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IndyHoya
07-04-2012, 12:50 PM
Help me with this as I'm trying to understand it. Maybe I've got something wrong.

Portland has made an offer to Roy. The Pacers have Bird Rights on Roy. Owing to the Bird Rights, if we match Portland's offer, the funds we have to expend to match won't be counted against the Pacers' salary cap. Thus, if we have to pay Roy the funds necessary to match Portland's offer, there shouldn't be any negative consequences from a salary cap standpoint in trying to acquire other new free agents (for example Chris Kaman) provided such doesn't push us up into Luxury Tax territory.

I guess my question is, if we have Bird Rights on Roy, we can still acquire other players, right? And really, given the Bird Rights on Roy (and there being no negative salary cap implications), isn't the question of matching or not matching really just a question of whether Herb Simon wants to spend the bucks to do it? If Herb follows his traditional course then, he won't be stingy and he'll go ahead and spend what it takes to keep Roy. Under the above scenario, matching or not matching Portland becomes merely a question of whether Herb is willing to pay the money and much of the drama about whether or not to sign Roy goes away.

Am I missing something important here? If so, please explain.

BrownBearCoffee
07-04-2012, 12:54 PM
No, that's about right. We can sign other free agents as long as we sign them before Roy and Hill. We can only go above the salary cap for our own free agents, so they have to be the last piece of the equation. So, yes, it essentially comes down to if we want to spend the money on Roy. Personally, I think he will be a Pacer by the 14th.

aamcguy
07-04-2012, 12:56 PM
You are correct. But we have to sign outside free agents before resigning Hibbert. If we resign Hibbert first, the only thing we will be able to use is the mid level exception to pick somebody up.

Hicks
07-04-2012, 01:51 PM
*edit* I made some math mistakes in this post, see future replies before you quote me and correct me; it's probably already addressed if you keep reading*

It's not quite right to say that Roy's contract 'won't be counted against the Pacers' salary cap'. It does count against the cap. It's just that there's a loophole that allows you to use the cap space elsewhere first. Reason for that is, as stated, the cap DOES NOT STOP YOU from re-signing your Bird Right free agents. The Bird Rights are one of the handful of exceptions that makes it a soft cap instead of a hard cap.

But once the contract is on the books, it does count towards the cap.

The salary cap is about $58,000,000. The luxury tax starts somewhere around $70 or 72m. About a 12-14 'zone' in between.

Right now, essentially, we're sitting at roughly $47,000,000 or so (counting who we have signed, and some other technicalities). That $11,000,000 could most wisely be spent (in theory) on outside help from free agency. Like say Nash was dying to come here first, we could pay him, say, $10,000,000 in '12-'13, leaving about $1,000,000 of cap space left.

Since we have Bird Rights on Hill and on Hibbert, that means we're not forced to offer them both $500k, we can offer them these contracts they're about to get because those rights allow us to ignore the cap and go over it. Hill's deal will start at about $6.5m, which jumps us up in this Nash fantasy to about 63,500,000, which is obviously above the cap, yet below the tax. Roy's deal will start at about $12 or 12.5. If it's 12.5, in the Nash fantasy, we'd then be in danger of being in the luxury tax because we'd be sitting then at about 75, 76m.

I highly doubt we want to be tax spenders. So I view the 70 or 72 (whatever it is; I have to look it up again) as our TRUE cap or self-imposed 'hard cap'.

Given what we think we know about Hill and Roy's deals, that's going to start at about 18, 19m combined, taking us to about 66,000,000.

So if we do keep Roy, the most we're going to spend on outside help is about 4-6 million unless we dump salary elsewhere.

I hadn't thought about that before or for a long time, but actually this helps explain our limitations and why we weren't necessarly going to sign certain people (AND keep Hill AND keep Roy, at least).

BringJackBack
07-04-2012, 01:56 PM
It's not quite right to say that Roy's contract 'won't be counted against the Pacers' salary cap'. It does count against the cap. It's just that there's a loophole that allows you to use the cap space elsewhere first. Reason for that is, as stated, the cap DOES NOT STOP YOU from re-signing your Bird Right free agents. The Bird Rights are one of the handful of exceptions that makes it a soft cap instead of a hard cap.

