Cap Implications of Tim's 2008 opt-out

[pad300]

All right, Tim Duncan has an opt-out after next season... That is also the summer when our FO appears to be planning a big FA splurge

(salary data from http://www.storytellerscontracts.info/index.html)

If Tim does, we are committed to the following salaries in 2K8-2k9

Parker - 11.55 million
Gino - 9.9 million
Butler - 2.35 million (team option)
Udrih - 2.62 million (team option)
+ possible 1st round pick this year (estimate 1 million)
+ possible Mahnimi (estimate 0.841 million - 2nd year of the contract he is locked into due to his pick in 1st round 2k5)

I expect Udrih to be gone before that point, leaving a committed total of 25.7 million. That is a ridiculous amount, and we would still have TD's bird rights, allowing us to resign him beyond the salary cap limits...

The projected salary cap in 08-09 is roughly $57 million
The projected luxury tax level in 08-09 is roughly $68 million

under the CBA, max contracts for veterans depend on years in -
(data from - http://members.cox.net/lmcoon/salarycap.htm#11)
Years in NBA** Defined maximum salary 05-06 06-07 07-08(projected)

0 - 6 $9,000,000 or 25% of cap* $12 m $12.455 m $12.93 m
7-9 $11,000,000 or 30% of cap* $14.4 m $14.95m $15.51 m
10+ $14,000,000 or 35% of cap* $16.8 m $17.44m $18.1 m

The spurs would have approximatley 32.3 million worth of space pre-cap,
and 43.3 million before the luxury tax kicked in. Tim could be resigned after using the pre-cap space due to his bird-rights at a max contract if neccesary. The MLE would be available after the pre-cap space, and would be exempt from the lux tax for the 1st year of the contract. The 08 1st round pick would be lux tax exempt, and could be signed into post cap space due to the CBA.

That is the Team side of it. TD's side is his projected salary
2006-07 2007-08 2008-09 2009-10
17,429,672 19,014,188 20,598,704 22,183,220

in summer 08 (and I believe 09), he has a player option to opt out of his contract. Assuming he does, he could get a max contract from the spurs starting in 08-09 at $18.1 million and going for 6 years (with up to 10.5% non-cumulative raises each year).

This raises several questions -
1) Does it make sense for TD to opt out in 08 for his personal finances - ie. getting a long-term contract at a high value, rather than having to renegotiate after his contract finishes in 2010.
2) Assuming 1), what would you consider a fair contract for a 08 & onwards Tim?
3) Which FA's would you chase in 08 (partial list of 08 FA's here - http://www.hoopsworld.com/article_22352.shtml - 1 notable absence : KG has an opt-out)?
4) Can you see TD opting out and taking a less than Max contract - say current Gino/Parker money, in an attempt to build/preserve long-term contender status?

[AFBlue]

Express News commented on his opt out saying that the Spurs would work on a 2yr $50M extension...

When that was reported I had an initial question as to whether that meant he would be paid an average of $25M over his last two years, or whether the $50M would be spread over the final four years of his contract (essentially being option #4 listed above).

Can anyone enlighten me? <<crossing fingers and hoping for second scenario I listed>>

[Bruno]

You should read that :
http://members.cox.net/lmcoon/salarycap.htm

The CBA is quite complicate and you make a lot of mistakes :
1) Duncan max starting salary for his extension is $20M (105% of his previous salary).
2) First round pick usualy sign for 120% of the rookie scale.
3) You don't know at all how to calculate a team salaries (usigned first round picks counts against the cap, you have roster charges when you have elss than 12 players udner contract...)
4) You can't use the MLE and cap space the same year.

[TDMVPDPOY]

wtf would he do that for?

he still has 60million on his contract

if he opts out in 08 << he's leaving 40mill...

what and resign him to 50mill 2yrs? sounds reasonable....so he be earnin 50 in 2yrs instead of the 40 in 2yrs remainin on his contract...

i expected him to sign for a longer extention if he chooses to opt out in 08....

i think he might play it safe since the CBA new negotiations are around teh corner....theres a reason why 03 class some studs sign for 3years instead of 6...if they raise the salary cap :D:D:D so we have in assess 28mill to play around right :D:D:D

[pad300]

You should read that :
http://members.cox.net/lmcoon/salarycap.htm

The CBA is quite complicate and you make a lot of mistakes :
1) Duncan max starting salary for his extension is $20M (105% of his previous salary).
2) First round pick usualy sign for 120% of the rookie scale.
3) You don't know at all how to calculate a team salaries (usigned first round picks counts against the cap, you have roster charges when you have elss than 12 players udner contract...)
4) You can't use the MLE and cap space the same year.

1) yes, duncan can sign for $20M or so, if he opts out, due to the bird rule being 105% of previous or max salary; however, the 18.1 million value given is the projected salary for a max contract for a free-agent not from our own team. While Tim can sign for $20m, I would be quite surprised to see our FO extend a contract offer for that much to Tim, if he did opt-out. Rather, I would expect to see a long term contract - 5 or 6 years, at a lower salary level (at most the value for a generic FA - no other team can offer more than that...)

2) True, 1st round picks typically sign for the max allowed, which is indeed 120% of the rookie scale, which is given here- http://www.nbpa.org/cba_exhibits/exhibitB.php

More info on rookie salaries at
http://members.cox.net/lmcoon/salarycap.htm#41

It is still difficult to estimate the salary cap space that this years and next years 1st round pick will take - A) he might not be in europe (eg. Kopponen, Fernandez, Splitter, Bellinelli) B) It has been speculated that we are looking to trade up in the draft...

