Before this trade, Charlotte was on the books for $117.2 million in salary, just south of the 2017-2018 Luxury Tax line of $119.2. Even with the increased Luxury Tax Line and Salary Cap, Charlotte would be flirting with the Luxury Tax Line and was looking to dump salary and clear up space. They found their answer with Brooklyn.
Charlotte traded C Dwight Howard to the Brooklyn Nets in exchange for C Timofey Mozgov, two future 2nd round picks, and cash consideration.
From Brooklyn’s side: Howard is on an expiring contract, so they will pay out the $23.8 million he is owed and have an open roster spot after the 2018-2019 season. Also, they were able to off-load Mozgov’s 2019-2020 contract, freeing up an additional $16.7 million in 2018-2019 (net + $8.9 million in freed salary). Their cash considerations will reset on July 6 with the new salary cap year, and the two 2nd round picks are the sweetener to get Charlotte to make the deal.
From Charlotte’s side: Mozgov costs roughly $7.9M less for 2018-2019 than Howard, thus it frees Charlotte from the danger of crossing the Luxury Tax line (giving them roughly a $13 million gap). If Mozgov plays well this season, they could look to move him again, now on an expiring contract, or let him ride through 2020.
The No. 1 pick in the 2018 NBA Draft could change a franchise, but the question lies in — at what cost? The CBA calls for set amounts for 1st Round Picks as Rookie Scale Contracts. While years 1, 2, and 3 have predetermined values, teams can negotiate to pay their 1st Round Picks up to 120% of the predetermined values. For the 1st overall pick, this is almost a guarantee. Year 4 comes at a percentage increase over year 3, and Year 5 is a percentage increase over Year 4 that serves as a Qualifying Offer to make the Draft Pick a Restricted Free Agent that offseason.
So, if Luka Doncic, DeAndre Ayton, Marvin Bagley III or others get selected by the Phoenix Suns with the No. 1 overall pick, his salary will be as follows (assuming a 120% increase over the predetermined values):
Thus, Doncic, Ayton, Bagley, or others would sign a 4 year/$40 million deal with the Phoenix Suns, with the Suns having the right to pick up the Team Option in 2020, 2021, and the option to extend a qualifying offer in 2022.
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