Fuck Yea[h] NBA

Gordon Monson at the Salt Lake Tribune attempts to wade through the tentative CBA deal and figure out if the Utah Jazz will be able to compete with the Los Angeles Lakers. The new CBA is supposed to regulate what larger franchises, like the Lakers, can spend when compared with the smaller franchises, like the Jazz. What owners, who buy into mid-small market franchises, forget when they’re making a conspicuous consumption purchase like the Utah Jazz is Justin Timberlake and Jessica Biel will not be sitting sideline at the Jazz’s Energy Solutions Stadium.

First, Monsoon talks about the harsher luxury tax penalties in the new deal:

Indeed, there are harsher luxury-tax penalties in the deal meant to slow the spending enthusiasm of teams such as the Lakers, who perennially have blown straight through the dollar-for-dollar penalty of the past. After the initial two years of the new agreement, the penalty moves to a $1.50-to-$1 ratio for the first $5 million over the threshold. For teams that are $5 to $10 million over, the ratio goes to $1.75-to-$1. From there, it launches upward for teams $10 to $15 million over to $2.50-to-$1, and $3.25-to-$1 for teams $15 million to $25 million over.

[…]

There also is an additional dollar-for-dollar repeater tax in the deal that will be applied to teams that go well over the threshold four times in a five-year period.

For a small market team like the Jazz, this is good. It penalizes a franchise like Los Angeles that routinely goes over the soft cap, and it penalizes them further for being routine about it. At specific points over the cap, more and more is sacrificed to the luxury taxes. Makes sense if competitive balance is what you’re seeking.

On top of the exponentially increased luxury taxes for the big-spenders, there’s also a limit on the amount of mid-level exemptions they’re afforded and a sign and trade “big spenders” proviso that allows only one player to make a maximum-salary that accounts for 30% or more of a teams allotted cap space.

Beyond that, big spenders face limitations in usage of the mid-level exception and, instead, will have to get by with a mini-mid-level deal that halves the payout and shortens a player’s contract from four years to three.

Also, there are some limits on sign-and-trades for heavy spenders, and a rule that allows teams to have just one player on a maximum-salary deal worth up to 30 percent of a club’s salary cap.

The problems Monsoon sees are the same issues any mid-small market owner must be asking themselves after the tentative CBA deal. Will any of this matter; especially when you consider the lucrative television deals franchises negotiate to host Lakers games in the LA area? Those deals are so big, a franchise like the Lakers or Knicks can afford to pay the stiffer penalties. As Moonsoon put it, “that’s just the cost of doing their business.”

As for the new luxury-tax structure, you have to wonder how much of a difference it will make, considering the rich teams with rich TV deals may go on spending to secure their spots atop the league. If big-market teams are getting hundreds of millions of dollars in those television contracts, will they really care if they have to shell out an extra $50 million in taxes in order to win titles? Or will it simply be a cost of doing their business and maintaining their positions?

Ostensibly, I’d figure it’s the middle/small market teams that will probably falter like Monsoon cautions. In an attempt to become relevant in the NBA, they’ll exceed their budgetary constraints imposed by their location and fan-base (Minnesota, Memphis, Sacramento, New Orleans, Charlotte, Indiana etc.) and they’ll end up incurring debt as they borrow to afford more superstars while exceeding the cap in place. The only way to stay competitive against the larger franchises is to over-extend themselves. The same way it’s been for the last decade. Was anything really solved for these small and mid-market franchises? Probably not.

Which is why contraction makes so much sense, but then Stern would have to contract, which he has been unwilling to do in the past, and owners will lose their franchises—even as they’re hemorrhaging money and fans—which they won’t be willing to do.

It’s like mid and small-market owners forgot they’re still in those same shitty markets. That doesn’t go away because a, largely ceremonial, band-aid was placed on in the guise of the CBA’s soft (but harder) cap, exemptions, and sign and trade rules.

We’ll see, but I’ve already written a few blog posts for the 2021 NBA Lockout—that is if this blog makes it that far. 

[Salt Lake Tribune; pic: Flickr/pseriesstylist]