CBA Deep Dive, Part II

We continue to look at the ramifications of the NBA's new collective bargaining agreement.

Good morning! No news on the horizon as we prepare for Game 1 of the NBA Finals tonight, so let’s get right to Part II of our deep dive…

CBA Deep Dive, Part II

Yesterday we talked generally about the next CBA, how it’s going to impact how teams plan out their finances moving forward, and specifically how it might impact the players currently on New York’s roster. Today we’re going to branch out and look at some other teams who are going to be impacted by these stringent new rules, and what opportunities might be available as those teams cut costs.

First though, let’s take a look at an imperfect snapshot of the teams currently projected to be above the second tax apron in the 2024-25 season, which is when the new CBA is going to go into effect. Courtesy of our friends at Spotrac:

Before we dive in, a quick word on why this is an imperfect snapshot, using the Knicks as an example.

For as much as I detailed yesterday how they’d be facing some difficult choices in the years ahead, their listed cap number of $219.7 million is way above the picture I laid out. The reason - and its the same reason that lists like these often don’t capture the full picture of a team’s future financials - is usually because of cap holds.

A cap hold, you’ll recall, is the dollar figure that stays on the books for a team’s own free agent, essentially serving as a placeholder for that player in case the team wants to re-sign them. For New York, even though they only have about $95 million in guaranteed salary on the books in 2024-25, they also have $23.3 million in non-guaranteed salaries for Fournier and Grimes, Jericho Sims’ $2 million non-guaranteed pact, and a whopping $99 million in cap holds and incomplete roster charges. The takeaway is that cap holds do not equate to future salary, and specifically in the case of the Knicks, much of the money currently listed as tied up in cap holds will be long gone for one reason or another¹.

So with that caveat, today I want to dive a little deeper into some of the teams on this list that figure to have major issues once the new CBA and its unwieldy lead apron kick in. First though, I’m going to pose a question that was raised in some of the comments to yesterday’s newsletter, and one that was discussed on a recent Bill Simmons podcast with Ryan Russillo: with the new CBA seemingly forcing teams to reconsider every dollar they spend, who’s going to take the biggest haircut?

We know it’s not going to be the true blue, offensive engine, MVP-level superstars. Some of those guys would get far more than the max if teams were allowed to give it to them. I doubt it’s going to be the class of players one step down from that group either (think Jaylen Brown, Pascal Siakam, De’Aaron Fox, etc.) because if every team allots for roughly two max slots and your team doesn’t want to pay one of these guys, several others surely will. My guess is that there’s one more group of players who will always get paid a premium (but non-max) rate, and it’s the league’s elite 3 & D wings with real size, to the extent that those players haven’t all graduated into the star category like Mikal Bridges. Cam Johnson’s impending restricted free agency will be a great test case here, as will Trey Murphy III’s extension negotiations a year from now.

With those categories out of the way, here are my candidates for the chopping block:

• Wanna-be, fake All-Stars: No, I’m not talking about Tyrese Haliburton. This applies to guys like D’Angelo Russell, Nikola Vucevic, Fred VanVleet, Jarrett Allen, Andrew Wiggins and Kristaps Porzingis - players who have made an All-Star team or two and are still in their relative prime but who are a level down from a typical All-Star level performer.

• Real All-Stars, but with caveats: You can throw Julius Randle in here, along with Domantas Sabonis, DeMar DeRozan, Rudy Gobert and the like. As with Randle, there are serious questions about each of these players despite their incredible talent. For example, can a defense with Sabonis at center ever be good enough to contend? Can a lead guard/wing who doesn’t shoot threes survive four rounds of playoff defense? Should an all-world defensive center with an incredibly limited offensive game take up 35 percent of your cap?

• Aging stars: Jrue Holiday just missed making an All-NBA team this year and still profiles as perhaps the ideal complementary star to a supernova. He’s also turning 33 in less than two weeks. He can decline a $37.4 million player option for the 2024-25 season and sign a new pact next summer. Even though he’ll be limited to a four-year deal because of the over-38 rule, that contract could be worth up to $222 million, or just over $55 million a season. Does Milwaukee pay up? And if not, will someone else take that plunge?

• Imperfect (but still really good) role players: Yes, Josh Hart, I’m looking at you. We just saw Miami basically ignore Hart on the perimeter whenever he was on the court, and it was part of the reason New York’s offense struggled to score in the second round. Hart’s 3-point percentage was great in the playoffs but his slow release time and well-known preference not to shoot was a bigger factor. There are multiple players like Hart on every roster, because role players are often role players for a reason, and it’s because there’s a part of their game that leaves something to be desired. Along with Hart, it’ll be interesting to see what guys like Caris LeVert, Christian Wood, Grant Williams, PJ Washington and Rui Hachimura get this summer. On the flip side, what happens with a guy like Max Strus, who is at least passable from deep and on defense, but you wouldn’t consider elite in either area? In this new NBA economy, how should he be paid in comparison to a guy like Wood, who is a devastating offensive force that can’t defend a lamp post, or even someone like Hart, what with his one glaring weak spot? Will any of these guys get more than midlevel exception money in a few years?

• Non-superstar centers: I’ve mentioned a few relevant names in other categories. It’s fair to wonder whether teams start to punt on this position more and more as the years go by. I’m fascinated to see what Nic Claxton gets paid a year from now (or if he extends off of his $9.6 million expiring salary). And last but not least…

• High profile / pedigree rookie extension candidates with stuff left to prove: How are the extensions for RJ Barrett, Tyler Herro, Jordan Poole and Deandre Ayton aging after one year? What about Michael Porter Jr? John Collins? What will guys like Desmond Bane, Tyrese Maxey or even our own Immanuel Quickley get this summer?

Without further ado, let’s start our deeper dive into two teams already in trouble. This will be the beginning of a running list that I’ll continue to add to over the coming weeks as we get closer and closer to trade season. By the time we get to the draft, we’ll have covered all of the pertinent teams in depth.