View Poll Results: How much do you think Lin will take next season? (Read First)

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  • $3 Million

    4 30.77%
  • $5 Million

    7 53.85%
  • He won't be a Knick next season.

    2 15.38%
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Thread: Off-season Salary Cap Situation - Must Read!

  1. #1
    Superstar YuvalNYC's Avatar
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    Nyk Logo Off-season Salary Cap Situation - Must Read!

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    Good read on the whole salary cap situation... damn, being a GM is a pain in the ass.

    Anyways, What I understand from this is, the two key players this off-season salary cap-wise are Landry Fields and Jeremy Lin... more-so Jeremy Lin, but if they don't get too greedy, Grunwald will have a much easier time this off-season with more cap space I didn't even know were available to us.



    The Knicks are currently $5.6 million under the league-mandated $58.044 million salary cap. (On July 1, if the cap stays the same, which it likely will, they will be $5.65 million over.) Currently, the main players under contract for next season include: Carmelo Anthony, Amare Stoudemire, Tyson Chandler, Iman Shumpert and Toney Douglas. In addition, J.R. Smith has a player option of $2.443 million, Josh Harrellson has a team option of $762,195, Jerome Jordan has a non-guaranteed salary of $762,195 and while Renaldo Balkman cleared waivers this past season, he's still owed some salary that counts against the cap. The team's restricted free agents are Jeremy Lin and Landry Fields, and the unrestricted pool includes: Steve Novak, Baron Davis, Jared Jeffries, Mike Bibby, Bill Walker and Dan Gadzuric.

    Looking ahead to the offseason, the key moves for the team include Smith's opt in or out, potentially re-signing Fields, using their mid-level exception of about $3 million (taxpayer) or of about $5 million (non-taxpayer), potentially using their bi-annual exception of $1.98 million and then spending a couple of veteran's minimums of $1.4 million each. Their biggest hurdle will be deciding which amount of their mid-level exception to give to Lin.

    Here's the full breakdown:

    J.R. SMITH

    Smith has a player option of $2.443 million for next season, which he can opt out of. The Knicks will know by July 1 if he's going to do so. If he does, that means the team will still be above the cap ($3.157 million), and they won't gain anything. That $2.443 million is not extra money that actually exists in order for the team to sign someone else.

    Even if Smith opts out, the Knicks could re-sign him for a 20 percent raise based on his $2.382 million salary from this past season. That's enabled by the Non-Bird Exception, which would put him at $3.097 million for 2012-13. A source told ESPN New York that Smith's father, Earl, is going to make a strong case for his son to stay in New York, but "it's very clear that the money is the biggest factor with him."

    In fact, when Smith chose the Knicks over the Clippers in mid-February after coming back from China, a source said the Knicks' higher offer ($2.443 million to the Clippers' $1.4 million veteran's minimum) was the deciding factor because he was financially broke. Therefore, Smith will likely opt out and ask for the 20 percent raise. At that point, the ball will be in the Knicks' court to re-sign Smith, who's already said publicly that he wants to return next season.

    JEREMY LIN

    During the lockout negotiations, the league wanted additional spending restrictions to be placed on all tax-paying teams. But the players' union managed to wrest one concession in the final labor settlement: those restrictions wouldn't be triggered once a team is above the tax line. As a result, the owners gave teams a little extra breathing room. They defined a point $4 million above the tax line, which they call the "apron," where those restrictions kicked in. With an anticipated $70 million tax level, the apron will come in around $74 million this summer.

    One of the restrictions placed on teams above the apron was the smaller mid-level exception of about $3 million, while teams under the apron could have the larger mid-level exception of about $5 million. Since a team above the apron can't offer more than $3 million in a mid-level contract, the converse is also true: a team that offers more than $3 million in a mid-level contract can't subsequently exceed the apron.

    The consequences are potentially devastating for teams with payrolls below the apron. If a team spends more than $3 million of its mid-level exception, then the apron becomes a hard cap for the remainder of the season. If you're a General Manager trying to assemble a winning roster, "hard cap" is an ugly, ugly phrase.

    Keeping that in mind, the Knicks are in a unique situation regarding their mid-level exception -- and it's all because of Lin, a restricted free agent. While the Knicks can sign him to the non-taxpayer mid-level exception of about $3 million or below, anything above that would create a hard cap. Lin is likely going to demand his maximum of about $5 million for two main reasons: 1.) While he may not have that much basketball value right now, teams will be drawn to bringing Linsanity to their city; and 2.) Because other teams are going to know that the Knicks will be hard-capped if Lin re-signs for $3 million or more, they'll press them to match at about $5 million.

