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Posts Tagged ‘Chris Bosh’

Miami Heat’s Great Hope Is … Josh McRoberts and Danny Granger?

July 8th, 2014 No comments

The Big Three era Miami Heat were always the ideal test case for a new collective bargaining agreement designed primarily as a cash grab for owners, but also with a secondary goal of engineering greater competitive balance around the league.

The new CBA went about achieving its secondary goal in large part by implementing a far more punitive luxury tax(1). Spend a lot on players, and you’re going to face a crippling “incremental” tax penalty that gets more severe as you add payroll. Keep spending year after year and eventually you’ll tack onto it the dreaded “repeater” tax.

It’s working. Just five NBA teams paid the tax this past year; that’s tied for the fewest ever in a tax-triggered season. Competitive balance is more prevalent today than at any point in recent history. Team salaries around the league have leveled out dramatically. The spending habits on the high end are down significantly, with particular emphasis for those in smaller markets which can’t support the weight of such enormous tax bills.

No one team has felt the burden of the new tax structure more than the Miami Heat. Some would say that was always the plan – a plan brought about by the demands of envious fellow owners in the wake of the Big Three formation. The Heat have had to make several painful and wildly unpopular cost-cutting (e.g., waiving Mike Miller via the amnesty provision) and cost-controlling (e.g., not utilizing the mid-level exception this past season) moves since the lockout, as a direct consequence to the harsh realities of the new CBA.

It wasn’t all that difficult to forecast. People have been predicting the inevitable demise of the Heat, as presently constructed, for three solid years. Whether owner Micky Arison could afford to keep his team together was never in question; he’s a six-billion-dollar man. But the limitations of his market – the Heat’s designated market area is good for just 17th overall, among the league’s 30 teams; smaller than, for example, that of the Minnesota Timberwolves – have made it virtually impossible to maintain some semblance of profitability while spending deep into the tax (at least in the near-term).  Read more…

Miami Heat Create NBA-Record $55 Million in Potential Cap Space

June 29th, 2014 5 comments

Many years from now, Saturday, June 28, 2014, could be remembered as a critical day in Miami Heat history. It marks the day when guard Dwyane Wade and forwards Chris Bosh and Udonis Haslem declared their intentions to join LeBron James and Chris Andersen in opting out of their contracts. It could ultimately mark the day in which the destruction of the Big Three era was initiated in earnest, or the day in which the remodeling of Pat Riley’s two-time championship-winning creation received a major boost.

Agent Henry Thomas, who represents all three players, has reportedly informed Heat president Pat Riley of their choices. Wade will exercise his Early Termination Option for the remaining two years and $41.8 million on his contract, Bosh will do the same for the two years and $42.7 million remaining on his contract, and Haslem will not exercise his player option for the lone season remaining on his $4.6 million contract.

Technically, there is no mechanism to notify the league that an option or ETO will not be exercised. Since the contracts of Wade and Bosh contain ETOs for this summer, they are required to inform the league of their intentions. Since Haslem’s contract contains a player option, he need do nothing but wait.

These actions, particularly in the wake of James, Wade and Bosh meeting last week on Miami Beach, make it rather clear that the Heat’s stars, as well as its supporting players, have decided to work together to provide the Heat the salary-cap flexibility with which to add additional components to a roster that earlier this month lost in the NBA Finals to the San Antonio Spurs, cutting spectacularly short the Heat’s bid for basketball immortality – four straight NBA Finals appearances and three straight NBA titles, a feat which has only been accomplished once in league history.

Without the opt-out decisions, the Heat would have gone into the offseason far in excess of what is projected to be a $63.2 million salary cap for the 2014-15 season, and without much ability to materially improve. Instead, the moves enable the Heat to create as much as an all-time NBA-record $55 million in cap space with which to reconfigure the roster(1).  Read more…

Would the Big Three Take Less to Help the Miami Heat?

June 21st, 2014 5 comments

Update (6/28): I wrote the following article several weeks ago, and posted it exactly one week ago. Since that time, several things have changed (e.g., the Heat traded up in the draft to select Shabazz Napier, several Heat players opted out of their contracts, the Heat have been rumored to be seeking a trade partner for Norris Cole, etc.), which slightly alter the figures presented in this post. This table provides an updated depiction of the hypothetical situation described below.

The day LeBron James, Dwyane Wade and Chris Bosh agreed to join together with the Miami Heat in the summer of 2010, they laid out a plan. They would each play four years together, then re-evaluate. They each signed nine-figure, six-year deals containing opt out rights prior to the final two. They were expecting titles. We all were.

