Raptors Cap/Tax Status - Page 26
Old 07-09-2014, 08:53 PM   #501 (permalink)
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... as we wait for more news.


Fun times.
Nice. I like the MLE strategy to try and get non-guaranteed years after year 1. The Raps look to be well positioned to make some solid improvements in the coming years.

Last edited by ANTMAN; 07-09-2014 at 08:58 PM.
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Old 07-09-2014, 08:57 PM   #502 (permalink)
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Official cap and tax numbers.

Cap: $63.065M
Tax: $76.829M
I'm not clear on the difference between the Cap and Tax. Is there no tax between the Cap and Tax?

Basically, why is there a difference between the Cap rate and the tax rate?
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Old 07-09-2014, 10:07 PM   #503 (permalink)
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I'm not clear on the difference between the Cap and Tax. Is there no tax between the Cap and Tax?

Basically, why is there a difference between the Cap rate and the tax rate?
The cap is what determines whether you can sign free agents. Any team wanting to sign away LeBron James, for example, would need to be 20M under the cap. To exceed the cap, you have to use exceptions - such as Bird Rights (re-signing your own free agents) the MLE and the minimum salary exception. So teams can go over the cap. Once they reach the tax level, they start being penalized financially - every dollar over the tax line and teams have to pay extra (and the amount extra increases the further over the cap you are, very quickly).
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Old 07-09-2014, 10:47 PM   #504 (permalink)
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The cap is what determines whether you can sign free agents. Any team wanting to sign away LeBron James, for example, would need to be 20M under the cap. To exceed the cap, you have to use exceptions - such as Bird Rights (re-signing your own free agents) the MLE and the minimum salary exception. So teams can go over the cap. Once they reach the tax level, they start being penalized financially - every dollar over the tax line and teams have to pay extra (and the amount extra increases the further over the cap you are, very quickly).
Well that puts some clarity to this. Thanks.
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Old 07-09-2014, 11:53 PM   #505 (permalink)
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So according to one rumour that the Vasquez deal was waiting on the tax numbers, we should hear something soon on that front.
And hear it we did!
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Old 07-10-2014, 10:45 AM   #506 (permalink)
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Now I am going to start making assumptions, and we'll see how I line up with reality when Sham starts updating salaries. Mainly I am assuming all the deals are backloaded, since that would result in the Raptors having exactly enough room for the full MLE and a vet minimum deal under the tax after their RFA signings. And since they waited until the exact tax numbers came in to sign Vasquez, I think that's why they were waiting, so I'm going with it. Also, Bruno signed, so I'll shift him over from the cap holds section.

Kyle Lowry $10,786,517
DeMar DeRozan $9,500,000
Amir Johnson $7,000,000 (5 M guar)
Greivis Vasquez $6,265,060
Landry Fields $6,250,000
Chuck Hayes $5,958,750
Patrick Patterson $5,581,395
Lou Williams $5,450,000
Jonas Valanciunas $3,678,360
Tyler Hansbrough $3,326,235
Terrence Ross $2,793,960
James Johnson $2,444,988
Bruno Caboclo $1,458,360
Diante Garrett $915,243 (unguaranteed)
Dwight Buycks $816,482 (unguaranteed until 22nd July)
Marcus Camby $646,609 (buyout)

Nando de Colo $1,901,900 (cap hold; $1,828,750 QO)
Lucas (BeBe) Nogueira $1,468,900 (cap hold; will be $1,762,680)

Above roster, with Buycks and Garrett waived, de Colo overseas and BeBe signed to 120%: $72,902,914

Confirmed:
Cap: 63.035 M
Tax: 76.829 M
Apron/Hard Cap: 80.829 M

We've used about 2.4M of the 5.3M MLE, leaving 2.9M. Below the tax we have room for 3.9M worth of deals. That's enough for our extra 2.9M of MLE plus 1 veteran's minimum deal to be used either now or later in the year.

Last edited by DanH; 07-10-2014 at 10:47 AM.
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Old 07-10-2014, 10:55 AM   #507 (permalink)
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As things stand now, with the assumptions I made above.

Kyle Lowry $11,595,506
DeMar DeRozan $9,500,000
Greivis Vasquez $6,734,940
Patrick Patterson $6,000,000
Jonas Valanciunas $4,660,482
Terrence Ross $3,553,917
James Johnson $2,555,012
Lucas (BeBe) Nogueira $1,842,000
Bruno Caboclo $1,524,000
2015 1st rounder (assumed 20th): $1,257,800

Nando de Colo $1,901,900 (cap hold; $1,828,750 QO)

Projected cap: 66.5M

Above team salary is $51,650,650. That leaves 14.9M ish to sign a major free agent, assuming we let all our expirings walk (that includes Amir, Fields, Hayes, Hansbrough, Williams). Then the room MLE of 2.814M, re-signing de Colo (unlikely), and minimum deals. But they only have room for 5 additions anyway, and only need to add 3 guys, so maybe it is just max-ish level guy, MLE, and one minimum salary.
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Old 07-10-2014, 01:04 PM   #508 (permalink)
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Lowry's contract is 12M flat each year. I'll wait for some more updates before posting the full summary again.
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Old 07-10-2014, 02:18 PM   #509 (permalink)
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Originally Posted by DanH View Post
As things stand now, with the assumptions I made above.

