07-18-2001, 08:58 AM
Join Date: Mar 2001
Just when you think everything is going well between the union and owners...
League, players' union can't agree on cap
NEW YORK -- In a post-midnight development that will delay several trades and free agent signings, the NBA and the players union broke off talks early Wednesday over the details of the new salary cap.
Free agents were expected to be able to sign new contracts as of 12:01 a.m. EDT, but lawyers for the league and the union were unable to finalize the agreement.
Under the terms of a formula contained in the league's collective bargaining agreement, the salary cap will increase on an interim basis from $35.5 million to $35.956 million.
Teams were expecting the new cap number to be about $42.5 million.
"This lower than expected salary cap creates an unfortunate situation for both teams and players," NBA executive vice president of legal and business affairs Joel Litvin said. "Although we worked late through the night to reach an agreement, the players' association made an 11th-hour demand we cannot accept."
The league did not disclose the details of the "11th-hour demand."
Union attorneys could not immediately be reached for comment.
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07-18-2001, 05:26 PM
Join Date: May 2001
Location: Where nerds gather
I came to a screeching halt when I read this article. There might be some contracts that were agreed to that might not happen now.
Posted link-free for flying tiger!
July 18, 2001
By Mike Kahn
SportsLine.com Executive Editor
Tell Mike your opinion!
That's the directive that came screaming out of New York in stunning fashion early Wednesday morning. The reason? The NBA and the Players Association couldn't agree on the ramifications of a salary cap that for now is more than 15 percent less than the projected figure anticipated for the 2001-2002 NBA season.
What does it mean?
NBA salary cap figures are based on basketball related income to all the teams, multiplied times 48.4 percent, minus player benefits and divided by the 29 teams.
The translation is the NBA made less money last season than anticipated, the Players Association was stunned, and this year's interim salary cap will begin at last year's figure of less than $36 million as opposed to the projected $42.5 million.
Consequently, the more than 17 new contracts that have been agreed to but not ratified may be altered because of a smaller number.
Although most teams are already over the salary cap and are using exceptions that will only moderately be affected by the change, some teams on the cusp of being under the cap will very likely go over now.
Evidently, when negotiations began Tuesday, everyone was settled on the $42.5 million figure, but once the numbers came clear, the NBA could not approve the more than $6 million increase in cap space based on last year's revenues.
NBA executive vice president of legal and business affairs Joel Litvin is the primary negotiator, and sources say the Players Association flipped upon knowledge of the lowered salary cap, and thus prevented the signing of the cap agreement for the coming season.
"This lower than expected salary cap creates an unfortunate situation for both teams and players," Litvin said. "Although we worked late into the night to reach an agreement, the Players Association made an eleventh hour demand that we could not accept."
The demand could have to do with the implementation of the escrow tax for the coming season. The lowered revenues could have a dramatic effect on where the luxury tax will kick in for each team.
Based on 55 percent of the basketball related income that will become official by the end of January, it now appears all players will have to pay back 10 percent of their salary to the NBA at midseason.
Teams that exceed the 55 percent will have to match dollar-for-dollar they are over that figure. The NBA will then garner all that money and decide what to do with it.
With regard to personnel, the lower the luxury tax, the less money teams will shell out to their players or prospective players on the free agent market. With that in mind, consider the players are going to be giving back money anyway.
"There's no telling how the players reacted with the cap not reaching what everyone thought," one NBA source said. "To have less money for salaries, more teams shying away from luxury tax and have all players paying the escrow tax is something I'm sure they didn't expect."
The good news for players is the mid-level exception will undoubtedly rise from the $2.25 million of last season. The bad news is the exception might come up a little bit shy of the $4.5 million figure.
That's particularly significant for the new multi-year contracts that have been agreed upon by free agents like Clarence Weatherspoon going from Cleveland to New York and Todd MacCulloch from Philadelphia to New Jersey.
From a team perspective, Detroit, Chicago, Houston and Seattle are four teams below the cap heading into the new season, with Detroit and Chicago having the most room to operate.
But for Seattle, the room to maneuver below the cap might best be served in the trade market as opposed to actually having just a little bit more than the exception with which to work.
And still, there is the ever-present luxury tax scaring teams away.
So now the discrepancy might be resolved by the end of Wednesday. Considering how much everyone hemmed and hawed over last year's full month of negotiations from July 1 to Aug. 1, the irony of what went on Tuesday is mighty rich, so to speak.
Every time deputy commissioner Russ Granik said the league needed the month to get all the figures together, too many people didn't believe him. So they pulled it back two weeks so the signings could occur soon and now look what happened.
The apologies to Granik can be mailed to the NBA office, c/o of Projected Salary Cap.