Through the first three of those years, all was as projected to be. Three straight NBA Finals appearances, two straight titles. But that was before this past year turned into a disaster, before they got throttled by the San Antonio Spurs.

James, Wade and Bosh are all on vacation now, a sort of rejuvenation for a trio who have played more basketball over a four year stretch than any other in league history. They will each take some time to consider their futures, to consider whether or not they wish to terminate their contracts.

The wait is unnerving. It is a reminder that the Heat and James, in particular, have a very uncertain future together, that his potential free agency, which could arrive in just days, looms over this city with as much significance as did Wade’s four years ago. It’s caused us to lose our equilibrium. It’s caused us to lose our perspective. We need to “get a grip” on reality. The Miami Heat, as presently constructed, can still be a championship-caliber team.

Sure, the team has it flaws. Lots of them. And they need to be addressed. But we, as fans, are hoping for much more than that. Cutting corners in the repair of a leaky dam will eventually cause it to burst. Like it did in 2006-07. Which caused 2007-08. Nothing short of a complete overhaul, then, will appease us.

A tear down and restructure requires sacrifice. It requires James, Wade and Bosh to each opt out of his contract and take less. Much less. It’s the only way. But is it possible?  Read more…

The Anatomy of a Spectacular Miami Heat Failure

June 15th, 2014 4 comments

The Miami Heat’s bid for basketball immortality – four straight NBA Finals appearances and three straight NBA titles, a feat which has only been accomplished once in league history – has fallen spectacularly short. In the wake of this colossal failure, we’re all left wondering how it all went so wrong so quickly – how our team ended up looking so old, so slow, so flawed, so unable to adapt, so unable to defend.

Is it an organizational philosophy that failed us?

“I don’t think you win championships with young, athletic players that don’t have experience. I think we’ve learned over the years that building with young players is very frustrating.”

That was Pat Riley in June 2011, describing his aversion to developing youthful talent.

It is a philosophy that he has expressed many different times in many different ways over the years. It is a philosophy that has permeated his every decision in preparation for and during the Big Three era. It is a philosophy upon which the Stepien-like decisions to surrender a whopping six future first round draft picks in a period of less than five months from February to July 2010 were predicated. It is a philosophy upon which the decision to constantly fill the roster with post-dated bench-warming veterans was predicated.

It was a philosophy which, initially, didn’t bother us. We were all so captivated by the moment. Riley had a plan. He executed upon it with deadly precision. He got the big things so right that it didn’t matter how he handled the little things. In Riley we trusted.

The winning that followed only validated that ideology.

But, quietly, things weren’t as wonderful as they appeared. In the wake of the signings of Dwyane Wade, LeBron James and Chris Bosh in the summer of the 2010, the front office lost sight of its need to build for the future. Everything was always only about the moment.

Some of us couldn’t help but wonder. If your mission is to win as many titles as possible while the Big Three are still in their primes, then wouldn’t you like to have some upside around? Some players who will be getting better with time? Some players who can keep the energy level high when the stars need to rest?

Riley has always had a clear affinity for the seasoned veteran versus the inexperienced rookie. He’d rather have the sure thing than the potential next big thing. But as much as these veterans are low risks to make stupid, rookie-type decisions, none will break free off the dribble in crunch time or make that key defensive stop and then sprint up the floor for a breakaway jam – they’re zero risks to become more athletic, to develop new parts of their games, or to be usable as trade bait should the need arise.  Read more…

The Cost of All Those Traded Draft Picks Becoming Clearer for Miami Heat

April 20th, 2014 4 comments

In the summer of 2010, the Miami Heat changed the course of team and league history. As a result of two trade calls held with the NBA league office in less than an hour on July 10, the Heat completed sign-and-trade transactions with both the Cleveland Cavaliers and Toronto Raptors, acquiring LeBron James and Chris Bosh in the process.

James and Bosh were to be paired with Heat incumbent free agent Dwyane Wade as the launching point for what would ultimately become the Big Three era. In the three subsequent seasons, the Heat have gone on to reach the NBA Finals all three times, winning the NBA championship twice. Their pursuit of a third consecutive title begins tonight.

Amidst the jubilation of the day, some questioned the manner in which Heat president Pat Riley chose to acquire his two new players. The Heat had the necessary cap room at the time to sign them outright. Why, then, pursue the trade?

