It's a brave, and somewhat scary, new world in the NBA where salaries are going to skyrocket as teams and players play a game of chicken for the next few years as they angle for the best contracts.
The salary cap is expected rise and fall in the shape of a camel's back over the next four years: $67.1 million, $91 million, $108 million, $100 million, $102 million. Player salaries on new contracts will rise and fall at the same rate, expect for players on rookie deals (which are predetermined in the CBA).
Either or both sides can opt out in the summer of 2017, but with the cap expected to balloon to it's highest value yet and a Commissioner who seems set on compromise, we might not see another 6-month holdout. Money talks.
Let's take another look at the Suns current cap sheet.
Existing long term contracts
While any evaluation of the Phoenix Suns must begin with the players and end with the win totals, you cannot deny that the Suns have negotiated quite reasonable contracts with their players especially considering the rising cap.
I touched on this the other day, pointing out that Eric Bledsoe will make barely more than the league average in two years, and that Markieff Morris and Marcus Morris will be paid well below league average. None on these players will have the advantage of signing a free agent contract at the apex of the salary cap. Players and their agents knew this would happen, yet wanted the financial security that comes with a long-term contract.
Veteran free agents
A real winner this summer is a veteran free agent. While the cap is rising only slightly this summer, it will explode in the coming years. So teams will be less worried about exceeding the cap and/or luxury tax this summer to bring back players on today's discounted rates.
Even an owner who hates paying more than he has to will likely be operating with an open pocketbook this summer. There's an artificially low cap to curb spending, but since next summer's cap will be 32% higher there's no reason to pinch pennies.
Players like Gerald Green can only benefit. And we might just see him come back to the Suns this summer because the Suns can use Bird Rights to exceed the cap to re-sign him. Of course, the Suns have to want him back. The decision to bring back Gerald will depend on precursor moves, of course.
If they really want to move on from Gerald, that's easy to do. I'm just saying it's also easy to re-sign him too. As I described the other day, as long as the Suns want to bring back Brandon Knight and Brandan Wright, they might as well keep the Bird Rights on all their free agents and enter the summer as a "cap" team, giving them the midlevel exception to sign free agents from another team.
You might see the Suns consider a run at an enticing RFA from another team, gutting their own free agents in the process, but in the end the Suns will likely see that move as fools gold.
Restricted free agents (Butler, Leonard, Green, Middleton, Knight)
Amin Elhassan of ESPN does a great job breaking down the market in the "new world". He says that restricted free agent players like Draymond Green and Khris Middleton are "no brainers" to receive a MAX extension offer this summer. He does not mention Kawhi Leonard or Jimmy Butler because those two would get a max offer regardless of the future landscape. It's middling players like Green and Middleton who will benefit greatly.
Translation: lots and lots of maximum level RFA offers will be made this summer. The big question is contract length.
This summer's starting salary on a max extension for a player coming off a rookie deal is $15.76 million, with a max of 7.5% raises. Next year, the max for a player off a rookie deal goes up to almost $21 million, and the year after that it's $25 million. By 2017, the average NBA player will be making $12 million a year on a new deal.
The best RFAs, including Kawhi Leonard and Jimmy Butler along with Middleton and Green, will be bargains by 2017 under those terms unless they get back on the market in 1-2 years.
I showed this in a chart the other day that I will repeat here.
My numbers differ slightly from Amin's (in the article linked above) but the point is the same. An RFA this summer who gets (and takes) a max long-term offer will make $4 million LESS than an RFA who takes a max offer next summer, and almost 10 million per year less than an RFA who gets (and takes) a max offer in the summer of 2017.
You know what that means? The best RFAs won't want to sign a long term deal if they don't have to.
They'd rather get back on the market when the going is good. Their own team can offer a contract of any length - 1, 2, 3, 4 or 5 years - and you can bet that players will be angling for the 1-2 deal range.
Even setting aside the QO, a home team can offer any size of one-year contract to their RFA, up to the $15.8 million max, to allow them back on the market next summer. While no team would WANT to do that, the bad blood created by making a player take the teeny tiny qualifying offer might be worth avoiding by splitting the difference on a one-year contract.
