Sixth Man (cont.)
The repeater penalty is not the only source of fear for ambitious owners and their team executives. Franchises that cross the threshold are also going to be hit with an annual luxury tax that will be toughened next season. The current tax penalty for annual offenders is $1 for every dollar over the threshold. Next season the penalty jumps to $1.50 for every dollar above the threshold up to $4,999,999, with the tax rates climbing incrementally for each additional $5 million. Put it this way: The Lakers are facing a tax bill of roughly $30 million for this season; for next year, a payroll that includes a re-signed Dwight Howard and a roster filled out with minimum contracts could leave the Lakers with a preposterous tax bill approaching $95 million in what could be Bryant's farewell season.
Rivals will be watching closely to see how the Lakers react to total costs of $199 million in payroll and taxes next season. If they decide they can afford it, based on a local TV deal that pays them $150 million annually, other franchises will complain that this CBA once again enables the richest teams to buy championships at the expense of the not-as-rich.
"I see three teams that can potentially afford to pay the biggest taxes," one general manager said. Those teams are the Lakers, Knicks and Nets, and they could yet undermine the aim of the new system to create an even playing field.
The repeater tax has already influenced the title race. "You saw it in the James Harden trade,'' a rival GM said. "It was definitely a consideration there.''
Had Oklahoma City re-signed Harden at the rate for which he would sign eventually with the Rockets, the small-market Thunder would have been facing the heightened luxury tax next season with the potential of a repeater tax penalty for 2016-17. Under no circumstances could OKC afford the repeater penalties, which would have forced it to abandon its title hopes as Kevin Durant and Russell Westbrook enter their peak years. As it is, the Thunder will be up against the tax threshold next season and beyond even without having to pay an eight-figure salary to Harden.
The Thunder don't generate revenues that would enable them to afford excessive taxes. While Miami is a richer franchise, it can't sustain high tax payments either. This season, which is the last year of the old system, the Heat are budgeted to pay a tax bill of $13.9 million in addition to their $84.2 million payroll. Next season those penalties will more than double under the new system, unless Miami changes its payroll.
One GM who reviewed Miami's payroll suggested that the Heat could try to lessen their tax penalty or avoid it entirely by diminishing the rotation around their three stars. Among the potential moves would be to apply the salary of Mike Miller (owed $6.6 million in 2014-15) to amnesty, and to trade Udonis Haslem (owed $4.6 million in 2014-15) and Joel Anthony ($3.8 million) to teams with room under the cap.
"They'll have hard decisions to make,'' the GM said. "Of course, they might have won three championships by then.''
It may turn out there will be no decision for Arison to make. James, Wade and Bosh can exercise options to become free agents in the summer of 2014, and one or more of them may surrender to the realities of the repeater tax by acknowledging that Miami simply can't afford to remain in contention year after year after year. Guess who will have gobs of cap space that summer? The only player currently under contract to the Lakers for 2014-15 is Steve Nash. The Lakers could scoop up LeBron, should he choose to opt out, while managing their cap to avoid the tax in 2014-15, liberating them to pursue a run of titles without having to worry about a repeater tax until 2018-19 -- at which time, when the harshest penalties kick in, they may well decide they can afford to pay the extra taxes.
So have at the potential consequences, all of you conspiracy theorists. If the Lakers don't trade Pau Gasol, it will be because they want to save his cap space for LeBron. Pat Riley, now 67, will retire and move back to Malibu rather than face the premature dissolution of the dynasty he assembled. And, if the Lakers eventually prove a willingness to play by a set of new rules that other teams can't afford, fellow owners will be demanding nothing less than a hard cap by opting out of the current CBA in 2017.
Good luck to you, incoming NBA commissioner Adam Silver. The next several years promise to be more provocative than ever.
The Lakers couldn't stay out of the news this week ...
Steve Nash's patient recovery. He didn't sound optimistic when asked whether he might recover from a fractured left fibula by next week. Nothing makes sense for the Lakers -- the hiring of Mike D'Antoni, the role of Gasol -- until Nash returns. In the meantime, his primary backup, Steve Blake, underwent abdominal surgery and will be out for at least two months.
Dwight Howard loses to Orlando in first game against former team. The visiting Magic hacked Howard repeatedly and he responded by making only 4-of-8 free throws down the stretch. Overall, he was 9-of-21 from the foul line in the humbling 113-103 loss. The Magic are 7-11 this season, while the Lakers are 9-10 despite a home-heavy early schedule. "I'm going to continue to practice," said Howard, who is 46.9 percent from the line this season. "That's all I can do, is continue to practice and they'll start falling."
Gasol sits. The Lakers shut down their power forward to enable him to recover from tendinitis in both knees. He was bench in the final 6:07 against Orlando and has been unable to find a meaningful role under D'Antoni. "I love Pau like a brother," Bryant told ESPNLosAngeles.com. "I want him to dominate like I know he can."
Despite recent trade rumors, it makes little sense for the Lakers to move Gasol because they'll never receive equal talent in return while asking a team to take on his $19 million salary. A trade would leave the Lakers with less talent when Nash returns.