I posted recently about how the higher-than-initially-expected luxury tax line helps the Nets. I decided to break down all the numbers for next season (and possibly beyond) to see where the team stands, and how it's likely to proceed regarding it's own free agents.
For this to work, I had to make a number of assumptions, some of which are likely, some more up in the air. I welcome input on any errors I may have made in fact or prediction.
First off, I'm assuming Kevin Garnett does not retire. Obviously if he does choose to retire, the numbers dramatically change. Next I'm putting down that the Nets will pay Andray Blatche the max allowed. As an early-bird eligible player, he's eligible to receive 104.5% of the league average salary, which should be around 5.5 million, with a raise to around six million for the next season (early-bird contracts can be from 2-4 years, the Nets would probably give a player option for year three). I'm going to assume Andrei Kirlenko stays. I would have doubted this earlier in the season, but it would probably take a long term contact to pry him from the Nets, and that seems unlikely with his injury issues. He should be eligible to decline his player option and get a new one year deal for 120% of this year's salary, which is slightly higher, so I'm going to go with that. I'm leaving Paul Pierce out for now, more on that in a minute. Shaun Livingston's decision essentially doesn't matter. If he declines the MLE the likelihood is the Nets will use it on someone else, making it cap neutral.
This leaves roster spots 14 and 15. Even though the Nets have no cap room, there are some different possibilities here. The Nets could sign players to the veteran's minimum, which varies by the time the player has been in the league, they could buy a second round draft pick, they could sign an undrafted player, or leave one spot (or even two) empty. I've put 900K in both spots for now.
The results - before the Pierce situation is addressed, the total salary in this model is about $100.5 million, which puts them about $19.5 mil over the tax line, with a tax bill of $43.6 million. Pierce's salary would then be taxed at $3.25 per dollar for the first six hundred thousand, $3.75 for the next five million, $4.25 for the next five million, and $4.75 for the next five million. If the Nets were to offer Pierce ten million, the tax would be about 35 million additional, putting the total tax at about $73 million, still less than this years bill.
What about 2015-16, when the Nets would need to get below the tax line to avoid paying the repeater rate? The Nets would be about 7.5 million below the tax line, with seven players under contact (if Pierce is not given a multi-year deal). I think staying below the tax line (barring a trade) would be very unlikely, however, going over the tax line by a much smaller amount than previous years would significantly lower the bill, even at the repeater rate. For instance, going ten million over the tax line at the repeater rate would give a tax bill of 26.2 million, with the prospect of Joe Johnson's contract coming off the books the following year.
Here it is in chart form.
Once again, I welcome your corrections.