The Athletic recently reviewed a copy of the term sheet of the new CBA, and spoke to multiple agents and executives about the league’s proposed changes.
The most notable change is that the new CBA contains a “second apron” set at $17.5 million above the luxury tax (with increases in future years commensurate with any salary cap rise) that places severe restrictions on any team that exceeds it. It also has harsher penalties even for teams that exceed the first apron that has already been in place at $7 million over the tax line, and comparatively lighter financial restrictions than currently in place for teams that merely exceed that tax line up until the apron.
The Clippers and Warriors, I’ll remind, you are both about $40 million above that line this season. More problematically, they are both locked into payrolls that soar just as high above the tax line for 2023-24. The Clippers, in fact, project to be the first team in in NBA history with a payroll above $200 million, while the Warriors could blow well past even that figure if Draymond Green doesn’t leave in free agency. Even in the years beyond, it will be difficult for either to lower payroll much without substantially degrading the roster.
The league is phasing in the new second apron over just a two-year period...
Teams above the second apron will have no midlevel exception, not even the taxpayer MLE of yore. They also may not use cash in trades, cannot trade for more money than is sent out, and will pay tax at a higher rate; for teams in the repeater penalty, that penalty also doubles to a $2-for-$1 additional tax.
... they may not aggregate contracts in trades. That aggregation rule is key, and not just for the Clippers and Warriors. Consider, for instance, that the Kevin Durant and Kyrie Irving trades to Phoenix and Dallas, respectively, would have been virtually impossible with those rules … especially since Brooklyn was deep in the tax and was also blocked by the same rules.
....restriction on signing buyout players who had made more than the MLE
...teams will not be able to trade a first-round pick seven years in the future...if those teams stay above the tax apron in more than one of the next four years, the pick gets pushed to the end of the first round in the year in question … regardless of where the team might finish.
While the harshest penalties are reserved for those who exceed the second apron, the NBA’s fangs also came out a bit for teams above the first apron at $7 million above the tax. Those teams will have a more limited taxpayer MLE ($5 million, two-year maximum) than in the past agreement, will have a 100 percent multiplier for trade salaries (in other words, can’t take back more than they send out), and will face the same buyout restrictions as the second apron teams.
The new rules not only clip the wings of the league’s most profligate spenders in general, but also catch the Clippers and Warriors in particular at a time when they are already facing something of a crossroads for their current builds. As much as these teams are facing battles on the court this week, their biggest challenges may yet come off the floor this summer.
The league came after the big spenders with a vengeance.