But once the contract is on the books, it does count towards the cap.

The salary cap is about $58,000,000. The luxury tax starts somewhere around $70 or 72m. About a 12-14 'zone' in between.

Right now, essentially, we're sitting at roughly $47,000,000 or so (counting who we have signed, and some other technicalities). That $11,000,000 could most wisely be spent (in theory) on outside help from free agency. Like say Nash was dying to come here first, we could pay him, say, $10,000,000 in '12-'13, leaving about $1,000,000 of cap space left.

Since we have Bird Rights on Hill and on Hibbert, that means we're not forced to offer them both $500k, we can offer them these contracts they're about to get because those rights allow us to ignore the cap and go over it. Hill's deal will start at about $6.5m, which jumps us up in this Nash fantasy to about 63,500,000, which is obviously above the cap, yet below the tax. Roy's deal will start at about $12 or 12.5. If it's 12.5, in the Nash fantasy, we'd then be in danger of being in the luxury tax because we'd be sitting then at about 75, 76m.

I highly doubt we want to be tax spenders. So I view the 70 or 72 (whatever it is; I have to look it up again) as our TRUE cap or self-imposed 'hard cap'.

Given what we think we know about Hill and Roy's deals, that's going to start at about 18, 19m combined, taking us to about 66,000,000.

So if we do keep Roy, the most we're going to spend on outside help is about 4-6 million unless we dump salary elsewhere.

I hadn't thought about that before or for a long time, but actually this helps explain our limitations and why we weren't necessarly going to sign certain people (AND keep Hill AND keep Roy, at least).

Dang. Keeping this team together only gives us six more million in flexibility until we hit the tax?!?!?!?! Did you count that right? I counted around 37 million, minus the Hill, Hibbert, and Price cap holds. Throw 20M on there from Roy and Hill and we are only at 57, and not 67... Which is a lot more stable.

Hicks
07-04-2012, 02:04 PM
Actually, I think the LT may be closer to 70 than 72. Yeesh. We'll only have $4m for a starting salary on any free agent we pursue if we match Roy now. No wonder we aren't netting much.

Hicks
07-04-2012, 02:07 PM
Dang. Keeping this team together only gives us six more million in flexibility until we hit the tax?!?!?!?! Did you count that right? I counted around 37 million, minus the Hill, Hibbert, and Price cap holds. Throw 20M on there from Roy and Hill and we are only at 57, and not 67... Which is a lot more stable.

Maybe you're right.

Actually, yeah, I think you are right. I forgot the reason our cap space isn't bigger than $11m is the cap holds of Roy and Hill.

Yep, that's it; Hill and Roy's cap holds push our team salary from about $36m to about $47. They were cap holds of about 6.5m and 4m respectively. So subtract that 10.5m I should not have included. Now it makes more sense. I was puzzled for a moment as to how it got so bad so fast. :laugh:

Hicks
07-04-2012, 02:08 PM
So now that I think I have my head on straight again, it's actually 36 + about 6.5 and about 12.5, equaling about 56m. Which means we're still 14 away from the tax. Whew.

BringJackBack
07-04-2012, 02:11 PM
Maybe you're right.

Actually, yeah, I think you are right. I forgot the reason our cap space isn't bigger than $11m is the cap holds of Roy and Hill.

Yep, that's it; Hill and Roy's cap holds push our team salary from about $36m to about $47. They were cap holds of about 6.5m and 4m respectively. So subtract that 10.5m I should not have included. Now it makes more sense. I was puzzled for a moment as to how it got so bad so fast. :laugh:

Whew. I faced some Pacer-fan doom for a second. Everything has been so bright and sun-shiney lately until the draft and then it seems like things have gone sour. First the pick, and then the possibility of not re-signing Roy, and now what we perceived to be no flexibility suddenly.

