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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.

USA’s 78-game international win streak ends at hands of Australia, Patty Mills, 98-94

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Gregg Popovich wanted his USA team to face some adversity. For them to be challenged and see how they’d respond.

He got his wish on a Saturday afternoon in Australia and has to be disturbed by the result.

Australia, behind a red-hot Patty Mills who finished 30 points and drained seemingly every big bucket down the stretch, tore up the USA defense and outplayed the Americans when it mattered most, beating Team USA 98-94 in an exhibition match in front of a raucous 52,000 people in Melbourne.

Team USA had won 78 consecutive games — including both friendlies and in international tournaments — before this loss. The last USA exhibition game loss was in the run-up to the 2004 Olympics (when the Americans took home the bronze).

The USA opens FIBA World Cup play in just more than a week, facing the Czech Republic in their first game on Sept. 1. The Americans enter that tournament as the favorites, but the combination of improved international play and a lot of elite American talent staying home has made the USA’s margin for error very slim. Teams such as Serbia have to see this result and gain confidence.

This loss comes just two days after

“They wanted it more than us tonight,” Kemba Walker said after the game. “Lesson learned for us.”

Those lessons include needing to clean up a defense that still has communication issues, and to find more consistent shot creation outside of pick-and-rolls with Kemba Walker or Donovan Mitchell.

Walker, who came off the bench to score 22, was clearly America’s best player. His ability to penetrate was the only thing all night that either forced the Aussie defense to collapse, or it allowed him to get space for a good shot. Donovan Mitchell, who finished with a dozen points including seven straight late in the game, was able to provide a little shot creation, but the Americans lacked much ball or player movement in this one. Harrison Barnes finished with 20 points on 7-of-12 shooting.

Popovich is clearly still experimenting with lineups and combinations, and that is the silver lining of this USA loss. This was not the American’s best foot forward.

But don’t take anything away from Australia, which played a physical and feisty game all afternoon. They put the ball more in the hands of Utah’s Joe Ingles and he responded with 15 points, seven assists, and he and Andrew Bogut set up the offense and were smart with their passes. Bogut finished with 15 points.

Team USA takes on Canada in a final exhibition game in a couple of days, before heading to China for the World Cup.

Report: Dwight Howard gave back $2.6 million in buyout with Memphis, what he will make in L.A.

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Dwight Howard will get his money, the full $5.6 million he opted into this summer. The man is getting paid.

The checks are just coming from two different teams.

To facilitate a move to the Lakers, Howard is giving back $2.6 million in a buyout with the Grizzlies — exactly how much he makes on a minimum contract with Los Angeles. From Adrian Wojnarowski and Bobby Marks of ESPN:

My guess is the Grizzlies will just take the cap hit this season to get Howard off the books.

This is exactly how this was expected to go down financially if Howard came to Los Angeles. The risk for Howard is he will sign a non-guaranteed contract with the Lakers — they can waive him for whatever reason, pay a small buyout fee, and Howard loses out on the $2.6 million.

That’s motivation for him to follow through on what he promised the team.

 

Former NBA, ABA coach Tom Nissalke dead at 87

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SALT LAKE CITY (AP) — Tom Nissalke, who won coach of the year honors in the NBA and ABA, has died. He was 87.

Nissalke passed away at his home in Salt Lake City on Thursday after facing a “series of health-related problems” in recent years, according to the Deseret News.

He was the first coach of the Utah Jazz after the franchise relocated from New Orleans in 1979.

Nissalke was also an NBA head coach in Seattle, Houston, and Cleveland.

Nissalke got his start in the pro ranks as an assistant with Milwaukee and helped guide a team featuring Hall of Famers Oscar Robertson and Kareem Abdul-Jabbar to an NBA title in 1971. His work with the Bucks landed him a head coaching gig with the ABA’s Dallas Chaparrals. He led them to a 42-42 record in his first season and was named the league’s top coach.

He was hired the next season in Seattle but was fired after a 13-32 start. Nissalke then coached the Utah Stars and San Antonio before returning to the NBA with the Rockets. He won 124 games in three seasons with Houston, twice taking the team to the playoffs and the 1977 Eastern Conference finals.

Nissalke was named the NBA’s Coach of the Year after going 49-33 in 1976-77.

After retiring, he was active with the YMCA and worked as a radio analyst.

Nissalke is survived by a daughter, Holly, son Thomas Jr, and two grandchildren. His wife, Nancy, died in 2006.

 

How Dwight Howard convinced the Lakers to take a chance on him

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Laker fans Friday sounded like your friends after an ugly relationship and breakup, when you suddenly consider taking that person back. Laker nation took to Twitter screaming “ARE YOU SERIOUS? What are you thinking? Are you even thinking?”

The Lakers, however, are entering a second relationship with Dwight Howard with their eyes wide open — he will sign a non-guaranteed contract to be the team’s center (sharing duties with Anthony Davis and JaVale McGee). Howard will have to prove himself, on and off the court. The Lakers have leverage and can waive Howard and move on to Joakim Noah or someone else quickly if things do not pan out.

But how did it even get to this point? How did Howard — who did his annual summer media tour saying “I have changed, I am taking the game and my conditioning seriously, I just want a chance” and league observers shrugged because they have heard the same thing for years — convince the Lakers to roll the dice on him again? Shams Charania of The Athletic laid it all out.

Howard’s message to [Laker assistant coach Jason] Kidd and the Lakers was the same one he delivered to The Athletic in July from NBA summer league: He’s learned from the past several seasons, learned that, at age 33, he is simply one of the guys now. Howard believes he can contribute at a high level for any NBA team, but the eight-time All-Star also understands he has to focus on rebounding, defense, blocking shots, finishing around the rim and simply playing whenever he is asked… Kidd became convinced about Howard’s newfound awakening…

The Lakers then began setting workouts for free agents, and Howard traveled from Atlanta to Los Angeles on Wednesday. His meeting and workout with the Lakers was set for Thursday, but Howard went to the Lakers’ facility in El Segundo, Calif., on Wednesday afternoon for his own training session. The Lakers were surprised to see him, sources said, and many key decision makers were in attendance…

League sources said Howard had a convincing and emotional meeting with the players and Lakers officials, explaining how he had reached rock bottom a season ago and needed to find a new mindset in his life. On and off the floor. He was not the teammate he needed to be in playing for three teams in the past three years. He did not take the game seriously enough, he did not understand what was needed to turn the corner.

Howard has said all that before. Multiple times. To multiple teams and teammates. Maybe this time he has genuinely figured things out, but whatever he did and said was enough to convince the Lakers to buy in…

To a point.

One could argue — and I would make the case — that Noah would be a better fit on the court for the Lakers’ needs in terms of passing and defense, but he comes with plenty of risks as well (health, getting along with LeBron James, and how much he liked the nightlife as a Knick in New York and what that would mean in L.A.). At least with Howard, the Lakers mitigated that risk with the non-guaranteed contract. If Howard will not accept his role and is disruptive (as he has been in recent stops), if he is still eating candy like a bingeing 10-year-old on Halloween night, if he can’t stay healthy, the Lakers can waive Howard and move on. If the Lakers brought in Noah, they would have been smart to have the same non-guaranteed contract (if Noah would have signed that kind of deal).

For now the Lakers have their man, but he’s basically on probation. Howard has to prove in deeds everything he has said in words.