If the salary increase for the third season is greater than 4.5% of the first year, the offering team must be able to bring the average of the entire contract below its upper limit. In the 2016/17 season, the billing of the player`s home team was different, with the player`s salary for a given year – not the average of the contract – being factored into the cap. In some cases, the offering team could exploit a loophole to create a so-called poison pill for the player`s home team, potentially forcing the original team to pay the luxury tax until the third season, as the Houston Rockets did to sign Jeremy Lin and Ömer Aşık from the New York Knicks and Chicago Bulls. respectively. This could discourage them from matching the offer sheet. [66] [67] At the end of the 2018-2019 season, Sports Illustrated author Andrew Sharp began an article on the Supermax rule with the following sentence: “If you`ve been paying attention to the NBA for two years, it goes without saying that the NBA`s `Supermax` contracts have failed.” First, he found that Supermax money wasn`t enough to prevent small team superstars from joining title contenders, even for much less money. Sharp argued that the rule actually caused more problems than it solved:[49] Wiggins, the No. 1 pick in the 2014 NBA Draft, already had a 5-year, $147.7 million contract, which he signed in the 2017 offseason. For the 2015-2016 season, the salary cap was set at $70 million, which meant a huge jump to $94.1 million for the following 2016-2017 season. Not only was it this year, but each of the following seasons also saw a significant boost, so for the next 2021-22 season, the salary cap was set at 112.4 million. If a team trades players with a higher salary than the players it acquires in return, with the exception of players traded, it can acquire players with salaries that do not exceed this difference + $100,000, up to one year after the exchange in which it acquired such a loan.
[26] [27] Since then, Durant has signed another $198 million maximum extension worth four years that will keep him with the franchise until the 2025-26 season According to a report by Yahoo`s Chris Haynes, Damian Lillard — who still has two years on his current contract with the Trail Blazers and is expected to be named to an All-NBA team — will be offered a four-year Supermax extension worth about 191. millions of dollars this summer. The next player to qualify for a Supermax contract was Anthony Davis, who had played his entire NBA career with the New Orleans Pelicans at the time. He qualified by being named to the All-NBA First Team in 2017-18, which allowed the Pelicans to offer him a five-year extension worth up to $230 million, which went into effect with the 2019-20 season. [52] Davis was also the first player to publicly reject a Supermax offer by telling the Pelicans during the 2018-19 season that he would not accept a Supermax contract and also requested a trade. Davis was eventually traded to the Los Angeles Lakers after the 2018-19 season.[53] [54] Teams are limited in what they can offer to an unrestricted free agent with two years or less of experience. The maximum salary for the first year in an offer sheet is the exception at the intermediate level. The salary of the second year can be increased by a maximum of 4.5%. The salary of the third year is limited to the maximum that a team has available in its salary cap.
The salary of the fourth season can increase (or decrease) up to 4.1% of the salary of the third season. The offer sheet can only be increased in the third season if it offers the highest salary allowed in the first two seasons, the contract is fully guaranteed and contains no bonuses. [17] [65] A player`s home team may use the Early Bird exception or its intermediate level exception to re-sign the player. [17] These salary increases, including the biggest jump before the 2016-17 season, which saw the cap rise to $94 million after just $70 million in preseason – a result of the money from the league`s new television contract (worth $2.6 billion per year over a nine-year period) – led to the cap rising from about $58 million for the 2011-2012 season at $112 million for the 2021-22 season. The contract is also the most important for all players outside the lottery, as Gobert was selected 27th overall by the Denver Nuggets in the 2013 NBA Draft and then traded to the Utah Jazz. Harden and Westbrook would not have qualified according to standard DVPE criteria, as both had signed contract extensions in the 2016 offseason, Harden for two years and Westbrook for one. The players` union and owners negotiated a special arrangement that allowed them to sign DVPE contracts if they qualified otherwise. [51] Officially known as the Designated Veteran Players Exception, this rule allows teams to re-sign qualified players with up to five-year contracts worth up to 35% of the salary cap with an 8% increase each subsequent year. While most NBA teams have contracts that are above the salary cap, few teams have luxury tax salaries. The tax threshold was $61.7 million in 2005-2006.
In the 2005-06 season, the New York Knicks` payroll was $124 million, which brought them $74.5 million above the salary cap and $62.3 million above the tax line that Knicks owner James Dolan paid the league. Tax revenues are typically redistributed evenly to non-taxpayer teams, so there is often a multi-million dollar incentive for homeowners not to pay the luxury tax. However, in the first year of this new contract, the 26-year-old added more equipment to his trophy cabinet by leading the Milwaukee Bucks to the NBA title and winning the Finals MVP award. He also won the All-Star Game MVP Award earlier in the season. The following players have signed 5-year/30% contracts:[34] The Bucks` downside is that NBA rules state that teams cannot offer the Supermax during the season, although many small contracts can be offered. That said, if he doesn`t sign before the start of the NBA season, he`ll wait until everything has happened, after the season and everything before getting another crack. Despite playoff disappointments, Antetokounmpo still had a stacked resume at the time of signing the contract with his two MVPs, the 2017 Most Improved Player Award, four All-Star selections, four All-NBA selections, including two on the first team, as well as the 2020 Defensive Player Award. Only a handful of players have qualified for this “Supermax” offer, as it is not easy to get these rewards.
Once signed in a Supermax, the player cannot be traded for a period of one year. Giannis Antetokounmpo is the 6th player to sign a Supermax contract. The others: Steph CurryDamian LillardJames HardenRussell WestbrookJohn Wall Supermax`s next signing was that of John Wall, who later agreed in July to a four-year, $170 million extension that began in 2019-20. [60] At the end of September, Russell Westbrook became the fourth and final Supermax addition of the 2017 offseason, signing a five-year, $205 million extension that began in 2018-19. [61] Prior to the 2005 CBA, the original team could only use an exception to re-sign a player who had been drafted in the first round. The 2005 CBA allowed teams to use exceptions for non-first-round picks, with expansion dubbed the “Gilbert Arenas Rule.” In 2003, Gilbert Arenas, who had been a second-round pick in 2001, signed a six-year, $60 million contract with the Washington Wizards after his home team, the Golden State Warriors, failed to fill the offer because they were above the salary cap. [68] The lower form of the Larry Bird exception is the “Early Bird” exception. Free agents who qualify for this exemption are called “early eligible veteran free agents” and qualify after playing two seasons with the same team. Players who are traded or claimed by waivers have transferred their bird rights to their new team. Before a referee decision in June 2012, all players who were waived and changed teams lost their bird rights. [24] [25] With this exception, a team may re-sign its own free agent either for 175% of its preseason salary or for the average NBA salary, whichever is greater. Early bird contracts must have at least two seasons, but must not last more than four seasons.
If a team accepts a trade where a player loses their early registration rights, it has the power to veto the trade. .