Hard Cap

[Sharcm1]

I'm a fan of this. I think with the way the nba has been trending recently a Hard cap is the only way to make it even and fair for all teams. Right now only a few teams will be competitive and rest are left in the dust. All these star players all want to play with each other now. In the past they were rivals. They wanted to get their own championships. Ever since the celtics put together a big three the rest of the players wanted the same thing.

Now we see teams like the heat with 3 of the top 6 players on one team and way over the cap to make the rest of the roster. In a few years the heat will have three players under contract and still be over the cap.
There is no chance now for other teams to compete in signing and keeping players. Melo is a great example. He wanted to play with another star (amare). so he did. Now you get rumors that cp3 or howard want to play with 2 other stars. Their teams don't have a chance to keep them.

This hard cap will force players to stay with their teams because other teams won't have the ability to sign them and go over the cap. I say make it even so the nba can survive. A whole league of competitive, any team can be great, basketball is the way to go. Not I just drafted the best player since MJ and because he wants to play with other super players I won't be able to keep him past his second contract.

[Nanogeek]

I agree a hard cap is a much better system. It will be interesting to see how they transition from the current system to a hard cap system.

[OGSactownballer]

As long as everyone is willing to accept that with a hard cap - as in the NFL - there will be TRUE competition each year and the rewards go to the shrewdest management who are best able to blend talents, coaching and be fiscally adept in the form of contention for the championship.

I can say right now that the large market teams and the deep pocket owners (i.e. - Lakers/Knicks/Bulls/Celtics and the Mark Cubans) will scream against this when they realize what it REALLY means beyond player salary control. However if it can include a better sharing system for outside-based revenue (i.e. shoe contracts and individual promotional contracts) in the manner the NFL handles it where there is very little allowed outside the LEAGUE contracts with the supplier companies so that the vast rank and file of the players are attracted to the fact that the stars will no longer get the top contracts, best team ups AND the best deals for extras, it can be made to pass handily.

[OGSactownballer]

As far as a transition goes, it seems that the majority of franchises are already very much preparing for that. And to enforce while allowing a grandfathering clause for existing deals, you hammer down on the dollar for dollar tax and make it start at the cap limit going forward to make the revenue sharing go into effect immediately.

[gflem]

As opposed to a hard cap, why not a modified version of the current system with one big exception. NO guaranteed contracts. Allow owners to buy out large contracts at a percentage of what they committed to going to the player and with a penalty going to the league and also to the players retirement fund.
The owners need to be penalized for commiting to these ridiculous contracts for marginal players, and the players who dog it after cashing in should be held responsible as well. Under performing players could be released and get a percentage of the money owed over the life of the contract, or the full amount for the current season, with percentages going into a revenue sharing pool and into the reitrement fund to placate the union and actually help the current and future retired players.
Also a percentage of terminated contracts could be counted against the soft cap for the remaining length of the terminated contract against the team to try to keep GMs an owners from overpaying marginal players.
It would be complicated, but it would be doable if both sides consider that a work stoppage is the worst possible outcome in this economic enviornment. No idea about percentages or penalties and so forth, but I just dont see the players agreeing to a hard cap. Thoughts?

[Agenda42]

To make a hard cap work, you have to convince players to accept non-guaranteed contracts. Good luck with that.

[Sharcm1]

see I don't think they need to have non guaranteed contracts. I think they just need to set the max a player can have to less money.
The Lakers are a perfect example of this. Right now Kobe makes 25 mill and it will go up about 30 mill for his final season of his contract. That is ridiculous. The Lakers are at 91 million for their salary this season. That is almost 40 million over the cap. If max contracts were lowered it would help lower the middle level contracts and the players that actually deserve those middle level contracts would get them and not the players that should barely be in the league.

Right now teams throw money at bad players because they showed a glimpse of a good game with another team. These are the bad teams, teams that can't get the star players and therefore can't get the good players to play with them. So they are forced to get any player that will come and those players are the travis outlaws of the nba. He is a perfect example and the nets are a perfect example. They missed out of the big time players and therefore missed out on the good players cause they only want to play with the big time players and so they were forced to give a 7mill per year contract to a player like outlaw. horrible

A hard cap with lowered salary for max players is the way to go. These players make a huge amount of money and it trickles down. So this player isn't a max player but we can't get one of those and he is a good player so we will give him close to max or max just to keep him. or he will walk to a team that will.

