Allan Houston Rule FAQ
http://sports.espn.go.com/espn/print...912&type=story
By Marc Stein
ESPN.com
You've heard about the NBA's new "amnesty" clause, also known as the Allan Houston Rule.
Now you want to know how it works.
The following FAQ explains every aspect of the rule currently known to the league's 30 teams . . . and we say currently simply because a tweak or two is still possible before lawyers from the NBA and the Players' Association finalize their new labor agreement in time for Thursday's scheduled unveiling at 6 p.m.
Q: What is the Allan Houston Rule?
A: More formally known as the "amnesty" rule, this provision grants teams a one-time exception to waive a player without paying any further luxury tax on the player's contract, regardless of how long or how rich the contract is.
Q: What is the deadline for capitalizing on this provision?
A: The window for releasing an amnesty player opens when the new labor agreement takes effect Thursday and was originally scheduled to close Oct. 1. Yet sources close to the final bargaining sessions tell ESPN.com that there is a growing movement -- with nudges coming from the union and a handful of teams -- to move up the deadline for releasing "amnesty" players.
Two front-office executives told ESPN.com over the weekend that they expect the Oct. 1 deadline to be brought forward, mainly so amnesty players aren't shut out of the free-agent market all summer and left scrambling for a new team two days before training camps start.
Q: Can teams save this one-time exception for later in the season or future seasons?
A: No. NBA front-office sources told ESPN.com that multiple teams have pushed for the rule to be tweaked to allow teams to be able to save the one-time provision for use during any of the six seasons in the new labor agreement. The league, however, apparently isn't budging there.
Q: Do teams have to waive a player?
A: No. The league-wide consensus actually suggests that fewer than half of the NBA's 30 teams will make use of the amnesty provision.
Q: Does the contract of an amnesty player drop off a team's payroll?
A: No. And the provision provides only luxury-tax relief, with no salary-cap relief. So a team can't release a player to gain cap space.
Q: But any player on a team's roster can be released?
A: Yes. Any player who appears on a team's 2005-06 payroll list is eligible -- except those acquired after June 21.
That includes players who are no longer with a team but whose salary still appears on the payroll. One prominent example is Alonzo Mourning, whose contract was bought out by Toronto for an estimated $11 million in March. Mourning has since signed with the Miami Heat, but the Raptors can still make Mourning their amnesty player to avoid paying the luxury tax on what they still owe him.
Q: When will we start seeing players released under this provision?
A: Most executives and player agents expect teams to wait as long as they possibly can, which is what sparked the movement to bring the Oct. 1 deadline forward. Delaying an amnesty waiver gives the team involved as much time as possible to explore trade options, limited as they tend to be for players with big salaries, and thus take every precaution against losing an asset without compensation. That strategy also keeps the player off the open market as long as possible, setting up teams interested in signing an amnesty player to potentially miss out on most other free agents if they have to wait until October.
Q: Can a team re-sign its own amnesty player at a later date?
A: No. Amnesty players are prohibited from re-signing with the team that released them for the life of the terminated contract.
Q: Can one team sign multiple amnesty players?
A: Yes. Let's say, hypothetically, that Houston and Finley both wanted to sign with Detroit. Both would become unrestricted free agents after being released by the Knicks and Mavericks, so the Pistons would indeed have the right to sign both.
Q: Who does this rule benefit the most?
A: Teams with extremely high payrolls. New York and Dallas can save roughly $40 million and $50 million, respectively, in luxury-tax payments by releasing Allan Houston and Michael Finley. But Houston and Finley get the biggest benefit by far. Not only is Finley guaranteed to receive every penny of the $52 million left on his Mavericks contract, he also becomes an unrestricted free agent who can sign a separate long-term contract.
Q: Is there a reduction in a team's financial obligation to an amnesty player once he signs a new contract with another team? Or can a player double-dip?
