Report: new CBA to set a cap at 62 million ?

[GreenEnvy]

I'm curious about all the details, including what specifically a "flex cap" is.  Obviously, it's more than a $62 million soft cap that teams can go over at their leisure; otherwise, the owners and players would just extend the system that is currently in place.

From what I can gather, it sounds much closer to a hard cap than a soft cap.  Perhaps it is a hard cap with certain exceptions where a team can go over, similar to the current system.  However, the times when they can go over it will be much stricter.

Also, it sounds like one of the keys to this is that it also has a hard bottom of the cap.  That is how they are guaranteeing the players a certain amount of money.

Well the quotes from OP state a "max that can be exceeded" which would mean it isn't a hard cap. It's maybe not as soft, but it's still soft.

If there is any truth to these, the NBAPA has to take a serious look at this offer. At the very least, they would be on the same page.

These quotes are a far cry from the rumors of what the owners reportedly wanted earlier this year.

Let's hope it's true and the free agency frenzy can begin before long.

[StartOrien]

Via Zach Lowe
http://twitter.com/#!/ZachLowe_SI

ZachLowe_SI Zach Lowe
Jeff Kessler, players attorney, tells me "flex cap makes no difference. It's still a hard cap." (con't).

ZachLowe_SI Zach Lowe
Kessler: Won't divulge precise #s, but says ceiling of hard cap is a) indisputably hard; b) not much higher than "cap number."

ZachLowe_SI Zach Lowe
(I.e. this is not a case of "cap #" set at $62M and "flex cap ceiling" at $110M. Would be closer).

Also via Kessler: Flex cap is back door to eliminating guaranteed deals for non-stars. Gotta save space for stars/stars rookies.

ZachLowe_SI Zach Lowe
Final Kessler: "The flex cap is a hard cap, and a hard cap is still an obstacle to making a deal."

[jpurthe1]

Chris Paul in NY... especially with Big Shot's contract leaving.

[Roy H.]

So, we're talking about a two-tiered hard cap, with the first tier around $62 million and the second tier unspecified, but perhaps around $70 million or so (the current luxury tax level)?

I'd be on board with that, and that's much, much more realistic than $45 million.

[StartOrien]

So, we're talking about a two-tiered hard cap, with the first tier around $62 million and the second tier unspecified, but perhaps around $70 million or so (the current luxury tax level)?

I'd be on board with that, and that's much, much more realistic than $45 million.

Anyone else surprised how well this is (seemingly) going? I'm relatively shocked. Seems to be a pretty fair offer.

[Roy H.]

So, we're talking about a two-tiered hard cap, with the first tier around $62 million and the second tier unspecified, but perhaps around $70 million or so (the current luxury tax level)?

I'd be on board with that, and that's much, much more realistic than $45 million.

Anyone else surprised how well this is (seemingly) going? I'm relatively shocked. Seems to be a pretty fair offer.

Yeah, this is around the number I thought they'd eventually agree to, but I thought it would be months in the future. 

We'll see if the players will sign off on a hard cap at all.  I personally hope they do, because it will help to preserve competitive balance.

[mgent]

So, we're talking about a two-tiered hard cap, with the first tier around $62 million and the second tier unspecified, but perhaps around $70 million or so (the current luxury tax level)?

I'd be on board with that, and that's much, much more realistic than $45 million.

Anyone else surprised how well this is (seemingly) going? I'm relatively shocked. Seems to be a pretty fair offer.

Yeah, this is around the number I thought they'd eventually agree to, but I thought it would be months in the future. 

We'll see if the players will sign off on a hard cap at all.  I personally hope they do, because it will help to preserve competitive balance.

Yeah but with the recent trend of young players teaming up an extra 10 million is just gonna make it easier.

[StartOrien]

Conspiracy Theory Warning:

Just a thought I had today, but does anyone think that Stern pushed the sale of the Nets through to Prokhorov to improve his side of the argument? If he did (and I doubt it, even though I'm presenting the argument) it's a pretty smart move:

He could make the point that the league is in such poor shape that he had to approve the sale of a team to an international playboy whose rise to financial prosperity is 'sketchy' to say the least.

Not necessarily something I believe, just a thought I had on my ride to work.

[action781]

I hope the transfer of Bird Rights in a trade is nixed from the new CBA.  I like the essence of Bird Rights where a team should be able to keep a player who has been there a while; it's a good clause for the team, the player, and most importantly the fans.  But getting to use bird rights to extend a player that you acquire at the trading deadline is just a loophole allowing teams to go over the cap completely missing the essence of why Bird Rights were created.

I hope both sides agree on Bird Rights being non-transferable.  If a player has been with one team for 2+ years on a single contract, Bird Rights may be used to exceed the cap in order to sign (not sign and trade) him.  I think that would be an improvement to this system and make the flex cap a little "harder".