This gives us all the more reason to match Roy, though

Cubs231721
07-04-2012, 02:13 PM
That 47 million figure includes Hibbert and Hill's cap holds. So if the Pacers actually sign them, the extra you add to that 47 million figure is only the difference between what their salary is and what their cap hold was. So for example, Hibbert's cap hold is almost 6.5 million which is reflected in that 47 million figure. If they match the max offer, his salary will be 12.9 million. But remember that 6.5 of that is already accounted for to get to 47 million. So you just add 6.4 more to get his total new cap hit, which would put the Pacers at 53.4. Hill's deal would work the same way.

So the Pacers should be able to spend all 11 million of cap space if they wanted to without going into the luxury tax this year (they would probably be about 2 million away) but depending on how long the new contracts are that would leave them little room to maneuver in future years.

IndyHoya
07-04-2012, 02:31 PM
But in future years, presumably, an acquisition might be accompanied by a trade, which would reduce cap hold and free up more cap space. Maybe it isn't as bleak for the future as it sounds at first blush? Just asking. I'm still trying to figure this all out.

tadscout
07-04-2012, 02:35 PM
Upcoming expiring contracts after this season-
West - 10m
Jones - 2.9m
Hans - 3.055m
DC - 2.32m
Pendergraph - 1.5m
= 19.775 (total if we need to renounce all the RFA) (Lances guaranteed deal would push us over 20m space)

Obviously we won't get rid of all these players. West's age could cut his salary down to 6-8m for example.

Point is we do have breathing room from the Lux tax (and could even slide under the cap), even if/when we match Hibbert and add another piece.

Such a solid and young core, being over the cap won't hurt us... we can still build through the draft, trades, and exceptions.

Hicks
07-04-2012, 02:42 PM
This inspired me to dust off an Excel spreadsheet I have with our salaries and some of the cap information and start updating and projecting with it based on what we think we know now.

As of right now, I have our 2013 team salary, adding in the estimated new Roy and Hill deals, subtracting the cap holds of Barbosa, Foster, Lou, Roy, Hill, and AJ, and adding in my knowledge/estimates of Plumlee and Johnson's presumed contracts, and I have the team salary at about $57,473,923.

IndyHoya
07-04-2012, 02:48 PM
This inspired me to dust off an Excel spreadsheet I have with our salaries and some of the cap information and start updating and projecting with it based on what we think we know now.

As of right now, I have our 2013 team salary, adding in the estimated new Roy and Hill deals, subtracting the cap holds of Barbosa, Foster, Lou, Roy, Hill, and AJ, and adding in my knowledge/estimates of Plumlee and Johnson's presumed contracts, and I have the team salary at about $57,473,923.

Wow, that doesn't seem so bad at all. All the more reason we should sign Roy IMHO

BringJackBack
07-04-2012, 02:51 PM
Upcoming expiring contracts after this season-
West - 10m
Jones - 2.9m
Hans - 3.055m
DC - 2.32m
Pendergraph - 1.5m
= 19.775 (total if we need to renounce all the RFA) (Lances guaranteed deal would push us over 20m space)

Obviously we won't get rid of all these players. West's age could cut his salary down to 6-8m for example.

Point is we do have breathing room from the Lux tax (and could even slide under the cap), even if/when we match Hibbert and add another piece.

Such a solid and young core, being over the cap won't hurt us... we can still build through the draft, trades, and exceptions.

The thing is that we don't have David West's bird's rights which sucks. So we'd have to be at least around 48 million in payroll to be able to reasonably re-sign him. If that weren't the case we could go the same route that teams go with RFA's and hold off until we get more ammunition for the team.

IndyHoya
07-04-2012, 03:03 PM
That brings up another question: Are Bird Rights portable? We seem to have acquired George Hill's Bird rights, buy why not David West's? Anybody able to answer this one?

Hicks
07-04-2012, 03:05 PM
The thing is that we don't have David West's bird's rights which sucks. So we'd have to be at least around 48 million in payroll to be able to reasonably re-sign him. If that weren't the case we could go the same route that teams go with RFA's and hold off until we get more ammunition for the team.

Are you sure about that? Wasn't there just recently a court battle that let guys like Jeremy Lin have some kind of Bird rights?

