The Rockets knocked $7 million off the payroll with the Rice trade. However, they actually may have saved $17 million in net payroll, by doing this trade, when you factor in the luxury tax and the kickback (if the 2002-2003 numbers are roughly comparable to the 2003-2004 numbers). Look at table 1 at the end of the following article to see the multiplier effect of the savings under the luxury tax system: http://www.uncg.edu/bae/people/rosenbaum/luxurytax1.pdf In the table, look at the net payroll difference between Houston in 2002-03 with a gross payroll $50.4 million, and Milwaukee at $57.6. The net payroll for Houston was $35.6, and for Milwaukee was $55.3 million. That's almost a $17 million swing in net payroll for $7 million in gross payroll. So is saving $17 million in exchange for the number 21 pick in the draft a bad deal? That sounds like a great deal, to me. However, Les didn't just keep all of this savings. He used the savings to sign JJ and Pike. They made less than $7 million combined, but they made a small enough salary to get below the luxury tax threshold. Going just a couple million over the threshold could cost $10 million in net payroll. So the trade was actually Rice and a no. 21 pick for JJ and Pike, plus several million in savings. Viewed that way, the Rice deal was one of the smartest ones Dawson ever did. The price of slashing payroll has gone down this year, given the probability that the luxury tax will not kick in for 2004-05. Teams are probably not as desperate to dump salary, which explains why the crazy contracts are being handed out for role players.
So, Nets traded Kittles salary away, got a TE plus a draft pick. Why we had to give up a No.1 Pick in order to trade Glen Rice away??
the nets want to get under the likely luxury tax, so can't see them using that trade exception any time this season
Because Kerry Kittles can still play. Rice was waived by Utah and then signed and waived by the Clipps.
Wow, eventhough Kidd has had those injuries lately, this will be a steal for the blazers. as someone mentioned earlier, i think the Rockets should make a play for Aaron Willams. he will be a great pickup.
1. As has been mentioned, Kittles now is better than Rice was when we traded him. 2. The luxury tax issue has already been explained. On that subject, I'd also mention that the luxury tax was considered a bigger threat to be triggered when we traded than it is now. Therfore, we had a weaker bargaining position than the Nets do now.
I would hate to be a Nets fan right now. For those who say Les is cheap I say that he normally pays players and makes moves to help us win. I don't think they are likely to use that TE(nor are we probably going to use ours). This is a pure fire sale that I would normally only expect from the Clips.