    If the Knicks do, they'll still be able to re-sign him because he's a restricted free agent. In fact, because he has that status, the Knicks and Lin could agree to an offer sheet even before other teams bid for his services. And the Knicks can match any number because of the Gilbert Arenas provision, which prevents other teams from offering too much.

    Currently, the Knicks are below the apron, so they'll be hoping and praying that Lin signs an offer sheet for $3 million or less. If the Knicks keep Lin at that amount (and they don’t use their bi-annual exception), they won't be capped at $74 million, and they can later go above the apron. Therefore, they could make trades that take on lots of additional salary, but they will still have to pay tax if their team salary is above the tax line (no transactions exempt a team from potentially paying tax).

    While Lin's agent, Roger Montgomery, will have a fiduciary responsibility to his client to get him the best deal possible, he'll know the eventual suitor will be the Knicks. Therefore, Montgomery could ask Lin to do the Knicks a favor and take $2 million less and sign for about $3 million, in order to give the team salary-cap flexibility. By staying in New York, Lin would be make up the difference off the court by being a hot name in the No. 1 media market. What Montgomery will have to watch out for is the Knicks saying, "Sign with us for $3 million and we'll promise to take care of you later." It's that promise to take care of a player later that gets teams into trouble.

    Now, keep this in mind: While the Knicks need to use their mid-level exception to re-sign Lin, they don't have to use it on Lin. They can spend it on anyone. For example, they could let him walk in order to sign unrestricted free agent Steve Nash, who's reportedly going to demand $3 to $5 million per year, or Goran Dragic, who will likely be in the same ballpark.

    But, again, anything more than $3 million will set a hard cap on the Knicks. If that happens, they won't have any flexibility to make any offseason or in-season moves (signs, trades, replacing an injured player, etc.) that leaves them above the $74 million threshold. For example, let’s say they have a team salary of $68 million after signing Lin, or about $6 million below the hard cap. They could make a trade (provided all other trade rules are satisfied) that adds up to $6 million to their payroll. But they couldn’t make a trade that adds $7 million.

    Whatever the case, all signs point to Lin being a Knick. As one source familiar with his situation put it, "He's going to be in New York next year regardless, unless they decide they're not going to match him because Nash is going to come in at $5 million or something like that. But Nash is a pipe dream. I think that they keep Lin, just because of his popularity."

    As for the length of Lin's contract, the Knicks have the option of making it one to four years. (It could actually be three years with a player option on the fourth.) Teams tend to lock up players who are fairly cheap, but are still a big part of their future and have the potential to progress quickly in only half of that four-year window.

    LANDRY FIELDS

    If the Knicks re-sign Lin to the full mid-level exception of about $5 million, that means they'll be hard-capped and only have about $9 million left to spend, which begs the question: Do they want to spend $5 million of that remaining amount on Fields? Even if another team matches the Knicks' offer sheet, they have Early Bird Rights on him, which sets the $5 million ceiling. (In comparison, Lin has Non-Bird Rights rights, which is why the Knicks need to use the mid-level exception to keep him.)

    However, if Lin and Fields re-sign for $3 and $5 million, respectively, the Knicks won't be constrained by the hard cap (based on the lower mid-level exception). They can re-sign Fields, secure veteran free agents and make trades to bring in someone who's more expensive. In other words, they can go above the apron.

    But, again, it all comes back to that $5 million for Fields, and some insiders just don't see the value there. One source familiar with Fields' situation said, "I doubt Landry's worth $5 million, but you never know. When teams try to sign restricted free agents, they sometimes have to over-pay just in order to make the other team let him go. So I could see Landry getting a bigger deal because of that -- not so much because he's worth that much right now as a basketball player, but because he can walk."

    As for the length of Fields' contract, it could be the same as Lin's. Also like Lin, because Fields is a restricted free agent, he and the Knicks could agree to an offer sheet even before other teams bid for his services. In addition, the Knicks can match any salary number because of the Gilbert Arenas provision.

