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View Full Version : Why Can't Miami use "Bird Rights" to Re-sign The Big 3?



Nikeman
06-30-2014, 08:24 PM
No, I am not trolling, I seriously do not know about this topic itself and just wanted some PSD Cap experts to enlighten me.

So, I believe from reports that we have 55 million in cap space??

The cap is set at 62 million with luxury tax at 77 million?

Why can't Miami sign all the free agents we want, then using bird rights, re-sign one of the big 3?

Example..

Sign Bosh- 15 mill
Sign Wade 15 mill

We still have about 20-25 million in cap space.

Now, can we not sign Gortat and fillers for say 15 mill, and then using bird rights, go over cap and sign LeBron to his max? That puts us at 75 mill, Mickey Arison is happy as we are not over luxury tax, and the Big 3 get their needed help?

So yeah, why can't we sign the Big 3 LAST using bird rights to go over cap?

Nikeman
06-30-2014, 08:25 PM
One of the HEAT posters said this:

"I could be wrong, but I think once the Heat re-announce the bird rights for James, Wade and Bosh, then the cap-space is gone technically. For instance, if the Heat re-announce the bird rights for Bosh, then there goes $20M in cap-space. But if the Heat signed Bosh let's say 4 years for $56M, then the $20M goes away immediately. Bosh would then be making $14M per year.

So basically if the Heat re-announce the bird rights for LeBron, then they can offer him about 5 years for $129M. On the other hand, if the Heat don't re-announce the bird rights for LeBron, in that case their in the same position as all the other teams who can offer LeBron a max contract."

This was my response:

"So why don't we sign who we want to sign, and then "re-announce" our bird rights and go over cap to sign our Big 3?

Or, say LeBron wants the max, then why don't we sign Bosh and Wade to their respective pay-cut deals, and then we have 25 million or so to sign anyone we want, and then we can use the "bird rights" to offer LeBron the max deal??"

Nikeman
06-30-2014, 08:34 PM
Hope some cap expert can answer this?

B'sCeltsPatsSox
06-30-2014, 08:35 PM
If the Heat renounce the big three, they lose their Bird rights to all of them but have 55 million in cap space. If they don't renounce their rights on them, they would lose all of that cap space. It's what the rules are.

Bramaca
06-30-2014, 08:36 PM
The big 3 are free agents but there is a cap hold for free agents which allows the team to retain their bird rights. The cap hold will actually be greater then what their contracts were so right now the cap holds on those three alone will have the Heat above the cap. In order to use cap room to sign other free agents the Heat would have to renounce the rights to one or more of the big 3 which would mean you no longer have bird rights to re-sign them. The Heat will have to figure out what their new salaries will be before they can really start discussions with other players.

Nikeman
06-30-2014, 08:37 PM
If the Heat renounce the big three, they lose their Bird rights to all of them but have 55 million in cap space. If they don't renounce their rights on them, they would lose all of that cap space. It's what the rules are.

Exactly, so why can't Miami sign Bosh/Wade to their respective 15 mill deals or whatever, and then we'd have 20m left or so. Then sign a Gortat/Ariza etc etc, and then use our bird rights on LeBron to give him his max deal he desires?

Nikeman
06-30-2014, 08:39 PM
The big 3 are free agents but there is a cap hold for free agents which allows the team to retain their bird rights. The cap hold will actually be greater then what their contracts were so right now the cap holds on those three alone will have the Heat above the cap. In order to use cap room to sign other free agents the Heat would have to renounce the rights to one or more of the big 3 which would mean you no longer have bird rights to re-sign them. The Heat will have to figure out what their new salaries will be before they can really start discussions with other players.

LeBron was scheduled to make 21m and wants a max deal? So thus, why can't we use his bird rights to resign him to a max deal after signing Wade/Bosh to their paycuts and some new roster additions?

Bramaca
06-30-2014, 08:40 PM
Exactly, so why can't Miami sign Bosh/Wade to their respective 15 mill deals or whatever, and then we'd have 20m left or so. Then sign a Gortat/Ariza etc etc, and then use our bird rights on LeBron to give him his max deal he desires?

Because the cap hold on Lebron is over 20 million so that cap space isn't there unless they renounce him.

DODGERS&LAKERS
06-30-2014, 08:41 PM
No, I am not trolling, I seriously do not know about this topic itself and just wanted some PSD Cap experts to enlighten me.

So, I believe from reports that we have 55 million in cap space??

The cap is set at 62 million with luxury tax at 77 million?

Why can't Miami sign all the free agents we want, then using bird rights, re-sign one of the big 3?

Example..

Sign Bosh- 15 mill
Sign Wade 15 mill

We still have about 20-25 million in cap space.

