with player options. After next season, both opt out and re-sign for five-year max contracts.
  • The Heat re-sign Haslem to the room exception and Chris Andersen and Ray Allen to minimum contracts.

Will it happen? Who knows?

But it’s definitely workable.

Report: Al Horford opting out with Celtics

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Celtics president Danny Ainge called restructuring Al Horford‘s contract status – which would involve the center declining his $30,123,015 player option then re-signing for a lower starting salary but more total compensation in a multi-year deal – a priority.

This is either a step toward that or a step toward Boston, with Kyrie Irving seemingly exiting, losing multiple stars this summer.

Adrian Wojnarowski of ESPN:

If they renounce all their free agents, the Celtics would project to have about $32 million in cap space. That’d be about enough for a max player with fewer than 10 years experience, and Boston would get the room exception (projected to be about $5 million)

Or the Celtics could use Bird Rights to re-sign Horford, Terry Rozier and Marcus Morris. That route would come with a mid-level exception, either the non-taxpayer (projected to be about $9 million) or taxpayer (projected to be about $6 million).

Horford could determine Boston’s path. If the 33-year-old wants to re-sign, that’d probably consume most of the Celtics’ cap space. If he sees Irving leaving and wants to chase a title elsewhere, Boston could reset around Jayson Tatum, Jaylen Brown and three first-round picks in Thursday’s draft.

The Celtics could bring back Rozier, who’ll be a restricted free agent, in either scenario. But if Horford departs, that’d at least open the door to pursue an outside point guard – like D'Angelo Russell or Malcolm Brogdon – to replace Irving.

Report: Kyrie Irving has ‘ghosted’ Celtics as free agency approaches

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The emerging expectation: Kyrie Irving will sign with the Nets in free agency.

Many thought the Celtics had a chance of changing his mind by trading for Anthony Davis. But Boston didn’t deal for the star center.

There’s little reason to believe Irving will re-sign with the Celtics now.

Adam Himmelsbach of The Boston Globe:

The strangest part of the Irving situation right now is that it appears he has essentially ghosted on the Celtics. The people within the organization I have spoken with have made it clear that they have had little, if any, communication with Irving in recent weeks.

Irving is the prize. He’s not interviewing for jobs. Employers are chasing him. By becoming one of the best basketball players in the world, Irving has earned the power to act however he wants in this situation.

The season is over. If Irving wants space, he’s entitled to it.

Maybe it’s because he’s being a jerk. Maybe it’s because telling Boston he wants to leave isn’t an easy message to deliver.

Either way, Irving can proceed as he sees fit. The Celtics will still offer him a max contract if he wants to stay.

This is the same tact he reportedly took on his way out of Cleveland. So, it’s believable he’s behaving this way again.

But we’ve also repeatedly seen players smeared on their way out the door. Whether or not it’s accurate, this report will reflect poorly on Irving in many circles. So, in light of recent history, have at least a little skepticism for this depiction of Irving.

2019 NBA Draft Prospect Profile: Ja Morant is the future of the point guard position

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Over the course of the next two weeks, as the 2019 NBA Draft draws closer and closer, we at Pro Basketball Talk will be taking deep dives into some of the best and most intriguing prospects that will be making their way to the NBA.

Today, we are looking at Ja Morant.

Previous draft profiles:

The trajectory that Zion Williamson and Ja Morant have taken to get to the point where they are projected to be the top two picks in the NBA draft could not be more different.

Four years ago, they were playing on the same, small AAU team out of South Carolina. From there, Zion blew up, becoming a viral sensation thanks to his athletic exploits, having his jersey get worn by Drake when he was still a high school junior and spending the majority of his time in the high school ranks as a top-five talent in his recruiting class.

Morant, on the other hand, was more or less a no-name prospect into the summer before his senior year. He eventually became a popular mid-major target, and he even received a scholarship offer from in-state South Carolina. He was hardly unknown, but he was miles away from being someone considered to be a potential franchise-changing talent at the NBA level.

As it stands today, the thing that both Zion and Ja have in common — besides the two most recognizable first names — is an otherworldly level of explosiveness that has both ratcheted up their hype and buried the lede. The reason Williamson is the most exciting prospect to come out of the college ranks since Anthony Davis is because of his ability to play the point and the five, all at the same time. He’s Draymond Green, only if he was injected with NOS from Dominic Toretto.

Morant’s athleticism rivals Williamson’s. Blessed with a 44 inch vertical, Morant’s motto this season was “jump with me if you want to go viral,” and that couldn’t have been more accurate. He spent more time on SportsCenter this season than every Ohio Valley Conference player before him combined, something that was highlighted by this dunk:

And that explosiveness matters, I would never try to say otherwise. Dunking over weakside defenders in the NBA is going to be more difficult than when playing at UT Martin, but being able to elevate the way Morant elevates will help him transition to the next level. His quick-twitch athleticism also manifests in his ability to make plays in the halfcourt, where his ability to change speeds — and to go from a standstill to top speed — is what allows scouts to be able to project Morant as a player that can create offense against set NBA defenses. For a player who did so much of his damage at the college level in transition, that’s a big deal.

Morant’s physical tools makes it very easy to see him as another De'Aaron Fox. They’re both about 6-foot-3 and 170 pounds with a 6-foot-6 wingspan, and Fox just wrapped up his second season in the NBA with averages of 17.3 points, 7.3 assists and 3.8 boards.

