everybody in the trade threads talks about the TE, some people say it can be comined with players contract, others say you cant ... so here's the rule about this have fun http://members.cox.net/lmcoon/salarycap.htm#68
There's only one point worth highlighting... "For example, a team with a $1 million Traded Player exception cannot combine it with their $2 million player to trade for a $3 million player (see question number 72 for more information on combining exceptions)." IOW, a single player can not be combined with a TE to trade for another single player. Juwan Howard @ 6.4M can not be combined with the $4.2M traded player exception to obtain a single player valued at $10.6M or less. Personally, I've always felt this flies in the face of what could have been completed at the time of the original trade. But that's how this "rule" reads. The following is from Section 72 and is another issue that comes up frequently. "If a team has Traded Player exceptions from two previous non-simultaneous trades, then they can't combine them into one big Traded Player exception. For example, suppose in the last year a team traded a $5 million player for a $4 million player (generating a $1.1 million Traded Player exception) and separately traded a $3 million player for a $1 million player (generating a $2.1 million Traded Player exception). They cannot now combine the two into a $3.2 million Traded Player exception).]
GATER - I actually got clarification on this from Larry Coon. While there was some logic behind my thinking, there is some behind the scenes workings that prove that I was in fact wrong. On the surface, you would think that TPE+salary would work, because the exception is not being comibed with another exception, but that isn't the case. It's like this: It would actually work if both teams were under the cap, even by $50 bucks, but if one or both teams are over the cap, then an exception is being used to allow the trade to happen, even if salaries match 100%. If you're over the cap, then ANY move, including a trade, necessitates the use of an exception. Say its Team A with a player making $6.5 mil and Team B with a player making $7.75 mil. The NBA "instruments the trade" by first creating 2 TPEs, since an exception is required for a team over the cap. Team A creates a TPE worth $6.5 mil and Team B creates a TPE worth $7.75 mil. The TPEs are then traded for each other, and since they match within 125% +100K, the trade is allowed. Team B instantly creates a new TPE worth $1.25 mil that can be used within 1 year. Because the league "instruments" the deals in this way, any TPEs that are created on the date of the trade, by the trade itself, can essentially be combined to make the trade work (ie 2 players for one, etc). Since exceptions cannot be combined in any other scenario, any pre-existing TPEs cannot be aggregated, and therefore may only be used on their own. Say a team has 2 TPEs from 2 different trades, they cannot be combined either. The only ones they let slide are those created in a simultaneous transaction, used at the time of the transaction. I agree that this sort of flies in the face, or goes against the spirit of being able to re-use that "credit" to get back to your original salary amount. if that spirit were being followed, you should allow you to combine that TPE with another salary, but that isn't the case. I'm surprised this carried over from the previous CBA, but I'm guessing that because the allowance was increased from 110% to 125%, this TPE scenario was left in as a trade-off. There you have it - a definitive answer.
purplefever - I have no problem accepting either aspect of the "traded player exception"...first, that it can not be combined (aggregated) with a single player to trade for a single player (my Juwan Howard example) and secondly that trade exceptions can not be combined. What I am curious about is where you got the concept that (for two over the cap teams) a trade exception is created during every trade where the assigned player exception (+/-125% + 100K) is used. Using your teminology...the "instrument of trade". I've looked at both the 1999 CBA and the 2005 CBA on the NBPA website and neither mentions the concept. You'd think with a 25% salary variance, there'd be a lot more TE's floating around. Is this your concept or Coon's?