Will Galen
07-04-2012, 03:05 PM
So now that I think I have my head on straight again, it's actually 36 + about 6.5 and about 12.5, equaling about 56m. Which means we're still 14 away from the tax. Whew.

The front office also has to look how new contracts will effect the team payroll in future years too. It would be stupid of the front office to sign players right up to the luxury tax line this year, then have those contracts put us over the tax in coming years.

Herb Simon doesn't want to pay the Luxury tax. I think he would pay some tax if he knew we had a contender and knew the fans would show up, but he's not going there until the fans show they are back. I think Bird left because he felt this was the year to strike, but Herb wouldn't risk paying the tax yet.

As for fans . . . some people look at how things will fit this year and then throw a fit because the front office is not signing someone they think they should. They call the front office stupid and worse when it's the person doing the complaining that is stupid! They are making judgment calls without knowing all the ramifications.

Of course as fans there's no way we are going to get all the facts, but we do like to talk about our team, so we make judgement calls with what we know. However, as in everything, there's a ten percent that tend to go overboard.

Will Galen
07-04-2012, 03:23 PM
But in future years, presumably, an acquisition might be accompanied by a trade, which would reduce cap hold and free up more cap space.

That's true, but you can't plan it that way. Say we sign Hibbert and we are okay the first two years and we plan to trade someone when player raises puts us over the tax line.

However, we then have a bunch of injuries and we can't get rid of the players we want to because no one will take them. So now we are either forced to trade Hibbert to get under the tax, or we are forced to pay the luxury tax on a bad team and the fans quit coming making the problem worse.

The thing to do is don't make decisions that will put you at risk in future years.

Fans on the other hand don't care about that, after all it's not their money.

BringJackBack
07-04-2012, 03:27 PM
Are you sure about that? Wasn't there just recently a court battle that let guys like Jeremy Lin have some kind of Bird rights?

I am not sure about that at all. I was just going under the generic rule that 3 years under contract = birds rights, which is basically a complete and utter assumption.

IndyHoya
07-04-2012, 03:31 PM
This at Wikipedia:

Larry Bird exception
Perhaps the most well-known of the NBA's salary cap exceptions, it is so named because the Boston Celtics were the first team permitted to exceed the salary cap to re-sign one of their own players (in that case, Larry Bird). Free agents who qualify for this exception are called "qualifying veteran free agents" or "Bird Free Agents" in the CBA, and this exception falls under the auspices of the Veteran Free Agent exception. In essence, the Larry Bird exception allows teams to exceed the salary cap to re-sign their own free agents, at an amount up to the maximum salary. To qualify as a Bird free agent, a player must have played three seasons without being waived or changing teams as a free agent. Players claimed after being amnestied have their Bird rights transferred to their new team. Other players claimed off waivers are not eligible for the full Bird exception, but may qualify for the early Bird exception. Prior to an arbitrator ruling in June 2012, all players that were waived and changed teams lost their Bird rights.[8][9] This means a player can obtain "Bird rights" by playing under three one-year contracts, a single contract of at least three years, or any combination thereof. It also means that when a player is traded, his Bird rights are traded with him, and his new team can use the Bird exception to re-sign him. Under the 2011 CBA, Bird-exception contracts can be up to five years in length, down from six under the 2005 CBA.[6]

Early Bird exception
This is the lesser form of the Larry Bird Exception. Free agents who qualify for this exception are called "early qualifying veteran free agents," and qualify after playing two seasons with the same team. Players that are traded or claimed off waivers have their Bird rights transferred to their new team. Prior to an arbitrator ruling in June 2012, all players that were waived and changed teams lost their Bird rights.[8][9] Using this exception, a team can re-sign its own free agent for either 175% of his salary the previous season, or the NBA's average salary, whichever is greater. Early Bird contracts must be for at least two seasons, but can last no longer than four seasons. If a team agrees to a trade that would make a player lose his Early Bird Rights, he has the power to veto the trade.
A much-publicized example for this was Devean George, who vetoed his inclusion into a larger trade during the 2007–08 season that would have sent him from the Dallas Mavericks to the New Jersey Nets.

