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Thread: Amnesty Clause: Where NBA Teams Replace Insane Contracts With Insane Contracts

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    Default Amnesty Clause: Where NBA Teams Replace Insane Contracts With Insane Contracts

    Amnesty Clause: Where NBA Teams Replace Insane Contracts With Insane Contracts

    By Tom Ziller - NBA Editor

    Only in the NBA can a team waive a crazy contract to make enough salary cap space to sign another crazy contract. The Hook looks at how strategic amnesty has led to a spate of massive free agent deals.

    Jul 16, 2012 - A year after it debuted, the amnesty clause has finally made its mark on the NBA. As a part of the collective bargaining agreement reached to end the lockout, the league would allow teams to waive one player already under contract as of December 2011, and not only remove his salary from the luxury tax rolls, but also remove his salary off the salary cap ledger. That means that if you were exactly at the $58 million cap and used the amnesty clause on a player making $20 million, you'd clear that off of the cap sheet and be at $38 million with plenty of room to maneuver. This was a one-time deal with a set waiver window each free agent period. This was teams' big shot to clear onerous contracts off of the books.

    But few teams used it. The Cleveland Cavaliers used it in the most traditional way, exiling Baron Davis, who had two nasty years left on a nasty contract. The Portland Trail Blazers pulled some fairly typical Portland Trail Blazers nonsense with it, laying it on Brandon Roy after deciding it would be more useful than the otherwise planned medical retirement. (Less than a year later, Roy is already back in the league. So really, the Blazers were just too cowardly to use the amnesty on Roy straight up. They had to break out the puppet theater to avoid embarrassment.)

    But the New York Knicks used it in a way that would preface what we're seeing this year. The Knicks used it as a strategic precursor to a larger move. Instead of opening up options, the Knicks held it until it was needed to facilitate a deal made independently. That move was Tyson Chandler, who New York landed in a sign-and-trade deal. To make the numbers work, the Knicks waived Chauncey Billups. The veteran point guard didn't have a particularly bad contract (one year, $14 million), but New York needed the proper amount of space to take in the younger Chandler. Billups offered that. All told, the Knicks likely would have wanted to find another way to handle it and keep Billups. But there was no other way. The Knicks had to use the strategic amnesty.

    That's exactly how it has gone this year, too. And the heretofore unmentioned additional wrinkle of amnesty -- the waiver claim process that increases the usefulness of salary cap space -- has turned this into a long series of dominoes falling.

    The Philadelphia 76ers needed to make a strategic amnesty of Elton Brand not because the final year of his deal was an anchor on the team's plans, but because the team wanted to sign unrestricted free agent Nick Young above the mid-level exception. So they amnestied Brand. The Dallas Mavericks struck out on a series of major moves, and had some cap space to use on Chris Kaman. But when Brand came available, Dallas decided to make a bid to add him, too. To make more space under the salary cap in order to place a competitive waiver bid, the Mavericks used the amnesty clause on Brendan Haywood.

    The Minnesota Timberwolves wanted to take restricted free agent Nicolas Batum from the Blazers, so just before making the offer to the Frenchman, the team used the amnesty waiver clause on Darko Milicic. The clause was used strategically to facilitate another move, not a transaction made just to generally improve the team's cap health.

    The Houston Rockets used a strategic amnesty clause waiver on Luis Scola to offer restricted free agent Jeremy Lin a fat contract, one that could convince the Knicks to back off. Scola's contract isn't bad, and he's a fine player who produces consistently. But the Rockets need a point guard, and like their chances with Lin. So out goes Scola. But Scola intrigues a number of teans, including the Phoenix Suns, who have a hole at power forward. But Phoenix didn't have the cap space to bid on Scola outright, so the Suns used their amnesty clause waiver on Josh Childress. Chances are someone will consider putting in the minimum bid for Childress, possibly using their own amnesty clause waiver to make the numbers work.

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    We should have known that instead of using the amnesty clause as a sort of "get out of jail free" card, teams would leverage it to maximize the amount of money they could offer free agents in one-time deals. That's the whole problem with pretty much all of the cost-saving measures that the league pushed for during the lockout: they aren't cost-saving measures at all, because no team -- well, except for the Sacramento Kings -- can help itself when offered the opportunity to spend more money to get better. When you think about it (and as was written when the amnesty clause was first publicized during labor negotiations), all the rule does is allow teams to spend more money on free agents. That's all it was ever meant to do.

    Mission accomplished. You can thank the amnesty clause for the massive offers to Chandler last season and Batum and Lin this year, and possibly a few others over the next couple of days. And next summer, it'll be the same thing once again. Forgive me for not being stunned that NBA owners somehow found a way to spend more money on salaries when given the option just months after screaming about the need to control costs.

    The Hook is a daily NBA column by Tom Ziller.

    I thought that this was a great article shedding some light on an under recognized fact about NBA Owners. They can't help themselves. Most of them want to win so badly that they'll take on more salary while continuing to pay 80-90 % of the amnestied player's contract. What exactly did the Lockout fix?

    I actually like the idea of the Amnesty for teams that are truly under the cap and wish it was something that teams could use every year or 1 every 4 years. I didn't expect teams that were over the cap to use it to get under the cap so they could sign free agents though. There's just something unethical about that.

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