New Salary Cap Realities To Keep In Mind

[scott]

Posted this in the offseason thread, but felt it was worthy of it's own post. You all will let me know if not, and I'll go impose a self-ban.


The 2026-27 salary cap increase came in at 7% AND Spotrac is currently forecasting only 5% cap increases after that.

As a result, the extensions for Paolo, Chet and JWill now look like this as a % of the cap *before* any SuperMax escalator is factored in (this will apply to any rookie 25% max deal):

2026-27: 25.00%
2027-28: 25.71%
2028-29: 26.30%
2029-30: 26.78%
2030:31: 27.15%

This is something to watch out for with the Spurs and Fox's extension. If he signs a 30% max deal with full 8% Bird Raises, his % of the cap would project to look like this (these same numbers apply to any 4-year Max deal with 8% Bird raises):

4 years/$222MM

26-27: $49.6MM 30.0%
27-28: $53.6MM 30.9%
28-29: $57.6MM 31.6%
29-30: $61.6MM 32.1%

I think it is not likely, but I think there is a small outside chance and I hope this is what Fox and the Spurs agree to: a 8% raise in year 2, then a (max allowable) 10% decline in years 3 and 4 with year 4 being a player option (someone can check my math on this, but I think it's right. Our resident cap gurus will correct me if I am wrong, I based the 10% max declines on Year 1 salary the same way 8% Bird Raises are applied):

3+1(PO)/$196MM

26-27: $49.6MM 30.0%
27-28: $53.6MM 30.9%
28-29: $48.6MM 26.7%
29-30: $43.7MM 22.8%

This would be about as "team friendly" as it can get for the Spurs, while still giving Fox maximum money for the first two years of the deal and giving him a player option to opt out in 2029 when he'll be eligible for a 35% max by virtue of years of service.

[LeBowen]

Player option options () would be the best case scenario, but I'll be content as long as it's not a 5 year deal.
Realistically we won't have issues before Harper's extension kicks in, which will be in the 4th year of Fox's extension, just before he turns 32.
We'll get his prime and then if he's in the way of Harper who could very well be the better player by 2029, we shouldn't have issues moving Fox's contract unless he suffers serious injuries and falls off completely.

If he actually takes those proposed discounts, then we might be onto something and Brian Wright might just be the next great GM.

[scott]

Someone will have to correct me if I'm wrong, but I do not believe Fox is eligible for a 5 year extension.

[vy65]

Curious why cap projections are coming in at 7% and 5% rather than 10%. Wasn't the NBC/Amazon deal much bigger than the previous media package?

[vy65]

Curious why cap projections are coming in at 7% and 5% rather than 10%. Wasn't the NBC/Amazon deal much bigger than the previous media package?

"Last week something happened, deep in the NBA weeds, that I think has chilled the market a little bit," ESPN's Brian Windhorst said Monday during The Hoop Collective podcast (51:50 mark). "The projection was that the salary cap would increase by 10 percent next year, but it is now only projected to increase by seven percent. ... The thing about it is now is when the new media-rights deal is coming in, this is the first year of it. And the salary cap is only allowed to go up by 10 percent a year. The media-rights deal is [more than double what it previously was]. And so there was this belief that the salary cap was going to go up by 10 percent for three straight years, just to fit this in. ... The reason why [it isn't], from what I've been told, is the regional networks. All of those that are struggling."

Per Windhorst. Also, why the are there still regional networks? Couldn't the NBA just have a dedicated TV crew for each of the 30 teams' games on league pass and avoid this problem?

[exstatic]

"Last week something happened, deep in the NBA weeds, that I think has chilled the market a little bit," ESPN's Brian Windhorst said Monday during The Hoop Collective podcast (51:50 mark). "The projection was that the salary cap would increase by 10 percent next year, but it is now only projected to increase by seven percent. ... The thing about it is now is when the new media-rights deal is coming in, this is the first year of it. And the salary cap is only allowed to go up by 10 percent a year. The media-rights deal is [more than double what it previously was]. And so there was this belief that the salary cap was going to go up by 10 percent for three straight years, just to fit this in. ... The reason why [it isn't], from what I've been told, is the regional networks. All of those that are struggling."

Per Windhorst. Also, why the are there still regional networks? Couldn't the NBA just have a dedicated TV crew for each of the 30 teams' games on league pass and avoid this problem?

The large market teams make tons off their regional networks, while the smaller markets struggle. Big markets aren’t giving that up. This is also why I am a STRONG proponent of the second apron. They may make more money, but they can’t ing outspend us like they have in the past.

[RC_Drunkford]

frontloading Fox contract will be key tbh. That can only happen if he takes slightly less than the max. Sochan's extension will be another one to watch. I doubt the cap raises will be 5% after this year though. Should definitely be higher.

[benefactor]

frontloading Fox contract will be key tbh. That can only happen if he takes slightly less than the max. Sochan's extension will be another one to watch. I doubt the cap raises will be 5% after this year though. Should definitely be higher.

Hopefully it's something we don't have to watch.

[baseline bum]

nm

[baseline bum]

"Last week something happened, deep in the NBA weeds, that I think has chilled the market a little bit," ESPN's Brian Windhorst said Monday during The Hoop Collective podcast (51:50 mark). "The projection was that the salary cap would increase by 10 percent next year, but it is now only projected to increase by seven percent. ... The thing about it is now is when the new media-rights deal is coming in, this is the first year of it. And the salary cap is only allowed to go up by 10 percent a year. The media-rights deal is [more than double what it previously was]. And so there was this belief that the salary cap was going to go up by 10 percent for three straight years, just to fit this in. ... The reason why [it isn't], from what I've been told, is the regional networks. All of those that are struggling."

Per Windhorst. Also, why the are there still regional networks? Couldn't the NBA just have a dedicated TV crew for each of the 30 teams' games on league pass and avoid this problem?

I forgot about that. I remember right before selling to to those genociders Cuban was talking about what a trainwreck Bally and Root were financially with the local TV broadcasts on All The Smoke.

[Ariel]

I'm also concerned by the upcoming Fox extension and, while I do wish it were to come around something like scott posted, I'm less optimistic this will happen as I fear there may already be a sort of (wink wink) understanding in place which Spurs will feel compelled to honor. But maybe a compromise could be had, like offering Fox a 3 year extension with no options, at a flat number equivalent to 30% of the first year. More than that and I'm starting to hope Spurs get cold feet.