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Did the Heat Turn Down An Evan Turner for Udonis Haslem Offer?

February 27th, 2014 Leave a comment Go to comments

It has been suggested that the Miami Heat were engaged by the Philadelphia 76ers with an interesting proposition at the Feb. 20 NBA trading deadline. It has been suggested that Sixers general manager Sam Hinkie proposed a trade to Heat general manager Pat Riley of Evan Turner, in exchange for Udonis Haslem and a future first round draft pick.

Riley reportedly rejected.

Did he do the right thing? Well, that’s for you to decide.

The Mechanics

Let’s get a couple things out of the way before we begin.

First, the rumored trade, as described, doesn’t work. It violates salary cap rules.

Taxpaying teams like the Heat can only take back up to 125% of their outgoing salaries, plus $100K, no matter how much salary the team is sending away.

Haslem makes $4.3 million this year. He can therefore only be traded for a player(s) who makes as much as $5.5 million. Turner makes $6.7 million.

When trades are rumored about, oftentimes only the vital components are leaked. The technical details are often either not yet established or not considered vital, and are therefore not leaked alongside the rest of the trade. If indeed this rumor is true, that may be what’s happened here, particularly because the solution is simple. If the Heat were to add an expiring contract to the deal – say, for example, Rashard Lewis – the trade would be legal.

Second, there’s the matter of the draft pick. The concept of including a first round draft pick is quite vague. When would that pick be conferred? What protections would be attached to it?

The Heat’s current predicament answers these questions, and quite nicely. 

The Heat still owes a first round pick to the Cleveland Cavaliers, to satisfy the terms the of the LeBron James sign-and-trade from July 2010. The pick has top-10 protections on it through 2016 (and is unprotected in 2017) but, unless the Heat were to get very bad very quickly, it will almost certainly be conferred in 2015.

Teams are restricted from trading away future first round draft picks in consecutive years. Therefore, by rule, Miami can’t trade its first round pick in either 2014 or 2016 (see here for the exact stipulations under which all Heat future first round picks can be traded).

Therefore, the pick we’re talking about would almost certainly be a 2017 first rounder(1).

Riley would also probably demand some degree of protections on it to ensure that it’s not much more valuable than intended – say, for example, make it Top-10 Protected through 2019 and, if not conferred by then, the obligation would convert into a pair of second round picks in 2019 and 2020. But that’s technical stuff, and pure speculation. The point is that it would likely have been the Heat’s 2017 first round pick.

Mechanically speaking, therefore, the rumored trade proposal actually becomes:

Rumored Trade Proposal
Heat Trade: Udonis Haslem, Rashard Lewis, 2017 Protected First Round Pick
Heat Receive: Evan Turner

***

Certain elements of this rumor ring true.

The Sixers were known to be targeting a first round draft pick in exchange for Turner.

They, ultimately, never got it. It is perhaps not an unreasonable stretch to assume that, in the absence of an ability to get one, they would have offered to swallow an extra year of Haslem’s untenable contract in order to get one. It’s not as if they’re going to need that extra cap space next season anyway. They’re building through the draft.

Of course, we don’t know – and we will never know – what the Heat were actually offered, if anything. As much as we’d like some transparency into the Heat’s trade deadline negotiations, we’ll never get it.

So, assuming the rumor was true, here’s me, debating with myself, talking through all aspects of the hypothetical deal:

The Loyalty Factor

A: There’s simply no way we trade Udonis Haslem. He’s a legacy. He’s a legend. He’s sacrificed nearly $20 million for this team over the course of his career. This organization is built on loyalty. You can’t just get rid of an icon like that. It’s not even fathomable.

B: Loyalty is a great concept in a vacuum. I’m all for it. But decisions are more difficult in reality. The fact of the matter is that money is somewhat finite. Unlike in huge markets like New York or L.A., there isn’t a perpetual supply of it in Miami. Fans were angry at owner Micky Arison for waiving Mike Miller through the amnesty process just to save some dollars. Their frustrations mounted when the team chose not to utilize the mid-level exception. Fans aren’t necessarily the truest evaluators of what is fair. They haven’t even considered that, despite the unpopular decisions made this season, and despite playing in the 17th largest market of the 30 NBA teams, Miami’s luxury tax bill this season alone will be higher than 16 teams have paid in their ENTIRE EXISTENCE.

Haslem has a $4.6 million player option for next season. That figures to cost the Heat at least $15 million when including the luxury tax, but it could reasonably cost as much as $24 million. Trading him would clear his salary off our cap, increasing our flexibility. So, yes, loyalty means a lot. But what if the price of that loyalty was the ability to re-sign Mario Chalmers? Or to utilize the mid-level exception to acquire [name of your favorite player] this summer? The cost of loyalty is expensive.

