So, I guess the owners can exercise self-control after all
$160 million in escrow money to be returned to players
by Steve Aschburner
Posted Jul 12 2011 12:14PM
Escrow money withheld from all NBA players' paychecks each season will be returned to them this offseason for the first time, providing a $160 million infusion of cash in the midst of the league's labor lockout.
The escrow funds -- representing eight percent of each NBA player's salary -- are held back each season to ensure that the players' share of basketball-related income does not exceed the contractually agreed-upon percentage, currently 57 percent. This year, for the first time since the system was introduced in the collective bargaining agreement that came out of the 1998-99 lockout, the cut to players will fall short, sources with the NBA and the National Basketball Players Association confirmed.
When a final audit is completed later this month, the players will have been paid less than 57 percent of BRI and will be due the entire $160 million. It's the first time the players will have the full escrow returned, a union spokesman said.
That cash could ease or delay the point at which some players begin to feel financial hardship from the lockout. Based on the "average" NBA salary of $5.7 million, the escrow rebate would be worth $456,000. A minimum-salaried player ($473,604) would be due $37,888 while a $16 million superstar could expect $1.28 million coming back.
A majority of NBA players are paid from November through April, while those on a 12-month payment plan receive checks through the summer for the just-completed season. A check for 8 percent of their annual salary could put off any money pinch they eventually feel.
Traditionally, the annual July audit is the time when BRI is defined, along with the salary-cap and minimum payroll figures.