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NBA} Jazz owner no longer dead set against paying luxury tax
Jazz: Miller softens on luxury tax
Jazz owner no longer dead set against paying it
By Phil Miller
The Salt Lake Tribune
The Jazz are a team built on a cornerstone of a few basic, unchanging concepts: Pick-and-roll. Layups first. Tuck in your jersey.
But one of the franchise's most inflexible rules has been changed, or at least loosened, by owner Larry Miller. If the right player or trade becomes available, Miller has decided, he is willing to pay the NBA's luxury tax on excessive payrolls.
"I told Kevin [O'Connor] and Denny [Haslam] that the first, primary consideration right now is the quality of the team on the basketball floor," Miller said of a recent meeting with O'Connor, the senior vice president in charge of player acquisition and Haslam, the team president. "Meaning, money is not as important right now as it has been in the past."
That's a notable reversal for a businessman whose position on the luxury tax was once as resolute as Rafael Palmeiro's was on steroids. "We absolutely will not get into luxury-tax territory," Miller said in July 2003, a position he has repeated several times. "You can cost yourself
a lot of money, that we frankly can't afford, once you do that."
Things have changed since then, however. For one thing, luxury-tax payers no longer forfeit their 1/30th share of tax revenues collected throughout the league, so the impact of the dollar-for-dollar tax is significantly lessened. In other words, even if the Jazz pay a couple of million dollars in tax, they could still collect enough to cover that from other higher-payroll teams.
But the biggest thing that has changed, Miller said, is his patience for becoming a competitive team again. Last season's 26-56 disaster was so painful, the owner decided he cares more about winning than revenue.
"Basically, last year was no fun for anybody," Miller said. "It was a bummer and I don't want to repeat that. I'm not saying let's start throwing money around like crazy, but I'm not going to handcuff our basketball staff with a financial ceiling that makes it difficult for us to compete."
Said Haslam: "Our business plan is still to stay below the luxury tax. That's the plan. But there may be a situation where we say, 'Let's pay the tax to put together a championship team.' "
It's unlikely that Miller's willingness to cross the tax threshold will come into play this season. The Jazz have nearly $51.5 million committed to 10 players so far, including $3.49 million for first-round draft pick Deron Williams.
That's already above the NBA's $49.5 million salary cap but more than $10 million below the $61.7 million mark where the tax kicks in. With the most expensive free agents now signed elsewhere, the remaining three to five players who end up on Utah's roster probably won't cost nearly that much.
Still, Miller said he would not stand in the way of increasing the payroll via a trade. And more importantly, O'Connor will have more payroll flexibility next summer and in future years.
"Kevin has been good, and Scott [Layden, O'Connor's predecessor] was good at managing to the salary cap or below, just to keep the team profitable," Miller said. "It was an affordability issue. What I've told Kevin and Denny now is that we've still got to be fiscally prudent, but I understand how fine a line you have to walk to keep costs down and still get good players. It's not likely to happen [this summer], just because we don't know how close we are to being a playoff team - not just making the playoffs but being truly competitive once we got there - but I'm willing to address that [payroll] issue if that's what it takes."
Some teams, most notably the Los Angeles Clippers, have been willing to simply keep the payroll low and collect millions in profits every season. Miller, who said the Jazz still are profitable, isn't interested in that business plan. "Let me tell you, it would be easy to make a lot of money in this league," he said. "But if that's all you're willing to do for your fans, you don't deserve to have a team."