A: Not trading Haslem now doesn’t necessarily mean the Heat can’t trade him down the road, if it were absolutely necessary. As an example, at the trade deadline next season, Haslem would have about $1.7 million left to be paid on his expiring contract, even after accounting for his 15% trade bonus. The Heat could give a trade partner up to the $3.3 million cash limit to take it. That’s a $1.6 million profit for any team willing to take on an expiring contract for less than two months. The Heat could even throw in a second-round pick to sweeten the future deal. So let’s not talk money.

B: Your proposed trade means that a trade partner would need to have at least $4.8 million of cap space (or a trade available exception that big) to execute it, in order to cover the cap hit associated with his salary and trade bonus. Yes, there were potential trade partners with that much cap space at the trade deadline this year. But it rarely ever happens, and certainly can’t be relied upon at next year’s trade deadline.

The Heat certainly can’t spend their money this summer while counting on a Haslem trade at the trade deadline. That’d be too risky. And to move Haslem’s contract this summer would be nearly impossible without including a first-round pick anyway. This way, you’d be getting Turner too.

A: Look, I agree with you. Loyalty is expensive. The things that are most important in life always are – whether they be monetarily expensive, personally expensive, or otherwise. Your willingness to overcome the expense and stand for what you believe in is what reveals your true character.

The First Round Pick

A: Are you crazy? We can’t possibility give away another first round pick. We need them to build for the future. Have you not seen how old this team is?

B: Have you not seen Riley’s track record in the draft? Left to his own devices in 2003, Riley nearly drafted Chris Kaman with the fifth overall pick, before being talked into selecting Dwyane Wade by his staff. Since that time, only three players he’s selected have ever played more than eleven big-league minutes for the Heat – Dorell Wright, Wayne Simien, and Michael Beasley. The very next players taken in those drafts were Jameer Nelson, David Lee, and, two picks down, Russell Westbrook. Riley’s track record in the draft is awful. So awful, in fact, that he doesn’t use the draft to build for the future anymore. He’s said so himself, many times.

A: But you’re missing one very important thing. First round picks have incredible value in trade, now more than ever.

Think about what you’re talking about. You’re talking about trading away a pick all the way out in 2017. Think about what that would mean. It would mean that the Heat couldn’t deal away a single first round pick, in any subsequent trade, until the year 2019.

How many trades have you envisioned over the past four years that couldn’t be executed because the Heat didn’t have the assets? Riley, for his part, was targeting Nikola Vucevic in the summer of 2012. Imagine if the Heat would have had a first round pick to trade back then. Do you really want to make that mistake again?

B: You’re talking about a pick that will very likely be at the very bottom of the round. Let’s not go overboard with how valuable it is.

A: Not necessarily. A 2017 pick would be one year after the contracts of the Big Three expire. It could wind up being quite valuable. It could wind up being a lottery pick. You have no way of knowing just how valuable, unless you’re saying you can predict the future. Do you think the Lakers would ever have predicted their current predicament when they traded away four draft picks – first rounders in 2013 and 2015 and second rounders in 2013 and 2014 – to acquire Steve Nash? No way!

And, even if it were a low-level pick, it still carries significant value in trade.

The Addition of Evan Turner

A: Would you really be willing to sacrifice a future first round pick AND turn your back on Haslem, all just for a four-month rental of Evan Turner?

B: That four-month period includes a championship run. I put it back to you: Would you not be willing to trade a first round pick in exchange for a championship?

A: That argument is invalid. Acquiring Turner doesn’t guarantee the Heat a championship. He’s an inefficient scorer, and not at all what this team needs. He probably wouldn’t even play. There is no guarantee that if we win the championship with him, it would be because of him. And there is no guarantee that we won’t win a championship even if we don’t acquire him.

B: Ok. Maybe you’re right. But Turner doesn’t have to be just a rental.

Think about it from a broader perspective. The Heat is old. Their reserve shooting guard is rapidly losing his effectiveness and may retire at season’s end. Their reserve small forward is retiring. Their depth in the frontcourt is questionable, which is why their reserve small forward has to start at power forward despite giving up inches and pounds. The Heat will have no cap space, no means to replace all that. They’ll have one mid-level exception, and, that’s it.

