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3 Ways to Improve the NBA’s Next Collective Bargaining Agreement

The NBA has a massive new TV contract and a collective bargaining agreement that can be renegotiated in 2017. And there are some who speculate that at that time, there will be another labor crisis. There are ways, though, that by looking at a few mutually beneficial ideas, a stoppage can be avoided.

Michael McCann of Sports Illustrated wrote back in May:

As numbers stand right now, the surge in TV money is expected to cause the NBA’s salary cap to skyrocket from $68 million in the 2015-16 season to approximately $90 million in the 2016-17 season. This would represent a stunning 33 percent increase over just one season and the highest percentage annual increase since the NBA’s salary cap climbed from $16 million in the 1994-95 season to $23 million in the 1995-96 season, a 44 percent bump. $90 million would also represent a massive escalation over recent salary cap growths. Consider that the salary cap for the 2014-15 season is set at $63.1 million, after being $58.7 million in the 2013-14 season and $58.0 million in the 2012-13 season. These recent annual salary cap increases are dwarfed by the projected increase set for the 2016-17 season.

Those numbers are a bit different, as the cap for next year was since adjusted to $70 million, but that’s still a mammoth bump in the following year’s salary. Now, a lot of attention is going to be placed on exactly how the Basketball Related Income (BRI) is going to be split up, with both sides wanting more. But in the end, it’s probably not going to change that much as both sides are still going to get about half.

But it’s during these times that other changes to the CBA also happen. For example, last time it brought about more severe penalties to repeat tax-paying teams, an amnesty for each team,  the since-dubbed “room” exception for teams below the cap and the “Rose Rule” which allows for players who meet certain thresholds in their rookie deal to get paid 30 percent instead of 25 percent of the cap.

Each of these types of rules helps facilitate the talks because the owners and players both get concessions that make the BRI split easier to reach. And if there are things that are win-win and palatable to both sides, then that should make it easier to avoid a lockout or strike.

The LaMarcus Aldridge Rule

One of the concerns is that big-time players bolt for big-time teams, which makes it more difficult for teams that are in small markets to build a team from the ground up. While restricted free agency helps teams keep their players up to seven years, as soon as their second deal comes up, they can bolt for greener pastures, and the team which brought them up is left without anything to show for their loss.

They can do what the Minnesota Timberwolves did, trading away a present superstar in Kevin Love for a potential future superstar in the person of Andrew Wiggins, but that’s not only risky — it’s also kicking the can down the road. Eventually that player will be putting them in the same position.

Thus, teams are constantly in rebuilding mode, having to restart every time the stars they have hit their primes.

The Portland Trail Blazers didn’t make the trade, instead gambling that LaMarcus Aldridge would stick with the team that won its division and was competitive in the Western Conference. Instead, he bolted for the vaunted San Antonio Spurs, and everyone else that could, abandoned ship with him. Now they’re left with Damian Lillard and a rebuilding team just when they finally started to get somewhere.

What could help with this is what I propose as a “LaMarcus Aldridge Rule.” Teams who lose a player to a max deal would have something akin to a trade exception in their pocket. They could sign any player in the league up to the amount that player would’ve been qualified to sign if they had stayed with the team. Effectively, this would be a team version of the Bird Exception which would expire after four seasons, and no team could have more than one.

This would allow teams that lost a max player to rebuild their teams, then add a max contract at the ideal time rather than lose one. Giving the small-market teams a chance to have two superstars and a thriving young cast would make them attractive to free agents. It’s partly what helped draw LeBron James back to Cleveland.

It’d also be beneficial to players because every exception would be one more max contract exception that’s out there. And while the BRI is built around the actual cap, when teams start going over it, it actually means that the players are getting a larger cut of the pie.

More competitive balance for the owners and more money for the players makes this a win-win situation.

The Dwyane Wade Rule

We could also call this the Kobe Bryant Rule, the Dirk Nowitzki Rule or the Tim Duncan Rule. Regardless of what you call it, there’s a point where a player can mean more to the financial well being of the team than his competitive benefit.

Kobe is the best example of that. While his current two-year, $48 million has hardly been justifiable on the court, his presence on the Lakers means the team is making money off him. Players like Duncan and Dirk went with the opposite approach and took massive “pay cuts” in their later years.

They’re called “pay cuts” because they’re reduction in pay, but in many ways, they’re just getting what they’re worth in terms of actual basketball contributions to the team. They’re paid according to what the cap dictates, and taking less than they could bargain for because they’re hoping that cut works out to title opportunities. And in Duncan’s case, it paid off.

