Chicago Bulls: Salary Cap Maneuvering in Action
Update (June 7): The Bulls didn’t follow my advice. They did waive Erik Murphy as I speculated. But they added more players too quickly, and ended up rolling the dice with regard to the bonuses of Joakim Noah and Taj Gibson. Noah made All-NBA First Team, and earned his $500,000 bonus. Gibson didn’t make the All Defensive First or Second Teams. As a result, the Bulls missed the tax by just $291,164.
This post has nothing to do with the Miami Heat but I, as a salary cap person, love intricate luxury tax maneuvering. The situation described herein is about as fascinating as it gets for me. It should be noted that the idea for this post was not my own. It stemmed from an incorrect post I read elsewhere, for which I happily provided the correction, and then decided to write a unique version for myself, with my own story line, and drawing my own conclusions. This post is long and it’s tedious, but the end result is utterly spectacular (well… spectacular for people who are amazed by how teams maneuver around luxury tax issues).
Most of us assumed that when the Chicago Bulls acquired the contract of the unremarkable Andrew Bynum in trade last month, it was to drop them below the luxury tax.
It was. But the process has been far more complicated than most of us, apparently including Bulls management themselves, realized.
For a long time, it appeared as if Bynum would be shipped off to Los Angeles, so that the Lakers could capitalize on his unintendedly valuable contract.
The nature of Bynum’s contract essentially meant that he was auditioning for the Cleveland Cavaliers from the date he was signed on July 19 all the way through the guarantee deadline on January 7, an audition he failed. Bynum’s deal called for a $12.25 million salary this season, of which only $6.0 million was guaranteed. Next season’s salary of $12.54 million was fully unguaranteed. Therefore, a two year contract was really just a six month commitment. But it also meant that any team which acquired his $12.25 million salary in trade could immediately thereafter terminate his contract, thus reducing his salary and resulting cap charge from $12.25 million to $6.0 million.
The Lakers have been luxury tax payers for six straight seasons. They were in position to leverage that $6.25 million delta to sneak below the tax for this season, producing huge up-front savings. And because they are unlikely to be taxpayers next year as they tear down their roster and rebuild, two consecutive years below the tax would have had an added benefit – no “repeater taxes,” which are paid by taxpaying teams that were also taxpayers in at least three of the previous four seasons, for the Lakers for the entire life of the current CBA, which will almost certainly be terminated after the 2016-17 season.
It was a potentially massive financial windfall for the Lakers at a cost of just the expiring contract of Pau Gasol (and another irrelevant throw-in to make the math work).
The Cavs had been after Gasol since this past summer, when they had extensive discussions with the Lakers, and were more than eager to make the swap. But the Lakers were demanding more for Gasol than just the massive financial savings. The Cavs refused.
That’s when the Bulls swooped in.
They quickly sent forward Luol Deng to Cleveland in exchange for Bynum and three future draft picks, and then waived Bynum immediately thereafter. The simultaneous moves cut $8,275,000 off their cap, dropping them from $7,726,202 above the tax to $548,798 below the tax, with a team salary (for tax purposes) of $71,199,202.
It also dropped them below the 13-player minimum roster requirement, but the Bulls knew that with $548,798 of wiggle room, adding a 13th player in order to comply with league rules would still keep them under the tax.
Understanding why necessitates an understanding of how minimum salary contracts are handled for luxury tax calculations.
When a player has been in the NBA for three or more seasons, and is playing under a one-year, 10-day or rest-of-season contract at the minimum salary, the league reimburses the team for part of his salary – any amount above the minimum salary level for a two-year veteran, which for this season is $884,293. Only the two-year minimum salary is included in team salary, not the player’s full salary.
Also needing consideration here is the oft-overlooked rule whereby rookie or sophomore free agents signed to minimum salary contracts (i.e., those whose current contracts were not signed with draft rights) are treated as two year veterans in luxury tax calculations.
In tandem, these rules make free agents signed to one-year, 10-day, or rest-of-season minimum salary contracts all count the same for luxury tax purposes.
If such free agents are signed after the start of the season (i.e., to a 10-day or rest-of-season minimum salary contract), their salaries are prorated down to reflect the number of days remaining in the regular season. There are 170 days in an NBA season from beginning to end.
As of January 10, after Bynum cleared waivers, there were 97 days left in the season.(1) At that point, signing a new player for the rest of the season would have cost the Bulls $504,567 ($884,293*97/170). That’d bring their team salary (for tax purposes) to $71,703,769, leaving them $44,231 below the tax.