But simply focusing on Morant’s athletic ability is to ignore what he does best: Pass.

Because while Morant did average 24.5 points and 5.7 boards while shooting 36 percent from three, perhaps what is most impressive about his sophomore season with the Racers is that he led all of college basketball in assists at 10.0 per game, just like Lonzo Ball led the nation in assists in 2017 and Trae Young did in 2018.

I mention both of those guys for a reason. Morant does not have the same hit-ahead ability in transition that Ball does, but Morant’s vision in the open floor and ability to make long, accurate passes in the open floor is one of the things that he does best. He also thrives in early-offense, where his And-1 Mixtape handle allows him to keep his dribble alive and probe opposing defenses. Because he is such a threat as a scorer, defenses would then collapse, which is when Morant’s ability as a dump-off passer and a lob-thrower comes into effect.

And that’s not even what he does best as a passer, because where he really shines is in the halfcourt and working off of ball-screens. Morant’s basketball IQ is the most underrated part of his game. He knows how defenses are going to defend him. He knows how to use his eyes to move weakside defenders. He knows where the tag is coming from, and whether the shooter in the far side corner or the roll-man will be open. This is where that Trae Young comparison comes into play, because reading defenses is where Young thrived while at Oklahoma.

The best way to describe Morant’s ability as a passer is that he not only knows when and where his teammates are going to come open, but he has the ability to find a way to make the pass that will get them an open shot. Morant is right-handed, but he will, at times, look like a left-handed player because of how often he makes bullet, live-dribble passes with just his left. He makes reads, and passes, that few point guards in the NBA today can make.

That passing is what makes all the difference, and as much as his athleticism or ability as a scorer, it’s the reason why he can be viewed as a player with the potential to be a franchise-changing point guard in the same stratosphere as the likes of Russell Westbrook and John Wall.

Now, Morant does have some flaws, and they are quite notable and relevant.

For starters, he is of a slight build, which is less than ideal. He is not going to be able to bounce off of contact in the NBA the same way he did in the OVC, and in a league where switchability is a priority at the highest-level, he is going to be targeted. Opposing coaches are going to target him by trying to force switches the same way that Nick Nurse did with Steph Curry in the finals. That is going to be an issue if he can’t add some weight and strength, particularly because he has not been a consistently great defender to date. Some of that can be attributed to the load that he was asked to carry offensively, and there is reason to believe that Morant’s athleticism, anticipation and quick hands will translate to being an above-average defender in the NBA.

Morant can also be a bit sloppy. He averaged more than five turnovers per game, and while some of that is strictly a result of workload and defensive attention, he also had a habit of trying to force passes that weren’t there.

But the biggest question mark, and what is going to determine his ceiling more than just about anything else, will be how well his jumper comes along. Morant shot 36.3 percent from three this past season, but that number drops to just 33.6 percent if his 7-for-8 shooting from three in the NCAA tournament is factored out.

Put another way, as good as Morant was this past season, there is still plenty of room for him to grow moving forward.

And in a league where ball-dominant lead guards that thrive in ball-screens is the norm, Morant is a player with quite a bit of value in the long-term.

Damon Jones says Lakers are in play for Kawhi Leonard

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I had heard from multiple sources going back to Summer League last year that the Lakers were not an option for Kawhi Leonard. He’s a guy who does not like a lot of drama and chaos around him, he just wants to play basketball, and being with LeBron James on the Lakers is to live in the spotlight with drama your constant companion.

Did the Anthony Davis trade change his thinking? Damon Jones, the former NBA player and assistant coach, said yes it did on ESPN’s Get Up show. He said a source that would know told him the Lakers are now in play.

Two thoughts here:

First, nobody knows what Kawhi Leonard is thinking. We can all play the “read the tea leafs” game — at the Raptors’ championship parade some fans started a “one more year” chant and Leonard’s close advisor Uncle Dennis (as he is commonly known) had one finger up and was chanting along, read what you want into that — but none of us really know which way Leonard leans. The “people close to Leonard” have sent mixed signals from the start, some have different agendas, and they are not Leonard. Stay in Toronto, come to the Clippers or Lakers? We don’t know.

Second, getting Leonard to the Lakers requires a semi-complicated salary cap move. After the Davis trade the Lakers have between $23 million and $27 million in salary cap space (depending on how much of Davis’ trade kicker he is going to take, if any) but that is not enough to sign Leonard to a max contract. And he’s not taking a discount. Los Angeles could create the room by delaying the Davis trade for a month. Follow along: Currently, the Davis trade can’t be executed until July 6. However, if the Lakers draft whoever the Pelicans want with the No. 4 pick, sign him, then wait a month and include that player and his salary in the trade (the CBA says a draft pick cannot be traded for 30 days after he signs his contract) then the Lakers could have $32.5 million in cap space, enough to sign Leonard (or Kemba Walker, or Jimmy Butler, or Kyrie Irving, or any free agent with 7-9 years of service and earning a max deal).

Except, the Pelicans want to get the trade done and, I was told, don’t have to agree to this delay. Would the Lakers have to throw in another second round pick or something to make this work? Maybe.

That all assumes Leonard wants to come to the Lakers. And nobody really knows that for sure.

Whatever happens, the board man gonna get paid.