Yeah, and let's do away with sign and trades.

[The Walker Wiggle]

From Ken Berger at CBS:

The essence of the system described by Stern was an NHL-style cap system with a targeted salary of $62 million per team and a to-be-negotiated range from a minimum to an amount above $62 million that teams could spend up to through various exceptions currently in place – such as the Larry Bird exception and mid-level exception. An escrow-like system would be used to adjust for teams coming in below and above the $62 million target. Unlike the current escrow system, through which 8 percent of players’ salaries is withheld and paid back if negotiated salaries fall short of 57 percent of revenues, Stern said owners would keep the escrow under the new system – making this, in effect, an 8 percent pay cut for the players in Year One.

In terms of the owners’ initial proposal of a $45 million hard cap, the latest offer from the league amounts to a $650 million move from their initial position. The basic structure of a 50-50 split of revenues – based on a modified formula with about $900 million in expenses deducted before sharing with the players – remains intact. The luxury tax would be eliminated under the owners' proposal.

In what Stern termed a "modest" proposal, the players on Tuesday offered to reduce salaries by $500 million over a five-year deal. The $100 million-per-year reduction would be achieved through a reduction in the players' share of basketball-related income by from 57 percent to 54.3 percent, sources said. The owners and players continue to disagree about the expenses the owners want taken off the top before revenues are shared with the players.

The owners' proposal, sources said, would reduce the players' effective share of BRI - once expenses were deducted - to less than 50 percent by the third year of their 10-year proposal and to 36 percent in the last three years of the deal. The players' salary and benefits for the 2010-11 season were approximately $2.17 billion, sources said.

[Cman]

I hope the transfer of Bird Rights in a trade is nixed from the new CBA.  I like the essence of Bird Rights where a team should be able to keep a player who has been there a while; it's a good clause for the team, the player, and most importantly the fans.  But getting to use bird rights to extend a player that you acquire at the trading deadline is just a loophole allowing teams to go over the cap completely missing the essence of why Bird Rights were created.

I hope both sides agree on Bird Rights being non-transferable.  If a player has been with one team for 2+ years on a single contract, Bird Rights may be used to exceed the cap in order to sign (not sign and trade) him.  I think that would be an improvement to this system and make the flex cap a little "harder".

Yeah, and let's do away with sign and trades.

agree, agree, agree.

[The Walker Wiggle]

Both good suggestions. I do expect we've seen the end of the sign-and-trade.

[17wasEZ]

So, we're talking about a two-tiered hard cap, with the first tier around $62 million and the second tier unspecified, but perhaps around $70 million or so (the current luxury tax level)?

I'd be on board with that, and that's much, much more realistic than $45 million.

I heard an interview with Derek Fisher on the Stephen A. Smith show and he said he wouldn't consider the negotiations that took place today to be of any note.  He said the players get 57% of the revenue and would be willing to give back 57% of the owner's losses (which would be about $150 million of the almost $300m they are claiming to be losing annually). 

He said the owners want the whole $300m they are losing plus a guarantee that each owner would make $20m per season which is about $900m in player give backs per season.

Sounds like both sides are way off.

[lepoooo]

There is a very interesting discussion on RealGM about the hard cap subject, here: http://forums.realgm.com/boards/viewtopic.php?f=4&t=1095853

[wdleehi]

From Ken Berger at CBS:

The essence of the system described by Stern was an NHL-style cap system with a targeted salary of $62 million per team and a to-be-negotiated range from a minimum to an amount above $62 million that teams could spend up to through various exceptions currently in place – such as the Larry Bird exception and mid-level exception. An escrow-like system would be used to adjust for teams coming in below and above the $62 million target. Unlike the current escrow system, through which 8 percent of players’ salaries is withheld and paid back if negotiated salaries fall short of 57 percent of revenues, Stern said owners would keep the escrow under the new system – making this, in effect, an 8 percent pay cut for the players in Year One.

In terms of the owners’ initial proposal of a $45 million hard cap, the latest offer from the league amounts to a $650 million move from their initial position. The basic structure of a 50-50 split of revenues – based on a modified formula with about $900 million in expenses deducted before sharing with the players – remains intact. The luxury tax would be eliminated under the owners' proposal.

In what Stern termed a "modest" proposal, the players on Tuesday offered to reduce salaries by $500 million over a five-year deal. The $100 million-per-year reduction would be achieved through a reduction in the players' share of basketball-related income by from 57 percent to 54.3 percent, sources said. The owners and players continue to disagree about the expenses the owners want taken off the top before revenues are shared with the players.

The owners' proposal, sources said, would reduce the players' effective share of BRI - once expenses were deducted - to less than 50 percent by the third year of their 10-year proposal and to 36 percent in the last three years of the deal. The players' salary and benefits for the 2010-11 season were approximately $2.17 billion, sources said.

deal killer.