    By the way, if you're wondering if the $5 million maximum for Fields can be used for anyone else (like Nash), it can't because of the Early Bird Rights provision. So, again, only the mid-level exception can be used for Lin, Nash or Dragic -- the three most popular picks at starting point guard heading into the summer.

    IMAN SHUMPERT

    If Shumpert was going to be out until June 30 of next year (based on a doctor's certification), the Knicks could apply for a disabled player exception, which would mean they could sign someone to replace the rookie at his salary. But Shumpert will likely be back on the court in December or January. Keep in mind, however, that if the Knicks were hard-capped (based on the apron), they couldn't use that kind of exception.

    BI-ANNUAL EXCEPTION

    The Knicks have a bi-annual exception of $1.98 million, which could be used for Novak, who's an unrestricted free agent. (However, he'll likely demand more because he emerged as the league's best 3-point shooter.) Even if the team re-signs Lin to $3 million or higher, and the $74 million apron becomes a hard cap for them, they'd still have the bi-annual exception. But then they definitely can't go above the apron. Keep in mind that if they spend their bi-annual exception first, they would be capped at the apron -- just like they would if they spent $3 million or more with their mid-level exception.

    PREDICTED NUMBERS

    Currently, the Knicks are about $6 million above the salary cap, which means they're about $9 million under the apron. If Smith opts out and the Knicks don't re-sign him, they'll be about $11.5 million under the apron. If they re-sign Lin for about $5 million, they'll be about $7.5 million under the apron, which would then create the hard cap.

    Then, if Fields re-signs for about $5 million as well, the team will only have about $3 million under the apron to spend on three players. Think about that. About $3 million, three players. Veteran minimum's deals could suck that right up.

    That mid-level exception is more critical than you ever thought. From the season to the offseason, Lin still remains right at the top of the Knicks' discussion. If you're a fan of the team, you should be rooting for him to sign for $3 million or less.
    [/CENTER][/U]
    Last edited by YuvalNYC; May 14, 2012 at 17:11.

  2. #2
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    Wow, really informative stuff. Great job.

    Originally Posted by YuvalNYC
    By the way, if you're wondering if the $5 million maximum for Fields can be used for anyone else (like Nash), it can't because of the Early Bird Rights provision. So, again, only the mid-level exception can be used for Lin, Nash or Dragic -- the three most popular picks at starting point guard heading into the summer.
    This confuses me a bit. Why exactly can't we use that money on whomever we like? $5 million for Fields is too much. We could get a great player at that price or 2 decent role players. If we let Fields go, can we not use that supposed $5 million (or $3 million or whatever) on someone else?

  3. #3
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    Originally Posted by Jinki£s
    Wow, really informative stuff. Great job.



    This confuses me a bit. Why exactly can't we use that money on whomever we like? $5 million for Fields is too much. We could get a great player at that price or 2 decent role players. If we let Fields go, can we not use that supposed $5 million (or $3 million or whatever) on someone else?
    Nobody is paying Fields 5 million per.....I am a fan of Fields but if the Knicks signed him for 5 million I would be furious....

    I assume Lin 4 million and Landry 3 million,,,,,I guess that leaves us 6 .

  4. #4
    Scoring Champ CA7's Avatar
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    Originally Posted by Jinki£s
    Wow, really informative stuff. Great job.



    This confuses me a bit. Why exactly can't we use that money on whomever we like? $5 million for Fields is too much. We could get a great player at that price or 2 decent role players. If we let Fields go, can we not use that supposed $5 million (or $3 million or whatever) on someone else?
    because we have 2 players with early bird rights, so their maximum is 5mil counting as the MLE

    Lin takes 5mil thats the MLE but we can still sign Fields for 5mil because he is eligible for the same deal as Lin, we cant sign Lin at 5mil then use the Fields 5mil for Nash because only Fields has the right for us to sign him at 5mil

    We have to hope Lin takes 3, Landry takes 2 and we have 2mil plus the 1.8 Bi-Annual exception to work with

  5. #5
    Quiet Storm New New York's Avatar
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    WOW so it all boils down to Lin!


    If he signs and offer sheet anywhere else we are screwed like a Phillips Head!

    Does he show loyalty to us and sign for 3 million in hopes that the endorsements even out....or does he take his cake and eat it too and signs for 5 million and gets those endorsements!

    Did his injury help or hurt us? It could be helpful if what we saw was just the tip of the iceberg and his value right now is as low as its gonna be....or did we see just enough to get gasssed into putting us in a hard cap situation by getting 5 million?

