APRON Rule

[HeatFanLifer]

I'm trying to figure out the effects the modified APRON rule could have on the league. I created the following formula to explain the correlation between the salary cap and the new APRON:

2018 salary cap will be:
$99,093,000 + X(99,093,000)
X is the percentage increase in the salary cap

2018 APRON will be:
$125,266,000 + 1/2X(125,266,000)

This is because the rule appears to state the APRON increase half the percentage the salary cap increases.

In other words if the salary cap goes up 10% (X=.10) then the 2018 salary cap would be:

99,093,000 + .1(99,093,000) = $109,002,300
APRON would be:
125,266,000 + .05(125,266,000) = $131,529,300

This would cause the buffer between the salary cap and the APRON to shrink by around $3.5 million.

Is that correct?

Thanks!

Edited: not sure where that number came from, thanks for correction

[DBoys]

In other words if the salary cap goes up 10% (X=.10) then the 2018 salary cap would be:

99,093,000 + .1(99,093,000) = $109,002,300
APRON would be:
125,266,000 + .5(125,266,000) = $130,220,650

131,529,300

[DBoys]

My prior post corrected the math. But the formula is way wrong. And your observation that "This would cause the buffer between the salary cap and the APRON to shrink by around $3.5 million" when the apron itself has gotten bigger should have been a major red flag.

[HeatFanLifer]

My prior post corrected the math. But the formula is way wrong. And your observation that "This would cause the buffer between the salary cap and the APRON to shrink by around $3.5 million" when the apron itself has gotten bigger should have been a major red flag.

What's the formula then? If the salary cap increases and the APRON increases half the percentage of the salary cap, how does the buffer between the cap and APRON not shrink? I appreciate the post, but if you are going to say someone is wrong, please explain what is wrong.

[DBoys]

In round numbers, with a 10% increase in cap, the apron would be at about 137M. An exact formula would be incredibly complicated, because it would have to include not only the pct cap increase, but other numbers such BRI and the exact amount of shortfall (or lack thereof) vs 51% of BRI in players' contractual pay the prior season.

FWIW, the NBA's estimate for 2018 is currently only about a 3% increase (to 102M), not 10% or anywhere close.

[HeatFanLifer]

In round numbers, with a 10% increase in cap, the apron would be at about 137M. An exact formula would be incredibly complicated, because it would have to include not only the pct cap increase, but other numbers such BRI and the exact amount of shortfall (or lack thereof) vs 51% of BRI in players' contractual pay the prior season.

FWIW, the NBA's estimate for 2018 is currently only about a 3% increase (to 102M), not 10% or anywhere close.

"In 2017-18 the Apron is the point $6 million above the tax threshold. In subsequent seasons the Apron rises or falls by one-half the percentage that the salary cap rises or falls."

http://www.cbafaq.com/salarycap.htm#Q20

The 10% number was just used due to the easy math calculation, not as a predictor.

A 3% rise in the salary cap would equal 1.5% rise, correct?

2018 salary cap would be:
$99,093,000 + .03(99,093,000) =
$102,065,790

2018 APRON would be:
$125,266,000 + .015(125,266,000) =
$127,144,990

2017 buffer between cap and APRON: $26,173,000
2018 buffer between cap and APRON: $25,079,200

Thus the buffer is reduced by $1 million. Am I misstating this?

I used excel this time instead of my phone calculator so the numbers should be correct.

[DBoys]

Your math is still way off. And the spread between cap and apron would be increased if the cap goes up, not decreased.

I'm a KISS guy on this type of projection stuff, since it's all guesswork anyhow. Since you won't ever have the numbers to create an exact formula anyhow, I'd suggest a much simpler formula for guesstimating future apron levels.

For a 3% increase
Cap = Old cap x 1.03
Apron = Old apron x 1.03

So an accurate number for a 3% increase should be close to 129M. (Old apron x 1.03 = 129,023,980)

That actually will maybe be off by about 90,000 from a more intricate formula that tries to factor in "apron x cap pct increase / 2" but for a guesstimate, where the number is around 130M and it's not precise, who cares about 90,000?

[HeatFanLifer]

For a 3% increase
Cap = Old cap x 1.03
Apron = Old apron x 1.03

I think your math is off. It's half the percentage increase of the increase in the salary cap, no?

In 2017-18 the Apron is the point $6 million above the tax threshold. In subsequent seasons the Apron rises or falls by one-half the percentage that the salary cap rises or falls."

http://www.cbafaq.com/salarycap.htm#Q20

[DBoys]

In 2017-18 the Apron is the point $6 million above the tax threshold. In subsequent seasons the Apron rises or falls by one-half the percentage that the salary cap rises or falls."

I just noticed the above wording in your post. That's poor wording in the new FAQ. But you did have the concept correct, generally, in your opening formula that the "half the increase" was only applicable to the 6M.

IOW per the CBA the spread between the tax line and the apron (not the "apron" itself), which was initially 6M in 2017, is what "rises or falls by one-half the percentage that the salary cap rises or falls".

Anyhow ....

My math and formula is really quite close, for a guesstimate, and super simple

If you want to be so precise on an otherwise rough guess as to subtract out the "half the percentage" part on the amount over the tax line, it's a very tiny number correction, but here it is so you can see my math is correct.

6M x 1.03 = 6,180,000
6M X 1.015 = 6,090,000
Correction = -90,000

To me, why even bother? Apron x pct increase, and you're close enough.

And, as you can see, when I did that calculation with exact numbers for a 3% increase, the spread over tax has GROWN from 6 to 6.09. If the cap goes up, that spread goes UP.

[HeatFanLifer]

I get it now. Thanks for clarifying.