Non-Bird exception
Free Agents who qualify for this exception are called "non-qualifying free agents" in the CBA, meaning they do not qualify under either the Larry Bird Exception or the Early Bird Exception. Under this exception, teams can re-sign a player to a contract beginning at either 120% of his salary for the previous season, or 120% of the league's minimum salary, whichever amount is higher. Contracts signed under the Non-Bird exception can last up to four years (down from six under the 2005 CBA).

BringJackBack
07-04-2012, 03:34 PM
So he probably fits the criterion for the early Bird exception?

Hicks
07-04-2012, 03:35 PM
The front office also has to look how new contracts will effect the team payroll in future years too. It would be stupid of the front office to sign players right up to the luxury tax line this year, then have those contracts put us over the tax in coming years.

Herb Simon doesn't want to pay the Luxury tax. I think he would pay some tax if he knew we had a contender and knew the fans would show up, but he's not going there until the fans show they are back. I think Bird left because he felt this was the year to strike, but Herb wouldn't risk paying the tax yet.

As for fans . . . some people look at how things will fit this year and then throw a fit because the front office is not signing someone they think they should. They call the front office stupid and worse when it's the person doing the complaining that is stupid! They are making judgment calls without knowing all the ramifications.

Of course as fans there's no way we are going to get all the facts, but we do like to talk about our team, so we make judgement calls with what we know. However, as in everything, there's a ten percent that tend to go overboard.

Right. With my best calculations (which is by no means saying they're 99% accurate, but I think they're in the ballpark), we'd be about 12.5 away from the tax if we match Roy. My guess is we're willing to spend no more than between 6-9 of that due to future years. Just guessing.

tadscout
07-04-2012, 03:45 PM
Right. With my best calculations (which is by no means saying they're 99% accurate, but I think they're in the ballpark), we'd be about 12.5 away from the tax if we match Roy. My guess is we're willing to spend no more than between 6-9 of that due to future years. Just guessing.

That is still 1 more decent piece though.

tadscout
07-04-2012, 03:47 PM
I am not sure about that at all. I was just going under the generic rule that 3 years under contract = birds rights, which is basically a complete and utter assumption.

If Barbosa has a cap hold, if he doesn't have bird rights, what is the point of him having a cap hold?

IndyHoya
07-04-2012, 03:57 PM
Hmmm... This Indy Star article seemed to indicate that the cap hold might be higher than $58M:

"The NBA salary cap will be announced later this month. The cap was $58 million this past season and is expected to increase for 2012-13."

Ihttp://tinyurl.com/6th54p8

Larry Staverman
07-04-2012, 03:59 PM
This at Wikipedia:

Larry Bird exception
Perhaps the most well-known of the NBA's salary cap exceptions, it is so named because the Boston Celtics were the first team permitted to exceed the salary cap to re-sign one of their own players (in that case, Larry Bird). Free agents who qualify for this exception are called "qualifying veteran free agents" or "Bird Free Agents" in the CBA, and this exception falls under the auspices of the Veteran Free Agent exception. In essence, the Larry Bird exception allows teams to exceed the salary cap to re-sign their own free agents, at an amount up to the maximum salary. To qualify as a Bird free agent, a player must have played three seasons without being waived or changing teams as a free agent. Players claimed after being amnestied have their Bird rights transferred to their new team. Other players claimed off waivers are not eligible for the full Bird exception, but may qualify for the early Bird exception. Prior to an arbitrator ruling in June 2012, all players that were waived and changed teams lost their Bird rights.[8][9] This means a player can obtain "Bird rights" by playing under three one-year contracts, a single contract of at least three years, or any combination thereof. It also means that when a player is traded, his Bird rights are traded with him, and his new team can use the Bird exception to re-sign him. Under the 2011 CBA, Bird-exception contracts can be up to five years in length, down from six under the 2005 CBA.[6]

Early Bird exception
This is the lesser form of the Larry Bird Exception. Free agents who qualify for this exception are called "early qualifying veteran free agents," and qualify after playing two seasons with the same team. Players that are traded or claimed off waivers have their Bird rights transferred to their new team. Prior to an arbitrator ruling in June 2012, all players that were waived and changed teams lost their Bird rights.[8][9] Using this exception, a team can re-sign its own free agent for either 175% of his salary the previous season, or the NBA's average salary, whichever is greater. Early Bird contracts must be for at least two seasons, but can last no longer than four seasons. If a team agrees to a trade that would make a player lose his Early Bird Rights, he has the power to veto the trade.
A much-publicized example for this was Devean George, who vetoed his inclusion into a larger trade during the 2007–08 season that would have sent him from the Dallas Mavericks to the New Jersey Nets.