Look at how this one trade could change everything. The Haslem savings could be re-deployed to Chalmers, with room to spare. Turner could replace Ray Allen as the Heat’s go-to scorer off the bench (and emergency starter when Wade is resting). The second unit could then become Norris Cole, Evan Turner, James Ennis, Chris Andersen, a 2014 first round draft pick, AND a mid-level exception player. Throw Michael Beasley and Greg Oden in there as possibilities as well. That’s a mighty impressive second-unit rebuild.

A: Ha. First you make the argument that the price of loyalty is the expense. Then you build what will become far and away the most expensive team in Heat history. I buy your argument that the Haslem savings could be re-deployed to Mario Chalmers, but I believe the Heat has every intention to bring Chalmers back anyway. I buy your argument that the Heat would probably have enough dry powder to utilize the mid-level exception and employ a 2014 first round pick, but I think they’ll do that anyway. So, at this point, it’s all the same. But Turner? He’d be too expensive. As I said before, it’d just be a rental. And how does that argument address the fact that he’s a quality player, and certainly not a strong fit?

B: I disagree with you. Look at the numbers closely. Based on the current luxury tax projections for next season (of $76.6 million) and even after incorporating repeater tax implications, if the Heat were to trade Haslem for Turner, they could: (i) re-sign Turner to a reasonable contract (~$5.5 million per year), (ii) re-sign Chalmers to a similar contract as he has now, (iii) utilize the full mid-level exception on anyone they choose, (iv) sign their 2014 first round draft pick, and (v) sign James Ennis… and their total payroll obligations would still go down from what they are this year. And that’s even if none of the Big Three takes any kind of a discount whatsoever.

Still feel so strongly about loyalty?

A: Yeah, but Turner won’t take $5.5 million per year. He wants more. And I wouldn’t pay him that anyway, not for what he brings, which isn’t much. He’s not worth it.

B: That’s only your theory. You have no way of knowing what he wants. Or what he’ll get on the open market. I didn’t just pick that number randomly. That’s what current market forecasters project he’ll be worth. And, even if that’s low, we could pay more if we choose. Because we’d have his Bird rights, we could pay whatever we want, right up to the maximum.

The beauty of the whole thing is the flexibility it’d give us. Since he’s coming off his rookie-scale contract, he’ll be a restricted free agent. That would give us the legal right to match any offers he gets. We can just sit back, see what he gets on the open market, and match whatever offer he takes if we want to.

A: Not true. To make him a restricted free agent, we’d need to extend him a qualifying offer by June 30. A qualifying offer is an offer of a contract that he could accept anytime. It would cost $8,717,226. There’s no way we give him a qualifying offer.

B: Fine. We wouldn’t have a legal right to match any offers. But we’d still have his Bird rights. So we’d still have the right to match any offers anyway. He’d just have to give us the chance.

A: He won’t give us a chance to match. He’s going to go where he’ll get much more playing time. Which means his Bird rights would mean nothing.

B: Not necessarily. Even if he doesn’t (or we don’t) want this to be a long-term thing, we could still leverage his Bird rights to work out a potential sign-and-trade. That might allow us to get something back in return. A player. A draft pick. Who knows.

A sign-and-trade could be valuable to us because we’d get something back in return. It could be valuable to Turner because he’d make himself available to more teams, not just those with cap space but also those who are over the cap and willing to trade for him.

There’s value to acquiring him, no matter what happens – whether we sign him for the long-term or not.

***

Considering the benefits and drawbacks of this proposed trade, if it did indeed exist and couldn’t be negotiated any better, Riley chose not to pull the trigger.

I wouldn’t either.

Turner isn’t a very good player, and doesn’t seem to be a solid fit for the Heat on-court schemes. He’d almost certainly be a short-term rental, and very likely wouldn’t play. So, the gaining Turner aspect of this hypothetical trade accomplishes nothing for the Heat.

There is substantial value for the Heat in clearing $4.6 million of largely unnecessary salary off the books for next season, but perhaps not at the cost of a South Florida icon and locker room leader, and certainly not at the cost of a future first round draft pick that extends well beyond the Big Three era. That’s too high a price.

Would you have made the trade?

Notes:
(1) When dealing with protected picks, the two-year rule is interpreted to mean that teams can’t trade a pick if there is any chance it will leave the team without a first round pick in consecutive future drafts. Since the pick owed to Cleveland is top-10 protected, there’s a chance, small as it may be, that the Heat won’t send it in 2015 or 2016. It needs to be conferred by 2017, though, because it is unprotected that year. Therefore, while a potential pick traded to Philadelphia would almost certainly be a 2017 first round pick, it couldn’t be written into the trade that way. It would technically have to be written into the trade as the first round pick in the draft two years after the Heat’s obligation to Cleveland is satisfied. 

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