Questions about BRI and Salaries

[bdm860]

Ok, so I get that player salaries are tied to 57% of basketball related income. 

And according to this link team payrolls are as follow:

LA Lakers   ~ 95.3
Orlando Magic   ~ 89.9
Dallas Mavericks   ~ 85.8
Boston Celtics   ~ 83.3
Denver Nuggets   ~ 83.0
Houston Rockets   ~ 72.7
Utah Jazz   ~ 71.1
Philadelphia 76ers   ~ 69.4
Atlanta Hawks   ~ 69.1
New Orleans Hornets   ~ 68.9
Memphis Grizzlies   ~ 67.8
Milwaukee Bucks   ~ 67.7
Portland Blazers   ~ 67.5
San Antonio Spurs   ~ 64.9
Detroit Pistons   ~ 64.7
Golden State Warriors   ~ 64.6
Indiana Pacers   ~ 64.4
Charlotte Bobcats   ~ 61.1
New Jersey Nets   ~ 57.0
Phoenix Suns   ~ 55.4
Miami Heat   ~ 54.4
Washington Wizards   ~ 52.7
Cleveland Cavaliers   ~ 51.3
OKC Thunder   ~ 50.3
Toronto Raptors   ~ 49.4
New York Knicks   ~ 47.2
LA Clippers   ~ 47.0
Chicago Bulls   ~ 46.7
Sacramento Kings   ~ 39.0
Minnesota T-Wolves   ~ 37.6


Total Salaries:  1,899.2m

And from other sources I get that BRI was about $4b in 2011, so 57% times $4b = $2,280m. 

Players share of BRI = 2,280m
Player salaries = 1,899.2m
Difference = 381m

So do the players all get an end of year bonus to distribute the surplus among players?  And if so how is this divided out?

Is it divided equally so everyone gets the same bonus (or at least based on games played so Shaq and Eddy Curry don't get the same bonus as everyone else)?  Is it based on team payoll, or maybe salary proportion to team payroll (so Kevin Garnett gets a much bigger share than Avery Bradley)?  Or is it divided equally by team so each team has to give their players about $13m more?  Or is it divided out by teams who are either under/over the cap?  (So with this last scenario say there are two teams with two equally paid max players, but one team is over the cap and one is under the cap, would the player surplus go more to one team than the other, effectively giving one player more money even though they have the same contract)?

And where does that money come from?  Hypothetically let's say the TWolves lost like $20M last year.  If the surplus was divided out equally by team, would the Twolves then have to pay their players $13M more which would just add to their losses even though they kept payroll low to try to avoid losses?


The more I think about BRI and salaries and how the pie is sliced, the more questions I get.  I'm sure someone knows this stuff (and maybe it's already been posted somewhere else) so I just thought I'd ask.

[CaptainJackLee]

Yes, the NBAPA receives the money.

How they distribute the surplus amongst the players, I'm not sure. When the amount in salaries and benefits exceeds the designated percentage and the players have to return money to the teams at the end of the season, the cuts are proportional to the players salaries. I'm not sure which is the case here - I remember reading that they keep the money in a strike/lockout fund (so the money doesn't really go to individual players), but I'm not sure how accurate that is.

Anyway, this has never happened in recent years and I'm not sure it's happened in 10/11 (although it's certainly possible, considering the projected growth of league revenues). The public information about salaries is never 100% correct and generally doesn't include bonuses paid and benefits (that have amounted to circa $130 millions in recent years). However those things count for the 57%.

Your last question is a good one. I don't know the answer (again, this has never happened during the validity of the current CBA), but I suspect teams would pay proportionally to their payroll.

[Fafnir]

57% is the maximum, the players have 8% of their salaries held in escrow in case they exceed that number. Previous years they always have, this year they came in under 57% and they will recieve that escrow money back.

This year they will be getting some 150-180 million back from their escrow withholdings.

[Roy H.]

For whatever it's worth, some of those salaries are drastically wrong, according to other sources.  For instance, that site lists the Twolves' team salary as $37.6 million; shamsports.com has it at $54 million.  Shamsports has the Kings at $44.9 million, rather than $39 million.

EDIT:  Also, remember that the 57% encompasses both salaries and benefits; we I don't know what the dollar figure for benefits is, but I'm assuming it's substantial.

[CaptainJackLee]

57% is the maximum, the players have 8% of their salaries held in escrow in case they exceed that number. Previous years they always have, this year they came in under 57% and they will recieve that escrow money back.

This year they will be getting some 150-180 million back from their escrow withholdings.

Yes, but the escrow system applies when the salaries+benefits are higher than 57.5%. He's asking how is the money distributed when the amount of salaries+benefits is lower than the guaranteed 57%.

[bdm860]

For whatever it's worth, some of those salaries are drastically wrong, according to other sources.  For instance, that site lists the Twolves' team salary as $37.6 million; shamsports.com has it at $54 million.  Shamsports has the Kings at $44.9 million, rather than $39 million.

I realize different sites have different salary numbers (so I have no clue what is right and what's not, basically I took the source I did because they listed all the teams on one page).  One error I clearly see with ShamSports though is that it doesn’t take playing for a team for only part of the season into account.  In the ShamSports example, the TWolves $54m includes all of Eddy Curry’s $11.5m salary.  Forgetting about his buyout, the TWolves would really only be responsible for only a portion of that $11.5m.  So right off the bat I don't think ShamSports would be completely accurate for pulling team payrolls (since I'm more concerned with what a team pays out, rather than salary cap numbers).

