This week, in addition to the NBA Draft, free agency begins. The league’s market has never been so active, with an addition in this edition: the new collective bargaining agreement or CBA. Since the end of the regular season, in mid-April, the regulations of the new CBA are already a reality and making transfers or signing free agents will be much more complicated for expensive teams. Because the NBA, In the quest for parity, it has created a network of rules and limitations that will be a real challenge for the general managers of many franchises, especially those looking to compete for the ring. And here we are going to explain the different levels that there are and what the possible punishment is in each case.
The first thing is to be clear about these four concepts, four figures that mark the NBA. What is the salary cap, the luxury tax cap and what happens if a team is above either aprons. It is important to know that the NBA is a league that has a soft cap so there are very common exceptions to exceed these limits, unlike other leagues (NHL, MLS, NFL…) but that Starting this season, performing certain trades and movements will trigger a hard-cap, either for the first or second apron. On the contrary, teams that have their books below the luxury tax have all the facilities to move when it comes to signing players in free agency or getting them via transfer (Here you can see the status of each franchise).
What are the figures to take into account in the NBA 2024 market?
- Salary cap (or salary cap): $141 million
- Luxury tax (or luxury tax): $171.3 million
- First apron: $178.7 — above right now: Denver, Lakers, Grizzlies, Heat and Bucks
- Second apron: $189.5 — above right now: Celtics, Timberwolves, Suns
The explanation of the new rules of the 2024 NBA market
Teams below the salary cap or between the minimum and the luxury tax are not going to be as regulated. Both have access to unlimited buyouts and have no transfer restrictions. In addition, they have different exceptions to sign free agents. The important detail is that, starting last season, teams are obliged to reach the minimum salary at the beginning of the season and not at the end, as was the case previously. This year, the figure is $127 million (or 90% of the cap). Otherwise, the team that doesn’t make it will see a cap hold equal to the money left to reach the minimum and will not be able to access that salary space, and will not receive at the end of the season the proportional part of the luxury tax penalty.
But let’s focus on the important things. What limitations do teams have that exceed aprons? There are two levels, the first and the second. A team above the first apron ($178.7 M) cannot perform any of these operations (rules that already existed before the implementation of the new CBA):
- Get a player via sign-and-trade.
- Use a TPE obtained in a previous transfer (you can use a new one).
- Receive more than 100% of salaries in a transfer. For example, if you send $10M you can only receive $10M.
- Sign a player in the buyout market whose salary before being cut exceeds the NT-MLE ($12.8 M)
On the contrary, most of the new regulations affect teams that exceed the second limit ($189.5 M), created with the arrival of the new CBA. They all have the same four limitations as the first Apron, and some extra ones added to create greater complexities when building a very expensive piece of equipment. Right now there are only three teams on this list (Celtics, Timberwolves and Suns) but the Heat, Bucks, Clippers or Lakers can finish above as well. A team above the second apron cannot:
- Get a player via sign-and-trade.
- Use a TPE obtained in a previous transfer (you can use a new one).
- Receive more than 100% of salaries in a transfer. For example, if you send $10M you can only receive $10M.
- Signing a player on the buyout market whose salary before being released exceeds the NT-MLE ($12.8M)
- Adding salaries sent in a trade. For example, if you receive $20M in a trade, you cannot send a $15M player and a $5M player, you can only match with a single player.
- Send cash.
- Perform a sign-and-trade where you send your players if the salary you receive exceeds the second apron.
- Acquire a player using a TPE obtained in a pre-trade sign-and-trade.
Hard cap, the new market risk
Previously, we have explained that the salary cap in the NBA is soft, which can be exceeded with exceptions and movements designed to benefit franchises, but there is also a hard cap: a hard limit. If the teams carry out specific operations or movements, a limit is established that they cannot exceed, both in the first apron ($178.7 M) and in the second ($189.5 M). Being hard-capped means that you cannot exceed that limit under any circumstances. A team that is below the first limit is automatically hard-capped in the first apron if it does one of the following operations.
- Use the bi-annual exception ($4.7 M) or use the NT-MLE ($12.8 M) a larger portion than the TMLE ($5.2 M). For example, if a team signs a free agent using the MLE for six million, over $5.2M, it is hard-capped.
- Acquire a player via sign-and-trade. If Paul George were to sign-and-trade, the franchise receiving the All-Star would not be able to exceed $178.7 million.
- Sign a player in the buyout market whose salary before being cut exceeds the NT-MLE ($12.8 M)
- Use a previously created TPE (not a new one).
- He receives over 100% of salaries in a trade. For example, Oklahoma received $9.9M in the Caruso trade, and only sent $8.4M for Josh Giddey, so the Thunder are hard-capped at first apron (which won’t be a problem because they still have +30M in space).
The truth is that All those transfer ideas that appear on social networks or the media usually do not work due to some of the limitations, especially if they are between high-spending teams. And it gets more complicated. A team, even if it is far from the second limit, is automatically hard-capped in the second apron ($189.5 M) if it does one of the following operations.
- Use the TMLE ($5.2M) to sign a free agent, even partially.
- They add two or more salaries in a trade to equalize a transaction. For example, if they receive $20M in a trade, send a $15M player and another $5M player, they are hard-capped.
- Send cash in a transfer.
- Acquire a player using a TPE obtained in a pre-trade sign-and-trade.
The NBA has gotten serious about big spenders, also increasing the fine for the luxury tax for repeating teams, and has given more and better tools to franchises that do not exceed either of the two aprons. The search continues for that utopian equality in the league that will only exist if the 30 owners decide to pay equally, but in the meantime, six seasons and six different champions. An agreement that players and owners signed together and through which they will have to go through the next, at least, seven years.
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2024-06-29 16:34:35
#NBA #market #rules #change #free #agency
