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Miami Heat A Slight Loser on Draft Night

June 27th, 2013 No comments
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Well, one of the Miami Heat’s bigger future assets is now not so big.

Pending league approval, which for salary cap reasons won’t come until July, the New Orleans Pelicans will reportedly trade center Nerlens Noel and a 2014 top-five protected first-round pick to the Philadelphia 76ers in exchange for point guard Jrue Holiday. The Sixers will also send its 42nd overall draft pick, point guard Pierre Jackson of Baylor, with Holiday.

Who won?

Not the Heat.

Holiday was an All-Star point guard. He was the team’s best player. He was young. A cornerstone. Now he’s gone.

By trading for Noel, the former Kentucky standout, the 76ers will also have no interest in bringing back center Andrew Bynum either.

And so, the Sixers have now lost former All-Stars at both the point guard and center positions, and replaced them with very little. With their No. 11 pick today’s draft, the Sixers selected point guard Michael Carter-Williams from Syracuse to replace Holiday. Noel, coming off a March 12 operation to repair a torn anterior cruciate ligament in his left knee, will replace Bynum, though he is not expected to be ready for play until at least the end of December.

The Sixers will also have a projected $18 million in salary cap room heading into the offseason, but nobody to spend it on. They aren’t likely to spend big, or long-term, dollars to attract top free agents, nor are such free agents likely to be eager to play for this roster.

This is a complete rebuild for Philadelphia.

They will be giving significant minutes to a rookie point guard in Carter-Williams, a vastly inexperienced fourth year shooting guard in James Andersen, a low-yield fourth year small forward in Evan Turner, a sophomore power forward in Arnett Moultrie, and a rookie center in Noel, amongst several other youngsters. That’s very likely a lottery team for the foreseeable future.

Not a good outcome if you’re the Miami Heat.

Prior to the trade, the Sixers had a strong shot at being an average but irrelevant team next season, perhaps a low-level playoff team in a not very deep Eastern Conference – horrible for them, but wonderful for the Heat.

The Heat hold the Sixers’ 2014 first round pick from its trade of Moultrie last season, conditioned upon the Sixers making the playoffs in either of the next two seasons. The lower the seeding for Philly within the playoffs, the better the pick would become for the Heat.

Philly was ninth in the conference last season, just one spot outside of the playoffs, with Atlanta, Boston and Milwaukee, all playoff teams last year, all rebuilding this year and figuring to get weaker. An eighth place finish for the Sixers in 2013-14 would translate into a possible No. 15 pick for the Heat in the strong 2014 NBA draft.

Now it would appear that Philly has chosen to sacrifice the present to concentrate on the future.

If Philly misses the playoffs next season, its first round pick will not get conferred to the Heat until 2015. If the Sixers then miss the playoffs the following season as well, the Heat would no longer be entitled to a first round pick. Instead, Philly’s obligation to the Heat would convert into consecutive second round picks in 2015 and 2016.

At this point, that appears all but certain.

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What Could a Ray Allen Opt Out Mean for the Heat?

June 27th, 2013 No comments
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The following post has been written in response to a column by Ira Winderman, a local beat writer who I enjoy reading and respect very much, in which it was stated that Ray Allen could not earn more from the Heat by opting out of his contract. As I often do all across the cyber universe of NBA basketball, I respectfully informed him that the Heat could in fact offer Allen both a higher starting salary and a longer contract by utilizing his Non-Bird rights if Allen were to first opt out. The revision of his column to reflect the correction has led to widespread speculation that Allen opting out is a forgone conclusion. While I have informed others of the possibility, I have never written about it on this blog because I do not believe it has a realistic chance to happen. I continue to believe that Allen will opt in by the June 29 deadline. The following post describes why. 

The plot keeps growing. And with it, so too the potential outcomes.

As expected, James Jones and Rashard Lewis have exercised their player options that will pay them $1.5 million and $1.4 million for next season, respectively. The Heat has also picked up its $4.0 million team option on Mario Chalmers.

The surprising revelation, however, is the apparent indecision of Ray Allen. Allen holds a $3.2 million player option. The common logic has been that – having hit the most iconic shot of the 2013 playoffs, perhaps the single biggest three-pointer in Miami Heat history, perhaps the single biggest field goal of his life, and, as a result, having won his second NBA title – he was surely rejuvenated and excited to return.

That notion now appears at least somewhat in doubt.  Read more…

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A Look at the Finances Behind the Miami Heat’s Success

June 25th, 2013 4 comments
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Micky Arison was one of five NBA owners who voted against the current Collective Bargaining Agreement back in December of 2011. It was mostly a symbolic move – he knew the agreement would pass either way. But the point he was making was clear: the harshest elements of the new contract, the more penal luxury tax system and the new revenue sharing model, were clearly aimed directly at his Miami Heat.