Both players were eligible for maximum salaries of $16.6 million in the first year of any new contract signed, whether it was with their prior teams, with the Heat, or with anyone else. But while the starting salary was to be the same no matter where they signed, the NBA’s Collective Bargaining Agreement gives the home team a financial advantage when it comes to re-signing its own players. Both players’ home teams were eligible to offer their respective player one more year (six instead of five) and bigger annual raises (10.5% instead of 8%). That translated to a maximum potential offer of $125.5 million over six years, versus the $96.1 million over five years that the Heat could offer.

James and Bosh utilized the structure not to make the increased money, but rather to mitigate the impact of taking less. They leveraged the sign-and-trade structure to take a reduced starting salary of $14.5 million – $2.1 million less than the maximum – in order to accommodate the contracts of Mike Miller and Udonis Haslem. (Wade, too, did the same).

Each structured the longer six year deal with the higher 10.5% maximum raises, but with the lower starting salary. The contracts paid out $109.8 million over the six years, roughly $15.5 million less than they otherwise could have made had they accepted full max deals.

The sign-and-trade structure, however, came at a cost for Miami.  Read more…

Living in a dream world… if only for a moment

June 22nd, 2011 2 comments

Pat Riley had a plan. He executed upon it with deadly precision. He got the big things so right that it almost didn’t matter how he handled the little things.

But not all of those little things went perfectly.

What if he did better with those little things? With the 2011 NBA draft now bearing down on us, would it have made any difference?

Navigating the uncertain waters of the draft has always been a special kind of hell for Riley. Riley’s draft record with the Heat reads more like a comedy of errors than it does a serious attempt at identifying talent.

In 2003, Riley nearly drafted Chris Kaman with the fifth overall pick before being talked into selecting Dwyane Wade by his staff. Whew!

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.

Perhaps it is something of a blessing that he now has just eight picks, just two first rounders, to deal with over the next five years.

Was it a combination of strong basketball decisions or his strong aversion to the type of scrutiny that comes with the draft that led Riley and the Miami Heat to this position?

Riley again yesterday openly described his aversion.

“I don’t think you win championships with young, athletic players that don’t have experience. I think we’ve learned over the years that building with young players is very frustrating.”

But what if things were different?

What if the Heat had made some different decisions along the way?

There was Dorell Wright.

In a season to that point mired in frustration, and seemingly defined by the anticipation of things to come, keeping Wright at the trade deadline was perhaps the single most popular decision the Heat brass made. Riley and crew decided that Wright’s presence was more of a priority than the estimated $7.7 million addition to owner Micky Arison’s already fat wallet.

Wright responded in kind, offering some of the best work of his career.

But not all of us were so thrilled. A select few among us realized that if the Heat were to be successful in its bid for three max contract free agents, the team would need to soak up every possible opportunity to create depth around them.

The Grizzlies were offering a lottery-protected first round pick in return for his services. This select few realized that, despite Wright’s overwhelming popularity and still very much untapped potential, 26 final games from a free-agent-to-be in a season going nowhere was simply not worth $7.7 million and a future first round draft pick. That pick ended up being No. 20 overall in tomorrow’s draft.

There was Daequan Cook.

We all understood the rationale behind surrendering the No. 18 overall pick in last year’s draft in order to be free of all obligations to Cook. With such high stakes, Miami could hardly afford to gamble on the $2.2 million devoted to Cook.

But not all of us agreed on the approach. Some of us felt that the $2.2 million could rather easily be shed simply by offering a potential suitor up to the $3.0 million cash limit the CBA allows as well as a selection of second round picks, if necessary. How many unprofitable smaller-market teams could realistically pass up the opportunity to add backcourt depth in the form of a young and developing Three-Point Shootout champion not only free of charge, but at an $830k profit?

These same people felt that treating the No. 18 overall pick with such apathy was imprudent, that it could be better utilized to draft a potential future starter, if available, and in a trade for a similar such pick in a future draft if notThey realized that while drafting a player would eat into the team’s valuable cap space, the very situation the Heat were trying to rid themselves of with Cook, in this case we’d only be talking about an incremental $760K, or roughly equivalent to the cap space the Heat was willing to eat up to retain the Bird rights of Joel Anthony. They realized that sacrificing one for the other was a good gamble.

There was the Big Three.

When Chris Bosh and LeBron James made their decisions, there was elation. When they were signed, there was controversy.

Surrendering four first round picks and two second round picks, in addition to two large trade exceptions, seemed a bit excessive to some of us for a couple of players who were otherwise already committed to the Miami Heat. It seemed a bit excessive in return for nothing more than a sixth season tacked on to an already huge five-year contract – a sixth year that both are likely to opt out of anyway.

The question has been asked. What if things were different?

Let’s try to answer it.