Now, can we not sign Gortat and fillers for say 15 mill, and then using bird rights, go over cap and sign LeBron to his max? That puts us at 75 mill, Mickey Arison is happy as we are not over luxury tax, and the Big 3 get their needed help?

So yeah, why can't we sign the Big 3 LAST using bird rights to go over cap?

They all have cap holds. So even though they don't have contracts that say they are making $20 million, they have a cap hold on them. So essentially the Heat don't have $55 million in cap space yet. They would either have to renounce their rights or sign them to an actual deal. That will remove that cap hold. But if they renounce their rights, they will no longer have bird rights on those players.

B'sCeltsPatsSox
06-30-2014, 08:41 PM
Exactly, so why can't Miami sign Bosh/Wade to their respective 15 mill deals or whatever, and then we'd have 20m left or so. Then sign a Gortat/Ariza etc etc, and then use our bird rights on LeBron to give him his max deal he desires?

They could sign them to those deals which would get rid of the cap holds if they didn't renounce them.

Nikeman
06-30-2014, 08:41 PM
Because the cap hold on Lebron is over 20 million so that cap space isn't there unless they renounce him.

Okay got it, thanks

Makes sense now

Bramaca
06-30-2014, 08:41 PM
lebron was scheduled to make 21m and wants a max deal? So thus, why can't we use his bird rights to resign him to a max deal after signing wade/bosh to their paycuts and some new roster additions?

cap hold

DODGERS&LAKERS
06-30-2014, 08:44 PM
Exactly, so why can't Miami sign Bosh/Wade to their respective 15 mill deals or whatever, and then we'd have 20m left or so. Then sign a Gortat/Ariza etc etc, and then use our bird rights on LeBron to give him his max deal he desires?

If a team could do that, why wouldn't the Heat use that $55 million to sign Melo, Gortat, Lowry, Bledsoe, and Parsons, for the $55 million and then use the bird rights on Wade, Bosh, and Lebron? The reason they cant do that and no team ever has is because it is illegal according to the CBA

Nikeman
06-30-2014, 08:46 PM
If a team could do that, why wouldn't the Heat use that $55 million to sign Melo, Gortat, Lowry, Bledsoe, and Parsons, for the $55 million and then use the bird rights on Wade, Bosh, and Lebron? The reason they cant do that and no team ever has is because it is illegal according to the CBA

Makes sense, just didn't know the whole concept of this burd rights

Nikeman
06-30-2014, 08:49 PM
Would it be possible to back-load Wade/Bosh deals?

Give them 4 year/60 million deals at 15 per or so, and then make the initial cap hit 8m? Then years 2,3,4 their hits can be closer to 20 mill?

This way, of the 55 million in cap space, Wade/Bosh use only 16 mill, and then LeBron eats his 20, and we have close to 18 mill to use?

king4day
06-30-2014, 09:11 PM
Would it be possible to back-load Wade/Bosh deals?

Give them 4 year/60 million deals at 15 per or so, and then make the initial cap hit 8m? Then years 2,3,4 their hits can be closer to 20 mill?

This way, of the 55 million in cap space, Wade/Bosh use only 16 mill, and then LeBron eats his 20, and we have close to 18 mill to use?

Someone has to correct me if I'm wrong but I'm pretty sure you can't backload cap. Salary doesn't matter but if you sign someone to 4 years 60 mil, the cap is 15mil per year, even if they are paid 10,10,10, 30.

Unless it's a poison pill contract. Asik being traded to N.O. means it's like 15 mil this year on the cap for the P's but had he stayed in Houston, he would have cost the Rockets just 8

Shmontaine
06-30-2014, 09:13 PM
Would it be possible to back-load Wade/Bosh deals?

Give them 4 year/60 million deals at 15 per or so, and then make the initial cap hit 8m? Then years 2,3,4 their hits can be closer to 20 mill?

This way, of the 55 million in cap space, Wade/Bosh use only 16 mill, and then LeBron eats his 20, and we have close to 18 mill to use?

I think max raise per year on contracts is 7.5%

that would put a 4/60 contract starting somewhere around a 13.5 mil...

Bramaca
06-30-2014, 09:14 PM
Would it be possible to back-load Wade/Bosh deals?

Give them 4 year/60 million deals at 15 per or so, and then make the initial cap hit 8m? Then years 2,3,4 their hits can be closer to 20 mill?

This way, of the 55 million in cap space, Wade/Bosh use only 16 mill, and then LeBron eats his 20, and we have close to 18 mill to use?

No, raises are restricted To 7.5% per year so they can't back load the deals.

Any other questions go to this site http://www.cbafaq.com/salarycap.htm
it explains pretty much anything you want to know and if it doesn't, ask him and he'll find the answer.

