Origin of the mid-level exception

[IrishBeatdown]

Just had a question for someone with more knowledge than me. Specifically, when was the MLE first introduced to the CBA, and what the original intent of it was. Why is the MLE allowed to exceed the cap unlike other contracts?

[DBoys]

Why is the MLE allowed to exceed the cap unlike other contracts?

1 The MLE is an "exception" to the salary cap limit. BY DEFINITION, that means it is an allowance to exceed the cap.
2 It is not the only exception to the salary cap. There are lots of them. See Coon's FAQ http://www.cbafaq.com/salarycap.htm items 25, 26, 27 and many many other references there.
3 The MLE, like other exceptions, was created to allow teams to keep spending and improving their team, to some degree, even after they even after they had already used their entire agreed allotment of player payroll spending room.
4 The MLE was created as part of the CBA ratified on 1/20/1999, and iirc some form of it was first available to teams for that shortened 98-99 season.

[IrishBeatdown]

Why is the MLE allowed to exceed the cap unlike other contracts?

1 The MLE is an "exception" to the salary cap limit. BY DEFINITION, that means it is an allowance to exceed the cap.
2 It is not the only exception to the salary cap. There are lots of them. See Coon's FAQ http://www.cbafaq.com/salarycap.htm items 25, 26, 27 and many many other references there.
3 The MLE, like other exceptions, was created to allow teams to keep spending and improving their team, to some degree, even after they even after they had already used their entire agreed allotment of player payroll spending room.
4 The MLE was created as part of the CBA ratified on 1/20/1999, and iirc some form of it was first available to teams for that shortened 98-99 season.

Good info. On point #3, why not just raise the salary cqp instead of creating the MLE? Wouldn't it have the same effect? I'm guessing its just a way to spend money on a player without proportionally increasing the salaries to players on a team overall by increasing the total cap space alloted to each of the players on the roster.

[DBoys]

3 The MLE, like other exceptions, was created to allow teams to keep spending and improving their team, to some degree, even after they even after they had already used their entire agreed allotment of player payroll spending room.

On point #3, why not just raise the salary cap instead of creating the MLE? Wouldn't it have the same effect?

Perhaps. But it isn't possible from a practical standpoint, because having an NBA salary cap, and how it works, is something that can only exist via an agreement between NBA owners and players. And in general, they don't want the same thing: NBA owners would prefer to strictly limit player payrolls, while the players don't.

So the NBA's cap, set by the CBA, ends up with lots of give and take in its details, rather than a simple "hard cap" (strict limit, no exceptions) like the NFL has. A "soft cap with exceptions" is the compromise setup that has evolved over time, and each CBA ends up as a negotiation and compromise over how high to set the soft cap (in relation to the revenues the NBA takes in), and over what exceptions there will be and how they will work.

[IrishBeatdown]

Thanks a lot boys +1