The Miami Heat took another step toward maximizing its salary cap space on Tuesday, when it agreed to buy out the contract of forward James Jones.
The Heat had a June 30 deadline before the three remaining seasons on Jones’ partially-guaranteed contract became fully guaranteed. The contract was set to pay him $4,650,000, $4,970,000 and $5,290,000 over the next three seasons, for a total of $14,910,000.
Miami had been trying for weeks to trade him so that they could owe him nothing at all, but there were no takers.
Instead, the Heat did one better.
Rather than paying Jones his guaranteed $5,952,000, they have reportedly instead bought him out for only $4,952,000.
In a spectacular display of selflessness for the greater good, Jones agreed to give up a million dollars of what he was owed to a team that was simultaneously releasing him. He did it for reasons unknown, but perhaps including a genuine love for the Heat and the city of Miami and because the Heat agreed to pay his buyout in one lump sum. Rather than receive bi-monthly checks for the next three years, Jones will get all of his buyout money up front. Getting paid up front is still not worth sacrificing a million dollars, but it is something.
While a formal promise of a future contract is a violation of cap rules, Jones may have also received a hint from the Heat organization of its intention to offer a minimum salary contract to partially offset the losses after all of the team’s cap space is used up. The future contract promise is just speculation, but it seems to make a whole lot of sense.
While Jones will get paid his money up front, in accordance with cap rules, the Heat will get to spread the salary cap hit associated with Jones’ buyout over the remaining life of his now terminated contract, in proportion to the salaries he was guaranteed in each of those seasons. Jones’ cap hits become $1,544,172, $1,650,667 and $1,757,161 respectively, thereby opening up an additional $311,828 in cap room for this season for Miami.
This amount may seem rather small, but it is important.
Michael Beasley is all but certain to get moved, perhaps to the Raptors as part of a Bosh sign-and-trade but more likely to the Minnesota Timberwolves, in a trade that would clear his $4,962,240 salary off the books. However, even if the Heat were to also move Mario Chalmers, it would still have fallen $198,764 shy of being able to offer each member of a potential Dwyane Wade, LeBron James and Chris Bosh trio a full, maximum contract. The $311,828 cap savings from Jones makes it officially possible. A potential Wade, James, Bosh trio – assuming the Heat can find a taker for Chalmers – would leave the Heat just shy of the projected $56.1 million cap, with only $113,064 to spare.
In accordance with buyout procedures, Jones will now be placed on waivers. “Waivers” is a temporary status for players who are released by their teams. During the waiver period, which lasts seven days, any other team may claim him. If a player on waivers is claimed, the new team acquires his existing contract in full and pays the remainder of his salary. In the case of Jones, however, this is highly unlikely.
If no team claims him, he is said to have “cleared waivers.” At this point, Jones would become an unrestricted free agent, free to sign a new contract with the team of his choice, including Miami. The Heat would then be responsible to pay the negotiated buyout amount.
The move adds further credence to the notion that Wade, James and Bosh may have an agreement in place to join the Heat in the off-season. While Pat Riley is restricted from speaking to either James or Bosh until free agency officially begins at 12:00 am on Thursday morning, no such restriction exists for Wade. The three reportedly held a small summit over the weekend, which was subsequently denied.
Jones originally signed a 3-year, $23.25 million contract with the Heat on July 9, 2008. He appeared in 76 regular season games, including seven starts, during his two years, averaging 4.1 points, 1.4 rebounds, 0.5 assists in 14.9 minutes, while shooting .366 from the floor, .376 on 3-pointers and .831 from the foul line.
The greatest words in the history of professional sport (from Stephen A. Smith):
I got a call last night from a source and I double-checked it with another and they told me essentially that LeBron James and Chris Bosh are going to tag team and go together and join Dwyane Wade in Miami.
Around 10 o’clock last night or so I heard the news and stayed up for a few more hours and made a few phone calls and I felt comfortable enough to go with what I reported.
I believe it’s highly likely, I wouldn’t say anything is a done deal with LeBron James until it’s signed.
Last night I heard emphatically that this is the direction that LeBron James has leaned toward and Dwyane Wade has done a very, very good job of convincing them (James and Bosh) not just about Pat Riley, not just about the fact there are no state (income) taxes in the state of Florida but at the same time he’s there in a tandem and that’s what it’s going to take. Either that or a three-headed monster to win multiple championships and that LeBron James is all in.
This is obviously a best case scenario for the Heat.
It’s difficult to believe that both LeBron and Chris are unequivocally ready to sign on the dotted line right now and join Dwyane in his quest for basketball immortality. But what if they are? Then what? Would the next half decade not be the best years of your lives? Read more…
It’s one of life’s certainties: Athletes need to pay taxes on income earned on the road.
For each of his first seven NBA seasons, Dwyane Wade has worked in Florida, where there’s no state income tax.
Yet, each April, he undoubtedly pays a small army of accountants to file hundreds of pages of tax returns, and writes checks to as many as a twenty different states, covering taxes on income he earned on the road.