It's crazy teams can't even keep their own players any more. They either have to pay them max to keep them, when they probably don't deserve max, or they have to watch them walk away for nothing.

Lowering the salary is the only only way to go and a hard cap with it to limit how many top salary players a team can have. That will spread the wealth throughout the nba and keep the league going. You will have more fans throughout the country if they believe their teams have a chance to compete each year. Right now there is no point to be a fan of the cavs or grizz, or t-wolves because they know they will lose and they know that no big player is going to come there and they have to get lucky in the draft to have a chance to compete.

[Curmudgeon]

Why completely overhaul the current system? If the owners attempt to do that, there will almost certainly be a lockout, if only because it takes an incredible amount of time and effort to reinvent the wheel.

I'd leave the current system pretty much in place with 3 relatively modest changes:

1. Guaranteed contracts are limited to three years. I see no need to change the current rules on signing bonuses, although you may want to permit modest bonuses for players who sign for the vet minimum.

2. Modest reduction in the percentage of BRI that the players share. The various salary caps come down a bit, along with the rookie scale. I like the idea of putting the difference into a pool to be distributed to "have not" teams along with the luxury tax money. But owners would be required to reinvest both this money and the luxury tax distributions in their teams. There wouldn't be this bull where the owners just pocket the money, which happens all the time in baseball. Yes, that's "socialism." So what?

3. A non exclusive franchise tag on one player per year for a maximum of two years per player (it's 3 years in the NFL). A team that franchises a player would be forced to insure that player's salary for three years. That protect's the player if he suffers a career-ending injury during his franchise year, since he would have received three years guaranteed as a free agent. As in the NFL, a tagged player could negotiate with other teams, sign an offer sheet, etc. It would work just like NBA restricted free agency, except that there would be a compensatory draft pick if the team that franchised the player elected not to match an offer sheet. IMO this should be an extra "sandwich pick" between the first and second rouinds like the ones in baseball. One is enough, since individual picks are worth much more when your draft is only two rounds.

[droponov]

This hard cap will force players to stay with their teams because other teams won't have the ability to sign them and go over the cap..

What kind of hard cap is that?

With a hard cap, LeBron James would have left Cleveland earlier because they were over the cap when they re-signed them.

The reason the most important exception - the Bird rights - exist is precisely to allow teams to retain their own free-agents because that's good for business.

[Sharcm1]

The bird rights should be continued. Add to the hard cap that teams can go over to sign their own players. But it has to be players that have played with them for at least 3 years. To limit players from taking one year deals just to get in and resign.

So if you get a great rookie you will be able to go over and sign him. Hard cap for trades and free agent signings. This now really allows teams with good moves and good management to keep their players. SO if I'm the clippers I will have a chance of keeping Griffin because I have the most money by far to spend.

I want to even things out in the nba. This 4 teams are good and the rest why bother crap is annoying. they lose fans. Yes the big markets have good teams now but what about all the fans in the rest of the country.

[Curmudgeon]

1. OK, so you continue the Bird Rights.

2. What about going over the cap to pay rookie scale (if there is one). If this is not permitted, it will disproportionately screw the "have not" lottery teams who desperately need an influx of new talent to remain both competitive and solvent. So there's another exception you need to help "fans in the rest of the country."

3. Are you going to have a minimum roster size? What happens when a capped out team has only 7 players. They won't even have enough guys to practice, and the current players will be forced to play too many minutes and will burn out. That's not so good when you are trying to sell season tickets and sky boxes. So you need an exception for players signed for the minimum, right? It's alot easier to cut players to get under the cap when your roster size is 53 instead of 15.

If you add a mid level exception and a couple of others (early Bird rights, the LLE, etc.) to the three exceptions above, you've just recreated the current system, haven't you?

You can add another feature of a hard cap system that would screw the small market teams: drastic reductiuon or even elimination of luxury tax payments.

I predict that a true hard cap will drive 5-6 small market teams out of business. In football, less wealthy teams are sustained by their share of the huge TV contract and by forced revenue sharing of gate receipts. There is no such thing in basketball.