Non-Bird exception
Free Agents who qualify for this exception are called "non-qualifying free agents" in the CBA, meaning they do not qualify under either the Larry Bird Exception or the Early Bird Exception. Under this exception, teams can re-sign a player to a contract beginning at either 120% of his salary for the previous season, or 120% of the league's minimum salary, whichever amount is higher. Contracts signed under the Non-Bird exception can last up to four years (down from six under the 2005 CBA).


I think Early Bird rights changed to 130% of previous salary after 2 years under the new CBA

http://www.cbafaq.com/salarycap.htm#Q37

xIndyFan
07-04-2012, 04:13 PM
Right. With my best calculations (which is by no means saying they're 99% accurate, but I think they're in the ballpark), we'd be about 12.5 away from the tax if we match Roy. My guess is we're willing to spend no more than between 6-9 of that due to future years. Just guessing.

using your numbers, the Pacers will have only the non-taxpayer MLE [the $5M one] only. Because they are over the salary cap. plus that gets into the 'apron' area, which acts as a hard cap if a team uses the $5M MLE.

the short answer is after signing roy and hill, the Pacers will have only about $5M to finish off the roster.

IndyHoya
07-04-2012, 04:17 PM
Seems like minimally that would apply to David West. I think we would have Bird Rights with respect to him.

Hicks
07-04-2012, 04:23 PM
That is still 1 more decent piece though.

Yep. Basically enough for a good 6th or 7th man. Mayo? Lee? Or someone else roughly like that.

If we really want to get cute with speculation... 7-8 per for Kaman to play 30 min off bench at 5/4 (18 min behind Roy, 12 min behind West)?

Hicks
07-04-2012, 04:25 PM
using your numbers, the Pacers will have only the non-taxpayer MLE [the $5M one] only. Because they are over the salary cap. plus that gets into the 'apron' area, which acts as a hard cap if a team uses the $5M MLE.

the short answer is after signing roy and hill, the Pacers will have only about $5M to finish off the roster.

Only if they sign Roy and George first. If they sign the other new guy first, they can go higher than 5 and won't need the MLE to pay for them.

Hicks
07-04-2012, 05:41 PM
After getting more information from JayRedd, it sounds like Roy's contract from Portland is actually calculated by taking 25% times the new psuedo-cap number of $54,700,000. (This is in spite of the real cap being $58m and the 2012 psuedo number being $51,700,000; oddly it went up by $3m despite the real cap being the same both years; go figure)

0.25 * 54,700,000 is 13,675,000. He then gets a 4.5% raise each season.

So his year 1 salary should be: $13,657,000.

Year 2: 13,657,000 * 1.045 = $14,290,375.

Year 3: 14,290,375 * 1.045 = $14,933,422.

Year 4: 14,933,422 * 1.045 = $15,605,447.

Total contract: $58,486,244

Giving us a team salary of around $58.227m, leaving us about 11.773m before we hit the luxury tax.

I think.

xIndyFan
07-04-2012, 06:05 PM
After getting more information from JayRedd, it sounds like Roy's contract from Portland is actually calculated by taking 25% times the new psuedo-cap number of $54,700,000. (This is in spite of the real cap being $58m and the 2012 psuedo number being $51,700,000; oddly it went up by $3m despite the real cap being the same both years; go figure)

0.25 * 54,700,000 is 13,675,000. He then gets a 4.5% raise each season.

So his year 1 salary should be: $13,657,000.

Year 2: 13,657,000 * 1.045 = $14,290,375.

Year 3: 14,290,375 * 1.045 = $14,933,422.

Year 4: 14,933,422 * 1.045 = $15,605,447.

