Raptors Salary Cap Situation (and planning for the future)

[DanH]

Information about actual revenue thus far in the year tends to trickle in and if it surpasses projections from the summer the projection tends to slide up (and the same for revenues that come in low - we've seen that happen as well, fairly often).

That DeRozan max deal keeps going up and up in salary. Now projects to 26M starting salary, almost 150M over 5 years.

[CalgaryRapsFan]

Information about actual revenue thus far in the year tends to trickle in and if it surpasses projections from the summer the projection tends to slide up (and the same for revenues that come in low - we've seen that happen as well, fairly often).

That DeRozan max deal keeps going up and up in salary. Now projects to 26M starting salary, almost 150M over 5 years.

The one intriguing part about the cap going up so much, is wondering if DeRozan (and others) would be open to taking less % (since it would still represent huge $), to both get paid and leave room for MU to further improve the roster.

In general, the bigger the cap is, the more opportunity there is for any top-tier player to make significant money while tying up a relatively smaller % of the total cap. It could be an interesting trend to watch, league-wide, over the next couple offseasons.

[JWash]

The one intriguing part about the cap going up so much, is wondering if DeRozan (and others) would be open to taking less % (since it would still represent huge $), to both get paid and leave room for MU to further improve the roster.

In general, the bigger the cap is, the more opportunity there is for any top-tier player to make significant money while tying up a relatively smaller % of the total cap. It could be an interesting trend to watch, league-wide, over the next couple offseasons.

DeRozan can't "leave room" for MU to further improve the roster. I think with the new projections we have ~$18M cap space if we renounce all our guys including DeMar. He's not going to take an $8M cut to his first year salary and what would probably be like a $50M cut to his overall contract. And even if he did we still would have no cap space.

Unless you're just talking about wiggle room under the tax but good luck selling that to a player. "Can you take less money so we don't have to pay as much for the team?".

[DanH]

The only scenario where we have cap space is if we start selling assets like Ross or CoJo for cap space and picks. Then the increasing cap could spell some relief allowing us to sign a big name and keep DD. But that's a big risk and we are probably better off using those assets in a sign and trade attempt for said big free agent.

[Raptor Jesus]

A question for the cap scholars of RR.

How do player incentives; All-Star Selections, ALL NBA (Rose Rule) and others I may not know affect cap?

If for instances KLOEs deal has player attribution incentives, are the dollars reflected in cap flexibility?

[DanH]

A question for the cap scholars of RR.

How do player incentives; All-Star Selections, ALL NBA (Rose Rule) and others I may not know affect cap?

If for instances KLOEs deal has player attribution incentives, are the dollars reflected in cap flexibility?

Incentives, each year, are assigned a status of likely or unlikely. This is dependent entirely on whether the player achieved them the prior season - ie, if a player gets a bonus for making the all-star game, then if they made the all-star game the previous season, the bonus is listed as likely for the next one. Then if that season he misses the all-star game, the year after it would be listed as unlikely.

This is important because likely incentives count against the cap - they take up cap room. Unlikely ones don't.

So, for example, DeRozan has incentives built into his contract. He never achieved any of them until his first all-star season. The following summer, since he had achieved those incentives, his cap hit went up from 9.5M to 10.1M. Then last season he only achieved some of his incentives, so right now his cap hit is only 10.05M, as the ones he achieved are still likely and still count as cap hits, while at least one he didn't achieve is now listed as unlikely and doesn't count.

For tax implications, the final calculation is done based on whether the player earns the incentive or not that season. But that's separate from the cap question.

Rose Rule is different and actually effects the value of the contract signed based on eligibility for a veteran max extension value on a rookie scale extension by meeting certain goals like all star starter and All-NBA awards. It's not really a cap impact so much as a change in the contract value itself (which impacts the cap, of course, but not JUST the cap like incentive likelihood does).

[Raptor Jesus]

Interesting. Thanks for that very clear elucidation.

If I'm following, then given no immediate (or any) All-NBA Team nominations for Lowry if any incentive is built in to his contract then it would not affect cap as it would be listed as unlikely? And any All-Star incentive will count as he was an All-Star last year and thus would be listed as likely?

[DanH]

Interesting. Thanks for that very clear elucidation.

If I'm following, then given no immediate (or any) All-NBA Team nominations for Lowry if any incentive is built in to his contract then it would not affect cap as it would be listed as unlikely? And any All-Star incentive will count as he was an All-Star last year and thus would be listed as likely?

Lowry's deal has no incentives in it.

DeRozan's has incentives, several unknown ones and one that seems to be for making the all-star game for 50k, all told they total 600k.

I don't believe any other player on the team has incentives in their deal.

[Raptor Jesus]

Lowry's deal has no incentives in it.

DeRozan's has incentives, several unknown ones and one that seems to be for making the all-star game for 50k, all told they total 600k.

I don't believe any other player on the team has incentives in their deal.

Cool thanks.

[Axel]

Dan, what's are current FA spending options?

[DanH]

Dan, what's are current FA spending options?

Depends on who comes back.

Assuming DeMar comes back, with his cap hold on the books, we might be able to clear a couple million in cap room (so essentially none at all since the MLE might as well be used instead) by letting everyone else walk, if the cap comes in high (92M is the latest guess I saw). But might as well just use the MLE and stay over the cap.

If DeMar walks, we could have a little under 20M to spend.

[Axel]

Depends on who comes back.

Assuming DeMar comes back, with his cap hold on the books, we might be able to clear a couple million in cap room (so essentially none at all since the MLE might as well be used instead) by letting everyone else walk, if the cap comes in high (92M is the latest guess I saw). But might as well just use the MLE and stay over the cap.

If DeMar walks, we could have a little under 20M to spend.

And MLE is project at ~$6M?

[DanH]

Yeah, just under 6M.

[JawsGT]

Dan, is the only reason we cannot keep this present team together is we have no rights to Biz if he opts out?

[DanH]

Dan, is the only reason we cannot keep this present team together is we have no rights to Biz if he opts out?

We have Biz's rights, and Scola's. But just their player rights, not Bird or Early Bird rights (require 3 and 2 years of service, respectively). So we can offer a 4 year deal, but only at a very slight raise over their current salary (so essentially can offer each of them 3M per year).

James Johnson has his Early Bird rights, so we can offer a 4 year deal at 1.75 times his current salary, so just under 5M.

DeRozan has his full Bird Rights, so we can offer 5 years at the max salary.

If you want to offer any of those first three more than those amounts, you need another exception (like the MLE) or cap space to do so.

Short answer, yes, the reason the team will likely not stay together is that Biz and possibly Scola will want more money than we can offer them to come back.