Rockets luxury tax watch 2019: What we are doing and why it matters

Again, if they intended to go over the tax line, they wouldn't have spent a pick to dump Baldwin and Stauskas, they would have just waived them.

 

This, he just needs to get under the tax threshold this season to avoid the repeater penalty and we should be fine going forward. Additions from the buyout market will fill out the rest of roster...

What does this mean for House negotiations now though?

 

has it been reported the full details of the trade from both sides. i only saw what houston was giving

 

can some explain to me, why are we sending picks out just to dump some players, why not just waive them and save the picks

 

You maybe right, but then under that premise they should have never re-signed CP3. Your team was then locked into a big three of Harden/CP3/Capela and it was always about surrounding the right supporting pieces.

And yes I do think they should have won against the Warriors last year, and probably still could beat them this year with the right role players & Capela/CP3 healthy.

IMO this was a self defeating strategy to begin with, and potentially a wasted season of Harden's prime.

-Essentially got out from under Ryno's albatross contract by trading out a first rounder & 2nd rounder
-Let two key wing defenders walk to save money
-signed prospects from the G-league
-signed stop gap vet buyouts - Rivers, Faried (probably the only standout moves)

The whole premise of success for this year would be relied upon basically Vet buy out targets... THAT is a freaking big risk to take in one of Harden's best prime years, and one of CP3's last good years. Hoping and praying for vet buyouts that overperform is a terrible strategy. There's a damn good reason why those players are bought out, and not valuable enough to be a trade candidate. I'm just saying if this is the way they wanted to operate, IMO they probably should have just let CP3 walk this offseason. And I love CP3.

 

So my understanding has been that we needed Melo at the vetmin and wouldn’t increase our House offer, all so as to save our Buyout $, which was going to be more than what other teams could offer.

A) Am I right on those points?

B) Does all this new Luxury/Repeater stuff change the math on all that? Ie. Do we actually have more to offer on the Buyout market, but won’t because it would take us into the Luxury/Repeater stuff?

I am faaaaaaaaar from the Carl/JR whinybitch Poor Tillman brigade. I see all kinds of wisdom in what we’re doing.

But I would like some clarification on this point, if you or @BimaThug or anyone can share some.

Bottom line: Have the Melo/House “savings” given us more money we “could” use on the Buyout market besides vet mins, but that we likely won’t use because tax issues?

 

To send them into another teams salary cap. If you waive them they still count against the cap unless they have a "non-guaranteed" contract.

 

LOL this is the final team. Even the original offer for house is off the table now since it will put us back into luxury tax. Dont even mention any of the other names in the buyout market

 

But if we wanted to (hypothetically, imagining the tax issue wasn’t an issue), do we theoretically have more buyout $ to offer than other teams?

I just thought that was a huge part of why they weren’t willing to offer House more $, was because doing so would mean dipping into the “Buyout War Chest”...

If all buyout offers will be vetmins, then I’m thinking I must have misunderstood the rationale for not offering House more?

Vetmins are vetmins, regardless of any offer to House, no?

Am I making sense here?

 

What are you expecting, Reeko? Morey to put out a tweet, "Too bad about Mirotic, LOL." Coupon emoji, #broke #pickoffreeagents?

The only time anything like that'll be reported is if Morey writes a tell-all, ten years or so from now.

 

And the Warriors can do that easily, their dominant run has turned them into the 3rd/4th most valuable tean in the NBA, and makes at least 250 million in profit per annum.

The Rockets? While I'm pissed over this blatant shedding, I can see where they're coming from a business perspective. If we failed to get under this year, we're looking at a payroll of at least 140+ million (with the harden extension underway, and CP in his final year) in 2021. The tax bill would look something like $110 million, that alone would make the Rockets unprofitable ($100 profits per annum), and Tilman has some serious loans to pay with interest to serve for buying the rockets, missing payments means harsh penalties, followed by bankruptcy.

It's a calculated risk, if we win the title, we might draw in enough revenue to offest that massive tax bill, but it appears Tillman lacks faith in this team's ability. The mans got 1.4 BILLION of debt to service, and outside of the Rockets, his enterprises focus almost entirely on tourism and entertainment, the two things that tank the hardest if a recession comes around. He knows this team is his surest stream of income, and he's not risking a 5-25% chance of financial ruin for a 5-25% chance of winning an NBA title.

 

What about Tillman calling out other teams/players a few days ago. Maybe the Rockets had a way to improve the team, buy it fell through and they didn't believe options left would move the needle so they opted with plan right now instead. We have no idea if the current deals were considered Plan A, B, C, or X, Y, Z.

Plus in don't understand why everyone is just presuming that Rockets will beat the Warriors in the playoffs? 2017-18 Rockets were the only team to win 2 games against them in a series and Paul has looked nothing like that player since his hamstring injury. Regular season is very different than playoffs. Plus now major pieces of the Rockets rotation will be working their way back from major injuries late in the season. Presuming the Rockets were 1 small piece away this season is seriously red-glasses view of the situation.

 

The theory is they put together a team that they though would win in the offseason. 54 games into that experiment they determined that they were wrong and hit the reset button to start prepping for the next experimental run, which will start in October 2019.

So when they signed CP3 and Melo and Ennis and traded Ryno, they believed those moves would put them in a position to win. They only aborted the experiment after real world data proved otherwise.

Theres some baseball adage about every team planning to play in the world series in spring training that I cant quite recall at the moment.

 

So re-reading this, we *could* use the MLE for buyouts (in theory). It’s just that we likely won’t because of the tax implications.

That’s what I was trying to understand. I think you did answer it. Thanks.

 

Thanks Les. Les is the guy that liked to take credit for signing Anderson and Gordon. Les is the guy that traded for CP3 with the understanding that Paul would get a max contract. Then, Les bailed on the team.

Tilman is the guy that is left with trying to clean up the mess that Les gave us when he bailed.

I don't expect an owner to pay the repeater tax. With the increase in salary for Harden, Paul, and Clint in the coming years, this was the year to get under the limit.

I realize some people will never understand if an owner is unwilling to spend an infinite amount of money to build a team. But, that's just not reasonable.

Les bailed on this team and left Tilman with a big mess.