A: The league says no, there's no reduction, and yes, double-dipping is permissible. That's why the biggest beneficiaries of the amnesty clause are the players released under this provision. They don't lose any money from the team that waives them and they have the opportunity to fully double-dip.
Q: Is there any way for a potential amnesty player to convince his team to release him sooner than Oct. 1 and thereby increase his free-agent options?
A: Besides begging, the only apparent means is consenting to a buyout in which the player agrees to reduce the amount of guaranteed money left on his contract in exchange for the immediate right to find a new team.
Q: Can a team that doesn't have a payroll more than the luxury-tax threshold exercise the amnesty option?
A: Yes. Non-taxpayers can make an amnesty waiver for tax relief in future seasons provided that the player is released before Oct. 1.
Q: Why was this rule adopted and what are teams really gaining if releasing an amnesty player results in no cap relief and doesn't stop the player from collecting all of his checks?
A: Taxpaying teams have long complained that the NBA's financial system offers no mechanism for teams to undo or recover from a contract mistake. This is a one-time chance for teams to at least free themselves of the tax consequences of what is deemed a bad contract.
Sources indicate that some of the league's smaller-market (and more fiscally responsible) teams fought the implementation of the Allan Houston Rule, arguing that the league's big spenders already have big advantages when it comes to player acquisition. Those appeals were denied.
Q: Besides Finley and Houston, who is likely to be released under the Allan Houston Rule?
A: Brian Grant of the Los Angeles Lakers and Philadelphia's Aaron McKie are widely considered the only other locks. See Chad Ford's team-by-team breakdown for other candidates.
This is something that I've been asking about.Q: Can a team that doesn't have a payroll more than the luxury-tax threshold exercise the amnesty option?
A: Yes. Non-taxpayers can make an amnesty waiver for tax relief in future seasons provided that the player is released before Oct. 1.
Most people here have been saying (even me after I was convinced by other posters) that if you aren't in luxury tax territory you can't waive a player with this rule.
I guess we were wrong; you can.
Could a team cut loose a player, that player then signs with another team, and then that player be traded back to the original team? Or does the rule mean a player once cut, can not PLAY for that team again during the terms of his contract, period?
It doesn't say play, just no re-signing.Q: Can a team re-sign its own amnesty player at a later date?
A: No. Amnesty players are prohibited from re-signing with the team that released them for the life of the terminated contract.
Well to play, they have to sign a contract.It doesn't say play, just no re-signing.
I'm guessing that players would be barred from re-joining the team that waives them in any cir stance through the duration of their contract. I haven't seen that stated, though.
Amnesty players are prohibited from re-signing with the team that released them for the life of the terminated contract.
so it is untill the contract runs out, then the player can sign another contract with that team if he wants to but till then he has to play for other teams
So trades are considered signings?
What player were you thinking on?
Interesting that teams under the tax threshold can waive a player -- contradicts earlier reports, but I'm sure we'll find other changes in the CBA as more is learned.
since it says RE-signing i am pretty sure attonrey coudl argue you can sign with the hawks, and then hawks coudl trade you back to the other team
remember though there are period were just signed players cannot or can be traded
some could argue that doing this breaks the "spirit" of the contract , but i think it would be possible, you would have to probaly pull it off without showing you had pre planned to do so
Most of the questions were asked about Rasho.What player were you thinking on?
Well this isn't the specific rules -- it's just an article. I'm sure the NBA's attorneys will have all their bases covered with specifics in the actual do ent.since it says RE-signing i am pretty sure attonrey coudl argue you can sign with the hawks, and then hawks coudl trade you back to the other team
this is a FAQ , has anyoen actual seen the contract I never seen the CBA all i know is what other peoepl post about it
Well it's a FAQ by a journalist - not by the NBA.this is a FAQ , has anyoen actual seen the contract I never seen the CBA all i know is what other peoepl post about it
The actual do ent hasn't been release yet. The delay in free agency has been because the lawyers were going over the specifics. It should be released in a few days, I'd imagine.
