The scoop on the $3.3 mill TPE

[Hotshot Hower]

From a pretty knowledgable poster in Denton's FL Today Forum:

I posted this elsewhere, but since we've been having the same discussion here, I thought I'd copy it here. It's also important, because JD also published that the TPE cannot be combined with a player to get another player. That's not 100% correct. Please read on...

I've seen a lot of people writing that you can't use the TPE in combination with another player to get a higher salaried player. I don't think this is correct. I think what is correct is that you cannot combine the TPE with the 125% + $100k exception. But you can use the TPE plus a player to get another higher salaried player if you land in the 100% + $100k margin, and if it is used in a non-simultaneous trade (from the Cap FAQ: In a non-simultaneous trade, a team can only acquire up to 100% plus $100,000 of the salary it gives up [as opposed to 125% plus $100,000 in a simultaneous trade]. A trade in which more than one player is traded away can only be simultaneous; non-simultaneous trades are allowed only when a single player is traded away). This is the case with the Dooling trade.

Where it comes in handy is if we want to make a trade where the margin between the player we're receiving and the player we're sending is greater than the 125% + $100k limit. Normally we couldn't do it, because we aren't in a position to use that exception. Now we have the TPE to get us there - but we still cannot go outside of the 100% + $100k limits of the non-simultaneous trade. This is most effective when trading mid-salaried players. When you get into huge salaries, a) the 125% margin grows larger in real dollars, and b) $3.3M is 25% of $13.2M - anything larger than that and it can't make up the gap (well, kinda). So, say we want to trade Cook for a higher-salaried player. We could use the TPE in combination with his $3.5M salary to get a player with a salary of up to $6.9M - $3.5M + $3.3M + $100k. And for anything less than that, but more than the 125% + $100k, we just use part of our TPE (enough to get us there).



Taa-daa!

http://www.floridatoday.com/apps/pbcs.dll/section?category=PluckForum&plckForumPage=ForumDiscussion&plckDiscussionId=Cat%3aadc4d919-840d-4bdc-bac8-3e3151995cf0Forum%3a65053859-5e1d-48de-b78b-b1c1db289989Discussion%3aecda5232-80f2-44d6-9981-321d482c93d4&plckCategoryCurrentPage=0

so it can be combined with a player in order to obtain another player if salaries come within the $100k + 100% limits. (i.e. Turk + $3.3 mill TPE + future 1st / David West)

Turk makes $6.8 mill and D-West makes $9.8 mill this year. $3.3mill TPE comes within those limts.
( I know it was from an unknown poster but Otis has had all of us guessing and surprising us with his moves this offseason)

I wouldn't be surprised if Orlando is inquiring about West. Given they want a real 4 and Shard to play the 3 eventually along with Turk commanding more money and West's contract frontloaded, this could be very well be in the mind of Otis.

But NOH on the other hand would probably want more, especially in the front court and pick(s)...

[cedric76]

i d rather haev Lewis at the PF
we need to give space to DH and haveing Lewis+Hedo on the perimeter is what w eneed

[magicfan4life05]

^ west would provide great spacing too, he's deadly from midrange, his jumper is automatic...if otis pulls this off, i would be very impressed...but theres just no way this happens, west is part of their core, why would they break it up for hedo when they have peja, and mo pete, and james posey...

[trebone]

i would love west but not going to happen, i would still like a rasheed wallace to play with dwight talk about intensity even though he is a nut case

[magicfanatic23]

West would be the perfect fit but I doubt they would get rid of him considering how well he fits in for NO.

[magic09champs]

If Otis could land West that would be a miracle.

[Devin 1L]

From a pretty knowledgable poster in Denton's FL Today Forum:

I posted this elsewhere, but since we've been having the same discussion here, I thought I'd copy it here. It's also important, because JD also published that the TPE cannot be combined with a player to get another player. That's not 100% correct. Please read on...

I've seen a lot of people writing that you can't use the TPE in combination with another player to get a higher salaried player. I don't think this is correct. I think what is correct is that you cannot combine the TPE with the 125% + $100k exception. But you can use the TPE plus a player to get another higher salaried player if you land in the 100% + $100k margin, and if it is used in a non-simultaneous trade (from the Cap FAQ: In a non-simultaneous trade, a team can only acquire up to 100% plus $100,000 of the salary it gives up [as opposed to 125% plus $100,000 in a simultaneous trade]. A trade in which more than one player is traded away can only be simultaneous; non-simultaneous trades are allowed only when a single player is traded away). This is the case with the Dooling trade.

Where it comes in handy is if we want to make a trade where the margin between the player we're receiving and the player we're sending is greater than the 125% + $100k limit. Normally we couldn't do it, because we aren't in a position to use that exception. Now we have the TPE to get us there - but we still cannot go outside of the 100% + $100k limits of the non-simultaneous trade. This is most effective when trading mid-salaried players. When you get into huge salaries, a) the 125% margin grows larger in real dollars, and b) $3.3M is 25% of $13.2M - anything larger than that and it can't make up the gap (well, kinda). So, say we want to trade Cook for a higher-salaried player. We could use the TPE in combination with his $3.5M salary to get a player with a salary of up to $6.9M - $3.5M + $3.3M + $100k. And for anything less than that, but more than the 125% + $100k, we just use part of our TPE (enough to get us there).