Dwyane Wade is the most interesting candidate of all because he took his pay cuts during his prime. While he wasn’t exactly living in poverty during that spell, there’s a monumental difference between what he could’ve made and what he has made.

At the conclusion of his current contract next summer, Wade will have been paid $156,321,666. In the course of that run, he’s been one of the two most important components of all three of the Miami Heat’s championship runs. He’s also an 11-time NBA All-Star.

Carmelo Anthony came into the league the same season as Wade: 2003-04. At the conclusion of this season, he’ll have made $181,198,275, or $24,876,606 more than Wade. And while Wade won’t have a contract, Anthony is still guaranteed to make another $78,731,280, or $103,607,886 more than Wade over the course of their careers. (Please note, I’m not comparing the players, I’m comparing what Wade did make to what he could have made. )

Now granted, Wade can sign another deal next year to take a chunk out of that, but is Miami going to offer him a max deal when he’s a year older that they weren’t ready to give this summer? Realistically, Wade’s selflenessness in his prime is going to cost him at least $50 million over what he could’ve made.

By instituting a kind “legacy rule” whereby a player can be financially rewarded for his loyalty without the team being punished for returning it competitively, this fundamental dilemma can be resovled.

I propose a rule where once a player reaches 32 and is with the same franchise for at least 10 years, each year, 10 percent less of his contract would count towards the cap, with the impact being limited to 50 percent. So, at 32, 90 percent of his salary counts, 33, 80 percent and so on.

For example, say that next year a 34-year-old Wade signs a four-year deal at $20 million a season. The first year, 70 percent ($14 million) would count towards the cap, the second year, 60 percent ($12 million would be applied) and the final two years 50 percent ($10 million). Thus, Wade could be rewarded for his loyalty without his team facing punitive ramifications competitively for rewarding him.

The Sam Hinkie Rule

Over the last few years, Sam Hinkie, the general manager of the Philadelphia 76ers, has been playing some Hinkie Pankey with the draft rules by putting together a team that’s guaranteed to lose during the regular season so that he can win on draft night.

This is what we call “tanking,” and its worse in the NBA than in other professional leagues. So much so that some have recommended drastic measures, such as a “draft wheel” to remedy it. The problem with a draft wheel is it punishes the “honestly” bad along with the tankers and makes rebuilding an almost impossible project. Imagine a championship team getting the No. 1 overall pick.

The irony of that is it’s happened before. The champion Los Angeles Lakers had the No. 1 pick in 1982 by virtue of a trade they’d previously made with the Cleveland Cavaliers in 1980. That’s how James Worthy became another cog in the Lakers dynasty.

The NBA’s response to this was to institute the lottery.

So, it’s not hard to see where the “draft wheel” could bring us full circle, which would be just as ironic as it sounds. And it wouldn’t even address the real issue, which is why the problem here is more specific to the NBA.

Rookie contracts are the best value in the NBA:

Look at how many win shares per dollar guys like Anthony Davis, Jimmy Butler and Andre Drummond gave last season compared to players like LeBron James and Chris Paul. They contributed a similar level of production for a fraction of the cost.

Therefore, it makes sense to stockpile a team filled with young rising stars that you can pay less. Like Hinkie’s plan or hate it, there is a kind of logic to it. Changing the draft doesn’t change that logic. To solve the problem you have to make it more expensive to stockpile young superstars.

One way of doing that would be to allow players on their rookie deals who reach certain criteria to have “kickers” in their contract that increase the amount of money they’re paid. These could vary based on the accomplishment.

A player makes the All-Defensive Team? He gets a 10 percent boost to his contract. Is he an All-Star? That’s another 20 percent. All-NBA First Team? 50 percent. MVP, a la Derrick Rose? His contract doubles. As those performance-based kickers escelate and compound, it makes it less and less beneficial to stockpile rising stars on the same team.

It wouldn’t be prohibitive, but it’d curtail some of the incentive of teams working on “seven-year plans” to rebuild. At a certain point, you could be paying tax on a “rebuilding” team, and who wants to do that? It moves up the timeline of when you decide it’s time to compete now, not just in some theoretical future. It shrinks the “tank window.”

Teams would like this because it’d make for a more competitive league throughout, and players would like it because again, it promises more money for players.

All of these ideas are just starting points. I don’t presume to have thought everything out, but certainly bringing some form of them to the bargaining table could make for some easy-to-reach compromises that would be better for the league and help work stoppages. And everyone is in favor of that.

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