And lastly, the quality of the product will be substantially reduced with a hard cap. The big stars are always going to get their money, because they are needed to sell tickets. That's the reason for the Bird exception. But teams will no longer to be able to afford "pretty good" players. Every team going forward will start to look like the Miami Heat, with a couple of stars and a bunch guys willing to play for the minimum. You can also forget about retaining very many foreign players when their rookie contracts are up. They will spend their prime years in Europe or Asia playing half as many games for the same money after having been trained in the NBA. I'm sure FIBA will send David Stern a thank you letter.

[DBoys]

Curmudgeon, your objections are shallow and easily fixed, if they wanted and agreed on a hard cap. I don't see the validity of all the angst, since a hard cap can still have a max salary limit for a single player, can still pass along the very same revenues that exist today, there can still be revenue sharing in some way, and so on.

They can create whatever they want to agree on, and a hard cap could be just as workable as the soft cap they have now, only with some different issues to plan for. The attitude that it can't be done amuses me, but it's far from realistic.

By definition, adding "exceptions" (such as Bird, MLE, etc) means you're no longer talking about a hard cap.

[GswStorm3]

Couldn't agree more. Staying with this soft cap is only going to sink parity lower and lower.

[Curmudgeon]

Curmudgeon, your objections are shallow and easily fixed, if they wanted and agreed on a hard cap.

So how would you fix each one? Please be specific.

1. Could teams retain their own free agents, even if over the cap?
2. Could teams go over to sign players they have drafted, or would they have to let someone else go?
3. What would you do if a team didn't have enough players even though it was capped out?
4. How would you share revenues? Would NBA owners agree to a net 60-40 split of the gate, as in football?
5. How would you address competition from FIBA teams, which have no cap, especially given the NBA's stated desire to expand internationally?

The present situation is a bunch of billionaires fighting over money with millionaires. I have no sympathy for either side. If the owners insist on a hard cap there will be a lockout, plain and simple. A long lockout. If the owners want to screw the fans that way, they can forget about me ever buying another ticket.

[DBoys]

So how would you fix each one? Please be specific.

Fair enough. But don't forget my answers are just one opinion, and each of these issues could be solved by other means as well.

1. Could teams retain their own free agents, even if over the cap?

In a sense this question makes the inaccurate implication that the current system allows a team to keep whoever they want, which isn't true. But after we recognize that current system does NOT assure a team of keeping anyone ...
a. There could be a rookie scale for several years like exists now ...
b. ...and then a team would have to plan to pay market value (as it does now) ...
c. ...while fitting that player's salary within a team budget (as is necessary now) ...
d. ...only in the new system, the budget limit would be set by the league rather than by the team.
e. Once rookie scale contract is complete, the current system has no mechanism that guarantees a team can keep a player it wants. All they can do is bid.
f. Don't ignore that the NFL has a hard cap yet teams are able to keep the vast majority of players they wish to keep.

2. Could teams go over to sign players they have drafted, or would they have to let someone else go?

a. There could be a rookie contract salary scale like there is now.
b. The draft could occur prior to free agency, like it does now.
c. When a team drafts a player, it would reduce their spendable cap room for free agency.

3. What would you do if a team didn't have enough players even though it was capped out?

Incredibly easy to handle, and in fact the rules already have been created and are being used in the current system, with cap holds for empty roster slots.

4. How would you share revenues? Would NBA owners agree to a net 60-40 split of the gate, as in football?

Totally negotiable. There's nothing in player payroll that prevents revenue sharing ...the owners simply have to figure out as a separate issue what they want and put it in place.

5. How would you address competition from FIBA teams, which have no cap, especially given the NBA's stated desire to expand internationally?

Incredibly overblown "chicken little" type hypothetical. Teams in Europe have no max salary and nothing prevents players from going there now, yet it's quite rare because the NBA is miles ahead as a place to play. As for international expansion, I wouldn't hold my breath.

The present situation is a bunch of billionaires fighting over money with millionaires. I have no sympathy for either side. If the owners insist on a hard cap there will be a lockout, plain and simple. A long lockout.

Agreed, but it's on both sides if they can't agree how to share such a huge pie. A hard cap is simply a budget, and all teams already have one. This just puts a league number on each team's budget.