So, great… Mission accomplished… The Bulls have avoided the tax!!!
No so fast.
The contracts of Joakim Noah and Taj Gibson presented significant, and unforeseen, problems. Each contract contains various bonuses:
- Joakim Noah: $500,000 if he makes All-NBA First Team
- Joakim Noah: $250,000 if the Chicago Bulls win the NBA championship
- Taj Gibson: $500,000 if he makes All-Defensive First Team
- Taj Gibson: $250,000 if he makes All-Defensive Second Team
That’s up to $1.25 million in performance bonuses – enough to push Chicago over the tax limit.
To find a solution to the problem, the Bulls first needed to establish that there was a problem. Bonuses are sometimes included within a player’s salary, and sometimes they are not. If these bonuses were already incorporated within their salary figures, the Bulls wouldn’t have a problem at all. Because if the bonuses are ultimately earned, they won’t increase either player’s salary anyway. They’d already be incorporated.
The determination as to whether a bonus is included within a player’s salary is based on whether it is considered likely to be achieved. In arriving at its determination as to whether a bonus is likely or not to be achieved, the league uses as its guideline whether such bonus would have been achieved based on last season’s results. If the bonus is determined to be likely, it is added to team salary. If not, it isn’t.
However, what ultimately matters for the purposes of the tax calculation is whether it is actually earned – the league will retroactively adjust team salary at the end of the season to account for such potential discrepancies. So, if a player has a bonus which is unlikely to be achieved, but he ultimately earns it, it will increase his team’s tax exposure. Conversely, if a player has a bonus which is likely to be achieved, but he ultimately does not earn it, it will reduce his team’s tax exposure.
Noah didn’t make All-NBA First Team last season and the Bulls certainly didn’t win the title, so neither of his bonuses is considered likely to be achieved, and thus neither of his bonuses is already included within his salary. Gibson didn’t make the All-Defensive First or Second Teams last season, so neither of his bonuses is considered likely to be achieved, and thus neither of his bonuses is already included within his salary either. Thus, if any of them are earned, they will increase the Bulls’ tax exposure.
Chicago isn’t winning the NBA championship this year, and the Bulls know it. The front office surely isn’t sweating that $250,000 bonus. But the rest of the bonus money, up to $1,000,000, is still very much a problem. If any one of them is earned, it would vault the team above the tax threshold.
The announcements of the All-NBA First Team, All-Defensive First Team, and All-Defensive Second Team are made several weeks after the end of the regular season. The Bulls, therefore, will have no way to know whether these bonuses will be earned until after the regular season is over. In other words, Chicago has only the regular season to prepare for the possibility that a vote which happens after the regular season is already over could vault the team over the tax threshold. Tense times in Chicagoland.
Would the Bulls risk all that they have – trading away Deng, which they said they wouldn’t do, in the process – just to fall a few hundred grand short of accomplishing their goal of dipping below the tax? Not a chance. They needed more salary dump moves to validate their previous actions.
While formulating a plan, the Bulls added Cartier Martin on a 10-day contract on January 10, to comply with minimum roster requirements. Chicago needed a minimum of 13 players and, as describe above, waiving Bynum left them with only 12. Rules are rules. There’s nothing they could have done but add another player. But it also added another $52,017 ($884,293*10/170) to team salary.
The magic number – the tax threshold – is $71,748,000.
At this point, they were at $71,251,219. That’s $496,781 below the tax. Still not enough room for comfort. And things were sure to get worse.
A 10-day contract only lasts 10 days. The Bulls would again fall below the 13-player minimum roster requirement in 10 days, and need to keep adding players on 10-day contracts. And so on, and so on, until, eventually, the sum of all those 10-day contracts (and one final rest-of-season contract for 7 days) would equal the same $504,567 described above, to reflect the 97 days remaining in the regular season from the point Martin’s first 10-day contract was signed.
By the time they’d be done adding contracts, their team salary would be right back to where we predicted — $71,703,769. That’s still only $44,231 below the tax. Which means that if any one of Noah’s or Gibson’s bonuses are earned, the Bulls have no chance of avoiding the tax.
Something needed to be done.
That’s when Bulls general manager Gar Forman absolutely abused Brooklyn Nets general manager Billy King. Forman traded second-year point guard Marquis Teague to the Nets in exchange for second-year small forward Tornike Shengelia.
Teague sucks. He is a draft bust. He is dead weight.