The lockout having ended, the season was spared and the Heat went on to win its first, and now its second, championship of the Big Three era. Heat fans have thus far been spoiled by Arison’s willingness to spend his way into ensuring the future is bright in Miami. But could the day of reckoning the league had envisioned for the Heat soon be upon us?

Player salaries, when combined with luxury tax obligations, can get quite expensive for a title contender such as the Heat. Revenue sharing obligations only increase that financial burden.

So the question becomes: How profitable is the Heat organization?

First, some background.

Micky Arison is a multi-billionaire.

He is the son of Ted Arison, co-founder of Carnival in 1972. He became Chairman and CEO of Carnival in 1979. He announced his intention to step down as CEO earlier today, retaining his role as Chairman, but he nonetheless owns 111 million shares of the company, currently valued at a whopping $3.9 billion!

He is the majority owner of the Miami Heat, having purchased the team from his father and two other men, Billy Cunningham and Lewis Schaffel, for $68 million in 1995, who themselves paid out $32.5 million in expansion fees in 1988 to bring the team to Miami.  Read more…

Should the Heat Trade into the First Round of the 2013 NBA Draft?

June 25th, 2013 4 comments
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The Miami Heat have no first or second round picks in the 2013 NBA Draft, which is to be held on June 27 at the Barclays Center in Brooklyn, New York.

The Heat’s first round pick was traded to the Cleveland Cavaliers as part of the LeBron James sign-and-trade on July 9, 2010. It was subsequently traded to the Los Angeles Lakers, and is now the property of the Phoenix Suns. It has become the No. 30 and final pick in the round.

The Heat also acquired a first round pick from the Philadelphia 76ers in the Arnett Moultrie draft-and-trade on June 28, 2012. However, the pick is lottery protected through 2015; if not conveyed by 2015, it will become consecutive second round picks in 2015 and 2016. Since the Sixers missed the playoffs this past season, the pick will be conditionally transferred to the Heat next year.

The Heat’s second round pick, which has become the No. 60 pick in the draft, is property of the Memphis Grizzlies. It was included in the Dexter Pittman trade on February 21, 2013.

Currently a bystander to Thursday evening’s activities, should the Heat attempt to trade into the first round of the draft?  Read more…

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Analyzing A Potential Miami Heat Offer to Chris Andersen

June 24th, 2013 3 comments
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When the Miami Heat signed Chris “Birdman” Andersen in January, they were hoping for an extra body off the bench who could bring energy, rebounding and defense. Since joining the team, the veteran forward/center has given them much more than that.

Outside of LeBron James, Andersen was the Heat’s most important player on offense during various stretches of the regular and postseason. Andersen was the beneficiary of James’ creative passing, scoring mostly at the rim, mostly on dunks, adding vertical floor spacing to the Heat’s offense, drawing double and triple teams away from the perimeter, and forcing opposing defenses to pay the ultimate price for their help defense.

Outside of James, he was also the Heat’s most important player on defense at times. James has praised Birdman profusely in the past, comparing him to his former Cleveland Cavaliers teammate Anderson Varejao for his hustle and energy. He blocks shots, he’s versatile enough to check both frontcourt positions, and he rebounds the basketball.

The Heat repeated as champions because they have LeBron James. But they wouldn’t have been nearly as dominant as they were without the contributions of their many secondary players, guys who know their roles and do what they’re supposed to do. Birdman has shown that he can be as valuable to the team as anyone not named James, Wade or Bosh.

He was a wonderful addition for the Heat this past season. A perfect fit. The missing piece at a position of desperate need. But he’s also a soon-to-be 35-year-old, low-minute, high-energy reserve. How should the Heat value such a player? How much can they afford to pay?

Basic mathematics could provide the answers.  Read more…

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The Fate of Mike Miller

June 23rd, 2013 No comments
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It’s still time for celebration in Miami, the Heat just having won its second NBA title in as many seasons. The champagne is still flowing, the parade is still upcoming, and the sheer joy of the moment is still bringing smiles to all of our faces.

For the front office, however, it’s time to get to work. There are tough decisions to be made.

Toughest of all may be the case of Mike Miller.

Miller is a truly wonderful guy. He’s classy. He’s humble. He’s a family man with a touching story. He’s a great teammate. He’s a great player. He can hit a barrage of clutch three-pointers to clinch NBA titles. He can hit them without shoes on. When he’s right, he can be the second most valuable player on the team.

But the Heat is in a difficult financial position and, as such, his tenure on the team is in doubt.

He knows it. He recently sold his beautiful Pompano Beach residence at auction in preparation.

