TPE player exception deal structure (continued from T&T board)

[SideSwipe]

There is a deal on the T&T board that offered Joe Harris and a 2nd for Markieff Morris. This deal led into a discussion regarding how the Haywood TPE can be used and if/how players may be additionally sent out as part of completing non-simultaneous TPE deals. Sounds deep and esoteric (it is ), but there has been some good discussion and not a clear answer yet on two topics that have come up.

1. On the Minimum player trade exception, do players salaries qualify by contract length or years remaining
CBA (pg. 155-157), and Coon (Minimum Player Trade exception section) say contract length. Practice may by the league may be "remaining term"

2. Can additional players be sent out by a receiving, over-the-cap team in a non-simultaneous trade that fills an open TPE without the other team sending additional compensation in a parallel trade?
Many of the mods (TC, HW, Smitty) say this is possible due to teams getting the most beneficial trade structure allowable under the CBA, but I am unable to confirm this fact either in the CBA, Coon FAQ, or in any actual deal that has occurred since the 2011 CBA.

If anyone has additional insight into this with a link or reference that may have been overlooked, I would be interested in taking a look.

Continued from this topic:http://forums.realgm.com/boards/viewtopic.php?f=2&t=1420714#start_here

[DBoys]

1 On the Minimum player trade exception, do players salaries qualify by contract length or years remaining?

They must have qualified under the MSE when they were signed.

2 Can additional players be sent out by a receiving, over-the-cap team in a non-simultaneous trade that fills an open TPE without the other team sending additional compensation in a parallel trade?

An over-cap team can always send away a player in trade to another team with no player in return, say for a pick or cash. But it has to be one in a trade, not a giveaway, so there are specific guidelines that must be met to ensure that, and they vary depending on how many teams are in the trade as submitted to the league. As long as those are met, then each team's side of the trade is structured to its greatest CBA advantage.

Re the fact that each team's side of the trade is structured to its greatest CBA advantage, I don't know if that is actually spelled out anywhere online, or detailed as such in the FAQ. I suspect it is. But that's absolutely how it works. It was thought to be otherwise for years by cap geeks like us, but I personally discovered that fact from a conversation with an NBA asst-GM perhaps a dozen years ago (under the 1999 CBA) when rules specifics were still hazy to us outsiders, and first shared it here with Coon, Dunkenstein, and some others.

[DBoys]

PS - Re the trade proposed in that thread, Harris for Morris, CBA-wise it works just fine. It's doable as just a simple one-for-one deal, as each team has the CBA-specified ability to add the player they are acquiring in that swap. And there is the potential for one or more players to be added on either side, and/or picks and cash, if desired.

[Smitty731]

1 On the Minimum player trade exception, do players salaries qualify by contract length or years remaining?

They must have qualified under the MSE when they were signed.

2 Can additional players be sent out by a receiving, over-the-cap team in a non-simultaneous trade that fills an open TPE without the other team sending additional compensation in a parallel trade?

An over-cap team can always send away a player in trade to another team with no player in return, say for a pick or cash. But it has to be one in a trade, not a giveaway, so there are specific guidelines that must be met to ensure that, and they vary depending on how many teams are in the trade as submitted to the league. As long as those are met, then each team's side of the trade is structured to its greatest CBA advantage.

Re the fact that each team's side of the trade is structured to its greatest CBA advantage, I don't know if that is actually spelled out anywhere online, or detailed as such in the FAQ. I suspect it is. But that's absolutely how it works. It was thought to be otherwise for years by cap geeks like us, but I personally discovered that fact from a conversation with an NBA asst-GM perhaps a dozen years ago (under the 1999 CBA) when rules specifics were still hazy to us outsiders, and first shared it here with Coon, Dunkenstein, and some others.

The first question is interesting because it appears that Brooklyn acquired players from Philadelphia last year that were signed to 3 year minimum deals using the Minimum Exception. At least that is how HartfordWhalers remembers it and his memory is usually spot on. I've always thought it was a max of two years too, but this is making me at least question it. I am fairly sure both Ware and Davies for the "Hinkie Special" which was 3 years of partial/non-guaranteed deals. Any thoughts on that?

[DBoys]

Who were the players and what was the deal that you think violated that rule?

[HartfordWhalers]

1 On the Minimum player trade exception, do players salaries qualify by contract length or years remaining?

They must have qualified under the MSE when they were signed.

