D-Day
First things first: Nobody beat the Jazz to Paul Millsap as free agency opened Tuesday night. Jazz general manager Kevin O'Connor was on the phone with Millsap's agent, DeAngelo Simmons, right at 10 p.m., which Simmons called a "class act" gesture.
It bodes well for the Jazz as they try to retain Millsap, even as their payroll went up, up and away with Carlos Boozer's and Mehmet Okur's decision to return this season instead of opting out to become free agents.
The Jazz's plan seems to be to bite the bullet as luxury tax payers this season - - it's inevitable at this point - - and re-sign Millsap no matter how much that bill climbs. The Jazz seem to acknowledge they can't lose Millsap and Boozer in subsequent seasons.
Maybe it's appropriate that the Jazz own the New York Knicks' first-round draft pick next season, because their luxury-tax bill is going to be astounding. They have more than $73 million in salary commitments to only 11 players after Tuesday.
If Millsap comes in at $8 million - - which is less than he's asking for, by the way - - that brings the Jazz to $81 million in payroll. They still would need to sign one more player, presumably a third point guard. So that could be another $1 million.
(I left a message for Ronnie Price's agent, Mike Higgins, just to see if the Jazz had called Tuesday night. Higgins had some interesting comments the other day that probably got lost in the opt-out madness.)
The Jazz would be looking at $82-plus million in salary commitments. The NBA's luxury-tax threshold is expected to be set at $70 million. So the Jazz would have to pay $12 million in dollar-for-dollar penalties, plus would lose $3 million in distribution payments.
My guess is the Jazz will do everything they can to minimize the tax hit going forward. Every dollar they can cut is really more like two dollars because of that dollar-for-dollar penalty.
Maybe they trade Kyrylo Fesenko for a second-round draft pick and keep Goran Suton. There was talk earlier this summer that C.J. Miles might be a prime candidate for a buyout given the Jazz's luxury-tax crunch.
The Jazz ruled out the possibility back then, but maybe they revisit it now. The market for Miles is different than for the Boozers and Okurs of the NBA since he would be looking for a part of the midlevel exception.
The most likely scenario is that the Jazz trade Boozer - - to avoid a lame-duck season before free agency - - and take back the lowest-end salaries possible. Even that would be more than $10 million.
We covered this scenario last night in the blog, but a team also could throw in another $3 million in cash, though it doesn't count into the matching salary computations. But that might ease the Jazz's fiscal pain a little bit.
It's still stunning to me, thinking back to Larry Miller's declaration about never being tax payers after he got out of the hospital last year, that the Jazz are facing the possibility of being so deep into the tax this season.
* * *
Some things to watch going forward: It will be interesting to see if the Jazz are inclined to make a long-term commitment to any of the three players - - Boozer, Okur and Kyle Korver - - who opted in this week.
It also will be interesting to see if the Jazz make any attempt to mend fences with Boozer. I can't find it any more, but ESPN's Ric Bucher cited the need for a supportive coach/owner/GM in his profile on Boozer as (formerly) one of the top 20 free agents.
That's clearly directed at the Jazz, I assume after Greg Miller's comments criticizing Boozer's leadership and defense.
All of a sudden, the Jazz have the potential to get in on the bidding for free agents in 2010. They have $34 million in expiring contracts, which could be attractive to teams trying to clear cap space to sign free agents from that class.
Or the Jazz could simply let those contracts expire, avoid making any additional commitments beyond this season (sorry, Paul, Kyle, Memo and Carlos) and they would be left with at least $10 million in cap space next summer.
That's taking into account five players - - Williams, Kirilenko, Miles, Koufos and Maynor - - plus a $3.5 million approximation for the Knicks pick, plus six minimum cap holds. If the cap rose to $60 million, the Jazz could have $15 million in cap space.
* * *
Some of you saw this in your morning paper, some of you got the midnight report on Millsap at the start of free agency. Here's your summer-league-roster-announced story:
With the Rocky Mountain Revue an economic casualty, the Jazz will report Wednesday to Orlando, Fla., for the start of summer-league practice, only six days after the draft and weeks earlier than in the past.
The Jazz announced their roster Tuesday with few surprises as Eric Maynor, Kosta Koufos and Goran Suton were included while Kyrylo Fesenko was not. As expected, Fesenko will play exclusively with the Ukrainian national team this summer.
Maynor and Suton will be making their debuts as the Jazz's newest draft picks while Koufos will be looking to build on his rookie season. He averaged 4.7 points and 2.9 rebounds in 48 games but didn't see action after Feb. 17.