    Here is what we have in our favor....the teams rumored to be after him (so far) are small market teams (Toronto is one of them) and that would kill all future value....I mean Jose Calderon is an All Star if he is on The Knicks,Heat or Lakers, Kevin Love is a household name amongsts guys who follow sports if he is one of those markets as well!


    Now the Novak factor!

    I do not believe his market is all that high coming off a series where he could not get off more than 1 shot per game! He is the definition of a lights out shooter....but not being able to create his own shot is why I can't see paying him more than a vet minimum!


  6. #6
    Scoring Champ CA7's Avatar
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    If Toronto really wants Lin, I'd do the Lin for Calderon deal before he signs an offer sheet, this is about basketball not business if Lin can't take a 2mil pay cut knowing he'll make 10 times more off the court then GTFO

  7. #7
    Quiet Storm New New York's Avatar
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    oops accidently posted before I was done w response


    J.R. Smith needs to opt in because he is not getting the money, playing time or shot attempts on any other team!


  8. #8
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    Originally Posted by New New York
    WOW so it all boils down to Lin!


    If he signs and offer sheet anywhere else we are screwed like a Phillips Head!

    Does he show loyalty to us and sign for 3 million in hopes that the endorsements even out....or does he take his cake and eat it too and signs for 5 million and gets those endorsements!

    Did his injury help or hurt us? It could be helpful if what we saw was just the tip of the iceberg and his value right now is as low as its gonna be....or did we see just enough to get gasssed into putting us in a hard cap situation by getting 5 million?

    Here is what we have in our favor....the teams rumored to be after him (so far) are small market teams (Toronto is one of them) and that would kill all future value....I mean Jose Calderon is an All Star if he is on The Knicks,Heat or Lakers, Kevin Love is a household name amongsts guys who follow sports if he is one of those markets as well!


    Now the Novak factor!

    I do not believe his market is all that high coming off a series where he could not get off more than 1 shot per game! He is the definition of a lights out shooter....but not being able to create his own shot is why I can't see paying him more than a vet minimum!

    Novak is getting more than a vet min. Doesn't matter that he can't create his own shot.

    He was the best 3pt shooter in the league last year. Is a solid character guy. And while he was shut down by MIA who gamed hard to shut him down, and he couldn't get any shots off, he actually can create his own shot -- not well, not even average, but he's not totally inept.

    If we got him for the 2milly exception it'd be really good value for us, IMO.

  9. #9
    Scoring Champ CA7's Avatar
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    There may be hope

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    Member CoolRunnings's Avatar
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    I've been saying for over a year to get Goran Dragic. Now his stock might be too high after the numbers he posted after lowry went out.

  11. #11
    SWAGABURY KingStarbury3's Avatar
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    dog theres no way i can read all that right now. I saw something about Fields, we should trade him

  12. #12
    Superstar YuvalNYC's Avatar
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    Originally Posted by KingStarbury3
    dog theres no way i can read all that right now. I saw something about Fields, we should trade him
    It looks long but once you start reading it gets very interesting...

  13. #13
    Veteran Sprewell-Houston's Avatar
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    Ok folks this is NOT intended to be a dig at Tyson or whatever, he's probably our least problem, but I'd like to know why he still hasn't developed any kind of post move or jump shot. Even Marcus Camby added a jump shot to his offense. It looked terrible, but he could make it and that's just so important.

    Chandler is like a great defensive lineman or linebacker, great on defense but useless on offense. Unfortunately this ain't football. He'S no scoring threat at all as long as teams prevent him from getting alley oops. It'S a shame, because at 7'1 he could dominate defensively and help us offensively.

    Miami had nothing but **** at center and we couldn't take advantage because Chandler has no offense.

    It would make us so much stronger if he just had one post move and a solid short range jumper.

    I love what he has brought to this team in terms of leadership, toughness and character and his defense has been fantastic, but at $14 million + a year he should have atleast one offensive move?

    I mean like I said this ain't football.

    Anyway, we got far bigger issues than Chandler's O. Just wanted to talk about it, because I see wasted offensive potential.

  14. #14
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    Lin stated he does not mind taking less than the MLE, hopefully he can be a good sport and take 3 mill

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    Let Fields walk, we need a SG/SF that can hit an open shot

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