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David Locke: Luxury Tax Threshold about to hit $100M in 2 years?

Discussion in 'NBA Dish' started by Carl Herrera, Mar 8, 2014.

  1. Carl Herrera

    Carl Herrera Contributing Member

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    http://1280thezone.com/index.php/audio/listen/dj_pk_david_locke_on_the_utah_jazz15

    David Locke does the radio play by play for the Utah Jazz. He said that he asked around the league about whether "a James Harden situation" will happen again soon and concluded "no" partly because the luxury tax level, currently at $72M, is about to hit $100M in 2 years when the NBA gets a new national TV deal.

    He said that this means that the Jazz is likely to match a high $ offer for Hayward because it would look like a much better contract when the new cap numbers come out.

    Not sure if this is the actual projection, but interesting if true.
     
  2. meh

    meh Contributing Member

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    Unfortunately a bit pointless for the Rockets if I have the timetable correct. The deal is set to expire in 2016, meaning the cap will get a sizable jump that year. But from all of Morey's moves, the key year seems to be 2015(unwillingness to take on Green, Lee, Young's contracts during Asik rumors), which is before the likely leap in cap number.

    Or does Morey predict a nice cap bump even in 2015?
     
  3. Voice of Aus

    Voice of Aus Contributing Member

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    This is stupid IMO. You can't just add an extra almost 50% level to the tax level in the current cba, it would make FA pointless as every team would match every offer since the limit they can offer is relevent to the current cap.

    This must be BS
     
  4. A_3PO

    A_3PO Member

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    Don't know if it's that simple (if this is actually true). For struggling small market teams, basic economics, not just the luxury tax, could still weigh on their payroll.

    For large market franchises, they can spend $18 million more without missing a beat. Chump change for them.
     
  5. WinkFan

    WinkFan Contributing Member

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    The players make a certain percentage of revenue. If the TV revenue goes way up, so does the cap.
     
  6. finsraider

    finsraider Member

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    The league's estimate for 2014-2015 was $62.1 million. If you just assume a 3% increase the following year, you get about $64 million. That gives you just enough to sign Love/LMA and keep Harden, Howard, Parsons, Beverley, Canaan, and maybe one other player under $1.5 million.
     
  7. crash5179

    crash5179 Contributing Member

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    The Luxury Tax Threshold is based off of the Salary Cap which is based off of BRI (Basketball Related Income). If the BRI goes up then the Luxury Tax Threshold goes up and it's really as simple as that since it's collectively bargained with the players union.

    If that happens then it puts the Rockets in the catbirds seat when free agency rolls around that season. What Free Agent wouldn't want to play on the Rockets provided salary was not an issue?
     
  8. xiki

    xiki Contributing Member

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    Great argument on the Jazz' guy's account. I mean, Player union efforts are working hard on this even as we speak.

    No, wait - - there is a total void, a vacuum in union headquarters.

    The flip side of the argument is out there that the Ownership side is licking its lips at the Union's unpreparedness for a fight, so they want to give them one.

    My guess is that this time Commish-for life-successor Silver works with ultimate Union leader(s) and get new deal brokered without lockout.
     
  9. Deckard

    Deckard Blade Runner
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    Wow! It would be huge (no pun intended), not just for the Rockets, but around the league. I find it hard to believe, not so much the number, as I think that's a more realistic number for teams in today's NBA, with the increasing success of the league. Aside from that, we have a devalued dollar, and the need for teams not connected to New York or Los Angeles, with their huge media deals, to be able to offer competitive salaries to star players without getting hammered with penalities that the richest teams might not care for, but can afford. I'd welcome it (because it would help the Rocks with an owner like Les), but am highly sceptical. However, time answers all, so I guess we'll see! If cats like crash think it's possible, who am I to argue? ;-)-
     
    #9 Deckard, Mar 8, 2014
    Last edited: Mar 8, 2014
  10. RocketsJumer

    RocketsJumer Member

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    Typical Jazz. Going to overpay for Gordon Hayward..
     
  11. basketballholic

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    Current projections are $62.9 million cap for 2014-15 and $75.7 million luxury tax threshhold.


    (Now everything after this is off the record)

    Snooping around with some of my friends...the rumors concerning 2015 are revenues are expected to continue to rise at the same growth rate and projections are around $68 million cap and around $82 million luxury tax threshhold. One guy I spoke with said he had heard as high as $70 million projections for 2015-16 salary cap.


    Now, just taking a peak at our 2015 cap, we've got: Dwight/James/Chandler(cap hold)/Bev(cap hold) on the books for a total of $41,687,788.70. Throw in 8 minimimum salary cap slots and you've got a total of $45,888,532.70. What this means is for us to sign a 7+ yr free agent(Love or Aldridge) to a max deal, we will need the cap number to rise to $65,555,047 in 2015. (This is assuming we have moved out Jones, DMo, Covington, Canaan, Daniels and any other contracts we put on the books between now and then.)

    Now in the above scenario if we want keep say...Canaan, Covington, and Daniels (no reason to keep Jones/DMo if we are signing Love or Aldridge) then we need the cap to rise to at least $67,364,402.

    So, let's say that happens and then of course we've got to deal with Parsons' and Bev's deals. It's pretty obvious we will likely hit the luxury tax in 2015-16. But then the new deal hits...and we're probably out of it the next season if the rumors are true of the luxury tax going to $100 million 2 years from now.
     
  12. basketballholic

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    I doubt it. Gordon is a top-notch player. If he had signed an extension this year the Jazz would have been in the catbird's seat in regarding to his contract. Twould have been a Rondo-esque bargain for them. They'll probably still get a bargain matching some other team's 4 year offer.
     
  13. A_3PO

    A_3PO Member

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    You think Gordon Hayward is top notch? LOL! Is Chandler Parsons a superstar?

    What does Hayward do that makes him "top notch"?

    Jazz made the right decision not to overpay him. Would have been a huge mistake.
     
  14. pmac

    pmac Contributing Member

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    This is what I was thinking. If the cap situation doesn't change drastically, it would be possible to sign a big name free agent and re-sign Parsons/Beverley but very costly down the line.

    I'm also uncertain as to how much more valuable a star forward (likely playing a Chris Bosh like role) + minimum salary PF is over a more experienced Jones/Dmo.
     
  15. Aleron

    Aleron Contributing Member

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    James Harden will probably be making less than someone who signs a max deal in 2015/16, lol. All things aside, by being the guy who got the max at the new bri year, he seems to have gotten screwed.
     
  16. Aleron

    Aleron Contributing Member

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    Um, you have Love/Aldridge being paid almost 20m when their maxes would be 18.2m. My guess is you're doing the calculation at 30% when the decoupling of the bri models between cap and maxes means its really 28.25%
     

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