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NBA Owners Budge, Give Up on Hard Cap Stance

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  • #1

    NBA Owners Budge, Give Up on Hard Cap Stance

    As the NBA lockout creeps past 90 days and counting, the league has already experienced the loss of the start of training camp and at minimum half the preseason. As the shades on the window of hope draw ever more to a close, many have resigned themselves to the misery of a winter without NBA basketball.

    But perhaps not all hope is lost just yet. For fans who were unwilling to sacrifice one winter in exchange for a system of parity and equality, hope was renewed Tuesday in negotiations between the owners and the NBA Players Association.

    According to Yahoo!’s Adrian Wojnarowski, the NBA owners have budged from their stance of stern insistence on a hard cap system. Instead, they made a proposal that would keep the current soft cap in place, with some modifications aimed at replicating the effects of a hard cap.

    So what exactly does that mean? ESPN’s Ric Bucher says not a whole lot. In that article on ESPN.com, Bucher lays out the details of the owners’ new proposal to the NBAPA:

    Sources told ESPN The Magazine’s Ric Bucher that the owners did not offer players a finite annual team limit on salaries but as of Tuesday night were willing to relax the cap only if the following conditions are met:

    The “Larry Bird exception,” which allows teams to exceed the cap to retain their own free agents regardless of their other committed salaries, is limited to one player per team per season.
    The mid-level exception, which the league valued at $7.4 million last season and could be extended by as many as five years, is reduced in length and size.
    The current luxury tax, the $1-for-$1 penalty a team must pay to the league for the amount it exceeds the salary cap, is to be severely increased.

    The article goes on to say that NBA agents scoff at the notion of this being a concession. In their eyes, this is just another way of saying the same thing. Of course, for the agents, this whole thing has never been about the system as much as it is a power play for them to overthrow the Players Union. So a little salt is required when considering their opinion on this, because for many agents, the Union coming up with an outside the box compromise would be a defeat to their cause.

    But maybe the agents are right, here. After all, how much does this proposal change things? Lets look at them one at a time.

    The changes to the Bird Exception are the most interesting, in my opinion. Essentially, the owners are proposing making it more like a franchise tag. Not exactly like the NFL’s franchise tag, but similar. By limiting them to one per team, it would theoretically limit what the Miami Heat have done. But that’s only on the surface. Without knowing the particulars of the proposal, it’s easy to see that by doing a sign and trade, the quantifiable restrictions are irrelevant. The Hornets could use their Exception on Chris Paul, then do a sign and trade with the Knicks, and the Knicks would still have their own Exception to use.

    Unless this proposal is saying that a team can only have one player with an exception applied at any given time, whether that exception was their own or not. If that’s the case, then this might be the most conglomerate-adverse restriction yet. A league where there could only be 30 “Bird Rights” players would be a dramatic change from the current system, and would almost certainly impose a hard cap style thinking on the league, without actually being a hard cap.

    Of course, this could all get mired in semantics anyway. You’d just see more superstars without the Bird Rights exceptions attached to them. So in that regard this actually wouldn’t be a hard cap replication, but more of a change in semantics only, while practical application would go on unchanged. In other words, the Knicks would still be able to have Amare, Carmelo, and Chris Paul, but only one of them would technically be tagged with Bird Rights. The team would just have to either be cap conscious in building around them, or else just careful not to acquire a Bird Rights player in a trade. Anyone else would be fair game in the trade market, and hey, there would only be 30 Bird Rights players anyway.

    So there’s really too much grey area here to really say how much of a change this would be. The devil’s in the details, and right now, we don’t have the details.

    The reduction or elimination of the mid-level exception (MLE) is interesting. If any of these proposed changes seem like a shot at the Miami Heat style of doing business, this one is it. The Heat’s one saving grace in trying to build a Championship team around their unholy triumvirate is the MLE. This exception will allow them to be competitive in bidding for quality, solid NBA role players.

    By reducing it or eliminating it all together, it would essentially mean the Heat would have only two ways of adding players. Either sign undrafted free agents or other similar low salary players, or else by trading. A severe enough reduction in the MLE could actually entice the Heat to consider possibly trading, say, Chris Bosh in an attempt to add more quality role players around LeBron and Wade.

    Finally, we have the “severely increased” luxury tax. I don’t view this one as quite as big of a change. If anything, increasing the penalty for exceeding the cap would only further drive a wedge between the big and small markets. New York, Chicago, Los Angeles, Miami, etc may not like paying up to double the previous tax amounts, but they will still pay it. Meanwhile, the smaller markets will find it that much more daunting to compete with the big market teams for high priced players.

    So that’s the proposal. Most pundits tend to feel that the revenue split will eventually be agreed upon around a 52-48 level in favor of the players (down from the current 57-43 split). This proposal from the owners offered the players 48% of the basketball related income (BRI), but the real deal to be made is around the 52% mark.