Shengelia isn’t any better. But he’s a hell of a lot cheaper. His contract, at $788,872, is not only $285,848 cheaper for this season, but he’s an expiring contract, whereas Teague has another $1.1 million guaranteed for next season.
How the Nets ever allowed such a trade to be executed is difficult to rationalize, but it had huge ramifications for Chicago. The $285,848 difference, while minor, covers the entirety of one $250,000 bonus.
The Bulls team salary now fell to $70,965,371 – that’s $782,629 below the tax.
By the time the Bulls are done adding all their 10-day contracts, they’d be at $71,417,921, giving them $330,079 of wiggle room. That’s much better than where they were before the Teague trade. It meant that Gibson could earn All-Defensive Second Team honors and still allow the Bulls to avoid the tax. But if either player is to earn his bigger bonus, the Bulls would once again be out of luck, as taxpayers.
Something more needed to be done.
While planning for the February 20 trade deadline, the Bulls continued on with business as usual. On January 20, they re-signed Cartier Martin to a second 10-day contract, just as his first 10-day deal expired, at a cost of $52,017, building the roster back up to 13 players. Rules are rules.
That’s when the Bulls front office had a collective brain fart.
Shockingly, they added a 14th player! They signed Mike James to a 10-day contract on January 22, which cost them another $52,017. Oops!
When Martin’s second 10-day contract expired, they decided not to bring him back. When the James mistake ended two days later, they decided not to bring him back either.
Then, just recently, the Bulls got some good news. Bynum signed a $1 million contract with the Indiana Pacers.
Upon his trade from the Cavaliers to the Bulls, Bynum had received total compensation of $5.1 million. Since his contract was guaranteed for $6.0 million, the Bulls became responsible for the additional $884K. However, when Bynum signed with the Pacers four days ago, it lowered the Bulls’ obligation to Bynum.
If another team signs a player who been waived by a previous team, the player’s original team is allowed to reduce the amount of money it still owes the player (and lower their team salary) by a commensurate amount. This is called the right of set-off. The amount the original team gets to set off is limited to one-half the difference between the player’s new salary and the minimum salary for a one-year veteran. With a new salary of $1 million and the minimum salary for a one-year veteran of $788,872, the Bulls were able to set off $105,564. Bynum’s enduring cap hit was therefore lowered from exactly $6 million down to $5,894,436.
And so here we stand today.
We’re at February 7th. The Bulls have a team salary (for tax purposes) of $70,963,842 but just 12 players under contract. They need to keep adding salary to keep to the 13-player minimum.
If they add a player as of today, for the 69 days remaining in the season, it can cost no less than $358,919 ($884,293*69/170). That’ll take team salary (for tax purposes) to $71,322,761, and, in turn, leave the team just $425,239 below the tax. That’s enough room to accommodate a Gibson All-Defensive Second Team selection, but he better not make the First Team, and Noah better not make All-NBA First Team!
What to do?
The Bulls now find themselves in an extremely unique situation. They’re determined to stay below the tax at all costs. In order to do so, they need to leverage yet another intricate salary cap rule.
The NBA requires that all of its teams maintain a roster of between 13 and 15 players during the regular season – that much we all know. What we may not know is that the league actually allows its teams to drop down to as few as 11 players for up to two weeks at a time.
The rule is intricate and complex. And dropping down to 11 players is more complex than dropping down to 12. To understand why, you need to understand the finer points of two interrelated rules.
We all know that, in normal circumstances, teams are allowed to carry between 13 and 15 players on the roster. What we may not know is that a team, in normal circumstances, must have between 12 and 13 players on the Active List and between zero and three on its Inactive List. The league also allows a team to drop to as few as 11 players on its Active List for up to two consecutive weeks at a time, and allows a team to drop to as few as zero players on its Inactive List for up two two consecutive weeks at a time.
These are convoluted rules, with confusing implications. If a team has 15 players on the roster, it can have either two or three players on its Inactive List. If a team has 14 players on the roster, it can have either one, two or three players on its Inactive List – but if it has three players on its Inactive List then, by default, it will have 11 players on its Active List, which it can only have for up to two consecutive weeks at a time. If a team has 13 players on the roster, it can have either zero, one or two players on its Inactive List – but if it has two players on its Inactive List then, by default, it will have 11 players on its Active List, which it can only have for up to two consecutive weeks at a time. If a team has 12 players on the roster, it can have either zero or one player on its Inactive List – but it it can only have zero for up to two consecutive weeks at a time; if it has one, then, by default, it will have 11 players on its Active List, which it can only have for up to two consecutive weeks at a time. If a team has 11 players on the roster, it must have no players on its its Inactive List – but it it can only have zero for up to two consecutive weeks at a time, and it can only have 11 players on its Active List for up to two consecutive weeks at a time.