You've pretty much got the end result correct, but your logic/explanation is off. If both teams are under the cap, then a) they dont' need to use an excpetion (see http://members.cox.net/lmcoon/salarycap.htm#67 ) Teams under the salary cap may make trades as they please, as long as they don't end up more than $100,000 above the salary cap following a trade. But if a team is over the cap, or they are under the cap and a trade would take them more than $100,000 over the cap, then an exception is required. An exception is the mechanism that allows a team to make trades or sign free agents and be over the salary cap. b) You can't have both cap space and an exception. (see http://members.cox.net/lmcoon/salarycap.htm#20 ) There is logic behind this. The whole idea behind an "exception" is that it is an exception to the rule which says a team has to be below the salary cap. In other words, an exception is a mechanism which allows a team to function above the cap. If a team isn't over the cap, then the concept of an exception is moot. Therefore, if a team's team salary ever drops this far, its exceptions go away. The effect is that a team may have either exceptions or cap room, but they can't have both. In the scenario that is described in your example, you're still not combining the TE with a player in a trade. What that example shows is a creative way to GENERATE a TE when one would not ordinarily be generated. What you are describing when you say the NBA "instruments" the deal, is that you are allowed to take your side of a trade and for the purpose of the cap, you can view it as two or more smaller deals. The Rockets did that very thing in the Steve Francis trade and even though it was a multi-player deal (where you normally wouldn't receive a TE), we received a large TE. In your scenario you want to trade player A ($6.5 mil) for player B ( $7.75 mil.). If each team has enough cap room to cover the salary of the incoming player, then they can do the deal. Since they are under the cap even after adding the salary, then no exception is needed. If each team were over the cap, but had TEs large enough to cover the incomming salaries, then you could instrument the deal as two individual deals where each team received the incomming player using their TE and sent nothing out. Perfectly legal. You are correct that ANY trade by a team over the cap requires an exception. What that is refering to is that they have to use the Traded Player Exception which allows teams over the cap to make deals if they are within $25% + $100K. That's not refering to the "non-simultaneous" part of a trade which we all commonly refer to as a "Trade Exception". The non-simultaneous trade is just a part of the larger traded player exception. Even though you are not allowed to combind two exceptions in a single deal, when you complete a non-simultaneous deal (i.e. use your TE), it is considered to be part of the original deal that generated the TE, so no additional exceptions are required (you don't need to use a 2nd traded player exception because your already using one). You never actually "trade" a TE, but by definition your use of the TE means that your taking on more salary than your sending out, then your trading partner has to be taking in less than they are sending out. That means that they can most likely instrument the trade to generate a TE.
What is the point of a trade exception then? You can only trade it to someone who gets no players back? So essentially, the only thing you can get is someone else's deadweight salary that they want to get rid of?
Kind of puts into perspective the summer of 2000 that had the board sending out "KT+4.5mill TE" for a number of different All-Star players...
Since you are allowed to break up your side of a trade into multiple deals for salary cap purposes, then it can be used in certain situations for making up the difference in salary. Here's an example, assume that these two teams want to trade the following player for each other: Team A - player 1 ($5M) Team B - Player 2 ($2M) Assuming that both teams are over the cap, you can't trade the players straight up for each other because the salaries arent' within 25% + $100K. If team B had a $5M TE, then you can orchestrate a legal trade as follows: TEAM A - Sending out $5M, taking in $2M. You're always allowed to take back less salary, so the deal is legal from their side. Team A would also receive a $3M TE. TEAM B - Breaks the deal up into two separate deals: deal 1) Take in player 1 @ $5M and use their $5M TE to cover the salary. That's legal. deal 2) Send out player 2 and take nothing back. You can always send out more than you take back, so this deal is also legal. In addition, Team B would receive a $2M TE for this portion of the deal. This ablility for each team to view their side of a deal as multiple deals gives alot of flexibilty. In the example I gave, Team A viewed it as a single trade while team B viewed it as two separate deals. We did this very thing in the McGrady trade and generated a TE for ourselves out of that deal. Does that make sense? It won't work in all situations, but in situations where one of the players can be covered by the TE, it can be done this way.
I knew my wording would probably be a bit confusing. I also overlooked the part about not being over the cap after the trade (so my $50 comment was moot). And the of course, if you're under the cap, your TPE disappears altogether... GATER - the "instrumentation" concept is Larry's, which is part of the reason I had it in quotations. So in terms of a Mike James deal using the MLE, it still means his salary would have to start out at $4.3 mil ($4.2mil TPE + $100K). He'd get more on an MLE deal, so it would make better sense for the Rox to acquire the another offseason target with the TPE than James. It also makes little sense for Toronto to do a S&T if the ability for James to make more, subsequently landing the Raptors value in exchange. If there's nothign to gain, then Colangelo would prefer you use the MLE, making additional moves more restrictive. It's that old "what's in it for me?" that every team has to ask themselves.
purplefever - Concerning the MLE vs TE deal for Mike James, I disagree with your conclusion. A 5 year $4.3M SnT has a $1.4M higher total contract value than a 4 year MLE. If no other over the cap team offers James a 5 year MLE, he would surely take the higher valued SnT. As far as Toronto's "what's in it for me" to broker the deal...future picks or (since Colangelo loves Euro players) the rights to V-Span. Either should get it done. The Raptors are currently under the cap so they could take Luther Head, but this part takes us into speculation. IMHO, the market determination of a 5th year for a full MLE totally dictates the Rockets' course of action.
what are your professions? how do you knowso much about the CBA? I consider myself pretty knowledgeable on the NBA and I read contracts and statutes for a living. but I don't know squat about the CBA, except what I read here.