Taa-daa!

http://www.floridatoday.com/apps/pbcs.dll/section?category=PluckForum&plckForumPage=ForumDiscussion&plckDiscussionId=Cat%3aadc4d919-840d-4bdc-bac8-3e3151995cf0Forum%3a65053859-5e1d-48de-b78b-b1c1db289989Discussion%3aecda5232-80f2-44d6-9981-321d482c93d4&plckCategoryCurrentPage=0

so it can be combined with a player in order to obtain another player if salaries come within the $100k + 100% limits. (i.e. Turk + $3.3 mill TPE + future 1st / David West)

Turk makes $6.8 mill and D-West makes $9.8 mill this year. $3.3mill TPE comes within those limts.
( I know it was from an unknown poster but Otis has had all of us guessing and surprising us with his moves this offseason)

I wouldn't be surprised if Orlando is inquiring about West. Given they want a real 4 and Shard to play the 3 eventually along with Turk commanding more money and West's contract frontloaded, this could be very well be in the mind of Otis.

But NOH on the other hand would probably want more, especially in the front court and pick(s)...

Ah, I see where the idea in the other thread of combining a player with the TE for David West came from.

As far as I can tell this guys deduction is completely wrong.

The CBA clearly states that the traded player exceptions may not be combined with other exceptions:

(j) Non-Aggregation.
Other than in accordance with Section 6(h) above, a Team may not aggregate or combine any of the Exceptions set forth above in order to sign or acquire one or more players at Salaries greater than that permitted by any one of the Exceptions. If a Team has more than one (1) Exception available at the same time, the Team shall have the right to choose which Exception it wishes to use to sign or acquire a player.

I think the fundamental error here is that he assumes that if the contract + the TPE is within 100% + 100k of another player then there is no combination of exceptions going on.

As far as I know, everything done above the cap is looked at in terms of exceptions, ie. Hedo's contract, West's contract, and obviously the appropriately named Traded Player Exception.

Regardless of whether you land within 100% and 100k, you'd still be combining exceptions (Hedo + TPE) to trade for another player. If you view everything in terms of exceptions (which as I said, is how I believe everything is handled when above the cap) then you can't combine the two.

Step back and think about it. If you could do this, don't you think you'd see a much more prevalent use of TPE in trades?

They're not used much because of their limitations. If you could combine them with a player, using the players salary and as little or as much of the exception as you would like to end up within 100% + 100k of a player you wanted, you would have all kinds of options.

Say you had a $5mil player and a $10mil exception. Under this line of thought, you could combine the two to trade for any player ranging from $5-15mil using only however much of the TPE that would be needed to be within 100% and 100k of the other players salary. (I'm sure Golden State would have liked that flexibility last year when in pursuit of Garnett.)

So, like I said, I think he is dead wrong, and I think his fundamental error is thinking that as long as Hedo + the TPE were within 100% + 100k of another player, that it wouldn't be viewed as combining exceptions. As far as I understand, it absolutely would, and thus it would not be allowed.

[UCFJayBird]

Yea i think this guy has got his facts wrong. It's an interesting thought, and I can see why he'd think it, but I've never seen a player combined with a trade exception for this very reason, you're not allowed to.

[MagicFan149]

so n.o. has peja and just signed posey... but they would want another s.f. in hedo for their second best player? not to mention that n.o. is already shorthanded in the front court...

n.o. would NEVER do this... its really not even worth discussing....

[surflawyer]

NBA Salary Cap FAQ

67. What are the rules regarding trades?

Teams under the salary cap may make trades as they please, as long as they don't end up more than $100,000 above the salary cap following a trade. But if a team is over the cap, or they are under the cap and a trade would take them more than $100,000 over the cap, then an exception is required. An exception is the mechanism that allows a team to make trades or sign free agents and be over the salary cap. Since teams are usually over the salary cap, trades are usually accomplished using exceptions.
Some exceptions are available only for signing free agents, and those exceptions are covered in question number 19 . The exceptions available for making trades are as follows:

The Traded Player exception is the principal means through which most trades are made. It is described in question numbers 68 and 69.


The Minimum Salary exception can be used for either trades or signing free agents. It allows teams to acquire minimum-salary players. See question number 70 for more information.

The Disabled Player exception can also be used for either trades or signing free agents. It allows teams to acquire replacements for certain injured players (see question number 19 for more information).
Note that there are sometimes multiple ways to configure the same trade. For example, a minimum-salary player might be acquired using either the Traded Player exception or the minimum salary exception, or a two-for-two trade might also work as two separate one-for-one trades. Teams are allowed to choose the configuration that works best for them. See question number 72 for an example of this.


--------------------------------------------------------------------------------

68. What is the Traded Player exception?

As described in question number 67, exceptions are the mechanisms that allow teams to function above the salary cap. Any trade which results in the team ending up over the salary cap requires an exception. This is true even if the team is moving downward in salary. For example, if the salary cap is $50 million, a team has a team salary of $55 million, and they want to trade a $5 million player for a $4 million player, they still have to use an exception. Even though their team salary would be decreasing by $1 million, the fact that they would still be over the salary cap ($54 million) means that an exception is required.

The Traded Player exception is the primary means used by teams over the cap for completing trades. It allows teams to make trades that leave them over the cap, but it places several restrictions on those trades. Trades using the Traded Player exception are classified into two categories: simultaneous and non-simultaneous. As its name suggests, a simultaneous trade takes place all at once. Teams can acquire up to 125% plus $100,000 of the salaries they are trading in a simultaneous trade. For example, a team trading a $7 million player (HEDO) in a simultaneous trade can receive one or more players whose salary is no more than 125% of $7 million, plus $100,000, or $8.85 million in return.

This is what FAQ actually says ......