I guess it wasn't released yet.
BTW I meant it was a FAQ of a writer not the NBA, just saying that tons of times writers can say stuff and it just be the just of the argument or be totaly wrong. For example some times the media gets hyped about key loggers which are decades old and act like it is some new spy software or soemthing. or when this dude was Suprised and SHOCKED his private files were shared, when a p2p app only shares what you instruct it to and in fact you have to change the defualt option to share anything outside a defualt share folder
Stein is usually pretty reliable.
Stein is very reliable. I'm just saying all the fine specifics aren't in this article. We have to wait for the new CBA to come out.
I agree, I was just filling anyone in who might never read stein.
Of course you can.
I wonder what team that might have been?Sources indicate that some of the league's smaller-market (and more fiscally responsible) teams fought the implementation of the Allan Houston Rule, arguing that the league's big spenders already have big advantages when it comes to player acquisition. Those appeals were denied.
Man, a couple of weeks back I was torn up by a lot of you because I said that the Spurs could cut Rasho because of this clause. Many here said I was wrong and so on. I feel a lot better now.
the Finley contract:
..who IS in the disadvantage here? Dallas or Finley?The scariest part for the Mavericks is that -- beyond the fact he'll receive all of the $52 million left on his contract -- Finley would then be able to go to a Dallas rival such as Phoenix or San Antonio for as little as a veteran minimum contract in the $1 million range.
i don't understand.
here's the rest of the article:
http://sports.espn.go.com/nba/column...=2113328&num=2
Houston, Finley gone; other big names staying put
By Marc Stein
ESPN.com
Archive Related Video:
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Imagine a free-agent universe where a slew of big-name vets become available in late July because their contracts are too expensive for their current teams to keep.
Don't expect the Magic to cut Grant Hill and his healed ankle.
Imagine a marketplace that suddenly offers up, say, the stately Grant Hill at a starting salary of no higher than $5 million.
Imagine a former All-Star like Eddie Jones in the same price range. Or a scorer in the Jalen Rose class.
Imagine Chris Webber being cut loose and, to really spite his old friends in Sacramento, joining Kobe Bryant's Los Angeles Lakers in a cut-rate deal.
Well, guess what?
You pretty much have to imagine all that, since roughly none of it will end up happening that way.
When word initially spread about the much-ballyhooed "amnesty" clause in the new labor agreement -- a clause that quickly became known as the Allan Houston Rule -- it wasn't fans alone salivating over such possibilities.
The one-time opportunity all teams will have to waive a player without paying any luxury tax on the player's guaranteed contract had front offices buzzing for a while, too.
The widespread first impression in circulation made the Hill, Jones, Rose and Webber scenarios seem plausible. Virtually every famous name in the league possessing an unwieldy contract has been mentioned as a possible amnesty candidate ... to the delight of capped-out contenders hoping to pounce on those vets at bargain prices.
"A lot of us," said one Eastern Conference executive, "have been curious to see how many players will be available for the ($5 million mid-level exception) that have no business being available for the mid-level."
No one foresees a bonanza any longer, though. Curiosity has been replaced by the reality that most teams aren't eager to waive productive players -- while continuing to pay their salaries in full -- in exchange for mere tax relief.
Amnesty moves, you see, provide zero salary-cap relief.
We repeat: No cap space is gained by waiving an amnesty player.
As a result ...
Conversations with numerous personnel folks around the league over the past month suggest that not even half of the NBA's 30 teams plan to make an amnesty move.
And all indications are that there's less-than-little chance that Hill, Rose, Jones, Webber or even Portland Trail Blazers shot-blocker Theo Ratliff would be set free by their current employers.
The Dallas Mavericks' Michael Finley is the only All-Star alumnus who's likely to be released while still anywhere close to his All-Star self.