2 Can additional players be sent out by a receiving, over-the-cap team in a non-simultaneous trade that fills an open TPE without the other team sending additional compensation in a parallel trade?

An over-cap team can always send away a player in trade to another team with no player in return, say for a pick or cash. But it has to be one in a trade, not a giveaway, so there are specific guidelines that must be met to ensure that, and they vary depending on how many teams are in the trade as submitted to the league. As long as those are met, then each team's side of the trade is structured to its greatest CBA advantage.

Re the fact that each team's side of the trade is structured to its greatest CBA advantage, I don't know if that is actually spelled out anywhere online, or detailed as such in the FAQ. I suspect it is. But that's absolutely how it works. It was thought to be otherwise for years by cap geeks like us, but I personally discovered that fact from a conversation with an NBA asst-GM perhaps a dozen years ago (under the 1999 CBA) when rules specifics were still hazy to us outsiders, and first shared it here with Coon, Dunkenstein, and some others.

The first question is interesting because it appears that Brooklyn acquired players from Philadelphia last year that were signed to 3 year minimum deals using the Minimum Exception. At least that is how HartfordWhalers remembers it and his memory is usually spot on. I've always thought it was a max of two years too, but this is making me at least question it. I am fairly sure both Ware and Davies for the "Hinkie Special" which was 3 years of partial/non-guaranteed deals. Any thoughts on that?

Yeah so:

10/24/14 — Traded Marquis Teague and 2019 second-rounder to the Philadelphia 76ers for Casper Ware.
12/11/14 — Traded Andrei Kirilenko, Jorge Gutierrez, a 2020 second-rounder, the right to swap 2018 second-rounders and $1 million to Philadelphia 76ers for Brandon Davies.

Both of those trades were doable with standard matching, and there is no need to use the minimum exceptions for the Nets.


However, all reports were that the Nets set the trades up for matching so as to give full TPE's for all the Brooklyn Nets outgoing players:
I.e. http://www.basketballinsiders.com/brooklyn-nets-team-salary/brooklyn-nets-salary-archive-201415/
Trade Exception (Marquis Teague, expiring 10/24/15) — $1,120,920
Trade Exception (Andrei Kirilenko, expiring 12/11/15) — $3,326,235
Trade Exception (Jorge Gutierrez, expiring 12/11/15) — $816,482

(Stein reported the TPE's as well, etc)

That works as long as the Nets did the trades:
Teague generating a TPE and Ware separately into some exception.
and
Kirilenko generating a TPE, Guitterez generating a TPE and Davies separately into some exception.

However, I showed the Nets having no exceptions that would have been available to make that work besides the minimum exception (if legal). And both players were signed for 3+TO contracts.

So, unless I am missing something it appears the Nets wrongly got 2 small TPE's and should not have been able to set up the matching that way.

[Smitty731]

PS - Re the trade proposed in that thread, Harris for Morris, CBA-wise it works just fine. It's doable as just a simple one-for-one deal, as each team has the CBA-specified ability to add the player they are acquiring in that swap. And there is the potential for one or more players to be added on either side, and/or picks and cash, if desired.

This was explained multiple times in the thread. It seemed the ability for each team to structure the deal to suit them best was the confusion. And then the non-simultaneous rule came up somehow and that lead the Minimum Exception and now here we are!

[DBoys]

"unless I am missing something it appears the Nets wrongly got 2 small TPE's and should not have been able to set up the matching that way"

*It's possible that the rules could have been changed behind the scenes. I have seen that happen. The CBA is hazy, but I first inquired in 2013 on this rule and I was told explicitly by someone who would know that only MSE-qualified contracts can be absorbed using the MSTE. (FWIW I did not go and re-review the pertinent CBA wording for this discussion, to see how hazy it is.)
*It is possible that the NBA made a trade-related mistake. It happens.
*The mistakes, if they occurred, were only an accounting error as to the existence of some minor TPE's, and otherwise effected nothing.
*If I'm not mistaken, any such TPE's were never used and would have expired already, so we have no way of seeing if they exist. And it's become a meaningless error, at worst.
*It is possible that the reports were deductive as to the generation of such TPE's within these trades, and someone erroneously made inaccurate deductions.

I did go back and look, and the restriction as I understand it is noted in FAQ 86.

