While the Cavaliers are still basking in the glory of their first championship, other NBA teams have begun the frenzy of assembling their rosters for next year. It’s called free agency – a period when teams can sign players whose contracts are up. And this month, they’ve been doling out dollars like never before. WKSU commentator Terry Pluto says there have been some outrageously huge contracts handed out in the first week of free agency.
"There's never been a salary explosion like this one," Pluto says.
For example, Cavs back-up point guard Matthew Dellavedova reportedly will sign a four-year, $38 million contract with the Milwaukee Bucks.
“I never thought I’d say $10 million a year is Delly money,” Pluto says. Last season's folk hero, Dellavedova played very few minutes during the NBA Finals as Kyrie Irving, J.R. Smith, Mo Williams and Dahantay Jones took the spotlight.
The salary cap and the lesser-known floor
There is more money to go around because of a new nine-year TV rights contract. The salary cap went up from $70 million to $94 million for this upcoming season. Pluto says some teams, like the Cavs, go over the salary cap and pay a luxury tax.
But he says there's another aspect to the salary cap that few people are aware of. It’s called the salary cap floor, which is $85 million.
"Let's say if a team wants to run a discount operation and their payroll is $70 million, the league would then come in and say, ‘You must spend $85 million. So you must spend $15 more million and if you don’t, we will take it and divide it up with everybody on your roster.'
"So what you’re seeing is some teams that are not very good and have lower payrolls throwing a ton money at very mediocre players to hit the [salary cap] floor."
The new money game
Pluto says it's all part of a new era in NBA contracts.
"Players want to beat the team in negotiating [and] the agents want to win; it helps them attract new clients."
And he says the players get competitive with each other. Miami Heat star Dwayne Wade is a good example. At 34, Wade's a free agent and his career is winding down.
"Wade has made hundreds of millions of dollars in his career. It doesn’t matter. Wade has never had a maximum contract or anything close to that. He wants to be paid. He wants $50 million for two years. There’s all these rumors that [he could sign] with the Cavaliers. They would have to practically give away Kevin Love to some team. Dwayne Wade is not coming here.”
Undercutting players
Pluto says superstars like LeBron James also got fed up with deals they made in the past.
"In 2010, when LeBron James, Chris Bosh and Dwayne Wade went to Miami, they all signed contracts for about $19 million each, down to the penny. That was about $2 million under the maximum contract. The players discovered later on that the teams were using these contracts to undercut other really good players, arguing, ‘Well Lebron James doesn’t get the max contract.’ Well, LeBronand those guys heard this and got very upset."
So, Pluto says that when James returned to the Cavs, he told Dan Gilbert he wanted a max contract. He had never been the highest-paid player on his team until now.
Welcome to the NBA in 2016
Pluto says it all comes down to everyone trying to win the money game.
"Competitive people looking at millions upon millions of dollars that are incomprehensible to most of us. [The players] want to beat the owners out of how much they can get. The owners want to hold the line on how much they can give. And the agents want to get very attractive contracts to bring in new clients.
Welcome to the NBA in 2016. And remember, if you don’t spend your $15 million, they’ll spend it for you."