3) Are you sure unsigned 1st round picks count - A) from http://members.cox.net/lmcoon/salarycap.htm#19,

ROOKIE EXCEPTION -- Teams may sign their first round draft picks to rookie "scale" contracts even if they will be over the cap as a result (see question number 41).

B) are you suggesting that because we are currently at or beyond the lux tax threshold, we are paying the league ~1 million dollars for Ian Mahinmi's potential salary as a 1st round pick? I don't believe that unsigned players count against the cap, otherwise stashing players in europe would be a horrible idea.

Finally, I would appreciate it if you would comment on the core idea - 1) does it make financial sense for TD to opt out for the team? 2) does it make Financial sense for TD? 3) What are the implications of such an opt-out?

[Bruno]

Express News commented on his opt out saying that the Spurs would work on a 2yr $50M extension...

When that was reported I had an initial question as to whether that meant he would be paid an average of $25M over his last two years, or whether the $50M would be spread over the final four years of his contract (essentially being option #4 listed above).

Can anyone enlighten me? <<crossing fingers and hoping for second scenario I listed>>

Duncan has three year left on his contract, Spurs can offer him two more years with $24M ofr the first year and $26M for the second.

[AFBlue]

Duncan has three year left on his contract, Spurs can offer him two more years with $24M ofr the first year and $26M for the second.

SON OF A..... :bang

Wouldn't it be nice if he did option B?

[Bruno]

1) yes, duncan can sign for $20M or so, if he opts out, due to the bird rule being 105% of previous or max salary; however, the 18.1 million value given is the projected salary for a max contract for a free-agent not from our own team. While Tim can sign for $20m, I would be quite surprised to see our FO extend a contract offer for that much to Tim, if he did opt-out. Rather, I would expect to see a long term contract - 5 or 6 years, at a lower salary level (at most the value for a generic FA - no other team can offer more than that...)

FO will do what Tim want. If he wants max money, he will get max money.





It is still difficult to estimate the salary cap space that this years and next years 1st round pick will take - A) he might not be in europe (eg. Kopponen, Fernandez, Splitter, Bellinelli) B) It has been speculated that we are looking to trade up in the draft...

Read that :
http://members.cox.net/lmcoon/salarycap.htm#14
http://members.cox.net/lmcoon/salarycap.htm#43



B) are you suggesting that because we are currently at or beyond the lux tax threshold, we are paying the league ~1 million dollars for Ian Mahinmi's potential salary as a 1st round pick? I don't believe that unsigned players count against the cap, otherwise stashing players in europe would be a horrible idea.

Unsigned first round pick doesn't count against the luxury tax.



Finally, I would appreciate it if you would comment on the core idea - 1) does it make financial sense for TD to opt out for the team? 2) does it make Financial sense for TD? 3) What are the implications of such an opt-out?

See before what Tim will do this summer before speaking of next summer.

[TDMVPDPOY]

even b4 the option extention kicks in, ginos contract expires the year duncans extention comes into play...so duncan is actually gettin ginos money minus one player....

[Bruno]

SON OF A..... :bang


:rolleyes
It's not like Spurs have won 4 titles because of him...

Duncan has three possibilities this summer :
1) Doing nothing.
2) Signing a two year extensions and add it two the three years remaining on his contract. If he does that, he won't be able to opt out in 08.
3) Opting out his contract and signing a 4 years extension.

1) is quite dangerous because Duncan can become an UFA next summer.
2) is the most likely scenario.
3) is an unlikely scenario. I see no reason for Duncan to take a paycut.

[TDMVPDPOY]

he should not opt out

we all know what happen to drob with the 10mill....yeh they wanted to trade his ass...

[AFBlue]

:rolleyes
It's not like Spurs have won 4 titles because of him...

Duncan has three possibilities this summer :
1) Doing nothing.
2) Signing a two year extensions and add it two the three years remaining on his contract. If he does that, he won't be able to opt out in 08.
3) Opting out his contract and signing a 4 years extension.

1) is quite dangerous because Duncan can become an UFA next summer.
2) is the most likely scenario.
3) is an unlikely scenario. I see no reason for Duncan to take a paycut.

Bruno, I'm not saying he doesn't deserve the $$.

I'm just saying that it would be unbelievably, rediculously, insanely amazing if he took a paycut and let the Spurs go after another emerging superstar with the cap-money saved. Imagine Duncan settling for $10M and Garnett doing the same to win a ring....

Unbelievable, Rediculous, Insane, Amazing....and a dream that will never come true. I wasn't being serious.

[Spurs Dynasty 21]

if the Spurs dont' get younger and much better this off season he should opt out

[TDMVPDPOY]

the question is why should he opt out?

he deserved that money....

[Phenomanul]

Dwight Howard

[BeerIsGood!]

if the Spurs dont' get younger and much better this off season he should opt out

Much better? They just won a Championship!! What world are you living on?

With the nucleus here and TP becoming a bonafide superstar the Spurs need role players who dominate their niche and come through in the clutch (i.e. Horry and Oberto types) much more than they need another superstar.

[gaKNOW!blee]

if the Spurs dont' get younger and much better this off season he should opt outI see no reason or scenario where Duncan is not a Spur for the rest of his career.