That’s important because of a second and related rule.
We all know that, starting on January 5, teams can enter into 10-day contracts. What we may not know is that no team can at any one time have more 10-day contracts than the number of players on its Inactive List (except that if the team has 13 players on its Active List then it can have two). The implications are again rather straightforward. If a team has 12 players on the roster, since it can have up to one player on the Inactive List, it can have one 10-day contract. If a team has 11 players on the roster, it can’t have any players on the Inactive List, and therefore can’t have any 10-day contracts. So, to sign a player to a 10-day contract, the Bulls need to have at least 12 players on the roster.
Dropping down to 11 players isn’t an option for the Bulls anyway, because they already have 12 players under guaranteed contract. But the two-week intervals during which a team can stay at 12 players before being required to increase back up to the 13-player minimum is a concept the Bulls will look to fully leverage.
The Bulls were last at 13 players at the end of Mike James’ contract on January 31. Thus, they will be required to sign someone by February 15. They’ll do it by signing him to a 10-day contract, at a cost of $52,017 ($884,293*10/170).
After it expires 10 days later, they’ll then wait another two weeks until they’re required to sign someone on March 11. They’ll do it by signing him to a 10-day contract, at a cost of $52,017 ($884,293*10/170).
After it expires 10 days later, they’ll then wait another two weeks until they’re required to sign someone on April 4. They’ll do it by signing him to a 10-day contract, at a cost of $52,017 ($884,293*10/170).
The last of the three contracts will expire on April 13. On the following day, April 14, the roster will again drop down to 12 players. But with the regular season ending April 16, just three days into the two-week window, they won’t be required to add another contract.
Such salary cap maneuvering won’t save the Bulls a whole bunch of money, but the little it does save will be critical dollars. When it’s all over, the Bulls will have a team salary (for tax purposes) of $71,119,893. That’ll leave them $628,107 below the tax. That’s enough for one $500,000 bonus.
The Bulls would still be in a tenuous position, but it’d at least give them some room for comfort. If Noah wins All-NBA First Team, no problem! If Gibson wins All-Defensive First or Second Team, no problem! Only if both happen do we have a problem. That’s highly unlikely.
But, still, the Bulls may not want to take any chances.
There’s a realistic maximum of exactly $1,000,000 in bonus money to be had. Thus, the Bulls would need to finish the regular season with a team salary (for tax purposes) which is at least $1,000,000 below the tax threshold in order to avoid any chance of tripping the tax threshold when the All-NBA honors are distributed during the postseason. If they do, they won’t need to worry about whether Noah wins All-NBA First Team honors, or if Gibson wins All-Defensive First or Second Team honors. But how do they get from a projected $628,107 below the tax threshold to a projected $1,000,000 or more below?
At this point, we don’t even know if that’s a focus for the Bulls. Maybe they’re reasonably confident that Noah won’t win All-NBA First Team honors. Or maybe they’re reasonably confident Taj Gibson won’t win All-Defensive First or Second Team honors. But maybe they’re not confident. Maybe they want assurances they’ll avoid the tax.
In order to get closer, if they’re creative, they can leverage yet another intricate salary cap rule.
Odd as it may sound, they’ll actually need to cut someone who has a guaranteed salary. Understanding why necessitates an understanding of how a player is actually released.
The only way to terminate a contract early is through the waiver process. When a player is released, he must first be placed “on waivers.” Waivers are a temporary status for players who are released by their teams. A team initiates the waiver process by “requesting waivers” on the player they are releasing. The player stays “on waivers” for 48 hours (including weekends and holidays), during which time other teams may claim the player and assume his contract.
If no team has claimed the player before the end of the waiver period (which is always 5:00 PM Eastern Time), he “clears waivers.” The player’s contract is terminated and he becomes a free agent. The waiving team continues to pay the guaranteed portion of the terminated contract, and it continues to count against its cap.
But here’s the thing – if a team makes a successful waiver claim, it acquires the player and his existing contract, and pays the remainder of his salary. The waiving team is relieved of all responsibility for the player, and the entire amount of his contract is removed from the waiving team’s cap. The player is awarded to the successful bidder (if any), the remaining financial obligations under his contract become the responsibility of the successful bidder, and each team’s team salary figure is adjusted only after the 48-hour waiver period has expired.