Kyle Lowry $11,595,506
DeMar DeRozan $9,500,000
Greivis Vasquez $6,734,940
Patrick Patterson $6,000,000
Jonas Valanciunas $4,660,482
Terrence Ross $3,553,917
James Johnson $2,555,012
Lucas (BeBe) Nogueira $1,842,000
Bruno Caboclo $1,524,000
2015 1st rounder (assumed 20th): $1,257,800

Nando de Colo $1,901,900 (cap hold; $1,828,750 QO)

Projected cap: 66.5M

Above team salary is $51,650,650. That leaves 14.9M ish to sign a major free agent, assuming we let all our expirings walk (that includes Amir, Fields, Hayes, Hansbrough, Williams). Then the room MLE of 2.814M, re-signing de Colo (unlikely), and minimum deals. But they only have room for 5 additions anyway, and only need to add 3 guys, so maybe it is just max-ish level guy, MLE, and one minimum salary.
Realistically I see only 3 players worth paying that much money in 2015 FA, it's Milsap, Al Jefferson and Love (who would ask more). Aldridge said he is going to re-sign in Portland, West is going to be 35 or so, so doubt he will be worth more than 8mil. Thad Young could be interesting option, but not likely that he'll get more than 9-12mil.
Is cap recalculated every year? if so it should go up a bit. And are we still projected to have max in 2016?

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Old 07-10-2014, 02:29 PM   #510 (permalink)
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According to this list: Future NBA Free Agents - RealGM

There aren't really any max level free agents next year, aside from Love if he declines his PO and Aldridge if he doesn't extend.

Other than those two the only interesting guys are Bropez, Dragic, Rondo, Jefferson, and Millsap.

Klay, Kawhi, Butler, Vucevic, and Faried are RFAs

I think it's not too far fetched that we could get one of those guys with 14mil, is it?
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Old 07-10-2014, 02:34 PM   #511 (permalink)
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Realistically I see only 3 players worth paying that much money in 2015 FA, it's Milsap, Al Jefferson and Love (who would ask more). Aldridge said he is going to re-sign in Portland, West is going to be 35 or so, so doubt he will be worth more than 8mil. Thad Young could be interesting option, but not likely that he'll get more than 9-12mil.
Is cap recalculated every year? if so it should go up a bit. And are we still projected to have max in 2016?
In 2016 Lowry and PPat are on contract along with team Brazil and our 2015 rookie. DeMar, Ross, and JV all have big cap holds that year. And if we sign somebody decent next year that will take another chunk. Next year was our make or break offseason but the cap space we had has had a chunk bitter out of it by bench acquisitions/re-signings this summer.
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Old 07-10-2014, 02:36 PM   #512 (permalink)
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According to this list: Future NBA Free Agents - RealGM

There aren't really any max level free agents next year, aside from Love if he declines his PO and Aldridge if he doesn't extend.

Other than those two the only interesting guys are Bropez, Dragic, Rondo, Jefferson, and Millsap.

Klay, Kawhi, Butler, Vucevic, and Faried are RFAs

I think it's not too far fetched that we could get one of those guys with 14mil, is it?
I could see Masai going hard after Milsap.
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Old 07-10-2014, 02:47 PM   #513 (permalink)
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I could see Masai going hard after Milsap.
That's my thought as well.
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Old 07-12-2014, 04:23 AM   #514 (permalink)
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If we hold bird right for Amir, we will have very few rooms for another free agent.
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Old 07-12-2014, 09:29 AM   #515 (permalink)
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If we hold bird right for Amir, we will have very few rooms for another free agent.
I doubt he gets brought back for big money considering his injury history.
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Old 07-12-2014, 10:39 AM   #516 (permalink)
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As things stand now, with the assumptions I made above.