The rest of the Jazz's roster includes two members of the NBA Development League's Utah Flash - - guards Kevin Kruger and Andre Ingram - - as well as center James Augustine, a former teammate of Deron Williams' at Illinois.
Augustine is one of three players on the roster to have played with another NBA team, having played in parts of two seasons with Orlando before spending last season in Spain.
Forward Justin Reed split three seasons with Boston and Minnesota before spending last season with Bakersfield of the D-League. Guard Cedric Bozeman appeared in 23 games with Atlanta in 2006-07 and was with Anaheim in the D-League last season.
Former Utah State center Gary Wilkinson will play for the Jazz, as will Derrick Brown, a second-round draft pick of the Charlotte Bobcats, who are not fielding a summer-league team of their own as a cost-cutting measure.
The Jazz will play five games in five days next week at the RDV Sportsplex, beginning Monday against Boston. They also will play a joint New Jersey/Philadelphia entry, Indiana, Orlando and Oklahoma City.
--Ross Siler
It bodes well for the Jazz as they try to retain Millsap, even as their payroll went up, up and away with Carlos Boozer's and Mehmet Okur's decision to return this season instead of opting out to become free agents.
The Jazz's plan seems to be to bite the bullet as luxury tax payers this season - - it's inevitable at this point - - and re-sign Millsap no matter how much that bill climbs. The Jazz seem to acknowledge they can't lose Millsap and Boozer in subsequent seasons.
Maybe it's appropriate that the Jazz own the New York Knicks' first-round draft pick next season, because their luxury-tax bill is going to be astounding. They have more than $73 million in salary commitments to only 11 players after Tuesday.
If Millsap comes in at $8 million - - which is less than he's asking for, by the way - - that brings the Jazz to $81 million in payroll. They still would need to sign one more player, presumably a third point guard. So that could be another $1 million.
(I left a message for Ronnie Price's agent, Mike Higgins, just to see if the Jazz had called Tuesday night. Higgins had some interesting comments the other day that probably got lost in the opt-out madness.)
The Jazz would be looking at $82-plus million in salary commitments. The NBA's luxury-tax threshold is expected to be set at $70 million. So the Jazz would have to pay $12 million in dollar-for-dollar penalties, plus would lose $3 million in distribution payments.
My guess is the Jazz will do everything they can to minimize the tax hit going forward. Every dollar they can cut is really more like two dollars because of that dollar-for-dollar penalty.
Maybe they trade Kyrylo Fesenko for a second-round draft pick and keep Goran Suton. There was talk earlier this summer that C.J. Miles might be a prime candidate for a buyout given the Jazz's luxury-tax crunch.
The Jazz ruled out the possibility back then, but maybe they revisit it now. The market for Miles is different than for the Boozers and Okurs of the NBA since he would be looking for a part of the midlevel exception.
The most likely scenario is that the Jazz trade Boozer - - to avoid a lame-duck season before free agency - - and take back the lowest-end salaries possible. Even that would be more than $10 million.
We covered this scenario last night in the blog, but a team also could throw in another $3 million in cash, though it doesn't count into the matching salary computations. But that might ease the Jazz's fiscal pain a little bit.
It's still stunning to me, thinking back to Larry Miller's declaration about never being tax payers after he got out of the hospital last year, that the Jazz are facing the possibility of being so deep into the tax this season.
* * *
Some things to watch going forward: It will be interesting to see if the Jazz are inclined to make a long-term commitment to any of the three players - - Boozer, Okur and Kyle Korver - - who opted in this week.
It also will be interesting to see if the Jazz make any attempt to mend fences with Boozer. I can't find it any more, but ESPN's Ric Bucher cited the need for a supportive coach/owner/GM in his profile on Boozer as (formerly) one of the top 20 free agents.
That's clearly directed at the Jazz, I assume after Greg Miller's comments criticizing Boozer's leadership and defense.
All of a sudden, the Jazz have the potential to get in on the bidding for free agents in 2010. They have $34 million in expiring contracts, which could be attractive to teams trying to clear cap space to sign free agents from that class.
Or the Jazz could simply let those contracts expire, avoid making any additional commitments beyond this season (sorry, Paul, Kyle, Memo and Carlos) and they would be left with at least $10 million in cap space next summer.
That's taking into account five players - - Williams, Kirilenko, Miles, Koufos and Maynor - - plus a $3.5 million approximation for the Knicks pick, plus six minimum cap holds. If the cap rose to $60 million, the Jazz could have $15 million in cap space.
