The NBA released the final salary cap, luxury tax and mid-level exception figures today, the first day free agents can sign contracts. After the jump we'll talk about the figures and try to nail down where the Sixers stand.
The NBA is in trouble. Maybe not from a "the league is going to fold" perspective, but absolutely from a teams are spending way too much money perspective. When we look at these numbers, you'll see what I mean.
2008-2009 Salary Cap: $58.68M
2009-2010 Salary Cap: $57.7
2008-2009 Luxury Tax Threshold: $71.15M
2009-2010 Luxury Tax Threshold: $69.92M
2008-2009 Mid-Level Exception: $5.585M
2009-2010 Mide-Level Exception: $5.854M
In a nutshell, the salary cap and the luxury tax rise and fall in direct proportion to how much money the league as a whole makes. The Mid-Level exception is the average salary in the league. When league-wide income is falling and the average salary is climbing, something has to give.
The drop in salary cap and luxury tax threshold were expected, but it's not this season that's really the issue. A drop of under 2% isn't going to kill anyone. A memo the NBA apparently sent out, which ESPN got its hands on, is painting a much worse picture for the 2010-2011 salary cap. ESPN is reporting the memo estimates the salary cap will drop to somewhere between $50.4M and $53.6M this time next year. The luxury tax between $61.2M and $65M. If the luxury tax level drops to below where it was reasonable to project the salary cap level to be for 2010-2011, many, many teams are going to be scrambling. And many, many players are going to be exercising their team options and/or begging for extensions.
Let's table next year's discussion for the moment, and take a quick look at where the Sixers stand right now against the new cap/luxury tax numbers. Here are the players under contract and their salaries:
Elton Brand ($14,858,472)
Andre Iguodala ($12,200,000)
Samuel Dalembert ($12,125,694)
Jason Kapono ($6,212,960)
Louis Williams ($4,972,500)
Willie Green ($3,682,000)
Thaddeus Young ($2,105,400)
Marreese Speights ($1,685,280)
Jason Smith ($1,418,880)
Jrue Holiday ($1,261,900)
Minimum Player ($736,420)
Minimum Player ($736,420)
Cap Space (-$4,295,926)
Luxury Tax Space ($7,924,074)
The Sixers currently have 10 players under contract, so two imaginary minimum contracts count against their cap space to bring the roster up to the minimum of 12. If they are able to re-sign Andre Miller for the reported 2-year/$16M preferred offer, they will only be able to sign two players to minimum contracts to fill out their roster (possibly 3 if 2 of them are un-drafted rookies).
If they use the full MLE on a player, the could also afford to use the bi-annual exception ($1.99M) and then sign 2 players to minimum contracts. Bringing the total number of players under contract up to 14.
That's where we stand, where we go from here is anyone's guess.