Mario Chalmers and Eric Bledsoe would be battling it out for starters minutes at the point.

Dwyane Wade would still be playing under a six year contract, earning $6 million more than he is today. Eddie House would be battling it out with Danny Green for reserve two-guard minutes.

LeBron James would be playing under a near maximum contract, sacrificing that sixth year guarantee in exchange for an added $3 million over the first five. Mike Miller would be battling it out with James Jones for reserve small forward minutes.

Chris Bosh would be playing under a near maximum contract, sacrificing his sixth year guarantee in exchange for an added $3 million over the first five. Udonis Haslem would, unfortunately, be playing under a five-year contract elsewhere, earning $13 million more under a full mid-level exception contract than he is today.

The disastrous contingent of Heat centers would remain unaltered. But, at least, Anthony would be playing under a much more palatable minimum salary contract.

And the Miami Heat would have five – yes, five! – more first round draft picks and two more second round draft picks over the next five years, including a potential unprotected first round pick from the Raptors in 2015 that could very easily turn into the No. 1 overall pick in the draft in the season immediately after the contracts of James and Bosh would expire.

In short, the Heat would have produced the very same roster, save for adding Eric Bledsoe and Danny Green and subtracting Udonis Haslem, and would have stockpiled a whopping seven first round picks and eight second round picks over the next five years.

That’s 15 picks in just five years! No other team in the league has anywhere near that total.

(For those who are counting, the first round picks would have been: Miami’s own 2011-15, Memphis’ 2011, and Toronto’s potentially unprotected 2015. The second round picks would have been: Miami’s own 2013-2015, Oklahoma City’s 2011, Minnesota’s 2011 and 2014, New Orleans’ 2012, and Memphis’ top-55 protected 2012.)

One has to wonder.

What would two first round picks (Nos. 20, 28) and a high second round pick (No. 31) get you? A top ten pick in this year’s draft?

What would two first round picks (Nos. 20, 28), a second round pick (No. 31), and what figures to be a fully unprotected Raptors first round pick in 2015 get you? The No. 2 overall pick from a Minnesota Timberwolves team actively looking to trade it?

The possibilities with that grouping of picks would have, in this fictional reality, been endless.

If Riley’s aversion to the draft was ever present, think of the potential trade possibilities. By way of example, rumor would have you believe that the Phoenix Suns were shopping Marcin Gortat and their No. 13 pick for the No. 2 pick. Imagine if the Heat had acquired that No. 2 pick, and then pulled the trigger on this trade (involving, perhaps, Haslem, the unguaranteed contract of Pittman, and any one of the minimum contractors who picks up his second year option to make the math work).

How would Gortat look in a Heat uniform? He’s huge, he’s athletic, he’s among the best pick-and-roll operators around, he’s got a soft touch around the rim, he’s got good range, he’s a solid post defender, and he’s a beast on the boards. Is there a more perfect fit for this Miami Heat team, outside of Dwight Howard, in the whole of the NBA? Can you imagine how dominant such a Big Four would be?

With the Heat second team backcourt flush with youthful talent, how would frontcourt options such as SF Kawhi Leonard, PF Markieff Morris, or C Nikola Vucevic look with that No. 13 pick?

How would it feel to have secured both Gortat and one of the above selections, and still have four first round and seven second round picks to play with over the next five years?

It’s not as if an entirely unrealistic scenario is being painted here. Many of us were questioning each one of these little decisions made by Riley and his crew as they were happening. Of course, they are now important only for those among us who choose to live in the past.

The lesson, however, remains the same: Ignore the NBA draft at your own peril.

Everything is Done: How Did It All Happen?

July 17th, 2010 5 comments

The Miami Heat finished last season with 16 players under contract and a team salary far in excess of the salary cap. They then created enough salary cap room to sign everyone who is on the roster today. Now they are far in excess of the salary cap once again.

So how did it all happen? How did they manage to get so far below the salary cap and then above it again all in the same season? With creative financing!

Everything has now been finalized. It’s done. Here’s a step-by-step breakdown.

(Note: The actions below, in some cases, may be out of order. They have been structured so as to make evident the Heat’s thought process along the way, as well as to promote ease of reader comprehension. Full comprehension also requires an understanding of cap holds and roster charges, which are described in detail here.)

This is a snapshot of the Heat’s salary cap situation at the end of last season:

Read more…

Dwyane Wade the Victim of Salary Cap Mistakes By His Agent and Team

July 15th, 2010 No comments

Miami Heat general manager Pat Riley and salary cap expert Andy Elisburg have been widely praised not only for their ability to recruit LeBron James, Chris Bosh and Mike Miller to join Dwyane Wade and Udonis Haslem in South Florida but also for their ability to structure their contracts to fit within the confines of a $58.044 million salary cap. Wade, however, has reason to be less than thrilled – with the Heat organization but, more importantly, with agent Henry Thomas.