Was he right? Were his actions premature? What are the alternatives for Miller and the Heat?  Read more…

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Decision Time Looming for Four Miami Heat Players

June 22nd, 2013 No comments
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The clock is ticking. Within a week, the first decisions for next season need to be made.

By June 29, there will have to be resolution with the four players on the roster with options for the 2013-14 season.

Of those decisions, only one is at the Heat’s discretion, the third and final year on Mario Chalmers’ contract. It is a $4 million team option. It almost assuredly will be picked up, a bargain price for an NBA starting point guard.

Three other options are out of the Heat’s control – player options held by guard Ray Allen and forwards James Jones and Rashard Lewis.

Allen has been silent on the issue of his $3.2 million option. But having hit the most iconic shot of the 2013 playoffs – and perhaps the single biggest field goal in Miami Heat history – resulting in his second NBA title, he is surely rejuvenated and excited to return. Lewis and Jones have each already expressed their excitement in returning with varying levels of certainty.

This is a happy team. It is a back-to-back NBA champion. It is the prohibitive favorite to get a third consecutive. Why would anyone choose to leave?

All four are likely to return.

But, for Lewis and Jones – who are playing at or near the minimum salary – there is a deeper story here. With the Heat in a financial crunch and attempting to keep its core together, the Heat and salary cap guru Andy Elisburg need to get creative. They have a golden opportunity to save as much as $3.1 million next season, and they should pounce. Read more…

2013 NBA Championship Prize Money

June 21st, 2013 2 comments
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Update (06/15/14): Attached are the Player Playoff Pool allocations and distributions for the 2013-14 NBA season. 

The Miami Heat, who have now won their third NBA championship in team history, get to take home the Larry O’Brien trophy for the second time in as many seasons. The team also gets to take home a little pocket change: $3,811,608 in playoff bonus money.

In the NBA, there is no championship prize money per se – just a $13 million “Player Playoff Pool” that is funded by playoff gate receipts and is then allocated to playoff teams. The amount earned escalates as one’s team advances in the playoffs.

As a team, the Heat earned $2,302,232 from the pool for winning the championship, compared to the $1,525,515 the San Antonio Spurs received as runner-up.

Earlier, the Heat earned $374,947 for finishing with the best record in the NBA, another $328,078 for finishing with the best record in the Eastern Conference, $194,016 for participating in the first round of the playoffs, $230,853 for participating in the Conference Semifinals, and $381,482 for participating in the Conference Finals.

Read more…

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Miami Heat Repeat As NBA Champions!

June 21st, 2013 No comments
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Miami Heat Champions

Their validation came in the form of a second consecutive championship celebration that began here late Thursday night and probably won’t end for days. And as the final seconds ticked off the game clock inside AmericanAirlines Arena, LeBron James, Dwyane Wade and Chris Bosh reveled in the moment. They earned it!

For Miami’s Big Three, the team’s 95-88 victory over San Antonio in Game 7 of the N.B.A. Finals completes a journey several years in the making. The Finals disappointment against Dallas in 2011, unforeseen setbacks and relentless criticism – much of it misguided – no longer mattered. They accomplished what they set out to do: win multiple N.B.A. titles as teammates.

That singular pursuit is what prompted the incomparable James to walk away from the team that drafted him, incurring the wrath of fans in his home state. It’s why Wade, one of the game’s greatest ever superstars, willingly stepped aside to let basketball’s best player lead the Heat. It’s why Bosh allowed himself to be denigrated from franchise player to disrespected third wheel.

The payoff was surely worth it.

In winning consecutive N.B.A. championships, the Heat joins an exclusive club that includes only the Boston Celtics, Chicago Bulls, Detroit Pistons, Houston Rockets and the Los Angeles Lakers. The list of teams that have made at least three straight Finals appearances in doing so is even shorter: the Celtics, Bulls, Pistons and Lakers.  Read more…

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Revised Luxury Tax Projections Come in Below Expectations

June 2nd, 2013 No comments
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The NBA’s salary cap and luxury tax threshold aren’t expected to rise as much as the league initially projected, a development that could have significant implications for the Miami Heat.

Estimates that were provided by the league to NBA teams on May 31 have the salary cap rising to just $58.5 million and the tax threshold to just $71.6 million for the 2013-14 season, both slight increases from the current levels but considerably lower than what had been projected. The league had previously guided to $60 million and $73 million, respectively, at the beginning of the season. The numbers will be finalized only after the NBA does a full season audit during the first week in July.

The revised projections suggest that revenues for the 2012-13 season are falling short of expectations and, as a result, player salaries are correspondingly too high, triggering escrow adjustments to the following season’s salary cap and tax threshold.  Read more…

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