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Why NBA teams are signing so-so players to massive contracts

The combination of a massive jump in the salary cap, a weak free-agent class and a desire by teams to fill that space will totally warp the pay structure of the NBA. Don't go too crazy when you see some of these contracts.

Kevin C. Cox/Getty Images

July is the NBA's greatest month. Not even the finals routinely commands the attention of the entire sports world like free agency does, not when the league consistently produces thrilling dramas like DeAndre Jordan's emoji sweepstakes and LeBron James' decisions. This year, even in a weaker free agency class, the opening days of July promise to be as thrilling as ever, and it's not even because Kevin Durant is on the open market.

It's thanks to a nine-year, $24-billion television deal signed by the NBA in 2014, which will cause the salary cap to rise higher than it ever has -- in money, yes, but also in sheer year-to-year growth. Last year's $70 million salary cap is expected to rise to at least $94 million; the $24 million increase is biggest leap the league has ever seen. There's no precedent for this in the NBA's history, which means nobody knows exactly what to expect from this offseason.

Well, beyond the obvious: a lot of players will be receiving a lot of money.

Forget about "normal" contracts

The salary cap has been rising for decades, and we've gradually become accustomed to what a player is and isn't "worth" in the NBA. But the $24-million increase is so sharp that the numbers normally associated with certain types of players can go out the window.

With the cap rising dramatically, it's more accurate to view contracts as a percentage of the total cap. A role player like Marco Belinelli usually makes around 8 percent, while a superstar like Kyrie Irving is capped at slightly below 25 percent. The numbers will look foreign from where they stood five years ago due to the new television money, but the percentages will likely be very similar, whether it's the $58 million cap from the 2012-13 season or next year's $94 million one.

Here's a chart that uses Irving's maximum contract as a template.

The spike applies to maximum contracts, but it also just as easily does for role players or normal starters, as the chart below displays. We'll use the current contracts of Belinelli (about 8 percent of the cap), Houston's Trevor Ariza (around 12 percent), and San Antonio's Tony Parker (about 19 percent) as a guide.

(Marco Belinelli)
(Trevor Ariza)
(Tony Parker)
Kyrie Irving
PERCENTAGE OF CAP 9 percent 12 percent 19 percent 23.5 percent
2012-13 $5.2 million $6.6 million $10.9 million $13.4 million
2015-16 $6.3 million $8.1 million $13.4 million $16.4 million
2016-17 $8.4 million $10.8 million $17.9 million $22 million

Let's make those numbers more relatable. When thought of as a percentage of the cap rather than in raw numbers, Kawhi Leonard's lucrative five-year, $95-million deal signed last season would have been worth $127.3 million this summer. DeMarre Carroll signed with the Raptors for four years at about $15 million per season, but he would average $20 million with the same contract if he had signed for the same percentage of the cap a year later.

The cap is rising almost exactly 34 percent, meaning salaries are cleanly going up by a third for players across the board. You can see the difference even in bit players like Brandan Wright, whose $18 million deal over three years would translate $24.1 million under this system.

OK, yes, we'll all make jokes about DeMar DeRozan when he signs a $152-million deal in Toronto while Stephen Curry makes just $11.3 million for the Warriors next year. But the contracts aren't comparable, since they come from completely different salary cap landscapes.

Teams that miss Kevin Durant will have more money than they can handle

The rising cap means contracts will increase, but it also means that there's more money overall to spend. More than two-thirds of the NBA (about 21 teams) could have room to sign a maximum-contract free agent because most multi-year deals signed between 2012 and 2015 are now under market value. That's a lot of money available without a huge supply of players to fill it.

In reality, there won't actually be 21 teams with max contract space, for several reasons. There are varying levels of maximum contracts based on different free-agent rules and a player's experience level, for one. Worse, there are only so many players good enough to be worth that price in a vacuum this summer. Some of the teams would have to decline or choose not to re-sign players to free up the necessary cap space, too, which brings the number of teams down. Regardless, there's still a record number of teams with globs of space.

The summer of Durant is growing more predictable, thanks to the Thunder's impressive Western Conference Finals run and rumors that Durant is a heavy favorite to return to Oklahoma City. However, he's holding meetings with five other teams -- Golden State, San Antonio, Miami, Boston and Los Angeles (the good one) -- before he decides, with a couple more franchises (mostly New York) still holding out hope that he'll entertain them.

The simplest math this summer is that Durant can only sign with one of those six-plus teams this summer, leaving many other teams with a hole the size of a 6'9 superstar forward in their salary cap. The NBA has a minimum team salary that all clubs are supposed to hit, which is 90 percent of the salary cap. The penalties if you miss out aren't harsh -- the extra money between your cap and the 90 percent floor is split among the players -- but it's still an incentive for teams to spend that money. And they have a lot of it.

At the same time, the free agent class is not particularly top-heavy. There are a few older stars in Al Horford, Dwight Howard, Pau Gasol and Dwyane Wade. There are players who seem unlikely to leave in Mike Conley, Nicolas Batum, Dirk Nowitzki and Bradley Beal. And there's Hassan Whiteside, who doesn't really any fit into defined category.

Then, there's a clear secondary tier, including Harrison Barnes, Chandler Parsons, Kent Bazemore, Marvin Williams, Evan Fournier and Dion Waiters. These are all role players in their prime or younger with varying levels of potential, but they're all set to make first tier money because teams won't have anything better to spend it on.

In another season, it would be crazy to think of Barnes or Fournier as players who could be offered maximum contracts, but this year is different. There's just too much money to spend and too few free agent targets to go around for teams not to consider it. To put it in very simple terms: there's too much demand and not enough supply in this market.

The cap will keep rising

The salary cap jump to $94 million was expected once the $24-billion television deal was signed, but no one immediately foresaw another substantial jump coming the year after. But it's happening, with the 2017-18 cap is set to jump to an estimated $107-110 million range.

The obvious result is that contracts handed out next summer will be even more ridiculous than before. That's why Durant's most lucrative option, wherever he decides, will be a "1+1" contract so he has the option to re-enter free agency next year, as Jason Patt explained on Tuesday.


Another projected $13-16 million increase to the salary cap means teams have less reason to be stingy with their extra money this year, too. Many can still make a significant signing and have maximum salary room next year.

Amazingly enough, deals signed this summer might actually end up looking like bargains next year. Think about it -- a player making $18 million this coming year will be worth 20 percent of the cap room, but only 16.3 percent by the 2017-18 season. So even if $18 million per year is normally too much for, say, Kent Bazemore, it could quickly fall back in line with what players like him earn.

Overall, NBA free agency has never had this much money to spend on so few top-tier free agents, all while having every incentive to actually use that money. We know NBA free agency always manages to be wildly entertaining. This season should be crazier than ever.

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Get ready for NBA free agency to blow your mind

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