Wade, James and Bosh were all eligible to receive maximum contracts with a starting salary of $16,568,908. However, in order to accommodate the contracts of Miller and Haslem, each graciously took less. The first year salaries in the contracts of James and Bosh have been finalized at $14,500,000, while the first year salary for Wade has been finalized at $14,200,000.

It remains unclear as to why Wade took a bigger discount than his Big Three cohorts. What is clear, however, is that it was unnecessary. The Heat had the ability to create the necessary room to allow Wade’s contract to match that of James and Bosh, with room to spare, without impacting the contract of any other player. The $300,000 discrepancy will wind up costing Wade $2,272,500 over the life of his deal.

Understanding how this would have been possible necessitates an understanding of certain league rules.  Read more…

A Story of Sacrifice for the Miami Heat

July 15th, 2010 No comments

The contracts are all signed. The final numbers are all in.

We now know exactly how much each member of the Big Three sacrificed, why exactly they sacrificed, and where exactly the savings went.

Each member of the Big Three was eligible for a maximum salary of $16.6 million in the first year of any new contract signed, whether it was with their prior teams or with anyone else. But while the starting salary was to be the same no matter where they signed, the NBA’s Collective Bargaining Agreement gives the home team a financial advantage when it comes to re-signing its own players. The home team is eligible to offer his player one more year (six instead of five) and bigger annual raises (10.5% of the first year salary instead of 8%).

Sign-and-trade transactions capitalize on this concept, in that they allow the to-be-traded player to be technically signed by his home team, and then be immediately traded to his new team. Pat Riley structured sign-and-trade transactions with both the Raptors (for Bosh) and Cavaliers (for James). No maneuvering for Wade was necessary because the Heat is already his home team.

The Heat’s trade partners were willing to accommodate the Heat, but only at a very steep cost. To the Raptors, the Heat sent its 2011 first round pick and returned the first round pick previously acquired from the Jermaine O’Neal trade in February 2009. To the Cavaliers, the Heat sent its 2013 and 2015 first round picks, gave Cleveland the option to swap first round picks in 2012, as well as a pair of second round picks. In total, the Heat surrendered four first round picks and two second round picks over the next five years to make the sign-and-trades happen.

The sign-and-trade approach increased the total potential value of the contracts of each of Bosh and James. Without the sign-and-trade approach, each would have been eligible for a five-year contract, starting at $16.6 million with annual raises of up to 8% of the starting salary, totaling $96.1 million. With the sign-and-trade approach, each player, and Wade, became eligible for a six-year contract, starting at $16.6 million with annual raises of up to 10.5% of the starting salary, totaling $125.5 million.

Each player then gave back a portion of that increase to accommodate the contracts of Miller, Haslem and other such things. The Big Three took discounts in order to accommodate the following:  Read more…

It’s Official!!!

July 10th, 2010 15 comments

With 13,000 Miami Heat fans anxiously waiting in AmericanAirlines Arena to welcome its newest trio of superstars, Dwyane Wade, LeBron James and Chris Bosh were upstairs finalizing their contracts. Minutes later, they emerged from a cloud of smoke, along with some unexpected news: They all took discounts large enough to accommodate the potential signings of both Mike Miller and Udonis Haslem in the days ahead.

James and Bosh signed matching six-year contracts, which start at $14.5 million and pay out a total of $109.8 million. Wade took an even bigger discount to stay in Miami, signing a six year deal which starts at $14.2 million and pays out a total of $107.6 million. They could have received $125.5 million apiece if they had demanded the maximum value allowed under the NBA’s collective bargaining agreement.

Each was eligible for a maximum starting salary for next season of $16.6 million, whether it was with their prior teams or with anyone else. But while the starting salary was to be the same no matter where they signed, league rules give the home team a financial advantage when it comes to re-signing its own players. The home team is eligible to offer his player one more year (six instead of five) and bigger annual raises (10.5% of the first year salary instead of 8%).

Sign-and-trade transactions capitalize on this concept, in that they allow the to-be-traded player to be technically signed by his home team, and then be immediately traded to his new team. Heat president Pat Riley therefore structured sign-and-trade transactions with both the Raptors (for Bosh) and Cavaliers (for James). No maneuvering for Wade was necessary because the Heat is already his home team.  Read more…