I've stated this as part of discussion's in other articles already but I still see people wondering why Les wont go into the luxury tax or under the delusion that he would. Or else complain that he's greedy since he wouldn't. The following two articles clearly explains why. http://www.realgm.com/src_feature_article.php?articleid=8 http://www.bayarea.com/mld/mercurynews/sports/6090803.htm Basically what I believe is happening is that if an owner stays below the tax, he's guarantee 10 - 20+ million dollars in profit, but if he goes above the tax even just a few million, he would definitely lose 5 - 15+ million dollars. This is a combination double hit from the tax and not getting the escroe fund from player's refund in salary. I think the reason the Rice deal was so bad and we were so desperate in doing the trade was because Les honestly believes that if he's over the tax, he'll probably lose 5 - 10 million instead of a possible 30 million profit (based on last year's earnings). That's 35 - 40 million dollar swing. I also think that's why they didn't match Posey's offer since it might put us in the luxury tax for the next several years, that can possibly cost Les over 100 + million. I think with exception of owners like Cuban, Paul Allen or the Maloof brothers that are or near billionares, most owners simply can not afford to loose 10 - 20 million dollars every year. So before any one continues to be delusional, here's the bottom line: Les will never go into the luxury, he can't afford to financially For those that say you need to spend money to make money, Les is spending as much as he can to make money (though I would like him to bite the bullet for just one year and kept Rice to be traded for a better deal later on this year). Please stop comparing Les to Cuban and say you can still turn a profit by looking at Cuban, Cuban lost close to 48 million dollars in the past 4 years (including one year when luxury tax didn't come in effect and he made 3 million). While Les isn't or doesn't have the pocket book to be an owner like Cuban, he definitely try to put the best product he can afford on the court. So unless there's a billionare out there with strong strong interest in the Rox, and have enough money and desire to free wheel and deal even after purchasing the team, I dont' believe we will see us in luxury land ever.
I didn't have time to read these articles, but around the time of the decision on Posey someone posted a reliable article stating that teams slightly over the LTax actually made money after the dispersion of the collected tax for 2002-03. I'll revisit this after the Sixers at Kings. On the surface, I smell more "why didn't we go after Posey harder" sentiments.
I believe from a basketball point of view on the Glen Rice deal,we really didn't have a spot on the team for Glen but the IR, with Pike already signed. Besides I like Jackson over Posey anyway because he brings veteran leadership and he can play,and JJ was byproduct of the Rice deal.It was like we traded Rice for Pike,Jackson and Meech.Though I agree we gave up too high of a draft pick,because the Jazz needed to add salary by NBA rules.We helped them also,so yes CD could have cut a better deal,but it still was a ok deal for some one with a high salary who never was going to earn a spot on our roster.I'm cool with the roster we got for now.
http://members.cox.net/lmcoon/salarycap.htm#16 The article gives an ex. of who makes and loses money. Ex, tax threshhold $52.9. Team with $50 mil payroll receives $16.3 mil tax, escrow and surplus refund. Team with $54.7 mil payroll receives 9.5 mil. Team with $60 mil payroll receives 0.9 mil Team with $80 mil payroll pays out ($19) mil.