Kyle Lowry $11,595,506
DeMar DeRozan $9,500,000
Greivis Vasquez $6,734,940
Patrick Patterson $6,000,000
Jonas Valanciunas $4,660,482
Terrence Ross $3,553,917
James Johnson $2,555,012
Lucas (BeBe) Nogueira $1,842,000
Bruno Caboclo $1,524,000
2015 1st rounder (assumed 20th): $1,257,800

Nando de Colo $1,901,900 (cap hold; $1,828,750 QO)

Projected cap: 66.5M

Above team salary is $51,650,650. That leaves 14.9M ish to sign a major free agent, assuming we let all our expirings walk (that includes Amir, Fields, Hayes, Hansbrough, Williams). Then the room MLE of 2.814M, re-signing de Colo (unlikely), and minimum deals. But they only have room for 5 additions anyway, and only need to add 3 guys, so maybe it is just max-ish level guy, MLE, and one minimum salary.
Alignment. That's the word that comes to mind when I think of the future of this franchise. From its fans and front office, to the players and coaches. It's a thing of beauty.

Seriously. Look at the expirings that are coming off next year. You couldn't ask for better expirings. If you're Milsap, you've got to recognize the alignment that this franchise has has and its opportunity to go deep into the playoffs.

We have ZERO dependencies on our rookies (barring injury). They can develop over time. Imagine if one or two of them blossom? If they don't, then no big deal. The pressure is off both them and the franchise as a whole.

If you look across the league, only contenders can boast of this.
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Old 07-16-2014, 12:03 PM   #517 (permalink)
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With increasing murmurs of a gigantic TV deal in 2016, I thought I'd give a run down of what impact that might have. The current deal pays 930M a year (about a quarter of the total revenue), and the NBA is apparently pushing to double that in the new deal. That would mean a huge jump in revenues, and a huge jump in cap and tax numbers.

It breaks down like this. The current revenue (last year) sits at $4.522B, $0.93B of which is the TV deal. The non-TV portion (3.592B) is projected each year to increase by 4.5% over the previous year. Lately that projection has been falling about 1% short. So adjusting for that and projecting forward to 2016, the non-TV revenue projects to $4.215B. Adding on the $930M current TV deal would put the total revenue at $5.145B. Adding the potential new $1.86B per year deal (assumed double the current one) makes it $6.075B.

The cap is calculated by taking that total revenue, dividing by 2 (players get half of revenues), subtracting 8% for benefits, multiplying by a 0.895 factor to account for teams spending over the cap, and dividing by 30 to get a per team number. That yields a cap of 70.6M under the old projection, and a cap of 83.4M with the new TV deal. Quite a difference, huh?

The tax is calculated similarly, and the TV deal could have a similar impact there. The calculation is almost identical - you substitute 1.07 for the .895 number (as most teams do not spend to the tax). That means a tax threshold of 84.4M under the original projection, and 99.7M.

* Interesting note - those two factors used to differentiate the tax and cap numbers mean that the expected expenditure for the average team is about 93.4% of the tax threshold (or 11.7% above the cap). For this year that would mean 70.4M average payroll.

Anyway, a change that drastic could have a major impact on the summer of 2016. I think I'll do an updated version of my pie-in-the-sky plan for 2016 with the numbers I calculated here.
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Old 07-16-2014, 12:23 PM   #518 (permalink)
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^Holly crap we could end up having a lot of capspace, because of that new tv deal.
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Old 07-16-2014, 12:50 PM   #519 (permalink)
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^Holly crap we could end up having a lot of capspace, because of that new tv deal.
and so is all other teams
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Old 07-16-2014, 12:57 PM   #520 (permalink)
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Now with pie-in-the-sky cap and tax estimates!

I'm revising my assumptions to make it so all of our new signings are flat deals like Lowry's, since that's all we have to go on.

Note: this means this season we are sitting 2.0M short of the tax (assuming Buycks and Garrett are waived). So we have room to sign another player to 2M with the MLE (we have 2.8M of it left).

Summer 2015:

Kyle Lowry $12,000,000
DeMar DeRozan $9,500,000
Greivis Vasquez $6,500,000
Patrick Patterson $6,000,000
Jonas Valanciunas $4,660,482
Terrence Ross $3,553,917
James Johnson $2,500,000
Lucas (BeBe) Nogueira $1,842,000
Bruno Caboclo $1,524,000
2015 1st rounder (assumed 20th): $1,257,800

That's 50.4M committed assuming no Nando, with a salary cap of 66.5M projected. 16.1M in cap room. So looking like we can't get a max guy, unless it is a RFA (first time max players are cheaper than second go-rounds).

But if we can't get a max level guy, we could sign a Millsap level second tier star to a less than 16M contract (say, 12M starting salary), and use the remainder of the cap room (4.1M), the room MLE (2.8M) (both on two year deals with unguaranteed 2nd years), and minimum one year deals to fill out the roster.

Then, 2016:

Operating above the cap now, so I won't list cap holds except for the key re-signings.

