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The controversial issues surrounding the salary cap in the nba

The controversial issues surrounding the salary cap in the nba

What is the luxury tax amnesty provision? This was a one-time opportunity for teams to waive one player and avoid having that player count in the team's luxury tax computation. Teams had the opportunity to use this provision between August 2nd and 15th, 2005 right after the CBA went into effect. It could be used only for players signed or acquired prior to June 21, 2005, or for players already waived when the current CBA went into effect.

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A team could waive only one player using this provision. Players waived using this provision are not counted in the team's team salary see question number 14 when computing the amount of luxury tax the team owes see question number 16. If they ended up below the tax level, then there is no tax to be paid so they wouldn't realize any savings at all. On the other hand, it's possible for the net savings to exceed the player's salary.

  • There's a lot of misunderstandings about how exactly this cap smoothing plan could work, and those misunderstandings spread in a controversy so deadly it almost became a twitpocalypse;
  • They could structure the TV deal to include basic parameters for covering the midseason tournament with exact terms to be negotiated after the CBA deal, giving an instant BRI boost as soon as the tournament is agreed upon;
  • They could keep the basic skeleton of the schedule the same that is, start in October and end in late April but implement 2-3 weeks of dead time around the all-star break, effectively giving NBA players a month off in the middle of the year;
  • In all other respects, the player is treated just like any other waived player see question number 56 for more information on waivers;
  • They could keep the basic skeleton of the schedule the same that is, start in October and end in late April but implement 2-3 weeks of dead time around the all-star break, effectively giving NBA players a month off in the middle of the year.

If a team's amnesty cut takes them from above the tax level to below it, then in addition to not owing any tax they will also receive a tax distribution. The amnesty provision only affects the team's tax obligation. The team must continue to pay the player, his salary continues to count against their salary cap, and all other salary calculations are unaffected.

The controversial issues surrounding the salary cap in the nba

However, the team may not re-sign or re-acquire the player for the length of the terminated contract. In all other respects, the player is treated just like any other waived player see question number 56 for more information on waivers. Although the amnesty provision was informally referred to as the "Allan Houston provision," the Knicks chose not to use it on Houston.

What are salary cap exceptions? The basic rule of the salary cap is that a team's team salary may not be above the cap at any time unless the team is using an exception. In a system with a soft cap, an exception is the mechanism that allows a team to function while above the cap. This exception enables teams to exceed the salary cap to re-sign their own free agents, up to the player's maximum salary.

  • There is one more limit to the maximum salary that can be given using the Larry Bird exception;
  • That month would lie dormant until the 2017 CBA negotiations, when the NBA could introduce a plan to hold a two week midseason tournament directly in the now-empty weeks;
  • That wouldn't just be bad form -- it would be completely illegal per the NBA's operating agreement, and probably lead to the end of the league through the courts.

To qualify for this exception the player essentially must play for three seasons without being waived or changing teams as a free agent although there are nuances to this rule, which are explained in question number 26.

This means a player can obtain "Bird rights" by playing under three consecutive one-year contracts, a single contract of at least three years, or any equivalent combination.

It also means that when a player is traded, his Bird rights are traded with him, and his new team can use the Bird exception to re-sign him. These contracts can be up to six years in length. A player can receive raises up to 10.

  • They are veteran free agents who are neither Qualifying Veteran Free Agents nor Early Qualifying Veteran Free Agents, either because they haven't met the criteria, or because they are Early Bird free agents following the second season of their rookie scale contract and whose team renounced the Early-Bird exception;
  • This may be the most likely smoothing plan;
  • They are as follows:

The 1983 CBA introduced the modern salary cap, and with it the provision allowing teams to exceed the cap to re-sign their own players.

It is commonly believed that this exception acquired its common moniker because Larry Bird was the the first such player to be re-signed.

However, this appears to be apocryphal, as Bird signed a seven-year contract in 1983 before this provision took effectthe controversial issues surrounding the salary cap in the nba did not sign another until 1988.

There is one more limit to the maximum salary that can be given using the Larry Bird exception. If the player was a first round draft pick, just completed the third year of his rookie scale contract, and his team did not invoke its team option for the fourth season see question number 42then this exception cannot be used to re-sign him to a salary greater than he would have received had the team exercised its option.

In other words, teams can't decline an option year in order to get around the salary scale and give the player more money. Starting January 10 of each season, this exception begins to reduce in value. See question number 20 for details. A player qualifies for this exception essentially by playing two seasons without being waived or changing teams as a free agent see question number 26 for details. Early Bird contracts at least two seasons in length which limits this exception's usefulness -- it's often better to take a lower salary for one more season and then have the full Bird exception available the next season and no longer than five seasons.

If the player was a first round draft pick and just completed the second year of his rookie scale contract, but his team did not exercise their option to extend the contract for the third season see question number 42then this exception cannot be used to give him a salary greater than he would have received had the team exercised their third year option. In other words, teams can't decline the option in order to get around the salary scale and give the player more money.

If the player is a restricted free agent with two years of service and receives an offer sheet from a new team, the player's prior team may use the Early Bird exception to match the offer sheet see question number 37 for restricted free agency. Its name is somewhat of a misnomer, since Non-Bird really is a form of Bird rights. They are veteran free agents who are neither Qualifying Veteran Free Agents nor Early Qualifying Veteran Free Agents, either because they haven't met the criteria, or because they are Early Bird free agents following the second season of their rookie scale contract and whose team renounced the Early-Bird exception.

A partial season counts as a full season for the tenure calculation related to Bird rights. If a team signs another team's free agent to a rest-of-season contract mid-way through the season, then at the end of that season the player is a non-Bird free agent. This exception may be split and given to multiple players.

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Signing a player to a multi-year contract does not affect a team's ability to use this exception every year. For example, a team can sign a player to a five-year contract using this exception and still use the exception the following year to sign another player. Also see question number 20 for more information on the availability and use of this exception.

If the player is a restricted free agent with one or two years of service and receives an offer sheet from a new team, the player's prior team may use the Mid-Level exception to match the offer sheet see question number 37 for restricted free agency.

Here are the actual values of this exception for each season. Note that since this exception is based on the average player salary, the actual value of this exception is not determined until the start of the free agent signing period.