The New York Knicks' plans to waive Allan Houston have become synonymous with the rule, obviously, and the Los Angeles Lakers' Brian Grant is another reasonably big name who's sure to be released. Knee problems, though, mean that neither is still regarded as a certain difference-maker.
Finley, then, stands to be the only impact player available. Portland's Derek Anderson and Indiana's Austin Croshere are among the more prominent maybes, but neither is on par with Finley. The 32-year-old's scoring average has declined for six straight seasons, and his salary for 2005-06 is nearly $16 million, but Finley did uncork a 31-point playoff game at Phoenix in the second round.
"Remember that a lot of the guys you're talking about are still good players," said one Western Conference executive. "At some point -- probably at the end of their contracts -- they're going to be tradable. Every contract at some point becomes tradable. Teams aren't just going to get rid of good players if they're not getting any cap relief."
Michael Finley can still fill up the hole every now and then.
Said another Western Conference executive: "The rule really only helps teams that are close or above the luxury-tax threshold, which will probably be around $61 million [next season]. "If a team doesn't look like it will be close [to the threshold] over the life of its worst contract, they won't use [the amnesty provision]."
Thus the rule appeals mostly to the teams with the fattest payrolls and biggest luxury-tax bills, such as New York and Dallas. The potential tax savings -- more than $50 million in Finley's case -- virtually forces Mavericks owner Mark Cuban to release his former face of the franchise unless Dallas can concoct a trade first, as it still hopes.
The scariest part for the Mavericks is that -- beyond the fact he'll receive all of the $52 million left on his contract -- Finley would then be able to go to a Dallas rival such as Phoenix or San Antonio for as little as a veteran minimum contract in the $1 million range..
If he's inclined to hold out for the best financial offer -- a multi-year deal starting at the full mid-level of $5 million or so -- Finley will weigh offers from at least two up-and-comers: Denver and his hometown Chicago Bulls.
The outlook is far different with most of the other high-profile cases who were once thought to be at risk, again because there is no cap relief for the teams who do the releasing.
The Heat, for example, are too close to a le to dump Jones and get nothing back for him, especially with just two years (at $30 million) remaining on his contract. If it made Jones an amnesty casualty, Miami would still be well over the cap and unable to land a quality replacement.
Rose also has just two years left on his deal -- at $32 million total -- but the Raptors have two high-salaried players still on their books (Alvin Williams and the since-released Alonzo Mourning) who are far less productive than Rose. The same goes for Boston and Raef LaFrentz (four years and $47 million left); Mark Blount struggled far more than LaFrentz last season to justify his salary ($33 million over five years).
The Magic, meanwhile, have come too far with Hill to oust him now, just when it appears -- as an All-Star reborn -- that he's sturdy enough to make a huge difference with a contender somewhere.
And Webber?
For all the concern about his mobility, cutting Webber holds little appeal to the Sixers. He had less than half a season alongside Allen Iverson, and Philadelphia just fired Jim O'Brien to bring Mo Cheeks back to town. Philly understandably wants to give the Iverson-Webber partnership more time to click under a new coach ... especially since the Sixers would still be required to pay the $62 million over the three seasons that remain on Webber's contract.
"The Lakers would love that," said one Webber confidante. "But it's not going to happen. Trust me."
So, no bonanza.
No matter what you might have heard or wished for.
Last edited by milkyway21; 07-26-2005 at 01:10 AM.
The sixers should cut Webber. I can not see a team with Webber and Iverson ever winning there. They are tons over the salary cap and are looking at paying mega luxury tax for the next three years. This and the fact that Webber will NEVER be the player he once was. He is a jump shooter with a little rebounding that is one tweak from the IR.
the way it reads is that the spurs and rasho can negotiate a buyout of say half of the remaining guarantee. Rasho would still benefit because he could probably sign for 6mil/yr with someone else. That would give rasho $3mil (half of spurs contract) + $6mil from his new team for a total of $9mil per year. sounds like a good deal for everyone.
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