Heat sign PJ Tucker (2 years, $15M)

Sam Amick: Anyone who noticed P.J. Tucker's latest Instagram post surely had questions about how and why he wound up leaving Milwaukee for a two-year, $15 million deal with Miami. There were cryptic comments made, chief among them the veteran forward writing, "Today took a hard turn on the road of my career but like my grandma used to tell me.. all you can control is what you can control." According to a source with knowledge of the negotiations with the Bucks, the most important thing that he couldn't control was the luxury tax.

While Tucker's salary with the Heat might seem relatively small, all things considered, consider this math: An offer that started at, say, $7 million would have cost the Bucks approximately $23 million in tax and, thus, would mean a $30 million bill. That, above all else, is why he's not coming back to the Bucks.

 

How the Bucks lost one of their championship ‘dogs’: P.J. Tucker signs with Miami Heat
https://theathletic.com/2748577/202...onship-dogs-p-j-tucker-signs-with-miami-heat/

When Bucks general manager Jon Horst spoke with reporters on Friday to recap the moves he made in the 2021 NBA Draft and discuss his mindset heading into the offseason, he fielded a question about free-agent forward P.J. Tucker. Specifically, he discussed the importance of the Bird rights the Bucks held on Tucker, which would allow them to pay Tucker any amount of money up to a max contract to keep him in Milwaukee, and what that meant for their ability to sign Tucker.

“The fact that we have rights on him is valuable,” Horst said. “It absolutely played into the calculus of trading for him. We knew where we were going, like it wasn’t a surprise that we’re in the luxury tax, it wasn’t a surprise we’re gonna have limited flexibility. Acquiring rights for players and Bird rights gives us other options to continue to improve and adjust this roster beyond the limited exceptions that we have.

“I don’t know what that means in terms of what his dollars will be or his years or what his market is, I don’t know any of those things yet, like we’re studying all that. We’re going to be ready for all that, and when free agency opens, like we’ll do the best we can, but the fact that we have rights on P.J. as an avenue to sign him gives us a chance to have a really quality player without dipping into some of our other exceptions. And so that’s one of the reasons why we acquired them. It’s valuable. And I think it’ll probably be valuable in free agency as well.”

And then, on Monday, Tucker signed with the Miami Heat on a two-year, $15 million contract.

The Bucks could have matched that contract. They could have offered even more than the Heat to counterbalance any of the effects of NBA players not paying state taxes in the state of Florida. They could have offered a third year on the contract to try to convince him to remain in Milwaukee. In the end, though, Tucker chose to play for the Heat and posted on Instagram after news of his decision broke.

The written statement that went along with the photos Tucker posted of his time in Milwaukee suggested that the Bucks did not do everything they could to retain his services, and those suspicions were strengthened later in the night. In The Athletic’s free agency live blog, Sam Amick reported that, according to a source with knowledge of the negotiations with the Bucks, the Bucks’ luxury tax bill came into consideration as the organization attempted to figure out what they might be willing to offer Tucker.

While the Bucks could have offered Tucker considerably more money, the Heat won the bidding war, and the Bucks lost the heart and soul of their 2021 NBA championship team in free agency. It would have been an unbelievable scene to imagine, if the team had not already gone through something similar two offseasons earlier.

In the summer of 2019, many of the Bucks’ most important players entered free agency. Malcolm Brogdon, George Hill, Brook Lopez, Nikola Mirotic and Khris Middleton all needed new contracts after the Bucks’ 60-win season and run to the Eastern Conference finals, but only the 26-year-old guard Brogdon was a restricted free agent. If the Bucks so chose, they could have taken care of the rest of their free agents and then signed Brogdon, no matter the cost, and moved into the luxury tax. As most Bucks fans likely remember, the Bucks decided to let Mirotic walk and signed Hill, Lopez and Middleton. Then, they worked out a sign-and-trade deal with the Indiana Pacers and moved on from Brogdon to avoid moving into the luxury tax.

Asked about the move during their preseason meeting with reporters before the 2019-20 season, the Bucks ownership group invoked their fear of triggering the repeater tax, the league’s punitive measures set up to punish teams for functioning as a luxury tax team too often.

“I don’t think we have an issue paying the luxury tax,” Bucks co-owner Marc Lasry said on Oct. 4, 2019. “I think part of it is we know we’re going to be in it. We’re definitely going to be there in a couple of years, soon. That’s not the question.

“The question is, ‘Was re-signing Malcolm an imperative?’ I think re-signing Malcolm was a luxury, and our view was Malcolm is a phenomenal player. He’s great, but for that amount of money, we thought we could have those dollars better spent elsewhere. And we’ll find out.”