Total contract: $58,486,244

Giving us a team salary of around $58.227m, leaving us about 11.773m before we hit the luxury tax.

I think.

IIRC, your numbers agree with count55's. He did a column on this in 8p9s (http://www.eightpointsnineseconds.com/page/7/)

IndyHoya
07-04-2012, 06:33 PM
Thanks for crunching the numbers. Assuming you are right, then we are back to where you were before, right? We can still make a pretty good acquisition for around $8 or $9M, not have to pay the Luxury Tax, and still sign Roy. Are your assumptions based on letting anyone else go?

solid
07-04-2012, 07:12 PM
The $$ we pay our players will all go against the cap.

It will go against it as soon as the contract is signed.

Right now Roy Hibbert nor George Hill is costing us a nickle against our cap. They are not under contract.
So right now we have lots of cap space and if we want a game changing free agent we can sign him. Right now.

Even if that puts us right against the cap we can sign Still sign our free agents because we have their Bird rights.

If we wait until we sign Roy and his contract gets us close to the limit?
Then we can only sign players that will still fit under the cap.

You can't legally get over the cap unless you qualify for an exception. (Like having a players bird rights)
So you can get Roy AND a Nash if you sign Nash before you resign Roy and Hill AND are willing to pay any taxes associated with the luxury you enjoy.

So, to put it another way...
Bird rights give you "the privildge" of paying a large sum of cash (to be distributed among the other teams)... for "the luxury" of signing (a long time employee) even if it ensures a total team salary that has been determined to be unfair by the league.

That's how I get it anyway.

Hicks
07-04-2012, 07:54 PM
Thanks for crunching the numbers. Assuming you are right, then we are back to where you were before, right? We can still make a pretty good acquisition for around $8 or $9M, not have to pay the Luxury Tax, and still sign Roy. Are your assumptions based on letting anyone else go?

I'm assuming no Barbosa, Foster, Amundson, or Price.

I'll add that JayRedd estimates George Hill's salary to start at $6,960,000. I don't know if this is right or not. At 7.5% annual raises, he ends up making $40,426,401 over 5 years. Maybe that's exactly right, but I guess I was assuming it would add up to no more than $40,000,000.

But let's say that's correct.

This once again lowers our wiggle room under the tax a little bit more. We're now looking at about $58,686,729. $70m - S = $11,313,271.

Whoever else we sign will probably have a contract with annual raises as well. Next year, here's how the raises appear to shake out:

Danny goes up by $963,182.
Paul goes up by $707,883.
Roy would go up by $615,375.
Hill would go up by $522,000.
I'm not sure how much Plumlee will go up. I think around $100k or so.
No clue if Orlando's deal will have raises or not. If so, not by much because he probably will only make around 880k a year.

Plus we may have more rookies to pay for next year.

So excluding '13 rookies, those raises will add up to no less than $2,908,440. Again, that's without figuring for next season's rookies, and that's before we worry about signing anybody else in the next week or two.

However, David West, Dahntay Jones, Tyler Hansbrough, Darren Collison, and Jeff Pendgraph don't have to be paid anything next season if we don't want to, so there's that to consider, too, to counter-balance things.

So my rough guess is we will use no more than about maybe $7m of our remaining wiggle room this summer. Unless we dump somebody's contract.

Hicks
07-04-2012, 08:02 PM
In other words, we should probably spend that money on one nice bench player, and then look to trade after that.

IndyHoya
07-05-2012, 10:22 AM
Hicks, were you using a $58M cap? Maybe it's higher than that.

I found this at this website: http://tinyurl.com/75bnqh5

"The NY Post has reported that sources, presumably the Knicks, have informed it that economic projections say that the NBA salary cap will grow to about $60-$61 million for the 2012-13 season. The salary cap for 2011-12 was set at $58,044,000 in negotiations over the collective bargaining agreement. Remember that the exact number of the cap relies upon a projection of basketball related income and is not set until July before each season. I’ll use the $60M in this post as a nice square number."

Maybe we have more cap space than people have been saying in the event we want to acquire FAs.