Shmontaine
06-30-2014, 09:19 PM
Someone has to correct me if I'm wrong but I'm pretty sure you can't backload cap. Salary doesn't matter but if you sign someone to 4 years 60 mil, the cap is 15mil per year, even if they are paid 10,10,10, 30.

Unless it's a poison pill contract. Asik being traded to N.O. means it's like 15 mil this year on the cap for the P's but had he stayed in Houston, he would have cost the Rockets just 8

Asik was signed using the 'gilbert arenas provision'.

http://www.cbafaq.com/salarycap.htm#Q14


What is the "Gilbert Arenas" provision?

Before 2005 it was sometimes possible to sign restricted free agents to offer sheets their original teams couldn't match. This happened when a player was an Early Bird or Non-Bird free agent (see question number 25) and the team didn't have enough cap room to match a sufficiently large offer. For example, Gilbert Arenas was Golden State's second round draft pick in 2001, and became an Early Bird free agent in 2003. Golden State could only match an offer sheet (or sign Arenas directly) for up to the amount of the Early Bird exception, which was about $4.9 million at the time. Washington signed Arenas to an offer sheet with a starting salary of about $8.5 million, which Golden State was powerless to match.

This loophole was addressed starting with the 2005 CBA (although not closed completely -- see below). Teams are now limited in the salary they can offer in an offer sheet to a restricted free agent with one or two years in the league. The first-year salary in the offer sheet cannot be greater than the Non-Taxpayer Mid-Level exception (see question number 25). Limiting the first-year salary in this way enables the player's original team to match the offer sheet by using the Early Bird exception (if applicable -- see question number 25), or Non-Taxpayer Mid-Level exception (provided they have it and haven't used it already)1.

The second-year salary in such an offer sheet is limited to the standard 4.5% raise. The third-year salary can jump considerably -- it is allowed to be as high as it would have been had the first-year salary not been limited by this rule to the Non-Taxpayer Mid-Level exception2. The salary in the fourth season may increase (or decrease) by up to 4.1% of the salary in the third season. The offer sheet can only contain the large jump in the third season if it provides the highest salary allowed in the first two seasons, it is fully guaranteed, and it contains no bonuses of any kind.

If the raise in the third season exceeds the standard raise (4.5% of the salary in the first season of the contract), then an additional restriction exists. In order to determine how large the offer can be, the team doesn't just have to fit the first-year salary under the cap. Instead, they must fit the average salary in the entire contract under the cap. So a team $8 million under the cap is limited to offering a total of $24 million over three years, or $32 million over four years. If the offer sheet does not contain a third-season raise larger than 4.5% of the first-season salary, then they only have to fit the first season salary under the cap.

Putting this all together, if a team that is $9 million under the cap in 2011-12 wants to submit a four-year offer sheet, and wants to provide a large raise in the third season, they can offer a total of $36 million over four years. The first-year salary is limited to the Non-Taxpayer Mid-Level exception, or $5 million. The second-year salary will be $5.225 million (4.5% raise). This leaves $25.775 million to be distributed over the final two seasons of the contract, with a 4.1% raise from year three to year four. So the entire contract looks like this:


Season Salary Notes
1 $5,000,000 Non-Taxpayer Mid-Level amount for 2011-12
2 $5,225,000 4.5% raise over season 1
3 $12,628,613 This is the amount that yields $25.775 million over the final two seasons with a 4.1% raise3
4 $13,146,387 Raise is 4.1% of season 3 salary
Total $36,000,000 Average is $9 million, which equals the team's cap room

For the team making this offer, this contract would count for $9.0 million (i.e., the average salary in the contract) of team salary in each of the four seasons if they sign the player. If the player's prior team matches the offer and keeps the player, then the actual salary in each season counts as team salary.4 The player's original team is allowed to use any available exception (e.g., the Non-Taxpayer Mid-Level or the Early Bird) to match the offer.

Since a team must fit the average salary from the entire contract under the cap in order to offer the large third-season raise, it must have some amount of cap room above the Non-Taxpayer Mid-Level exception amount in order to utilize this provision. For example, suppose the Non-Taxpayer Mid-Level exception amount is $5 million, and a team wants to provide a four-year offer sheet. If they want to offer a third-year raise greater than 4.5%, their cap room will be determined by the contract's average salary, so the total contract must pay $20.4 million or less. However, since a four-year offer starting at $5 million with standard 4.5% raises would total $21.35 million, the Arenas provision would be ineffective unless it offered more than this amount. So the team in this example would need at least $5.3375 million in cap room in order to utilize the provision.