So if the Bulls waive someone, and he gets claimed, they can lower their team salary even further.
But there are substantial risks. First, the Bulls would, of course, lose that player. Second, if the player they terminate does not get claimed while he’s on waivers, the Bulls would wind up getting no tax relief whatsoever. Third, because the Bulls are already below the 13-player minimum roster size, at 12 players, waiving someone would require the Bulls to immediately sign someone. So, waiving someone could require the Bulls to add more salary, and it may not end up saving them any money in return if the waived player is not claimed while he’s on waivers.
Further complicating matters is that only very rarely do players get claimed while they are on waivers, since the team claiming a waived player inherits his entire contract. That means the acquiring team needs to want to inherit the contract – the very contract the waiving team is trying to get rid of. It also means the acquiring team needs to have a means to acquire the contract. A team can claim a player on waivers only if one of the following is true: (i) the team is far enough under the salary cap to fit the player’s entire salary, (ii) the team has a Disabled Player exception for at least the player’s salary and the player is on the last season of his contract, (iii) the team has a trade exception for at least the player’s salary, or (iv) the player has a minimum salary contract. It is far more common for teams to wait for the player to clear waivers, and then sign him to a much smaller (even minimum salary) contract.
The question needs to be asked: Who on the Bulls has a reasonable contract and enough value that he’d almost surely be claimed, and has a high enough salary to produce enough savings for the Bulls even after adding a replacement player?
Murphy, a four-year player at the University of Florida, was the No. 49 pick in last year’s draft. He doesn’t play much in Chicago, but there should be several teams who like him. He is, after all, a 6-foot-10 power forward who shot a remarkable 43.5% on 3-pointers during his college career. He is playing in the first of a two-year minimum salary contract, that pays out the league minimum of $490,180 (and counts that much against the tax). His salary for next season is completely non-guaranteed (if he waived prior to August 1), making him a valuable asset in trade. He may not ever be a superstar, but who wouldn’t want to take a chance on someone with his skill-set in a stretch-four dominated league, particularly if the worst case scenario is to have acquired a valuable asset in trade?
Murphy represents a low-risk addition for any number of NBA teams. It’s a minimum salary contract, which means every NBA team can attempt to claim him on waivers. If one of them does, it could be a high-reward play for the Bulls.
If he isn’t claimed, the Bulls will have accomplished nothing. They’ll still have to pay him every penny. But he will be claimed. He’s too valuable, and too cheap, not to be claimed. And look what happens if he is.
As mentioned above, the Bulls will have started with a team salary (for tax purposes) of $71,119,893, putting them $628,107 below the tax. Waiving Murphy, assuming he’s claimed, would then put team salary (for tax purposes) at $70,629,713, which is $1,118,287 below the tax. We’ve done it! We’ve cleared more than a $1,000,000 of breathing room below the tax.
Timing is critical here.
The player’s roster spot is freed-up as soon as the team places the player on waivers. The Bulls certainly won’t want to waive him so early that they’re forced to take on additional salary. If they place him on waivers within the final two weeks of the regular season, they can take advantage of the two-week intervals during which a team can drop below the 13-player minimum and not add anyone in his place at all. That means the Bulls will want to waive him on or after April 2.
The Bulls also won’t want to wait too long to waive Murphy. A team’s finalized team salary (for tax purposes) is calculated as of the start of its last game of the regular season, which, for all NBA teams, is April 16. Any team that claims Murphy would become their financial responsibility only after the 48-hour waiver period expires. That means the Bulls will want to waive him on or before April 14.
So, as long as Murphy is waived between April 2 and April 14, they’d be okay. Remember that during this time frame, the Bulls would also be in the midst of a 10-day contract cycle while fluctuating their roster size between 12 and 13 players. As of April 14, the last 10-day contract would expire, dropping the roster to 12. Adding in a Murphy waiver would drop the roster size to 11. But that’s okay. The Bulls would have 11 players under contract for the final two days of the regular season, but none of the 11 would have a 10-day contract. As described above, that’s allowed.
So, great… Mission accomplished… The Bulls have avoided the tax under any conceivable circumstance!!!
No so fast.
Here’s where another intricate rule comes into play – this time, a rule which could cost the Bulls. They’d be leveraging a rule that says they can drop to 11 players for up to two consecutive weeks at a time in order to finish the regular season with 11 players under contract. But a separate rule states that a playoff team must carry between 13 and 15 players.