Really?
07-05-2012, 10:46 AM
Hicks, were using a $58M cap? Maybe it's higher than that.

I found this at this website: http://tinyurl.com/75bnqh5

"The NY Post has reported that sources, presumably the Knicks, have informed it that economic projections say that the NBA salary cap will grow to about $60-$61 million for the 2012-13 season. The salary cap for 2011-12 was set at $58,044,000 in negotiations over the collective bargaining agreement. Remember that the exact number of the cap relies upon a projection of basketball related income and is not set until July before each season. Iíll use the $60M in this post as a nice square number."

Maybe we have more cap space than people have been saying in the event we want to acquire FAs.

True, but that also changes the amount that Hibberts Max will be for, so it will give us some more money, but we will end up paying him more long term because of it.

IndyHoya
07-05-2012, 11:28 AM
One thing. Assuming we match Portland's offer, then it's over, right? Roy has to sign with us, all things being equal? Or do we have to do a deal with Roy that's monetarily better than Portland's? We don't have to do a 5 years deal with him, do we?

BrownBearCoffee
07-05-2012, 11:30 AM
One thing. Assuming we match Portland's offer, then it's over, right? Roy has to sign with us, all things being equal? Or do we have to do a deal with Roy that's monetarily better than Portland's? We don't have to do a 5 years deal with him, do we?

If he signs their offer sheet, we pay him exactly what they were going to pay him.

Naptown_Seth
07-05-2012, 11:35 AM
In other words, we should probably spend that money on one nice bench player, and then look to trade after that.
Yes.

Basically in a "match Roy" situation we must go sign a solid FA (say Kaman due to interest/need) for 8-10m, then ONLY AFTER THAT you match Roy. After that you are in trade land for any serious adjustments.

EJ and Nash off the board, makes it seem like Kaman might be the only other big money FA you would chase, and it also makes it seem much more likely that they would match on Roy. Even Dragic is off the board, there just isn't much out there worth adding to the point that you'd pass on Roy.

Of course you don't match on Roy till the last second, simply because it benefits the team to stay as flexible as possible to the last second, and maybe because it screws with Portland's situation a little as punishment for even messing with our situation.

I mean that last part sincerely. Attacking RFAs must have a cost so that teams don't view it as a free, safe thing to do. It's not out of spite (though it doesn't hurt) but rather out of establishing the tone of risk in pursuing a Pacers RFA. You'd better be prepared to suffer the cap hold right to the bitter end. Don't let them off the hook early, it might cost them their own FA and that might make other teams reconsider the situation in the future if they aren't certain.

IndyHoya
07-05-2012, 08:44 PM
There's a pretty good explanation of how the salary cap and Luxury Tax is calculated here.

http://tinyurl.com/d4awwq9

I find it so weird that teams have to estimate what both will be while the FA bargaining period is going on. What a crap shoot!

Hicks
07-05-2012, 10:11 PM
Hicks, were you using a $58M cap? Maybe it's higher than that.

I found this at this website: http://tinyurl.com/75bnqh5

"The NY Post has reported that sources, presumably the Knicks, have informed it that economic projections say that the NBA salary cap will grow to about $60-$61 million for the 2012-13 season. The salary cap for 2011-12 was set at $58,044,000 in negotiations over the collective bargaining agreement. Remember that the exact number of the cap relies upon a projection of basketball related income and is not set until July before each season. I’ll use the $60M in this post as a nice square number."

Maybe we have more cap space than people have been saying in the event we want to acquire FAs.

I was assuming $58m, yes. Mostly I hear it's staying the same, then you have this saying otherwise. I guess we'll find out eventually.

Fez2012
07-06-2012, 02:13 AM
If you dont have Bird Rights on a player, are you not allowed to go over the cap to re-sign him, even if you don't go over the luxury tax? I know we have Bird rights on Hibbert, but not on West. And when do you have to pay the luxury tax? I heard it's when you hit $70 million which if that's right, there is another with the NBA and its soft cap. You can just go $9 million over the cap and not have a penalty? Why even have a cap if teams like the Knicks and Heat can just go over as much as they want and get pretty much anybody they want? Please correct me if I'm wrong.