Post-Lockout NBA To Mirror This NFL Chaos? Yes and No.

Amid all the post-lockout chaos in NFL rosters, you must be wondering how this correlates to the NBA, when they finally resolve their debt-ceiling debate CBA negotiations.

Will NBA free agency be a whirl-wind of chaos just like the NFL this past week? The Arizona Cardinals have signed 51 of 90 training-camp players in the last 5 days. At least 6 of them are starters and a dozen more are regular rotation players.

One similarity is certain: the NBA free agency period post-lockout will be just as abbreviated as the NFL's (one week or less before training camp begins). Free agency will be a free-for-all. Guys will sign contracts and go directly to training camp. No waiting to see how it turns out. No prosthletizing over "fit" and chemistry. BOOM. Answers within days instead of months.

But will we see new signings every hour for a week? No

Major roster turnover on nearly every team in the league? No.

Fortunes and futures changing in the span of mere days? No

As long as the NBAPA and player-agents have a say in the matter, the NBA will never be as sexy (and solvent, and competitive) as the NFL.

Here's why...

1. The NFL does not guarantee salaries for the length of the contract; whereas nearly every NBA contract is 100% guaranteed

In the NFL, nearly every player has to earn his paycheck year over year. There are no guaranteed contracts beyond year one after your rookie contract expires. That's why player-agents and NFL front offices use huge signing bonuses. Nearly 40% of many contracts are paid on day one as a signing bonus, which for cap purposes can be spread out over the length of the contract's term even though the money is in the player's hand already.

Consider Kevin Kolb, the recently acquired QB who got $21 million last week for every win on his NFL resume ($63 million for a lifetime total of 3 wins as a starting QB). Sounds crazy right? Not really. Only $21 million of that is guaranteed (signing bonus, year 1 salary, year 2 salary). Considering a rational team would give the talented 26-yr old Kolb 2 seasons to settle in regardless of what happens, that's only $10.5 million per year for your starting QB which is about the league average for a good starter. Kyle Orton in Denver is getting nearly that much already, and what has he done? He led Denver to a 3-10 record last year.

Yet now the Cardinals have a great situation: Kolb is both a stop-gap AND long-term option. If Kolb works out as a good NFL starter, he's locked up for 5 years. If he fails, the Cardinals can start over in 2 seasons and only spend the same they would have invested in, say, Orton.

Does that happen in the NBA? No.

What's interesting is that the NBA's old CBA DID allow for non-guaranteed deals, but for some reason the NBA has never used it on a regular basis. Nearly all contracts end up guaranteed 100%, the only exceptions in the owners' favor being "early termination options" which are rarely included and even more rarely executed.

 

2. If an NFL player is not living up to his contract, he can be released in the offseason and his annual salary drops off the cap; whereas in the NBA he stays on the team at full price

Wouldn't that be nice. This is what Amare Stoudemire and the Suns haggled over last summer. Sarver wanted to give Amare a max money "NFL" contract, guaranteeing only 3 of the 5 years (no signing bonuses in the NBA). Amare wanted "an NBA contract", so he signed with the New York Knicks who were happy to give him all 5 years guaranteed.

Now Amare is on the Knicks payroll at 16-20 million a year for the 5 years, regardless of whether he plays the games or not. Eddy Curry. Allan Houston. Jerome James. Tracy McGrady. Just a few players with exorbitant contracts on the Knicks cap in recent seasons who barely contributed. And that's just one of the 30 NBA teams.

 

3. The NFL uses signing bonuses liberally, because the cap impact can be spread over the length of the contract years; the NBA... doesn't.

In the NFL, a large portion of money can be paid immediately as a signing bonus. This is a MAJOR carrot in negotiations on several fronts.

It's great for the player, because the more you get as a signing bonus, the happier you feel on day one. Like winning the lottery. Second, the more you got on day one, the more you can stomach the idea of being released a year later. Why? Cuz then someone ELSE can give you a brand new signing bonus when you sign with them.

In the NBA, there is a modest max on signing bonuses, and they count fully on the year-one cap.

 

4. More on the wonder of NFL signing bonuses

In the NFL, there is no correlation between the size of the bonus and the annual salary. The cap-hit of the bonus is spread out over the life agreed contract, regardless of how many years are guaranteed.

Example: An NFL team can sign player X to a 5-yr/$35 million contract, structured as $10 mil in signing bonus, then $5 mil per year for 5 years ($35 million total contract). Player A takes home $15 mil in year one, then is scheduled for $5 mil per year for 4 more years (none guaranteed). The team's cap hit in each year, including year one, is $7 million.

The team now has options. If player X is not worth a $7 mil cap hit in a subsequent year, just release him and his cap hit drops to $2 mill (the prorated signing bonus "money", commonly called "dead money"). The team can now spend $5 mill on anyone they want to replace the released player. BAM.

Wouldn't that be a nice option with Josh Childress (not that I want Childress gone - I love that guy), or Marcus Banks before him?

The player is happy cuz he got $15 million for one year's work. The team is happy cuz they can replace him if he doesn't work out.

 

5. Restructured contracts make everyone happy

Of course, (taking that same example above) sometimes the player is worth a lot MORE than the $5 million you're paying him in those later years. And sometimes that player gets REALLY unhappy about it. This happened with Anquan Boldin, Karlos Dansby and Darnell Dockett of the Cardinals in recent seasons. They all "forgot" about the big day-one payout on their first non-rookie contract and started complaining with several years left on their deals.

The team has options there too. The first option is to make the player finish his contract. Teams has control in all cases. Dansby, Dockett and Boldin had to play for Arizona or no one.

The second option is to restructure, giving the player another pot-o-gold bonus while the team can once again spread the cap hit across multiple additional seasons. Dockett was rewarded this way because he was a professional and never held out of camp. Boldin complained regularly, was never renegotiated and eventually got traded. Dansby just kept signing his Franchise tenders, then bolted when he was able.

 

Summary

That's just a few of the differences between the NFL world and the NBA world. Due to guaranteed contracts, NBA owners are over a barrel, completely help captive by the players they've signed, and limited in their rebuilding efforts.

Here's hoping an outcome of the new CBA is more closely align with the NFL's much more successful version.

I'll share this again:

Rebuilding and competing in the NBA is hard. In the NBA, two teams have won half the championships (LA and Boston) in its history. In the NFL, there have been 10 different NFC representatives in the last 10 Super Bowls. And half the league has won a championship in the last 30 years. Half the league. Now THAT'S competitive balance.