Cap hold question

[Malinhion]

The former Blazers guy that ESPN has working tonight said, while the Nets were on the clock for 31, that the first pick in the second round is helpful because second round contracts are non-guaranteed. We all know this because it became a big deal in 2007 with Nikola Pekovic, a pick that had moved twice. Unsurprisingly, another european prospect went at the 31 slot this year.

However, analyst also went on to say that second round picks don't count as cap holds.

Miami traded Cook, and the guaranteed money 18th pick.

So right now they have this on the books:
1. Dwyane Wade's extension/bird rights cap hold
2. Michael Beasley's rookie contract
3. Mario Chalmers $800k option

If second round picks don't count as cap holds, do the rest of the open roster slots each get a minimum salary caphold until someone is signed? Or does Miami not have to count those slots because the contracts with the 2nd round picks remain unnegotiated?

Trying to run some numbers and I want to know if Miami has to count 5 or 9 minimum salary capholds against them when trying to see how much cap space there is for free agents.

Maybe I am interpreting the CBA language wrong. I know minimum salaried players can be signed over the cap as an exception, but teams under the cap with not enough players do have cap holds for those roster spots.

Can anyone clear this up for me?

[Three34]

If second round picks don't count as cap holds, do the rest of the open roster slots each get a minimum salary caphold until someone is signed?

Yes. A roster charge equal to the rookie minimum is charged for each spot up to and including the 12th.

[Malinhion]

Thanks Sham. Helpful as always.

Okay, so the point of amassing 2nd rounders was that they wouldn't have rookie slotted salaries on the books, but rather capholds for the rookie minimum.

When a team is negotiating with a free agent, are they allowed to neglect that one cap hold for the roster space that the new free agent shall fill? Or does the hold only dissipate after they sign?

[Three34]

After.

[Malinhion]

After.

Does this really make sense, though?

Doesn't that mean that Miami will be left one minimum salary rookie deal under the cap after signing all players? It seems like you actually can't even use all your cap space unless you go over the minimum number of roster spots.

[Dunkenstein]

It may not make sense, but that's the rule.

[Three34]

And anyway, it does make sense. The cap hold is the charge for not having a twelfth player. Why should it be removed until you get that twelfth player?

And anyway, it's a difference of, what, $473,604? No big deal.

[Dantares]

so do you need 12 or 13 players?

[Dunkenstein]

During the season, a team needs a minimum of 13 players under contract. But during the off-season, a team needs to have a minimum of 12 players. If it has less than 12 players, it must have the requisite number of cap holds to bring it up to 12 roster spots. These can either be the cap holds for former players who are now free agents or a cap hold equal to the cost of a minimum salaried rookie.

To explain how this works, let's say that the salary cap is $50M and the rookie minimum is $500,000. Let's take a fictitious team. We'll call them the Clippers. On July 15, the Clippers have 11 players under contract whose contracts total $40M and have renounced all their free agents. They must therefore have one cap hold of $500,000. They therefore have $9.5M to sign a free agent. Let's then say they sign a single player to a contract for the whole $9.5M. For a nanosecond they have 12 players under contract plus a $500,000 cap hold. But then that cap hold drops off and they are left with a team salary of $49.5M for the 12 players under contract.

[answerthink]

The roster charge concept exists to ensure that teams with cap space are thinking about their entire rosters when making player personnel decisions. It ensures that teams below the cap can complete their required 13 player minimum regular season rosters without exceeding the cap. Math dictates the way to do that is to stop the charges at 12.

[Dunkenstein]

Of course teams can always exceed the cap by signing additional players using the minimum salary exception.

[Malinhion]

Thanks everybody.