[Official] Cap Q&A (w/ Resident Clutchfans Capologists)

1. Are we already over the salary cap?
2. If so, by how much?
3. How large is this year's MLE?
4. Could we sign a player to the veteran's minimum (Mutumbo and/or Horry) and keep our MLE if we are already over the cap?

Thanks.

 

to answer your first 3 q's:
http://games.espn.go.com/nba/features/trademachine
it says here the houston is already 9.9 million over the cap basing the salaries on the 07-08 season.
and if i remember correctly, our mle is almost 6 mil. roughly 5.9 million

 

The answer to #4 is we can sign as many people we like to the minimum salary without it impacting our MLE. We also have another exception for $1.9 million we can use without impacting the MLE. However, Les' willingness to use the MLE can be impacted by other signings or trades because of our proximity to the luxury tax threshold.

 

I'd also like to point to this blog post...

http://theondeckcircle.net/2008/07/01/nba-free-agency-guide-part-1-salary-cap-rules/

It gives a good description of what the types of contracts are for a free agent signing. It made me understand things a lot more because it's written in "layman's terms".

It is also part one of a series, so there will be more information to follow.

 

If we use up our MLE on two players other than Landry. If we then sign Landry for 4mill a year. How much of his 4million will be Luxury Taxed?

 

Taken from another site:

 

If the MLE is $5.9MM this year, and a team is less than $5.9MM under the cap (let's say they're 5.5 under the cap)...

How much money can they spend on a given free agent?



Is it just 5.5, or do they get an 0.4 exception to go with it? Or do they get a full MLE once they hit the cap? Or (most likely), something totally different?

 

Okay, I just read the italicized part in the article HayesFan posted, but I'm still not sure exactly how this works.

 

As long as they're under the cap by less than the MLE, then they can spend the whole MLE on a player, up to and past the cap. If they're further under the cap than the MLE (let's say...8 million), then they get no MLE.

Some examples...

Team A is 4.0 million under the cap and the MLE is 5.9 million. They can give 5.9 million to a free agent and they will end up 1.9 million over the cap.

Team B is 8.0 million under the cap and the MLE is 5.9 million. Team B is not eligible for the MLE.

Team C is 2.0 million under the cap and the MLE is 5.9 million. If they sign a player for 4.0 million, they are now 2.0 million over the cap. Because they are over the cap, they cannot use the "remaining" 1.9 million of the unspent MLE.

 

Yes in a way. All exceptions are added to your total team salary when calculating cap space. SO if you only had the MLE (5.9) and if you were 5.5 under the cap you would be .4 over the cap. You would have to be more than 5.9 mil under the cap to offer a player more than the MLE.

 

if we use up our MLE, we will NOT be able to sign landry for 4 mill a year.

Because we don't have the bird rights (or is it early bird?), we can only use MLE, or LLE, or minimun salary to sign Landry.

thus, if our MLE is used up on other players, the best we can offer to landry would be our LLE, which should be slightly less than 2 mil.

-- This is why people are saying rockets can not make any real offseason FA moves until landry is signed. If we sign brent barry for part of the MLE (say, 2.5 mil) before the landry situation is resolved, other team can simply offer landry a 4 mil/year contract, and we will not be able to match it, since we don't have that much MLE money left.

and as to how much of landry's salary is taxable, I don't have the exact figures. but IIRC, rox are dangerously close to the tax threshold last season. Any incoming salaries through trades, MLE signing, and other signing would likely be in the tax region. IOW, if landry are signed for 4 mil/year, expect the majority of that 4 mil being taxed for double -- assuming the luxury tax is invoked.

 

Thanks CCR & OMR! No practical reason for the question, it's just something I've wondered.

 

No problem. I just hope I'm right, considering all these damn caveats and loopholes.

 

no, you can combine cap space with part of MLE to sign a player. MLE becomes available only when your existing salary at or over the cap. in your case, you can sign the player with 5.5.

 

no, you can't combine cap space with part of MLE to sign a player. MLE becomes available only when your existing salary at or over the cap. in your case, you can sign the player with 5.5 or use your MLE.

 

Fantastic thread and well-written OP. Off the topic sort of but there should be more quality threads like this.

 

From the NBA Salary Cap wiki page:

I take that to mean that if you were 5.4 under the cap in a year where the MLE is 5.9, then you could use the whole 5.9 and end up .5 over the cap.

Someone correct me if I'm mistaken.

 

3 Questions:

1. Sign and Trade:
My understanding of the current salary cap rules is that Carl Landry, as a Non-Qualifying Veteran Free Agent, with less than 2 years of service to one team, cannot be signed for any more than the qualifying offer without using either the LLE or the MLE; therefore making him essentially impossible to sign and trade.

Correct?

2. Non-American Leagues
Are there any current provisions in an NBA contract that would allow a player to buy himself out and play in a different league? Up until now, NBA teams were happy to let players leave with no penalty, because they were inevitably not very good. However, lately we've seen that the European leagues have enough capital now to outbid the NBA for the services of players who have foreign passports. If Luis Scola were to get a 30M Euros contract next year (hypothetically) and wanted to buy himself out, could the Rockets force him to play? How about for a rookie? Let's say that Kosta Koufos blows up next year, and gets an offer he can't refuse from a Greek League team. Will he be obligated to play for 5 years with them, including his restricted 5th year; if the Jazz tender him a qualifying offer, is he forbidden from leaving the NBA, even if he technically is a free agent?

3. Odds and Ends
Anyone want to explain to me why "cash considerations" are not considered part of "Team Expenditures" and factored into "Team Salary" when computing the Luxury Tax penalty? That certainly seems like a fair way to help curb one of the major advantages that allow the wealthier franchises to take advantage of the poorer ones.

Are players in Toronto allowed to collect their paychecks in Canadian Dollars? With the exchange rate the way it is now, getting perhaps 2% or more on an 8 figure salary is no trivial matter.

 

It also helps the poorer franchises by giving them a means of making some money on the side.

It'll give them something to spend in the future, should they so desire.

If it counted towards the cap, the richer teams just wouldn't do it anymore, so it definitely helps the poorer clubs too that they are able to sell draft picks etc for 'cash considerations'.