The following is a list of contracts reportedly agreed to based on the $42.5 million salary cap figure that apparently will not be reached:
Allan Houston, New York Knicks, 6 years, $100.4 million
Dikembe Mutombo, Philadelphia 76ers, 5 years, $87 million
Antonio Davis, Toronto Raptors, 5 years, $60 million
Doug Christie, Sacramento Kings, 7 years, $48 million
Aaron McKie, Philadelphia 76ers, 7 years, $42 million
Jerome Williams, Toronto Raptors, 7 years, $40.8 million
Todd MacCulloch, New Jersey Nets, 6 years, $33.8 million
Eddie Robinson, Chicago Bulls, 5 years, $30 million
Nazr Mohammed, Atlanta Hawks, 5 years, $28.5 million
Clarence Weatherspoon, New York Knicks, 5 years, $27 million
Christian Laettner, Washington Wizards, 4 years, $21 million
David Robinson, San Antonio Spurs, 2 years, $20 million
Avery Johnson, Denver Nuggets, 3 years, $14.9 million
Anthony Carter, Miami Heat, 3 years, $12 million
Horace Grant, Orlando Magic, 3 years, $7.4 million
Patrick Ewing, Orlando Magic, 2 years, $4.7 million
Tyronn Lue, Washington Wizards, 2 years, $3.6 million
07-18-2001, 08:27 PM
Join Date: May 2001
Location: Where nerds gather
Well that didn't take long. Everything is back on track.
Squabbling between lawyers from the NBA and the players' union kept some free agent activity -- but not all of it -- from moving forward Wednesday.
Salary cap progression
1995-96 $23 million
1996-97 $24.4 million
1997-98 $26.9 million
1998-99 $30 million
1999-00 $34 million
2000-01 $35.5 million
2001-02 $42.5 million
Several players signed contracts with new teams as an 18-day moratorium on free agent signings expired. Patrick Ewing went from Seattle to Orlando, Eddie Robinson moved from Charlotte to Chicago, and Tyronn Lue left the Lakers to play for Washington.
Other signings, including Horace Grant's move to Orlando, were held up while the attorneys from the league and the union argued over which revenue streams should be included in salary cap calculations.
The salary cap was temporarily raised from $35.5 million to $35.956 million early Wednesday, and it was later increased to $42.5 million after the league and union resolved their standoff.
"We worked through our differences and reached a mutually satisfactory agreement," said Joel Litkin, the NBA executive vice president of legal and business affairs.
The increase of $7 million from last season's cap of $35.5 million represented the largest year-to-year jump since the cap was instituted for the 1984-85 season. A year ago, the salary cap went up $1.5 million.
The future of Sacramento free agent forward Chris Webber remained uncertain, but he was expected to make his intentions known soon.
With Webber trying to decide whether to return to the Kings, sign with the Detroit Pistons or request a sign-and-trade deal sending him to another team, his agent, Fallasha Erwin, said he would make a statement on Webber's behalf around midnight ET.
"It's still an ongoing negotiation. We're still waiting for Chris on his deliberations, and we'll move forward at that time," Kings general manager Geoff Petrie said. "We're waiting for his group to update us on where they are."
The Kings were able to complete one move, re-signing Doug Christie to a seven-year, $48 million contract. Also staying with their former teams were Aaron McKie (76ers: seven years, $42 million), Jerome Williams (Raptors: seven years, $40.8 million), Nazr Mohammed (Hawks: five years, $25 million) and Milt Palacio (Celtics: two years, $1.43 million),
Three trades that were agreed to in principle were officially completed. Phoenix sent four-time All-Star Jason Kidd and center Chris Dudley to New Jersey for Stephon Marbury, Johnny Newman and Soumalia Samake.
Also, Detroit acquired forward Cliff Robinson from the Suns for forwards John Wallace and Jud Buechler. The Pistons also acquired the rights to forward Zeljko Rebraca from Toronto in exchange for a a 2002 second-round draft choice.
Trades sending Charles Oakley from Toronto to Chicago for Brian Skinner, and Shareef Abdur-Rahim from Memphis to Atlanta for Lorenzen Wright, Brevin Knight and Paul Gasol were delayed.
The Bulls were able to sign Robinson to an offer sheet that the Hornets have 15 days to match.
The 6-foot-9 forward played two seasons in Charlotte, averaging 17.3 minutes, 7.2 points and 2.9 rebounds. In the first round of the 2001 playoffs, he averaged 12 points and 4.7 rebounds against the Miami Heat.
He shot 50 percent or higher in 21 straight games from Feb. 2-March 23.
Ewing, who made $14 million with Seattle last season, will earn about $2.25 million with the Magic.
"It wasn't a money issue," Ewing said. "It's about being somewhere where you're wanted, somewhere where you can make a difference, somewhere where you can be happy."
Ewing, 38, and Grant, 36, would bring a combined 30 years of NBA experience to Orlando. Ewing is an 11-time All-Star, and Grant has four championship rings.
"We have a lot of talent on this team, but we did need some experience," said Orlando coach Doc Rivers, who played with Ewing for three seasons in New York. "We needed guys who have gone through the wars of the playoffs, who could tell our young guys what it's going to be like."
Lue, who played on Los Angeles' back-to-back NBA championship teams, signed a two-year deal.
"I had a great experience winning championships in L.A.," said Lue, who averaged 4.1 points in three seasons with the Lakers. "That was fun, but I came here to have a chance to play and grow with young players."
Lue is not yet sure if he'll have Michael Jordan as a teammate -- and neither is Jordan.
At a golf tournament in Long Grove, Ill., Jordan said he will make up his mind about a comeback later this summer.
"Give me another month and a half," Jordan said. "Middle of September."
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