April 15 — tax day — is quite possibly the most stressful day for professional athletes, now that 20 of the 22 states with NBA franchises have laws that require visiting athletes to pay state income tax for each game they play there.
This so called “jock tax” is an income tax levied against visitors to a city or state who earn money in that jurisdiction. Since states cannot typically afford to track the thousands of individuals who do business on an ongoing basis, the ones targeted are typically the very wealthy and the very high profile, namely professional athletes. Not only are the working schedules of professional athletes public, so are their salaries. The state can compute and collect the amount with very little investment of time and effort. Read more…
Note: From 8:00 am on 6/28 to 8:00 pm on 6/28, the Vegas lines in regards to landing LeBron James have changed dramatically. The Heat’s odds have increased to 2/1 from 5/1. At the same time, the Bulls’ odds have reversed to 1/3 from 1/5. This is the first time the Heat has been in the second place in the race for the King!
Three days until free agency begins.
Nine days until the salary cap, luxury tax and mid-level exception numbers are released.
Ten days until players can be signed.
The Miami Heat is poised to make a big free agent splash, but several cap space teams have equally high hopes. Here’s a look at the key competition: Read more…
With free agency set to begin next week, the New Orleans Hornets’ ownership transfer delay could hamper the team’s ability to improve its roster, even though George Shinn has continued to reassure fans of his commitment toward winning.
What else is he going to say? The cash strapped owner needs to sell season tickets.
But the situation in the Big Easy has led to widespread speculation that more than half of the league’s general managers have taken great interest in. The Hornets remain a league-wide curiosity because, even after last season’s virtual giveaways of Rasual Butler and Devin Brown to avoid paying luxury tax, New Orleans is back in tax territory with a projected payroll of more than $73 million in 2010/11.
What do you do when your loss-making team’s two best players play the same position?
One answer, and the easiest, is to trade one of them this summer. There are only 48 minutes available to a point guard, and the Hornets have more pressing needs at hand. Both Chris Paul and Darren Collison would demand a major return on the trade market. The Hornets could move Paul in return for a bevy of solid, young talent and draft picks that could shore up several positions of need. They could also move Collison with a bigger contract to pad his outgoing salary. The Hornets unfortunately have multiple overpaid declining parts still locked up for at least another season.
Rival executives continue to try to convince the Hornets to make Paul available in trades, pointing to the fact that new head coach Monty Williams can simply slide the promising Collison and his modest $1.4 million salary into that spot. When those teams get shot down, they come right back and suggest the Hornets’ make Collison available, conditioned upon a willingness to take back the cap-clogging contracts of Emeka Okafor, James Posey or Peja Stojakovic.
It has always been assumed that the Hornets will trade away one of their two star point guards to get under the tax threshold. Recent history suggests that smaller market teams will do just about anything – even the decidedly stupid – to drop below that magic line. Last season, the salary-dumping Utah Jazz jettisoned the promising rookie point guard Eric Maynor to Sam Presti, perhaps the best young general manager in the league today, and his Oklahoma City Thunder, in a package deal that included the retiring Matt Harpring. Read more…
With the twelve pick in the 2010 draft, the Memphis Grizzlies selected Kansas swingman Xavier Henry. The pick is certainly intriguing, in that it engenders further questions about the length of restricted free agent Rudy Gay’s stay in Memphis. The common perception is that Henry was selected solely because of the Rudy Gay situation. Is it a prelude to a potential trade of the explosive 6’8″ small forward?
Despite the rumors that have flailed about for several months now, Memphis owner Michael Heisley has remained steadfast in his commitment to retaining the budding forward. At least his comments have been. His actions, however, would suggest otherwise.
Heisley said his team was going to make a big move in the draft. They did. Only this time they again moved to the ATM machine to make a deposit. The Grizzlies’ 25th overall pick, Dominique Jones, was dealt to the Mavericks for cash considerations. Instead of getting an experienced junior ready to contribute right away, a player who can score, rebound and pass (the only player in college to average 21 ppg, 6 rpg and 4 apg last season), the Grizzlies got three-million dollars to put in Michael’s back pocket.
You can read into this in one of two ways. You can say that Heisley would rather deflect the loss-making enterprise that is the Grizzlies organization than spend big dollars to build a winner. The folks in Tennessee sure feel slighted, particularly when you consider the team has a solid core in place that is not too far away from being legitimately competitive in a difficult Western Conference. Or, perhaps Heisley is stashing the cash in order to offset the impact of the hugely overvalued contract his highly sought after free agent is certain to command.
The first seems more likely, but consider the second. Read more…
At No. 18, both Eric Bledsoe and Avery Bradley were available for the taking. If you believe either had the potential to be a future high-quality starting point guard in this league, then that was the true cost of the Cook blunder. If you’d rather have seen the pick traded for a future pick, then such a pick – perhaps between Nos. 16 and 20 overall next season – is the true cost.
