Per CBA rules (Article VII, Section 2b), each NBA team is required to spend 90% of the Salary Cap in team salaries. This limit is called the “salary floor.” For 2017-2018, the Mavericks have fallen beneath the salary floor by $4,036,966. Thus, the Mavericks must reimburse the players on the roster this amount of money postseason, so that the players earn 90% of the Salary Cap (and their share of Basketball Related Income – BRI). The numbers are displayed below.
What: Make your Restricted Free Agent into an Unrestricted Free Agent
Why: Likely no plans to resign and to clear cap space
When: Offseason Move
Benefit: Eliminates the cap hold for the RFA
Renouncing the rights to a player means that a team can no longer use Bird, Early-Bird, or Non-Bird exceptions to resign him, making him an Unrestricted Free Agent. As a result, a team can still negotiate with the player but must do so as an UFA. The team is freed from the cap hold that the player would claim as a RFA, and can use other exceptions besides Bird Rights.
This action can occur no earlier than July 1 following the most recent season of the player’s contract. If a team renounces a player on July 1, 2018, and the player remains unsigned for the 2018-2019 season, he will remain a UFA in the next offseason. A team cannot “wait-out” a renouncement period to then sign a player later on.
A team would likely renounce a player to free up cap space. If they chose, a team could sign the player to a Two-Way contract or execute a sign-and-trade after renouncing a player.
In one specific case can a team “un-renounce” a player. If Team 1 renounces a player (or players) to clear room to sign a RFA from Team 2, and the RFA resigns with the Team 2, Team 1 can “un-renounce” or rescind the renouncement of that player. However, a team cannot “un-renounce” a player if it takes them above the salary cap or further above the salary cap than it was before renouncement.
On June 23, 2017, the Detroit Pistons extended a Qualifying Offer of $4.96 million to Kentavious Caldwell-Pope. In July of 2017, the Detroit Pistons renounced the rights to Kentavious Caldwell-Pope, making him an Unrestricted Free Agent. At the time, they were over the salary cap, into the luxury tax, and couldn’t match KCP’s offers. Thus, Kentavious Caldwell-Pope signed with the Lakers for a 1 year/$17,745,894 contract using the cap room of the Lakers.
For the offseason of 2018, Kawhi Leonard qualifies for the Designated Veteran Player Extension, otherwise known as the new NBA Super-Max Deal. Per the CBA, he can sign this Super-Max deal in the final season of his current deal, extending him by five years (6 total with the Spurs). He has done so based on the following qualifications (Article II, Section 7a, ii):
The “supermax” deal qualifies Kawhi for a first year base-salary (2019-2020) of 35% of the NBA salary cap. In the following years, he can receive an 8% increase yearly from the first year salary. The DVPE calls for a six-year length, thus Kawhi would sign a five-year contract in the summer of 2018, having only one-year remaining on his current deal. The salary projections are based on the first year of the new deal, thus the 2019-2020 NBA salary cap. The numbers are as follows:
2019-2020 NBA Salary Cap Projection: $108,000,000
Year 1 – 2019-2020
Year 2 – 2020-2021
Year 3 – 2021-2022
Year 4 – 2022-2023
Year 5 – 2023-2024
In total, Kawhi could sign a 5 year/$219,240,000 contract with the San Antonio Spurs in the summer of 2018. Because of Rule 3, the San Antonio Spurs are the only team that can offer him this deal.
On the other hand, if Kawhi were to sign with another team during the summer of 2019, he would only be able to sign a max contract of 4 years/$139,320,000. Only the Spurs can offer him a 5 year, 35% of the cap, 8% raise contract as the Supermax deal, and others can only offer a 4 year, 30% of the cap, 5% raise contract. As a result, the Spurs can offer Kawhi nearly $80 million more than any other team in 2019 NBA Free Agency.
I'm Jake, a recent graduate of Duke University pursuing a career in collegiate or professional basketball operations.
Cap #s 2018 - 2019
Salary Cap: $101.869M
Lux. Tax: $123.733M
Tax Apron: $129.827M
Tax Floor: $91.682M
Room MLE: $4.45M