As the NBA lockout winds toward a Monday deadline to save the 82-game schedule, Zach Lowe of SI.com reports on some of the ideas that the league and players' union have come up with to get around the sticky idea of a super luxury tax.
In abandoning the hard team salary cap as a negotiating point, the league offered up some ideas to harden the existing soft cap. One was a graduated luxury tax that would extract charges of up to 400 percent of overage from teams who amassed player payrolls much higher than the cap level. The union balked at this, surmising that the graduated tax levels would essentially amount to a hard cap.
Lowe said a resultant idea was to punish teams like the Dallas Mavericks and L.A. Lakers by restricting future flexibility.
[I]f Team X spent $90 million on player salary in one season, or was set to exceed certain tax level in the following season (the timing is unclear at this point), that team would not have access to the mid-level exception during the summer free-agency period. Or perhaps it'd face stricter limitations on Bird Rights than the rest of the league, making it harder for the team to retain outgoing free agents.
To use a concrete example, in July 2010, the Lakers were about $25 million over the salary cap and $14 million over the luxury tax threshold before using their mid-level exception to sign Steve Blake ($4 million per year). The year prior, the Lakers were over the tax line before signing Ron Artest with the mid-level and re-signing Lamar Odom using a Bird rights exception. Such a rule as one Lowe describes would limit the Lakers' ability to stack payroll on payroll on payroll using the items that make the current salary cap a soft one.
It's an interesting idea, though you wonder how the cyclical nature of the NBA -- where teams get up in a position to spend large for the piece that will put them over the top for a few years, then drop off as stars age -- would affect the program's usefulness.
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