NBA salaries have to change

NBA salaries have to change
By Ira Winderman
NBCSports.com

Poverty or positioning?
Distress or deception?
Turmoil or tomfoolery?
This truly is a difficult one to decipher, the block-charge of all financial ledgers.
On one hand, the NBA takes out a $200 million line of credit to help its teams during this period of worldwide economic distress.
On the other hand, commissioner David Stern says his league must be in pretty good shape to merit such a loan in these times of tight cash.
On one hand, Stern talks about how changes will have to be made in the league's collective-bargaining agreement to reflect the economy.
On the other hand, it is too convenient to not declare distress when the current working agreement is two seasons from expiring.
That's not to say that the NBA is not suffering. Back in October, Stern already was making plans for a shrinking workforce in the league office. Teams have significantly trimmed staff as revenues wane.
Yet what better way to sweat out markets where new arenas are sought than to offer tangible evidence that your team already is on fiscal support, and that without new revenue streams, they might soon be gone?
In Sacramento, woe-is-we could not have been better timed. The Kings tap into the new credit line, voila, significant new arena talks.
Granted, this remains a world unto its isolated self.
As the staff member of one team pointed out, his franchise several years back made calls to each of the players' families, with the team on a lengthy trip during the holiday season, to make sure they were able to secure their holiday turkeys.
That same team, at that same time, was dismissing members of its secretarial staff.
And while several teams currently are in the midst of cutbacks, everything from trimming game-night meals for staffers to elimination of team publications, players still are spending their nights at the Four Seasons or Ritz-Carlton.
(As an aside: Those very same players frequently express a preference to stay at Marriotts, Hiltons and Hyatts, with those properties often closer to malls and more in line with players' sensibilities when it comes to room-service charges.)
Walk into the offices of most teams and there is a very real and ornate wall between the basketball and business sides. In some places, the differences can be stark, from cathedral to cubicle.
No, those two worlds will never become unified.
Yet to truly restore something closer to fiscal sanity, where lines of credit won't have to be justified as signs of economic strength, what first has to change are the rules of the workplace, rules that can save far more than any current cost-cutting on the business side.
First will come a spending binge unlike any the league has experienced, with the 2010free-agent free-for-all of LeBron James, Kobe Bryant, Dwyane Wade, Chris Bosh and Amare Stoudemire.
Then, on July 1, 2011, ownership can put something in place that just might save themselves from themselves.
Expect a push for several changes from the current collective-bargaining agreement.
Salary cap
The current formula should result in its own decrease in the payout to the players, without much wrangling, based on declining revenues.
At least that's the way teams are already approaching the process.
While the cap is $58.7 million this season, the expectation from at least one front office is for it to drop to $57.3 million for next season and $56.5 million for 2010-11.
At that rate, it is unlikely teams would push too hard to adjust how the players' share is calculated from the overall revenue stream.
Soft cap
What might change, though, is how soft the cap will remain.
Unlike the NFL, with its hard cap, where the annual ceiling is a definitive ceiling, the NBA long has allowed for exceptions that allow teams to retain their own free agents, as well as continually add lower- to mid-range free agents.
However, the bane of teams with over-aggressive general managers long has been the mid-level exception, the means to add one player each offseason at the average salary.
The problem is those players, indeed, prove to be just that, average, with their contracts lingering on the books long after the search resumes for something better.
A mid-level deal this season started at $5.6 million. The dilemma is that such deals can be offered for up to five seasons, mistakes that keep on giving.
Look for the mid-level exemption to either be eliminated or reduced to a maximum of two seasons, as is the case with what the league calls its lower-level exception, one worth less than half of the mid-level that can be utilized only in alternate years.
Maximum contract length
Currently, teams that retain their own tenured free agents can re-sign those players for up to six seasons. Most other contracts, including extensions, are limited to five seasons.
Unless the union is willing to move toward non-guaranteed contracts, as is the case in the signing-bonus-based NFL, figure on those maximum lengths to be trimmed severely.
Considering how well the current rule has worked in keeping players with their current teams, perhaps the move would be to a three-year maximum length when signing with an outside team or a five-year limit when re-signing with your current team.
Maximum salaries
This is an interesting one. Currently, a player with seven or fewer years of service can receive a starting salary of no more than 25 percent of his team's salary cap. Those tenured between seven and nine years, can receive 30 percent of their team's cap. With 10 or more seasons of experience, it rises to 35 percent.
While the goal of this rule was to spread the wealth, the NBA, with its preoccupation with 2010 free agency, has come to the realization that one player can make all the difference.
The key here is that if you can pacify the leading players, and, therefore, the leading agents, you just might find the rank and file falling in line.
This might be one area in a new deal where the percentages go up. A league with a happy Kobe, LeBron and Dwyane tends to be a happy league.
Maximum raises
Currently, players re-signing with their teams can receive annual raises up to 10.5 percent. Player signing with other teams can receive raises of up to 8 percent.
Considering we're essentially living in an inflation-less society, those figures come off as excessive, even by NBA standard. Of course, this being pro sports, common sense tends to only get in the way.
But if ever there was a time for reform, the league appears to be at that crossroads.
The economy is changing. So must the NBA.