Maybe this playoff rule wasn’t written with roster maneuvering in mind. Maybe if the Bulls were to petition the league for leniency on this rule, they’d oblige. Maybe they’d never even notice. Or maybe it is an intentional rule, with which the Bulls need to comply.
As of now, the Bulls would qualify for the playoffs. They could avoid dealing with this rule altogether, simply by tanking and missing the playoffs. But they’re not about to do that. Each playoff game is estimated to generate between $500K and $2 million in profit for the home team. The Bulls, as a large market team with a huge stadium and massive attendance numbers, would almost certainly generate profits at the high end of that range. In a weak Eastern Conference, it is not inconceivable that the Bulls could make it all the way to the second round of the playoffs. That’s as many as seven playoff home games (assuming both the Miami Heat and Indiana Pacers advance). They’re not about to throw away $14 million!
Intentionally missing the playoffs is therefore not a viable solution to the 13-player minimum playoff roster requirement. So, they’d need to add more salary in building back up to 13. Remember that the Bulls would, as of April 14 – just two days prior to the end of the regular season – have just 11 players under contract, with a team salary (for tax purposes) at $70,629,713, which is $1,118,287 below the tax.
That’ll give the Bulls a $118,287 cushion. That’s plenty. It’ll enable them to add players at the minimum salary for a total of 22 days. With that, the Bulls could actually build up to the full 15-player maximum prior to the start of the playoffs. After accounting for Murphy, the Bulls will be at 12 players until April 14. So, if they add three players on April 10, with seven days to go in the regular season, they can build back up to the 15 player maximum, with the contracts costing $36,412 ($884,293*7/170) each. They’ll then drop to 14 players on April 14. On the very last day of the regular season, they can once again add a 15th player, this time at a cost of $5,202 ($884,293) to finish out the regular season.
Add the cost of these four players – $114,438 in total – and team salary (for tax purposes) would increase to $70,744,151. That’s exactly $1,003,849 below the tax.
The most Noah and Gibson can realistically earn in bonus money is a combined $1,000,000.
To recap: If the Bulls continue along in adding 10-day contracts every 24 days (i.e., the 10-day term plus two weeks), and if they waive Erik Murphy within the final two weeks of the regular season, and if Murphy is claimed on waivers, and if the Bulls add four players all within the last week of the regular season, the Bulls will enter the postseason with the full 15 players on the roster and at the same time will have have successfully dropped far enough below the tax threshold to avoid the tax even if both Joakim Noah and Taj Gibson earn their maximum bonuses. With as little as $3,849 to spare!
Is this how things will play out for the Bulls? Will they continue adding 10-day contracts every 24 days? Will they waive Erik Murphy? Will they add two players on the final day of the regular season?
If they want to assure themselves of missing the tax, that’s exactly what they’ll do.
What will be the reward for such sly salary cap maneuvering?
Consider from where they came. From the various roster moves they’ve undertaken since the Bynum trade, Chicago will have:
- Saved $7,388,133 in salary payments(2)
- Saved $12,270,853 in luxury taxes avoided
- Earned approximately $3.1 million in luxury tax distributions (which is paid to non-taxpaying teams from the proceeds of taxpaying teams)
That’s nearly $23 million!
This analysis excludes trade scenarios, because such scenarios require a willing partner, and the Bulls cannot control the free will of other teams.
(1) The number of players on a team’s roster technically drops by one when a player is waived, not when he clears waivers 48 hours after that. Therefore, Chicago’s roster dropped to 12 when they waived Bynum on January 7 and, in turn, signing a player to a new contract could have added $520,172 if it were executed that day, reflecting the 100 days left in the regular season. I subtracted the extra three days, reducing it to 97 days and $504,567, in order to create symmetry with what the Bulls actually did. They waited three days, until January 10, to sign Cartier Martin.
(2) The salary payouts have been calculated as the $8,728,521 difference in team salary, plus $5,961,912 in payouts to Luol Deng before he was traded, less $5,116,176 in salary payments to Andrew Bynum paid by the Cleveland Cavaliers, less an additional $105,564 in payments to Bynum not owed because of set-off, plus $518,294 in payouts to Marquis Teague before he was traded, less $380,515 in salary payments to Tornique Shengalia paid by the Brooklyn Nets, plus all of Erik Murphy’s salary prior to being placed on waivers.