[bdm860]

57% is the maximum, the players have 8% of their salaries held in escrow in case they exceed that number. Previous years they always have, this year they came in under 57% and they will recieve that escrow money back.

This year they will be getting some 150-180 million back from their escrow withholdings.

Yes, but the escrow system applies when the salaries+benefits are higher than 57.5%. He's asking how is the money distributed when the amount of salaries+benefits is lower than the guaranteed 57%.

I don't think 57% is the maximum, it's the players slice of the pie no matter what, right?  So ya, like CaptainJackLee said the escrow is for when salaries go past the 57%, but it doesn't explain what happens when salaries are under, so I'm still wondering what's going on.

This year, based on what I've seen (though the actual dollar figure is disputed), the players are under the 57%.  So they should be getting all the amount put into escrow back, but what about the difference for the amount under the 57%?

[Roy H.]

For whatever it's worth, some of those salaries are drastically wrong, according to other sources.  For instance, that site lists the Twolves' team salary as $37.6 million; shamsports.com has it at $54 million.  Shamsports has the Kings at $44.9 million, rather than $39 million.

I realize different sites have different salary numbers (so I have no clue what is right and what's not, basically I took the source I did because they listed all the teams on one page).  One error I clearly see with ShamSports though is that it doesn’t take playing for a team for only part of the season into account.  In the ShamSports example, the TWolves $54m includes all of Eddy Curry’s $11.5m salary.  Forgetting about his buyout, the TWolves would really only be responsible for only a portion of that $11.5m.  So right off the bat I don't think ShamSports would be completely accurate for pulling team payrolls (since I'm more concerned with what a team pays out, rather than salary cap numbers).

The most accurate salary site I've found is this one. 

In terms of Eddy Curry's contract, the total amount in salary he received was the amount listed ($11.5 million).  I believe that includes the amount of any buyout he got.  The reason his salary is listed solely with the Twolves is because that's how the NBA calculates team payroll; team payroll is calculated (for luxury tax purposes) based upon the total annual player salaries that remain on your payroll (plus salaries of any waived players, etc.)

While the Twolves may have actually paid their players less than $54 million, their payroll for NBA purposes is that $54 million.  In terms of total salaries for purposes of BRI, etc., this all comes out in the wash, as each player's contract is only accounted for once.

[Roy H.]

57% is the maximum, the players have 8% of their salaries held in escrow in case they exceed that number. Previous years they always have, this year they came in under 57% and they will recieve that escrow money back.

This year they will be getting some 150-180 million back from their escrow withholdings.

Yes, but the escrow system applies when the salaries+benefits are higher than 57.5%. He's asking how is the money distributed when the amount of salaries+benefits is lower than the guaranteed 57%.

I don't think 57% is the maximum, it's the players slice of the pie no matter what, right?  So ya, like CaptainJackLee said the escrow is for when salaries go past the 57%, but it doesn't explain what happens when salaries are under, so I'm still wondering what's going on.

This year, based on what I've seen (though the actual dollar figure is disputed), the players are under the 57%.  So they should be getting all the amount put into escrow back, but what about the difference for the amount under the 57%?

If it's under, the league cuts a check to the player's union, who disburses it.

[bdm860]

57% is the maximum, the players have 8% of their salaries held in escrow in case they exceed that number. Previous years they always have, this year they came in under 57% and they will recieve that escrow money back.

This year they will be getting some 150-180 million back from their escrow withholdings.

Yes, but the escrow system applies when the salaries+benefits are higher than 57.5%. He's asking how is the money distributed when the amount of salaries+benefits is lower than the guaranteed 57%.

I don't think 57% is the maximum, it's the players slice of the pie no matter what, right?  So ya, like CaptainJackLee said the escrow is for when salaries go past the 57%, but it doesn't explain what happens when salaries are under, so I'm still wondering what's going on.

This year, based on what I've seen (though the actual dollar figure is disputed), the players are under the 57%.  So they should be getting all the amount put into escrow back, but what about the difference for the amount under the 57%?

If it's under, the league cuts a check to the player's union, who disburses it.

And I guess the “benefits” in the salary + benefits could explain away the difference too (as I saw in your "edit").  So there may be no "surplus" to the players after all.

The league cutting a check to the union does make the most sense though.

Thanks for the discussion guys.

[CaptainJackLee]

Yes, the NBAPA receives the money.

How they distribute the surplus amongst the players, I'm not sure. When the amount in salaries and benefits exceeds the designated percentage and the players have to return money to the teams at the end of the season, the cuts are proportional to the players salaries. I'm not sure which is the case here - I remember reading that they keep the money in a strike/lockout fund (so the money doesn't really go to individual players), but I'm not sure how accurate that is.

Anyway, this has never happened in recent years and I'm not sure it's happened in 10/11 (although it's certainly possible, considering the projected growth of league revenues). The public information about salaries is never 100% correct and generally doesn't include bonuses paid and benefits (that have amounted to circa $130 millions in recent years). However those things count for the 57%.

Your last question is a good one. I don't know the answer (again, this has never happened during the validity of the current CBA), but I suspect teams would pay proportionally to their payroll.

I just consulted a person who works in athletes representation about this and he confirmed there's a NBAPA agreement to keep the money on a NBAPA managed lockout fund - where it'd join part of the revenue from licensing fees.