As was the case with Brogdon in 2019, the dollars that went unspent on Tucker on Monday night cannot be used elsewhere. Because of the Bird rights they held on him, they could spend more on Tucker, but no other player. That money cannot be transferred elsewhere, just like the roughly $20 million that went unspent on Brogdon could not be transferred to other players. It was simply money not spent to give the Bucks’ one more talented player.

Because Bobby Portis decided to sign a contract that can fit in a non-qualifying veteran free agent exception slot, the Bucks could have signed Portis and Tucker without touching their taxpayer midlevel exception, the team’s largest monetary tool for signing a free agent. By using Tucker’s Bird rights, the team could have signed three high-quality players this offseason. It would have cost the Bucks significantly more from a salary and thus, also a luxury tax perspective.

 

With the assumption of a base salary built around the contracts of Giannis Antetokounmpo, Middleton, Jrue Holiday, Lopez, Pat Connaughton, Donte DiVincenzo and Portis, plus four minimum deals for Elijah Bryant, Mamadi Diakite, Sam Merrill and Jordan Nwora, plus a minimum contract for Thanasis Antetokounmpo …

• adding Tucker on a two-year, $15 million deal, the same one the Heat gave him, would have put the Bucks $22.2 million over the luxury tax line and incurred a luxury tax payment of $53.3 million at the end of the season
• adding Tucker on a two-year, $20 million deal, would have put the Bucks $24.7 million over the luxury tax line and incurred a luxury tax payment of $62.7 million at the end of the season
• adding Tucker on a two-year, $20 million deal, but then taking Portis off the cap, would have put the Bucks $20.2 million over the luxury tax line and incurred a luxury tax payment of $45.8 million at the end of the season

In the end, though, the Bucks appear to have opted against doing that by failing to sign Tucker and now will be able to add just two players with salaries larger than minimum deals. Two offseasons after avoiding the luxury tax by sidestepping the opportunity to sign Brogdon, the Bucks appear to have decided against diving deeper into the luxury tax to sign Tucker. And while the two situations are awfully similar, there are a few key differences that must be acknowledged in fully assessing each situation.

First, Bucks ownership was not wrong about being in the luxury tax two offseasons ago. By signing Antetokounmpo to the largest contract in NBA history, retaining Middleton in the summer of 2019 and acquiring and then extending Holiday, the Bucks are comfortably over the luxury tax threshold this season and even managed to cross it last season as an unlikely bonus in Holiday’s contract cashed when the Bucks won the 2020-21 NBA championship. So, not only will they likely be forced to pay a more punitive luxury tax bill because they’ve paid the luxury tax in at least three of four seasons, they will do it a year earlier than expected.

Second, the Bucks enter this season with the same goal as they had in the summer of 2019: to win an NBA championship. Rather than trying to win their second championship in the last 50 seasons, they will be chasing their second championship in as many seasons.

Finally, while both Brogdon and Tucker both made significant contributions in the seasons before moving onto a different team, there was a 10-year age gap between both players. Brogdon was entering his fourth NBA season at 26 years old; Tucker will be entering his 11th NBA season at 36 years old next season.

Differences aside, the decision to move on from Tucker will frame the Bucks’ offseason endeavors in the same way the decision to move on from Brogdon framed the Bucks’ offseason in 2019.

Without Brogdon, the Bucks signed veterans Wesley Matthews and Kyle Korver to try to make up for Brogdon. Matthews started all 67 games he played in Brogdon’s vacated starting spot in the 2019-20 season and Korver contributed well off the bench, but in the end, the Bucks did not have enough in the postseason and the lack of strong two-way play in the shooting guard spot contributed to the team’s demise in the second round against the Heat.

Because Portis’ contract fits into the non-qualifying veteran free agent exception slot, Horst still has the full mid-level taxpayer exception at his disposal to attempt to replace Tucker. As evidenced by the fanbase’s momentary panic on Monday night about Semi Ojeleye’s contract (a one-year, minimum deal, per a league source), direct comparisons will be drawn between Tucker and the player signed to fill the midlevel taxpayer exception, even though the exact same player(s) signed with the exception could have been on the roster in addition to Tucker, if the organization was willing to pay a higher luxury tax bill.

They decided against paying a higher tax bill and now have one less contributor on the roster. Even if Tucker regressed as a 37-year-old, which doesn’t necessarily seem likely as evidenced by his strong postseason following a subpar regular season, his contract may have been a useful piece of salary flotsam to make a deal for a different contributor on a double-digit annual contract figure.

Now, the Bucks do not have the man that coined and then embodied the Bucks’ “We Dogs” postseason mantra, the salary that could have been useful in future roster construction and the player that spent the postseason putting his body on the line helping defend the opponent’s best players. And Horst has to figure out how to use the taxpayer mid-level exception to find a difference-maker and help fill out the Bucks’ rotation as they attempt to repeat as NBA champions.

It will be no easy task with some of the best free agents already off the market and a single salary exception to fill the opening left on the roster.