Other teams will be at a disadvantage, even more than previous off seasons (we saw what happened to Eric Bledsoe and Greg Monroe last year). The terms of the CBA require another team to offer a minimum of two guaranteed years (three total, including options) to an RFA in an offer sheet. For the best RFAs this summer, any RFA offer sheet of any length signed by the player will be matched immediately by the "home" team because the salary is such a bargain.
And if the "home" team preempts everyone by offering the full 5-year max extension - which is ONLY available to one player at a time on a team, for the life of that contract as long as the player remains on the team - then the minimum RFA offer sheet from another team must include three guaranteed years.
You know what that means? That means this summer is a game of chicken for RFAs. The best RFAs this summer won't want to sign a three-year contract because that would put them under contract until at least 2018, making them bypass the biggest salary cap bubble.
It will be a question of belief in oneself versus income security. Bledsoe, Morris and Morris chose security. Brandon Knight, Greg Monroe, and others chose the insecurity of the one-year deal to get onto the market this summer.
Will Green, Middleton, Knight, Butler and Leonard sign short deals to get back onto the market in 2016 or 2017?
Teams certainly hope not, as Amin points out.
Players on shorter deals, testing free agency more often, are more likely to switch teams more frequently, especially as the increase in the cap continues to outpace the maximum allowable salary raises. If you're always better off signing a new deal than sticking to a 4.5 percent (or even 7.5 percent) raise, what's the incentive of Bird rights? The answer is there is no incentive, and so not only will players continue to seek bigger paydays to maximize their earnings but they'll also hold teams accountable in their roster construction: If real, immediate progress isn't sensed, it's in a player's interest to pack his bags and seek a better situation. Teams won't have four or five years to prove they can build a winner.
Expect Brandon Knight to push for a lucrative 2-year guaranteed deal (maybe a player option on the third year) to get himself back on a cash-flooded market in 2017 when he's still only 25 years old. The Suns would be foolish not to match any offer sheet that Knight would sign, even up to the max contract.
Draft Rights to overseas players (Bogdan)
The salaries for rookies are written into the CBA, and are not a factor of the cap. So a late first round pick will remain stuck on a $1 million contract for a two-and-two deal (two guaranteed years, and two options) with slow rise in salaries. However, after three years the salary restrictions disappear, while the draft rights remain. Nikola Mirotic, for example, signed a $16.6 million, 3 year contract last summer by waiting out that three years.
This problem directly impacts Suns draft pick Bogdan Bogdanovic, likely pushing his US debut into the 2017-18 season rather than next summer.
If Bogdan comes over next summer (2016), two years after he was drafted, he will be stuck with a 4-year contract that makes barely more than $6 million. But if he waits just one more year, he can sign a market-rate contract with the Suns with a salary cap at an all-time high of $108 million.
Why not come over in 2017 and sign for, say, $7-10 million per year? Bogdan is going to wait.
The Suns will likely dip into the trade market to acquire that star player, if there's one to be had. That's really where the team's reshaping will have to come this summer. Once we get into the ballooning cap, THEN the good free agents might start team-hopping for a year or two at a time, like the NFL works.
Draft picks will be gold because salaries can be controlled. The Suns already have a number of players on the rookie deals and will continue to bring new ones in. If Bogdan waits until 2017, and if the Suns don't win the lottery and push the Miami pick into the 11th spot, heres the future incoming players for the Suns:
- 2015: #13 overall pick
- 2016: Suns first round, Cleveland first round
- 2017: Suns first round, Bogdan on market rate deal
- 2018: Suns first round, Miami first round (Top-7 protected)
- 2019: Suns first round
- 2020: Suns first round
- 2021: Suns first round, Miami first round (unprotected)
With only three players under contract through 2018 (and none of them guaranteed to stay long term), expect the Suns to have a ton of roster turnover in the coming years.
The new TV money and the rising salary cap, resulting in shorter deals, will create a very changing NBA landscape every summer.