    So this will eventually come down to the details of the type of system the players and owners can agree upon. On a personal level, as a fan of the Cavaliers and a fan of parity in general, I’m disappointed the owners gave up the true hard cap. Sure, it’s just a proposal, but once you take the hard cap off the table, it’s never coming back.

    I don’t want to lose a season. I love the NBA and I cannot imagine going a whole winter without out it. But quite frankly, I’m tired of the Lakers and Celtics winning all the Championships. Furthermore, I’m appalled by the writing on the wall. NBA superstars are gravitating toward these mega unions and they are only interested in the type of market they are going to.

    The one thing we learned first hand from the LeBron James free agency is that a small market in a cold weather city has no chance to be competitive in this environment. Dwyane Wade’s comments about how he “wasn’t going to Cleveland” only further drive home this point. LeBron James wanted to play with other superstars. Other superstars were not going to come to Cleveland. It wasn’t about money, it wasn’t about team success, it was about market. The money and success would follow. Those are the constants. The variable is market.

    So it’s funny that as the agents disregard the owners’ proposal as just more of the same, I find myself feeling despair. I never thought I would possibly be sad about positive momentum towards an NBA season, but I would give up short term gratification for long term parity in a league that has the most pathetic parity levels of all sports.

    This shouldn’t be that hard. You make the split 52-48 for the players, but you implement a hard cap. You increase both the ceiling and, more importantly, the cap floor. You guarantee rookie contracts and contracts that are below league average. For above average contracts, you can use tiered system to limit the guaranteed contracts from 1-3 years. You set a tiered buyout level (based on factors such as age, production, and/or salary) to give flexibility to both owners and players. You leave the revenue growth levels for players uncapped, so as the league makes more money, that profit is filtered into player contracts.

    Under that system, the players will still have protection for players who need it (rookies, young players, minor role players, etc), while still receiving more than 50% of the BRI. The owners will get more guaranteed revenues, thus fulfilling the financial side of it, while the cap will give the league a new level of parity, thus satisfying the owners who want the hard cap for the competition side of things.

    But it sounds like a pipe dream now. With the start of the NBA season drawing near, on November 1, the two sides are facing crunch time. The fact that the owners withdrew the hard cap means that they want to move toward a resolution to minimize the loss of regular season games. This means we’ll probably see an agreement in a few weeks with a reduced revenue split and a modified soft cap system that will actually be the true “more of the same” issue.

    As a fan of the NBA, I’m excited about the thought of there being a season after all. As a Cavs fan, though, I’m just sad. It was probably inevitable, but the hard line talk made it easy to get our hopes up. But make no mistake, the hard cap system is gone for good now
    http://www.waitingfornextyear.com/20...rd-cap-stance/
    "So, which one of you guys is going to come in second?" - Larry Bird before the 3 point contest. He won.


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  • #2
    Re: NBA Owners Budge, Give Up on Hard Cap Stance

    Yea on the one hand it's good there is movement from either side. On the other hand it sounds like this will probably do little to nothing for small market teams to be able to compete for big name athletes.


    Basketball isn't played with computers, spreadsheets, and simulations. ChicagoJ 4/21/13

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    • #3
      Re: NBA Owners Budge, Give Up on Hard Cap Stance

      I can't believe they caved on the hard cap this early in the game. I figured that was the one thing they would never give in on. It's a shame. That could have really helped fix the league.

      At least we will probably be seeing some Pacers bball in a month or so. I am so excited to see the Pacers take it to the next level this year.

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      • #4
        Re: NBA Owners Budge, Give Up on Hard Cap Stance

        They're probably giving up a hard cap in a tradeoff with a 50/50 split between BRI.

        I still say actual revenue sharing would help small market teams more than a hard cap anyway.

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        • #5
          Re: NBA Owners Budge, Give Up on Hard Cap Stance

          Originally posted by Peck View Post
          Yea on the one hand it's good there is movement from either side. On the other hand it sounds like this will probably do little to nothing for small market teams to be able to compete for big name athletes.
          Without a Hard Cap....is that the best answer to "leveling the playing field" for the Small Market Teams? as in the use of the Bird Rule on only 1 Player, creating a progressive LT and reducing the size of the MLE?

          I'm beginning to think that many of these proposals are made to limit the Players as well as the Large Market Teams. It seems like the Small Market Teams are trying to make the conditions harder for Mega-Teams to be formed again and even if it could happen ( under a Soft Cap ) that it would be harder for them to improve ( with the reduction in size and length of the MLE and...hopefully...a progressive LT penalty that gets progressively worse when you reach a certain limit )....all things that I can see the Small ( not the Large ) Market Teams be in favor of.

          Honestly, I don't know what to think IF all of this bickering ended up being a re-negotiated CBA where Billionaire's and Millionaire's haggle over how much $$$ they get to keep and the "rules of the games" essentially looks the same as the old CBA ( such as a Soft Cap ) where the "Rich, Large Market Teams" continue to prosper while the "Not so Rich, Smaller Market Teams" continue to remain mediocre....essentially where we were at the end of the season.

