At the NBA trade deadline, the Indiana Pacers listened to the players and held fast. Don’t expect the same for the 2018 offseason. After looking at the upcoming NBA financial climate, the crystal ball looks favorable for the Pacers.
The last two NBA offseasons weren’t exactly an exercise in moderation.
Over $1 billion was shelled out — after the gigantic television deal hit — in 2016. Last season a more modest $400 million was spent. The lasting impression from all this thriftiness was that the good time would keep rolling and free agents will keep reeling in the dough.
And then Lou Williams signed a contract extension.
You know Lou, Lou of the Clippers. Lou, the coulda-woulda-shoulda 2018 All-Star that wasn’t. Lou, the front-runner for the Sixth Man of the Year award who’s averaging 23.2 points per game. That Lou? That Lou signed a contract extension worth $24 Million over the next three seasons. So much for obscene contracts.
Welcome to the temporary return of sensibility to NBA contracts.
A near-miss All-Star signing for virtually $8 million a year, signifies the first practical effect of the upcoming market correction to the NBA. In short, over the last two season a lot of teams found they had a lot of spare money and thought it was a good idea to spend it ravenously on the available players; and now those teams don’t have the money to spend ravenously meaning the money in player contracts will shrink.
Welcome to the temporary return of sensibility to NBA contracts.
So while Miles Plumlee — you remember Miles Plumlee — a borderline role player signed a 4 year/$50 million deal with Milwaukee in the lucrative summer of ’16; Williams a borderline All-star — in the frugal 2018 — did not. The majority of teams just don’t have the money to splurge on players now as they did then.
Look at the practical cap space that teams have available to them going into the offseason. Six teams are already over the 2018-19 luxury tax (Cleveland, Oklahoma City, Golden State, Toronto, Washington and Minnesota); two more (Miami and Charlotte) are dangerously close to the tax; seven others (Detroit, Portland, LA Clippers, Milwaukee, Denver, Boston, and Memphis) are over the cap but have room under the tax. That’s half the league.
Of the 15 teams that remain: three (San Antonio, Houston and New Orleans) for various reasons have virtually no cap space. Six (Phoenix, Orlando, Sacramento, Dallas, Atlanta and maybe Chicago) aren’t in a position to add key free agents to their roster because they…well…stink and are dedicated to playing young players.
Adding everything up, that’s 24 of the 30 teams who either have no space, don’t have liquid space or don’t have much intention to use their space.
That leaves Indiana, Utah, Brooklyn, Philadelphia, the Lakers, and possibly New York as the only team with space and the motive to actualize it.
This puts the Pacers in a great position for the offseason and increases their leverage over the available player pool.
Now, of course, teams can clear space through trades and such. Cleveland and Oklahoma City will both open up a bit of space — though likely not enough to get under the salary cap — if LeBron James and Paul George leave to join the Lakers, potentially depart in the offseason. Regardless, the lack of teams with usable cap space turns this offseason in a very team-friendly one.
This puts the Pacers in a great position for the offseason and increases their leverage over the available player pool.
At various times during this season, and in various articles, the list of players who’s names have appeared with some version of the qualifier “it’s going to be tough to keep him because somebody’s going to offer him a lot of money”, is long: Will Barton, Ed Davis, Wayne Ellington, Tyreke Evans, Derrick Favors, Joe Harris, Mario Heronja and the Pacers Glenn Robinson III are all unrestricted free agents. Clint Capela, Aaron Gordon, Treveon Graham, Montrezl Harrell, Rodney Hood, Zach LaVine, Patrick McCaw, Jusuf Nurkic, Kyle O’Quinn, Jabari Parker, Julius Randle and Marcus Smart are all restricted free agents.
You tell me where all these guys are getting their big money from?
There are, of course, ways to pay players, the mid-level exception is a over $8 million, and the mid-level tax exception is over $5 million, but that’s my point. The Pacers won’t be bidding against teams offering grandiose $40 or $50 million contracts, they’ll be competing against teams offering exceptions in the 3 year/$15 or $24 Million range. Much, much more manageable for Indiana.
And none of this includes the LeBron Jameses or Isaiah Thomases of the world. That level of notable player will still land a big-dollar contract. But, the more those player demand the less there will be for the good, but not super-star players: like Robinson.
The moral of this story is that there are deals to be had in free agency, and the Pacers would be deliriously foolish not to capitalize on such a moment.
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Indiana’s cap space could either be gigantic (close to max level, if they cut Al Jefferson and both Cory Joseph and Thaddeus Young decline there option) or just pleasant ( a little over $ 9 Million).
In this climate, that cap space should be enough for two good role players(resigning Robinson and a friend), or maybe bundle it all together for a Lou Williams-level talent.
Indiana could also finagle some of their expiring deals into enough space to offer Aaron Gordon the type of contract that would give the perpetually disastrous Orlando Magic pause.
It might not take an Oladipean $21 Million-a-year deal. If Orlando has to pay another $17 Million contract (both Evan Fournier and Bismack Biyombo have one) it would make them queasy.
Then other player movement scenarios will render some restricted free agents expendable. Like, if James and George go to the Lakers, Los Angeles will likely find it tough to match a sizable contract offer to Julius Randle. Or Boston, after the development of Terry Rozier III, won’t likely expend much effort to match an offer sheet that Marcus Smart signs.
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None of this means that Indiana will spend lavishly in free agency, but they could; if the crystal ball is correct Indiana won’t have to spend lavishly to add key players.