[HartfordWhalers]

"unless I am missing something it appears the Nets wrongly got 2 small TPE's and should not have been able to set up the matching that way"

*It's possible that the rules could have been changed behind the scenes. I have seen that happen. The CBA is hazy, but I first inquired in 2013 on this rule and I was told explicitly by someone who would know that only MSE-qualified contracts can be absorbed using the MSTE. (FWIW I did not go and re-review the pertinent CBA wording for this discussion, to see how hazy it is.)
*It is possible that the NBA made a trade-related mistake. It happens.
*The mistakes, if they occurred, were only an accounting error as to the existence of some minor TPE's, and otherwise effected nothing.
*If I'm not mistaken, any such TPE's were never used and would have expired already, so we have no way of seeing if they exist. And it's become a meaningless error, at worst.
*It is possible that the reports were deductive as to the generation of such TPE's within these trades, and someone erroneously made inaccurate deductions.

I did go back and look, and the restriction as I understand it is noted in FAQ 86.

The wording is clear in the CBA:

Minimum Player Salary Exception.
A Team may sign a player to, or acquire by assignment, a Player Contract, not to exceed two (2)Seasons in length, that provides for a Salary for the first Season equal to the Minimum Player Salary applicable to that player (with no bonuses of any kind). A Player Contract signed or acquired pursuant to the Minimum Player Salary Exception covering two (2) Seasons must provide for a Salary for the second Season equal to the Minimum Player Salary applicable to the player for such Season (with no bonuses of any kind).

[DBoys]

"The CBA is hazy"
"The wording is clear in the CBA:"

Then I guess my memory of the wording was what was hazy! lol

[SideSwipe]

Great discussion, Dboys thanks for your input in here. Maybe its mutually agreed interpretation of the contract, but I cannot see a means to circumvent completion of a single non-simultaneous trade by adding a player to it within the CBA, and I don't think we have any examples that have happened that match the situation described since the CBA went into effect. If anyone thinks of any examples that would be great.

On the MSE discussion above, I am wondering if rookie (first contract/ under 25)vs. "vet" minimum is the difference the league is looking at here. Harris looks to be signed for 3-4 years on standard rookie terms, but with a minimum salary for each year except the year the QO is available, in which case the QO is $200K over the true min.

So per CBA it says no MPE's can be used for minimum salary contracts longer than 2 years, but maybe in practice rookie contracts may be allowed to pass? On the flip side min contracts can't be signed for more than 2 years, so the only case an MSE could not be used would be a rookie contract.

[DBoys]

"I cannot see a means to circumvent completion of a single non-simultaneous trade by adding a player to it within the CBA, and I don't think we have any examples that have happened that match the situation described since the CBA went into effect."

I have no idea what you are referring to as circumvention, but rest assured that's not what is being allowed. Instead, teams are being granted permission to make trades, as long as they comply with the CBA cap rules pertaining to such trades. A trade can be made with whatever players the rules allow. Keep in mind that we are discussing a single trade, and nothing more.

"I am wondering if rookie (first contract/ under 25)vs. "vet" minimum is the difference the league is looking at here."

Nope. There is no CBA distinction in the application of MSE based on age or NBA experience.

[DBoys]

SS, if you want to follow and understand the trade process, what you have to recognize is that the CBA is to a large degree about a limit on salaries (the "cap"), and possible exceptions to that limit. So the key issue with a trade is that a team must have CBA permission, in a sense, to add each player they will acquire. (There are also rules that have to be met that ensure a trade is a trade, not a giveaway, but we'll assume those aren't a question.)

You don't need permission to lower your team salary. So assuming you meet the "trade, not giveaway" general guidelines, all you have to satisfy and all the league really looks at, for each team, is the satisfaction of CBA permission to add the incoming.

One way for a team to do that is to simply have cap room for all the incoming players in a trade, of course. But lacking that, each and every player coming in by trade to that team must be added using a cap exception. So in essence, for each team (separately) the NBA lines up the proposed incoming players to that team, the exceptions that team has available to use, and then matches them up. The only relevance that the outgoing players would have to that process is the general one of the usable exceptions (TPEs) arising from those outgoing players that can be used either in that trade or (perhaps) in a later one.

Sometimes there are different ways that the exceptions of a team can be allocated so that cap rules can be met in a trade, and the league allows each team independently to apply its exceptions in the way it feels is most beneficial. There is no demand to match up one team's choices with another's, only to have each team meeting the need to satisfy the limits of the CBA for itself.

At the end, if allowed by the rules, leftover TPE's are preserved for later non-simultaneous use (at a lower matching value, and with additional restrictions on use).