New CBA rules to aid Warriors
The Warriors’ recent dynasty required myriad factors: a deft coaching change; Stephen Curry’s bargain contract that allowed them to sign Kevin Durant; the emergence of Klay Thompson and Draymond Green.
But for Golden State to go from perennial punch line to class of the league, it needed majority owner Joe Lacob to spend big. Long one of the NBA’s stingiest franchises, the Warriors’ payroll vaulted into the top half of the league after Lacob took over the team in 2010, ranking among the top five in three of the past five years.
In recent months, as he charted the financial toll of the coronavirus pandemic, Lacob began to rethink his approach to rosterbuilding. Perhaps he’d need to advise general manager Bob Myers to
shed some salary, especially with a combined $ 130.1 million committed next season to four players: Curry, Thompson, Green and Andrew Wiggins.
Such a possibility no longer might be necessary, however.
To ease the burden on luxurytax teams such as Golden State, the NBA made a change to its collective bargaining agreement this week, reducing the luxurytax bill for franchises at the end of the 2021 season by the percentage amount that the league’s Basketball Related Income ( BRI) declines from initial projections.
According to ESPN, a 30% decline in BRI — $ 8.45 billion to $ 5.9 billion — would reduce the Warriors’ luxurytax bill from $ 60 million to $ 42 million. It also helps Golden State that the salarycap and luxurytax lines will be $ 109.1 million and $ 132.6 million, respectively, the same numbers they were before the NBA shutdown in March.
When play was suspended because of the coronavirus, some within the Warriors’ organization feared that the salary cap — an agreedupon amount based off expected revenue for the next season — would drop between $ 4 million and $ 15 million. That could have had sobering ramifications. Had the cap declined by $ 10 million, the Warriors might have had to pay roughly $ 15 million more in taxes than on their entire payroll.
Such a development, combined with the tens of millions of dollars in revenue Golden State already has lost in canceled games and a shuttered Chase Center, likely would have forced Lacob to at least consider making roster decisions for reasons other than maximizing the team’s chances at another title.
As pundits tried to forecast the Warriors’ offseason plans, they weren’t sure how big a role finances could play. Would Golden State deal its No. 2 pick — a spot that comes with an $ 8.7 million rookie salary — for a later pick and less burdensome contract? Would it opt not to sign a free agent to its $ 5.7 million midlevel exception? Would it let its $ 17.2 million trade exception expire?
The new CBA hardly eliminates finances as a factor in Lacob’s offseason plans, but it should buoy the odds of him returning to his aggressive ways. According to a league source, Golden State was pleased with the CBA and doesn’t expect to change its todo list in the interest of saving money.
If the Warriors trade back in the draft or let their trade exception expire, they will do so because they believe it’s the best basketball decision. The odds of Golden State utilizing the trade exception, which allows a team to take on more salary than it unloads, actually increased, because of the CBA.
According to ESPN, the Warriors’ tax bill would jump to $ 149 million if they acquired a player for the full $ 17.2 million in a trade. A reduction to NBA revenue, however, could trim Golden State’s bill by up to $ 45 million.
The names that have been mentioned as trade exception possibilities — San Antonio’s Rudy Gay, Phoenix’s Ricky Rubio, Miami’s Kelly Olynyk and Milwaukee’s Eric Bledsoe, among others — are all helpful rotation players, but they might not have been worth the investment for an ownership group worried about an exorbitant luxurytax bill. Now, if Myers orchestrates a trade for one of those players, he probably won’t need to work as hard to convince Lacob to agree to it.
Even amid a pandemic, Lacob recognizes that the Warriors have only a few years remaining to maximize what’s left of their core’s prime. Spending big might be the only way to put together a roster capable of contending for another title.