As I said above, the loophole was addressed with this rule, but not closed completely. The Gilbert Arenas provision is primarily intended to protect teams from losing their successful second round picks, who are typically Early Bird free agents after two years. There are several situations where a team still might be unable to match an offer sheet:

If the player is a Non-Bird free agent, the team only has the Taxpayer Mid-Level exception, and the offer sheet is higher or for more years than allowed by the Taxpayer Mid-Level exception.
If the player is a Non-Bird free agent and the team already used their Non-Taxpayer Mid-Level exception to sign another player.
If the player is a Non-Bird or Early Bird free agent with three years in the league (this rule applies only to players with one or two years in the league).
If a team has two Non-Bird free agents with one or two years in the league. They can use their Non-Taxpayer Mid-Level exception to keep one of them, but would lose the other.
1 Teams can also use cap room to match, of course.
2 To determine whether the team has enough cap room to offer a contract with a substantial increase in the third season, they compare the cap room to the average salary in the offer sheet.
3 If you want to know how I got that exact amount, you solve for (4R - 2.045E) / 2.041. R is the room the team has under the cap, so the entire four-year contract pays 4R. E is the Non-Taxpayer Mid-Level Exception amount, which is the maximum the team can offer in the first season. The second season has a 4.5% raise, and the first two seasons together account for E + 1.045E, which is 2.045E. So the last two seasons total 4R - 2.045E, and with a 4.1% raise from year three to year four, we can say (if Y is the year 3 amount) Y + 1.041Y = 4R - 2.045E, so the year three amount is (4R - 2.045E) / 2.041.
4 If a player signed pursuant to the Gilbert Arenas provision is later traded, his trade value is equivalent to his cap amount, and new team inherits the same cap hit as the team that traded him. In other words, if the player goes to the team submitting the offer sheet and that team later trades him, the average salary of the contract is charged to his new team's cap. If instead the player's original team matches the offer sheet, keeps the player, and subsequently trades him, the player's actual salary is charged to his new team's cap.

Nikeman
06-30-2014, 09:21 PM
Gotcha, thanks!

JasonJohnHorn
06-30-2014, 09:28 PM
Their cap space must be used for their own players first, meaning that whatever contract they sign counts against the cap. If they want to use that available cap space on somebody else, they have to renounced their Bird rights.

That cap space is essentially reserved for the players whose Bird rights they have.

IndyRealist
07-01-2014, 10:40 AM
If they renounce their rights to clear the cap holds, then they lose their bird rights.

IndyRealist
07-01-2014, 10:51 AM
Exactly, so why can't Miami sign Bosh/Wade to their respective 15 mill deals or whatever, and then we'd have 20m left or so. Then sign a Gortat/Ariza etc etc, and then use our bird rights on LeBron to give him his max deal he desires?
Because you still have Lebron's cap hold tying up the space you would use to sign free agents. Until he signs or they renounce him, you can't use the money reserved for him. Cap holds are designed to prevent EXACTLY what you are trying to do.

hugepatsfan
07-01-2014, 10:55 AM
You have to keep a cap hold for the player's salary the previous year.

I think it's easiest to explain with an example. Let's say a team has $10 million of cap room and a free agent who made $5 million last year. The team could sign a player for $5 million and then use bird rights on their own free agent for whatever number they want because they still have the cap room to accomodate his cap hold. However, if they signed a free agent for $6 mil in order to have that much cap space they would have to renounce the bird rights to their own guy. Then they would only be able to sign him up to the cap.

DWNTWNLakeShow
07-01-2014, 11:11 AM
I live in Ignornace and let me tell you it is Bliss. It lets me dream up all these impossible scenarios that other posters then crush instantly ...haha

tripleplay2007
07-01-2014, 12:00 PM
Capholds are the reason why Miami cannot do this. To use bird years you must account for last years salary for the players you plan to use those rights on. By doing this it keeps teams from using that bs loophole.

Example if Bron, Wade, and Bosh all made 60 mil last year (Not true, just making an example) you would have to account for 60 mil on your salary even if they aren't official signed with you so you are able to have the bird luxury. They can renounce their rights and make more cap room at any time but if your renounce a players rights you are unable to use bird years.

Bramaca
07-01-2014, 02:01 PM
You have to keep a cap hold for the player's salary the previous year.

I think it's easiest to explain with an example. Let's say a team has $10 million of cap room and a free agent who made $5 million last year. The team could sign a player for $5 million and then use bird rights on their own free agent for whatever number they want because they still have the cap room to accomodate his cap hold. However, if they signed a free agent for $6 mil in order to have that much cap space they would have to renounce the bird rights to their own guy. Then they would only be able to sign him up to the cap.

Basically right but you don't use the previous years salary as the cap hold. For that $5 million player the cap hold would likely be $7.5 million (150% of previous salary).