The problem isn't just the owners. There's plenty of player greed as well. Players say, "It's not our problem if teams spend themselves into bankruptcy, " but that's not entirely true. Without collectively-bargained limits, owners get sued for collusion when they don't compete aggressively for players and drive up salaries. Therefore, a hard (or harder) cap is the only time and means for the owners to create some fiscal restraints that protect franchises from spending themselves into the poor house, as the current system has them doing.

[Curmudgeon]

Thanks for your response, but your solutions don't seem to work.

1. In #1, let's say the hard cap is 50 million and I'm capped out. My player, who has been with the team for five years, made 5 million (reducing my cap to 45 million) but is aski ng for 10 million in free agency. You are saying that I would have to rid mself of five million in salary befor I could sign that player, right?

The NFL has two forms of franchise tag and teams can franchise a player for up to three years. That's how they keep their players. NFL teams also have much more flexibility because the rosters are so large.

In #2, the cap is 50 million and I'm right at 50 million. I won the lottery and have the #1 overall pick. The rookie scale for that pick starts at 5 million. Do I have to release players in order to sign the player I've drafted?

In #3 the cap holds are irrelevant. I'm at 50 million with only 7 players. Cap holds would put me over the cap. So do I have to release one or more players to get down to 50 million to cover the assumed cap holds for all of my empty roster spots?

As for competition with FIBA, the reason players come here is that the money is better. Period. In Europe the players get a free apartment, a free car, and can stay off the IRS radar if they have good tax advice (such as by establishing residence in one of the known tax havens, like the channel islands). The food is better and the girls are just as pretty. You play half as many games and there is considerably less travel, so you have more free time and your career can be longer. When a FIBA team is offering, say, 80% of what an NBA team is offering, FIBA begins to look pretty good.

As I said earlier, the stars will always get paid. That's 2-3 guys per team, at most. The others will take substantial cuts from what they are making now, making Europe more attractive.

As for revenue sharing, I'll believe it when I see it. The revenue sharing provisions have been the the NFL constitution forever. The NBA teams would have to devise something fair and then rewrite the NBA constitution, and the big market teams won't like it one bit.

[gflem]

And dont forget in scenerio #1, with guaranteed contracts there is no way other than to buy out a player to make room for another contract. With that kind of leverage given to the players the buyouts would have to be larger than the actual contracts. Can you imagine a capped out team with the #1 pick and no room to sign that pick?
Having to negotiate a buyout in that situation would cost much more than the actual contract. It would go somethng like this "hey Mr. agent we want to buy out your clients contract so we can sign the #1 pick in the draft that we have"..... Agent (with huge hard on) "sure we will consider it for the entire amount plus another $10 million or you will just have to forfeit your pick, I'm sure your fans will understand".

[Curmudgeon]

Oh no, the owners will get a hard cap, no guaranteed contracts and givebacks on contracts already signed. I guess we can forget about NBA basketball until 2018 or thereabouts.

Of couse, they could make a rule that waived players no longer count on the cap lol. That would solve the problem you've described.

[gflem]

Oh no, the owners will get a hard cap, no guaranteed contracts and givebacks on contracts alreaqdy signed. I guess we can forget about NBA basketball until 2018 or thereabouts.

Well if the owners demand both and wont budge, I really dont see a season next year. That would be unfortunate for us fans and in that scenerio I could see more than a few teams folding with the economy in the shape its in and other events likely to negatively affect it even more. A work stoppage would come across as so out of touch that I believe many casual fans would just say F U to the league and the subsequent revenue drop when they eventually resume would be devastating to the league.

[Curmudgeon]

LOL, and the teams that fold will be the same small market teams that the hard cap is allegedly supposed to help. The Lakers aren't going to fold.

And even those small market teams that weather the lockout will be hurt by a hard cap just as much as the big market teams.

So I'm the Boston Celtics (just to name one solvent. well-managed franchise) and you are asking me to agree to revenue sharing. If you use the NFL model, the home team takes 15% of the gate off the top to cover stadium costs and the rest is split 60% to the home team and 40% to the visitors.(Correct me if I've gotten these numbers wrong.)

So Wyc Grousbeck says, "Wait a minute. I'm selling out the Garden every night and charging top ticket prices. Plus I've got sky boxes. You want me to give 40% to some team from Podunk? When I go to play there, they have 1,500 goats and chickens in the building who purchased discounted tickets, and half of them are Celtics fans anyway. Hey guys, I have stockholders (or partners) too. What's in it for us?"