          I'm assuming that this would affect and even limit the Small Market Teams...but with a Soft Cap......the notion of the Mega Teams that go to these Large Market Teams will continue to exist. But I'd hope that a progressive LT penalty coupled with the above steps would limit their ability to significantly improve their roster....all boiling down to an "If you want to build a Mega Team, it will cost you a pretty penny....but it will also be harder for you to give them a good supporting cast" approach.
          Ash from Army of Darkness: Good...Bad...I'm the guy with the gun.

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          • #6
            Re: NBA Owners Budge, Give Up on Hard Cap Stance

            Originally posted by Sookie View Post
            They're probably giving up a hard cap in a tradeoff with a 50/50 split between BRI.

            I still say actual revenue sharing would help small market teams more than a hard cap anyway.
            What was the previous percentage split in the old CBA?
            Ash from Army of Darkness: Good...Bad...I'm the guy with the gun.

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            • #7
              Re: NBA Owners Budge, Give Up on Hard Cap Stance

              I think all that does is allow the Simons and the rest of the owners of the small market teams to turn a profit. It will probably make things slightly more competitive but not as competitive as something like a hard cap would have.

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              • #8
                Re: NBA Owners Budge, Give Up on Hard Cap Stance

                But, from my understanding of the article, the luxury tax hits once you go over the cap.....there's no longer that cushion
                "So, which one of you guys is going to come in second?" - Larry Bird before the 3 point contest. He won.


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                • #9
                  Re: NBA Owners Budge, Give Up on Hard Cap Stance

                  Originally posted by Peck View Post
                  Yea on the one hand it's good there is movement from either side. On the other hand it sounds like this will probably do little to nothing for small market teams to be able to compete for big name athletes.
                  Could there be a way to give players more financial incentives to come to smaller market teams then?

                  For example pay them a little more percentage of the bri or winning player money? i dont know, just an idea to help the milwaukees and indianas of the nba.

                  Comment

                  • #10
                    Re: NBA Owners Budge, Give Up on Hard Cap Stance

                    You guys realize that, according to the NBA, they've come off their hard cap stance a couple of times?

                    They said that when they went to the "flex cap" idea, and the NBPA responded that it was pretty much the same thing, with a different name.


                    Why isn't this the exact same scenario? Look at the quote already highlighted.
                    According to Yahoo!’s Adrian Wojnarowski, the NBA owners have budged from their stance of stern insistence on a hard cap system. Instead, they made a proposal that would keep the current soft cap in place, with some modifications aimed at replicating the effects of a hard cap.
                    “Just because you're offended, doesn't mean you're right.” ― Ricky Gervais.

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                    • #11
                      Re: NBA Owners Budge, Give Up on Hard Cap Stance



                      If the soft cap remains in place, then this entire lockout was a failure.

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                      • #12
                        Re: NBA Owners Budge, Give Up on Hard Cap Stance

                        If the outlined "soft cap" parameters happen... it might as well be a hard cap, no sign and trades. No sign and extends, in season. Only can be over the cap 2 out of 5 years. I mean, its not a hard cap for teams, but it will really really limit it.

                        If it makes the players feel better to not call it a hard cap and it still levels the playing field... good for the Pacers, which is good for Pacer fans, imo.

                        Side note: I predict today goes HORRIBLY and they likely won't even extend it past today into the weekend.

                        Too many egos from Star players to Agents.

                        The players just won't get how much of a disadvantage they have here and aren't willing accept hardly any of the things that are being mentioned now. Its sad they are going to have to actually lose paychecks to realize the predicament they are in.

                        Edit: I'm expecting the players to storm out, today, and all kinds of really negative stuff to be said on both sides. Gawd, I hope I'm wrong!
                        Last edited by Speed; 09-30-2011, 11:31 AM.

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                        • #13
                          Re: NBA Owners Budge, Give Up on Hard Cap Stance

                          I think it was best said when he said, they reall didnt give up on a hard cap. They just disguised it and called it something else

                          This is a no win situation for the players. I do believe the offer will get worse if not accepted currently

                          The owners know that they are exceedingly wealthy and that their team is only a portion of their income , yet the players (except the superstars) have to rely soley on the income derived form playing
                          Sittin on top of the world!

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                          • #14
                            Re: NBA Owners Budge, Give Up on Hard Cap Stance

                            I think the only way to ever have parity is something like when say a top pick who is borderline superstar by his 3rd year (last under contract) their has to be HUGE incentive for him to remain with his current team

                            like he could sign with a new team, but max would be 5 years at 8 million per

                            or if he stays wiht current team, he can sign 5 years at 14 million per

                            Hope fully that would increase the likelyhood they stay with the current team
                            Sittin on top of the world!

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                            • #15
                              Re: NBA Owners Budge, Give Up on Hard Cap Stance

                              Well, it depends on the parameters of the "soft" cap. Though I highly doubt the NBAPA is too stupid to recognize a "hard cap in disguise." If they don't see a way to abuse it, they won't agree to it.

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