* * *
Some of you saw this in your morning paper, some of you got the midnight report on Millsap at the start of free agency. Here's your summer-league-roster-announced story:
With the Rocky Mountain Revue an economic casualty, the Jazz will report Wednesday to Orlando, Fla., for the start of summer-league practice, only six days after the draft and weeks earlier than in the past.
The Jazz announced their roster Tuesday with few surprises as Eric Maynor, Kosta Koufos and Goran Suton were included while Kyrylo Fesenko was not. As expected, Fesenko will play exclusively with the Ukrainian national team this summer.
Maynor and Suton will be making their debuts as the Jazz's newest draft picks while Koufos will be looking to build on his rookie season. He averaged 4.7 points and 2.9 rebounds in 48 games but didn't see action after Feb. 17.
The rest of the Jazz's roster includes two members of the NBA Development League's Utah Flash - - guards Kevin Kruger and Andre Ingram - - as well as center James Augustine, a former teammate of Deron Williams' at Illinois.
Augustine is one of three players on the roster to have played with another NBA team, having played in parts of two seasons with Orlando before spending last season in Spain.
Forward Justin Reed split three seasons with Boston and Minnesota before spending last season with Bakersfield of the D-League. Guard Cedric Bozeman appeared in 23 games with Atlanta in 2006-07 and was with Anaheim in the D-League last season.
Former Utah State center Gary Wilkinson will play for the Jazz, as will Derrick Brown, a second-round draft pick of the Charlotte Bobcats, who are not fielding a summer-league team of their own as a cost-cutting measure.
The Jazz will play five games in five days next week at the RDV Sportsplex, beginning Monday against Boston. They also will play a joint New Jersey/Philadelphia entry, Indiana, Orlando and Oklahoma City.
--Ross Siler
12:44 AM
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7 Comments:
Is there a difference between the soft salary cap and the luxury tax threshold? I always thought they were the same thing.
What about the Larry Bird exception??? No one has mentioned that anywhere. As far as I understand, any player that has played 3 consecutive seasons with a franchise can be resigned by that team for any amount up to the league maximum without having it count towards the luxury tax threshold. The exception was put into place to assist teams in building/developing talent rather than buying a new set of players every offseason. By my understanding, Millsap's contract should qualify him for the exception as should last years agreement with CJ Miles. Ross, please address this issue if you have a chance. Both the Larry Bird Exception and the Early Bird Exception. Thanks, Trent
Interesting points by Trenton.
If that exception does not work out, my gawd, 12 mil in penalties. Jeezus.
The Larry Bird exception only allows teams to exceed the salary cap to re-sign a player. But the salary still counts against that team's luxury tax threshold. Without the Larry Bird exception, teams would not be allowed to exceed the salary cap at all. The exception allows teams to make a decision. It comes down to whether a team wants a player bad enough that it is willing to pay luxury tax or not.
The Bird exceptions just allow teams to go over the salary cap to re-sign their own players. It doesn't affect the Jazz's luxury-tax status. The Bird exceptions also slant the playing field in the Jazz's favor when it comes to re-signing somebody like Paul Millsap. The Jazz can offer Millsap a six-year contract, while everybody else is at five years. They can offer him an annual raise equal to 10.5 percent of his first-year salary. For all the other teams, the max raise is 8 percent of his first year salary. If Paul gets an $8 million a year starting offer from one team and an $8 million a year offer from the Jazz, his contract with the Jazz could be as big as six years and $60.6 million, compared to five years and $46.4 million from the other team.
--Ross
The so called Larry Bird exception is what makes it a soft cap. Under a hard cap you couldn't exceed the cap amount no matter what. However, as mentioned above you can re-sign your own players even if it takes you above the cap. The luxury tax is a penalty for doing so.
Also, this is all Kirilenko's fault for being a total albatross on the Jazz' cap.
The reason I ask, mainly because I’m a little confused:
Paragraph one:
The Jazz would be looking at $82-plus million in salary commitments. The NBA's luxury-tax threshold is expected to be set at $70 million. So the Jazz would have to pay $12 million in dollar-for-dollar penalties, plus would lose $3 million in distribution payments.
Fact one: Luxury tax threshold=70 million. Got it.
That's taking into account five players - - Williams, Kirilenko, Miles, Koufos and Maynor - - plus a $3.5 million approximation for the Knicks pick, plus six minimum cap holds. If the cap rose to $60 million, the Jazz could have $15 million in cap space.
Fact two: The cap in 2010 is expected to RISE to 60 million? Isn’t the soft cap/luxury tax threshold (which I thought was the same thing) 70 million?
I know I’m totally missing something, but I’m just trying to understand all these little intricacies of the NBA financial documents. Sorry, please, and thank you!
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