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The Gortat Situation

Continuing with the theme of the players I want, but the Sixers probably won't get, I thought I'd lay out the situation with Marcin Gortat to the best of my ability. After the jump I'll do my best to explain the CBA, as it applies to Gortat and his situation this Summer.

All the information about the CBA I'm using in this post comes from this FAQ, the salary numbers from this page.

OK, so on July 1st, Marcin Gortat will become a restricted free agent, assuming the Orlando Magic extend a qualifying offer to him, which they will. The qualifying offer will be for one year, roughly $890,000 (125% of his 08-09 salary).

Gortat is a restricted free agent, here's why:

Restricted free agency exists only on a limited basis. It is allowed following the fourth year of rookie "scale" contracts for first round draft picks. It is also allowed for all veteran free agents who have been in the league three or fewer seasons.

Gortat will have a few options after July 1st

  1. He can sign the qualifying offer and play for the Magic next year, basically for the minimum salary
  2. He can sign can re-sign with the Magic
  3. He can sign an offer sheet with another team, then wait and see if the Magic will match it.
Those are the basics, now things get a bit convoluted. Gortat qualifies as an Early Bird free agent, meaning Orlando can sign him for 5 years, starting at the average salary (basically, the MLE level which was $5.85M last season), with 10.5% yearly raises. So the most they could offer him (assuming the MLE stays the same) would be 5 years, $36,072,034.

When get into how much other teams can offer him, the Gilbert Arenas provision comes into play. In a nutshell, the Arenas provision protects teams from being outbid for their restricted free agents. Basically, teams with cap space can offer large contracts to restricted free agents with less than 3 years of service time, but the most they can offer in the first season is the average salary (the MLE). Then the contract can have an 8% bump in the second season, then in the third, it can have an extremely large bump, then yearly increases of 6.9% in the fourth and fifth years. The catch is that the team trying to sign the restricted free agent must fit the average yearly salary under their salary cap, while the team which owns the Early Bird Rights must only fit the first season.

I'll use a real-world example to illustrate. Let's say Detroit winds up with roughly $19M in cap space. They sign Ben Gordon to a 5-year deal with a first-year salary of $10M. They now have $9M in cap space remaining. That means the most they could offer Gortat is $27M for 3 seasons, $36M for 4 seasons and $45M for 5 seasons. The five-year contract would look like this:

  • Year 1: $5,850,000 (average)
  • Year 2: $6,318,000 (average + 8%)
  • Year 3: $10,237,605 (bump year)
  • Year 4: $10,944,000 (bump +6.9%)
  • Year 5: $11,699,136 (another +6.9)

As you can see the contract escalates greatly in that third season. Now if Detroit made this offer to Gortat, Orlando could then match it using their Early Bird Rights or the MLE, whichever is available. Personally, I find it doubtful they'd be willing to pay their backup center $45M over the next five seasons, especially considering the deal would put them over the luxury tax threshold for the foreseeable future, so they'd essentially be paying $90M for an insurance policy.

Now, for the teams already over the cap, like the Sixers, the most they can offer is a five-year deal starting at the MLE and increasing 8% each season. Here's what the Philly max for Gortat looks like:

  • Year 1: $5,850,000
  • Year 2: $6,318,000
  • Year 3: $6,823,440
  • Year 4: $7,369,315
  • Year 5: $7,958,860

Five years, $34,319,615.

Now that we have a barometer for how much the Sixers can offer, it simplifies things a little bit. Every team which is currently over the cap can offer the same amount, but for teams with cap space to offer more, they need to have significant cap space because the first year has a ceiling on it. This means, a team with $7M in cap space really can't offer any more than the Sixers could. Anyone who wants to outbid the MLE would really need to use almost $8M in cap space to get the job done, and they'd be committing $40M to Gortat in a heavily back-loaded contract.

So what does all this tell us? Well, for one thing, if the Sixers want him, and I mean really want him, there is a chance. They'd probably have to act quickly, offer the Philly max, and promise him starter's minutes. All things I'd have no problem with. The bonus they have is that they don't have to renounce anyone's free agent rights to make the offer. Whereas a team like Atlanta has Mike Bibby, Josh Childress and Marvin Williams on their books. They'd have to renounce those guys to clear enough cap space to top the Sixers' offer. And they couldn't use the MLE and then use the cap space gained from Bibby's departure later. Detroit would have to renounce Rasheed and Iverson to clear enough space.

As far as I can tell, Memphis and Oklahoma City are the only teams who would be in a position early in free agency to top the max offer the Sixers could make. One of those teams is probably going to draft Thabeet, and I think you can probably cross Memphis off the list because (a) they're cheap and (b) they already used the MLE to sign a Dwight Howard backup, and it didn't work out very well.

I believe if the Sixers act decisively, put the money on the table quickly for Gortat and promise him starter's minutes, there's a chance they could lock him down before other teams can get involved and drive the price up. That's if there are teams out there willing to lock up $10M/year on The Hammer. Will the Sixers do it? I doubt it, but I would.
by Brian on Jun 16 2009
Tags: Basketball | Free Agents | Marcin Gortat | Offseason | Sixers |