Trying To Understand the Rockets Cap Situation pre Nene signing

Just curious if any of the capologists can verify that I'm thinking correctly on this: BimaThug, heypartner, aelliott, Basketbalholic. I have a very healthy respect for the salary cap knowledge you guys have.


So I wasn’t quite sure why the Rockets didn’t roll Nene out in the Anderson and Gordon press conference. They have agreed on a deal so why not just sign him already and do this whole thing all at once?

My first thought was that teams had to start below the Salary Cap (losing MLE, Bi-Annual exceptions etc…) and then exceed the cap again prior to actually using the Room Exception. But after reading Larry Coon’s Faq, once a team drops below the cap the Room Exception becomes available. Not sure if I'm interpreting this correctly.

http://www.cbafaq.com/salarycap.htm#Q25

The other question that has been on everyone’s mind is where are the Rockets at with Donatas Motiejunas? I have maintained the stance all along that the Rockets have every intention of bringing him back and may already have the bases of a new deal agreed upon with him. But if so, why not roll him out or resign him as well? We know that the timing of resigning Motiejunas is important because once his new contract is signed; his 5.7 million dollar cap hit probably goes up significantly. But so what? Since the team is going to use the Room Exception to sign Nene?

But technically, even after extending James Harden, the Rockets are not over the cap yet. Until Nene or Motiejunas sign; the Rockets are still $543,772.00 under the salary cap. Why is that figure important? This brings me to Chinanu Onuaku.

The Rockets typically like to sign their 2nd round draft picks to at least a 3 year deal so they can get early Bird Rights and avoid getting caught in the Gilbert Arenas rule should some other team try to sign them away after their Rookie Contract. However, once the Rockets either exceed the salary cap or get close enough to the Cap that they no longer have enough Cap room to offer at least a minimum salary contract to a player, they would have to use a “Minimum Player Salary Exception”. The maximum number of years a player can get in a contract when using the "Minimum Player Salary Exception" is 2 years, which of course leaves the team vulnerable to another team using the Gilbert Arenas rule to sign away that player if he has less then 3 years in the league.

The minimum salary for a non-1st round pick player in 2016 /2017 is $543,471.00. The Rockets currently sit at $543,772.00, which means as of right now the team can offer Chinanu Onuaku a three-year deal. At the end of his rookie contract the Rockets would be able to exceed the salary cap and still match any deal he might receive up 175% of his previous salary (early bird exception) without using any other exception. More importantly, he would not be subject to the dreaded Gilbert Arenas rule.

If the Rockets sign either of Donatas Motiejunas or Nene next they will officially be over the cap and they would have to sign Chinanu Onuaku using the minimum player salary exception. Which of course would leave them vulnerable to the Gilber Arenas rule.

So if I understand all of this correctly, neither Nene nor Donatas Motiejunas will be signed until after Chinanu Onuaku is signed, unless of course the Rockets decide not to sign him at all.

 

There is something else to consider. What does his contract count against the salary cap? Didn't the Rockets already sign him to a contract? Is it strictly a summer league contract or does that even matter? So I don't know how either he or Kyle Wiltjer figure into the Rockets current salary cap situation since both technically have contracts.

 

A lot of moving parts but everything i've heard is that Nene is going to be signed using the Room Exception.

aelliot, one of the points I need clarification on is this: Do they need to use any exception to sign Nanu if they have available cap space? If they use cap space to sign him instead of the exception (I think) they can do a three year deal. If they use the minimum player exception they are limited to a 2 year deal.

Am I over thinking this?

 

Not without some sort of sizable move. We have no cap space to sign him unless he wants to take the minimum which would be $543,471.00 and I just don't see that happening. Of course it's possible that the Rockets could trade away some players for cap space but not sure they are willing to do that at this point.