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The "Stretch" Exception Could Help teams like the Celtics

Discussion in 'NBA Dish' started by Clips/Roxfan, Oct 22, 2011.

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  1. Clips/Roxfan

    Clips/Roxfan Member

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    by Jeff Clark on Oct 22, 2011


    A New York Times article is reporting that before talks broke off, there were three new rules that actually were agreed upon. They are as follows.

    With N.B.A. Talks Halted, Sides Predict a Meeting Next Week - NYTimes.com

    There will be a one-time "amnesty" provision that will allow each team to waive a player (with pay) without his salary counting against the salary cap.

    There will be a "stretch" exception, available every year, allowing teams to waive players and stretch out their remaining salary over a number of seasons, thus reducing the annual salary-cap hit.

    The midlevel exception will be set around $5 million, a decrease of $800,000, but more than double what the owners were seeking.

    As I mentioned before, I don't think the amnesty rule helps us much at all. In theory you could cut Paul Pierce and re-sign him immediately to a minimum deal (he's getting the money either way, and this way he gets more). However, the league would be stupid not to put in provisions against such chicanery. Notice I didn't say it wouldn't. If nothing else, they've proven they are capable of any shortsightedness.

    The midlevel isn't moving much at all, so I'm not sure there's any big change to discuss there. At least the Celtics will have a vehicle with which to go after a few free agents.

    When I read the description of the stretch exception I can't help but think that the Celtics will find a way to utilize that in the next 12 months or so.

    Star-divide

    Here's a scenario. The Celtics are after a free agent who fits into the mid level pricepoint. They want to upgrade their roster without sacrificing the Dwight money earmarked for 2012. Other teams have no problem offering a guy a 2 or 3 year deal. Danny can offer him a 2 or 3 year deal (or 4 if he's really got a blank check), use his services for the next year (hopefully contending for a title - you know, ...if there's a season), then waive him next offseason if he needs that extra $5M. Sure, you still have to pay the guy, but the cost is deferred into the future.

    Now, if you do this enough times and you are looking at a lot of dead money, but once in a while, especially for guys with smaller deals, it is a no brainer. In fact, I'm sure agents are looking at this as a way to get some of their lower tier clients more money.

    Anyway, food for thought.

    http://www.celticsblog.com/2011/10/22/2507069/the-stretch-exception-could-help-the-celtics
     
    #1 Clips/Roxfan, Oct 22, 2011
    1 person likes this.
  2. Deckard

    Deckard Blade Runner
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    No word on the numbers of years an MLE would be? Perhaps they compromised with a larger salary than the owners wanted, but fewer years than the players wanted. Anyway, interesting post. We'll have to wait and see if it turns out to be true.
     
    #2 Deckard, Oct 22, 2011
  3. BimaThug

    BimaThug Resident Capologist
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    Three years, max.

    I also don't think that blogger fully understands the application of any "stretch" exception.
     
    #3 BimaThug, Oct 22, 2011
    Last edited: Oct 22, 2011
  4. Deckard

    Deckard Blade Runner
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    That's one of the things that interested me. With all the speculation, it's the first I've heard of this idea. The three years for the MLE sounds about right.
     
    #4 Deckard, Oct 22, 2011
  5. A_3PO

    A_3PO Member

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    Guys, I just can't get into this until an agreement is reached. If there is no season, who gives a flip?
     
    #5 A_3PO, Oct 22, 2011
  6. BimaThug

    BimaThug Resident Capologist
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    Just read about it from a more credible source, so I deleted that statement from my post. Not quick enough to do so before you replied, though.

    I'm pretty sure no team that uses the amnesty or the stretch exception can then re-sign the waived player. That much seems obvious to me.

    The blogger seems to think you can spread salary over many, many years. In his example (signing a guy to a 3 year deal at $5M per), the player you'd be cutting would have 2 years, $10M remaining. I doubt you'd be able to spread that money over more than 4-5 years, meaning that you're still looking at a $2M to $2.5M hit in each subsequent year. And if you repeated this more than once, you'd likely have a cumulative cap hit of "stretched out" dead money that is roughly equivalent to (if not more than) the regular salary of the first guy you waived! While the blogger seems to understand that concept when it is applied to a ludicrous degree, it also rings true if it is used even twice. Definitely if it's used three times.
     
    #6 BimaThug, Oct 22, 2011
    Last edited: Oct 22, 2011
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