Example - Paul Millsap $12,540,000
Kyle Lowry $12,000,000
Patrick Patterson $6,000,000 (expiring)
Role player signing 2015 $4,296,638 (unguaranteed)
Room MLE signing 2015 $2,940,630 (unguaranteed)
Lucas (BeBe) Nogueira $1,921,320
Bruno Caboclo $1,589,640
2015 1st rounder (assumed 20th): $1,577,280
2016 1st rounder (assumed 20th): $1,562,280 (cap hold is $1,301,900)
2016 1st rounder (NYK/DEN assumed 10th): $2,568,600 (cap hold is $2,140,500)

DeMar DeRozan $14,250,000
Jonas Valanciunas $11,651,205
Terrence Ross $8,884,793
Greivis Vasquez $9,750,000
James Johnson $4,750,000

Total committed salary including cap holds: 96.7M

So, two options. Either we let everyone go (waive unguaranteed players, let all free agents walk besides JV and Ross) and have 22.7M in cap room. Durant's theoretical max will be 23.6M. If we can get 1M in wiggle room in Ross' contract or elsewhere, we sign Durant outright and end up with this:

Kevin Durant $23,600,000
Example - Paul Millsap $12,540,000
Kyle Lowry $12,000,000
Jonas Valanciunas $11,651,205
Terrence Ross $7,984,793 (took 0.9M off to accommodate Durant's max)
Patrick Patterson $6,000,000
Lucas (BeBe) Nogueira $1,921,320
Bruno Caboclo $1,589,640
2015 1st rounder (assumed 20th): $1,577,280
2016 1st rounder (assumed 20th): $1,562,280 (cap hold is $1,301,900)
2016 1st rounder (NYK/DEN assumed 10th): $2,568,600 (cap hold is $2,140,500)

Plus the room MLE (2.9M) and minimum deals to round out the team. Loads of potential with BeBe, Bruno, and three recent first round picks (and potentially one of them fairly high). Some established yet young talent in JV, Ross and Patterson. A borderline all-star in his prime in Millsap. A wily (but extremely effective) vet in Lowry. And a superstar in Durant. Very nice.

PG: Lowry, Room MLE, 1st rounder
SG: Ross, 1st rounder
SF: Durant, Caboclo
PF: Millsap, Patterson, 1st rounder
C: JV, BeBe, min

----

But maybe Durant isn't sold on that talent level. But with DD and Vasquez he would be. So you go to option 2 - sign and trade. Assuming Durant a) tells OKC he is walking either to TOR or to a team with cap room and b) that OKC plays along to get some assets, here's what I would offer.

Durant's max contract will be 23.6M starting salary. A sign and trade of James Johnson (4.0M per year), plus expiring contracts (Patterson (6M), Role Player 2015 (4.3M unguar), Room MLE 2015 (2.9M unguar) and our 2015 draft pick sophomore) would be enough to fit cap-wise. They would obviously want picks included, so we'd send both our recent 2016 picks as well. They would waive both the unguaranteed contracts (if they wanted to, or keep them for trade chips), and have a young and decent piece in Patterson on an expiring deal, as well as three recent draft picks, one possibly a top 10 pick. So at that point, they are taking on 10M in immediate salary as well as 3 years of JJ's salary (in theory, maybe he gets a bigger deal but with the later years unguaranteed), with all the contracts they take back being valuable trade pieces (with the possible exception of JJ), plus loads of picks.

At this point, our commitments would look like this for 2016-17:

Kevin Durant - $23,600,000
DeMar DeRozan $14,250,000 (cap hold)
Example - Paul Millsap $12,540,000
Kyle Lowry $12,000,000
Jonas Valanciunas $11,651,205
Greivis Vasquez $9,750,000 (cap hold)
Terrence Ross $8,884,793
Lucas (BeBe) Nogueira $1,921,320
Bruno Caboclo $1,589,640

Total committed salary including cap holds: 96.2M
Apron (hard cap) is 103.7M

So, undoubtedly, DD will want more than the 14.3M cap hold (his max salary would be the same as Durant's). Vasquez may take less than his cap hold - 8M per year would be a good raise for him even in the new cap environment. Plus he gets to play on a contender, with his buddy Durant, and getting more and more minutes as Lowry is getting older at this point.

Filling out the rest of the roster (4 more roster spots at minimum) means using the MLE (might as well, already hard capped) and three minimum deals. Assuming 8M for Vasquez, if we use the full MLE, we have only DD's cap hold (or thereabouts) to offer him. If DD wants, say, more like a starting salary of 18M, then we would only be able to offer about 2M of the MLE. Nonetheless, we end up with a depth chart as follows:

PG: Lowry, Vasquez, min
SG: DeRozan, Ross, min
SF: Durant, Caboclo
PF: Millsap, MLE (partial)
C: JV, BeBe, min

Fun times.
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