The Thunder, who took on Cook in exchange, used the No. 18 pick to draft Bledsoe, who was subsequently dealt to the Clippers for a protected future first round pick. So… at the very worst, Riley sacrificed his point guard of the future. At the very least, if he preferred the extra $1.2 million in cap space pick No. 18 eats up, he sacrificed a protected future first rounder. It’s hard to believe that the price to jettison Cook couldn’t have been substantially cheaper. As far as general managers go, Pat Riley got used by Sam Presti on that one.
The Heat did get the 32nd overall pick in the trade, which it used to acquire 22-year old University of Texas senior Dexter Pittman. Pittman is an undersized center, at 6’9.5″ without shoes, with a huge 7’6″ wingspan and the biggest hands in the draft (whatever that means). He tips the scales at over 300 pounds, having already dropped more than 60 pounds during his four seasons with the Longhorns and playing at nearly 400 pounds in high school. His nearly 21% body fat (fourth highest in draft history) suggests he still has a long ways to go with his conditioning. Read more…
The Chicago Bulls have a deal in place that would move Kirk Hinrich and the 17th pick to the Washington Wizards, freeing up enough cap space to pursue two maximum-salary players in this summer’s free-agent market, sources with knowledge of the Bulls’ plans said Thursday.
It wasn’t immediately clear what Washington would send to Chicago in the trade.
The deal can’t be officially consummated until July 8, when the Wizards will have room under the salary cap to absorb Hinrich’s $9 million contract without having to send back anything of similar value.
Since it’s a good-faith deal for the time being, there remains a chance it could fall apart. But according to one source, the Sacramento Kings are prepared to make a similar deal with the Bulls in the Wizards’ stead if that were to happen.
Despite the report, the trade doesn’t quite get the Bulls the required cap room for two max contract players. The last cap estimate provided by Commissioner David Stern was $56.1 million at the start of the playoffs. The Bulls would have enough room for a $13,838,492 offer after signing one maximum free agent.
That number is below the second max threshold by $2,730,417 — an amount which can not be bridged without saving money by moving Luol Deng. James Johnson and Taj Gibson combine to make $2,831,280, but they’d have a $947,208 roster charge coming back if they’re traded, so the Bulls would still be shy by $846,345.
As expected, center Joel Anthony has elected to forgo the 2010/11 player option he held with the Heat. Anthony faces a midnight Thursday deadline on his decision, with his inaction making him a free agent. The announcement cannot be made official until that time.
The decision frees up an additional $885,120 in spending money for Pat Riley’s ball club. The Heat now has just two players with guaranteed contracts, Michael Beasley and Mario Chalmers, and a total guaranteed payroll (which assumes James Jones will be bought out by June 30) of $7,672,629. With the cap projected at $56.1 million, Miami figures to have some $48,427,371 of available room.
The decision to opt out makes Anthony slightly less expensive to the Heat if the team hopes to retain him. With Anthony having played just three NBA seasons, the Heat can choose to make him a restricted free agent, which would afford the right to match any outside offers. To do so, Miami would be required to extend a qualifying offer of $1,060,120, which would reduce the team’s available room. However, the qualifying offer can be rescinded at any time prior to July 23, at the team’s sole discretion. If no qualifying offer is extended, or if it rescinded prior to July 23, Anthony would count $854,389 against the 2010/11 salary cap.
Independent of whether or not a qualifying offer is extended, the Heat would continue to retain Joel’s Bird rights until he is officially renounced.
Despite the decision by Joel to test the free agent waters, the Heat still has the clear inside track to retain him. In fact, the decision may have been mutual between player and team, and could pave the wave for Anthony to receive a substantial raise at little cost to the Heat.
For a list of all the Heat’s available options with Joel, click here.
The Boston Celtics have put their first-round pick in Thursday’s draft — No. 19 overall — on the market… with an eye toward making one more run at a championship next season.
The reasoning behind trading the pick, according to a source, would be to take the money that would be guaranteed to a first-rounder and spend it elsewhere.
Boston GM Danny Ainge figures to be looking for additional bodies to help fill out the roster for next season. If the Celtics are to make a run at one last title before breaking apart, they need help now. With Rasheed reportedly about to retire, the team will have just five players under contract for next season. The Celtics also hold the 52nd pick.
Ainge has been very adept at finding quality talent in the second round of past drafts (Glen Davis, Leon Powe, Ryan Gomes). Perhaps Ainge is considering dealing down for value, to pile up cheaper help which he believes to be just as useful as any prospect waiting at pick 19.
Miami has plenty of second round picks to offer, holding picks 32, 41, 42 and 48.
Should Pat consider trading picks 32 and 48 to Boston in exchange for 19?
Such a scenario would effectively mean the Heat will have discarded Daequan Cook’s contract for pick 48 and a swap of picks 18 and 19. For those of us that held the Heat’s first round pick in high regard, this certainly makes Riley’s initial trade much easier to stomach.