Rileydog, I think there are really two answers to your question. First, via the internet I "know" aelliott and NIKEstrad. So I will let them speak for themselves if they so desire. I have never communicated with heypartner beyond CF. Additionally, there are newer posters (m_cable and purplefever among them) who have obviously done their homework. When I first joined CF, I barely could spell "CBA". But aelliott, NIKE, and HP already had it down and were very patient as I fumbled my way through. So part of the answer is learning from others who are already well versed in CBA mechanics. The second part of the answer is that I am a Sr Financial Analyst for a worldwide high-tech firm so I deal with numbers and analysis on a daily basis. But once I'm out the door from work, I am 100% musician. (When I'm on CF, I'm usually simultaneously playing piano or working in my recording studio). IMO, that helps alot in being able to look at raw data and put a little more of a more human "what-if" view on it all. I feel the creative aspect is an advantage in life in general...but I'm predjudiced. Sorry...probably waaayy more than you wanted to know.
ok so we can't use the trade exception in a sign and trade taking on someone with a 5.35$ contract (4.2 X 1.25 + 100k) ?
Correct. Neither aelliott nor purplefever used the term "assigned player exception" (APE) in their analysis. In my view the "APE" is the 125% + 100K part. And since exceptions can not be combined, you can't combine your APE with a TE. Unless you are really kinky.
I've basically kept my ears peeled during these CBA discussions over the years, and looked all the info up on Larry Coon's faq: http://members.cox.net/lmcoon/salarycap.htm I usually retain a lot of the info, and when in doubt I'll look it up.
Gater. The APE and the Traded player exception are one in the same. Look at the 2nd paragraph of the original post in this thread. It gives an explanation of the Traded Player Exception. In the CBA it's called Assigned Player Exception, but Larry Coon's FAQ calls it Traded Player Exception. You are correct that it can't be combined with the TE. Remember, there really isn't any such thing as a Trade Exception. It's just the final step of a non-simultaneous trade and it's all part of the Traded Player Exception. Because it's actually just the conclusion of an earlier (non-simultaneous ) trade, you don't get an additional 25% + $100K buffer.
Coon's FAQ is great, but there's somethings that might not be in there or might be somewhat ambiguous. Many times it helps to go to the actual CBA which can be found at: http://www.nbpa.com/cba_articles.php
It hasn't been announced yet, but the MLE is expected to be about $5.4 mil. Mike James' contracts coudl work out as follows: MLE deal with 8% raises: $5.42 $5.854 $6.287 $6.721 $7.154 Total = $31.436 mil over 5 years --or-- $24.282 mil over 4 years. TPE deal with 10.5% raises $4.2 $4.641 $5.082 $5.523 $5.964 Total = $25.41 mil over 5 years *** For the record, I design and build custom LED lighting systems for a living, and have little to do with this type of matter. I have been runnign some sort of basketball website since the summer of 2000 (originally nbacourtside.com and later purplefever.net). It was during the previous CBA that I did a whole lot of reading on both the CBA itself, Larry Coon's FAQ and other published pieces by guys like Dan(?) Rosenbaum. I had begun to compile my own CBA FAQ for use on my website, but it's such a massive undertaking that it was never completed, and now the CBA has chaned altogether. I simpy don't have time to run a site any more, but we will be re-launching purplefever.net again very shortly, as there was a pretty loyal community of media cappers and file sharers that used it as a gathering spot. It was always our goal to become the Raptors equivalent to clutchcity, but that's something no other fansite of any major North Amercian sports team has ever come close to matching. Major props to this website.
aelliott - Agree except for one minor point. As I read everything we've presented, I have drawn the conclusion that you can use the 100K as part of the final non-simultaneous trade value. Do you not see that as well? Coon even uses it in one of his examples where a $2m player is traded for a $1M player and later the non-simulataneous is completed with a 1.1M player. Take a look.
