The Nets switched out vets minimum deals on Friday, agreeing to terms with Darius Bazley, a 6’9” big, while declining their option on Edmond Sumner, a 6’6” combo guard. They got bigger and younger but may have lost some offense along the way. But nothing really changes on the salary cap. The Nets are still at about $10 million — $9,861,543, reports Spotrac — below the luxury tax threshold and more than $20 million — $22,145,760, again per Spotrac — below the dreaded second apron in the new CBA.
But unless they have a big trade in the works and nothing has emerged yet, the Nets are likely very close to being done. They have 14 players on standard NBA deals. They’ve lost six players since the end of last season — Joe Harris, Patty Mills, Seth Curry, Yuta Watanabe, David Duke Jr. and Sumner — and added five — Noah Clowney, Dariq Whitehead, Dennis Smith Jr., Lonnie Walker IV, and Bazley. Jalen Wilson has been signed to a two-way. Overall, the story is pretty much the same as it was in Friday’s transactions. They got a little bigger, a lot younger and may have lost some offense along the way.
But they got less expensive too. There is a bottom line. It’s this (and we’ve said this before): they are more about competing than contending and trying to get their fiscal house in order. No need to pay out big bucks for a small return. That sort of thing.
Because they spent so much in luxury taxes in the “Big Three” era, they are in repeater tax hell. If a team goes over the tax threshold in three years out of four, the repeater tax kicks in and that is what has happened in Brooklyn. The Nets were tax payers in 2020, 2021 and 2022, automatically triggering the repeater tax.
Here are the penalties that apply to repeat taxpayers, like the Nets per HoopsRumors: The more you go over the tax threshold, the more you pay:
$0-5MM above tax line: $2.50 per dollar (up to $12.5MM).
$5-10MM above tax line: $2.75 per dollar (up to $13.75MM).
$10-15MM above tax line: $3.50 per dollar (up to $17.5MM).
$15-20MM above tax line: $4.25 per dollar (up to $21.25MM).
For every additional $5MM above tax line beyond $20MM, rates increase by $0.50 per dollar
If you’re looking at a practical example, here’s one that Kristian Winfield came up with this week, a prospective trade in which the Nets trade for Miami’s Duncan Robinson using the $18.1 million trade exception generated by the Kevin Durant trade at the deadline. Winfield chose Robinson because his salary matches the KD trade exception (not because it’s been rumored. It hasn’t.)
The issue here, of course, is the repeater tax: The Nets are already at $155.4 million in payroll and the luxury tax threshold sits at $165.3 million. In this scenario, the Nets would not be taxed on the first $9.86 million of Robinson’s contract. The remaining $8.3 million on Robinson’s contract, however, would be taxed at the repeater tax rate of $2.50 on the dollar for the first $5 million and $2.75 on the dollar for the remaining $3.3 million.
That’s $21.575 million in taxes on top of Robinson’s owed $18.1 million deal.
Is Miami’s sharpshooter a $40 million player? The answer is a resounding no.
Moreover, as Winfield notes, Robinson is not going to “move the needle” on a championship scale. If it’s going to cost ownership $40 million to acquire a player, he had better.
That same math would apply next season as well, Yossi Gozlan of Hoopshype tells NetsDaily.
“If the Nets finish over the tax this season, they pay the higher rates. Same thing would apply for next season (the three of four season rule),” he messaged ND. “They’ll still be repeaters next year no matter what.
“Think of it this way. The rule is three of the last 4 seasons. So for this season, you need to consider 2019-20, 2020-21, 2021-22, and 2022-23. The Nets were in the tax in those last three seasons, so they’re in the repeater for this season,” he continued.
“For next season, you need to consider 2020-21, 2021-22, 2022-23, and 2023-24. The Nets were in the tax in those first three seasons, so they’re still in the repeater for 2024-25. After that season they will no longer be in the repeater, provided they avoided the tax in both 2023-24 and 2024-25.”
(One question, however. Could it have been avoided? The Nets are in this repeater tax predicament because they were barely over the luxury tax this past season. Before the deadline trades, they were $108.2 million over the threshold. Afterwards they dropped to around $8 million. There were reports that they wanted to go all the way, were trying to dump Curry’s deal and get under the threshold as the deadline approached at 3:00 p.m. on February 9, but time apparently ran out.)
That aside, if you’re looking for a milestone in the Nets timeline, Gozlan just provided it: the summer of 2025. There are other reasons to believe that beyond the fiscal concern. The next big free agent class is in 2025 and the Nets core of 23-to-27-year-olds should mature by then, sort of like what happened in 2018-19. Yes, we should also know by then where Ben Simmons stands. His contract runs out at the end of 2024-25. Finally, the NBA’s current TV/streaming rights deals will also expire then, and expectations are the new numbers will rise, providing a new windfall for everyone involved.
Sean Marks & co. are well aware that their play — trying to win while rebuilding — is very difficult but they like their chances because their core has a number of positives beyond youth. They are more athletic and certainly better defensively than the roster has been in four years. They also like that although they don’t have a lot of their own first rounders, they have 11 firsts from now through 2030. Perhaps most importantly, they believe that Joe Tsai will pay when it will make a difference. He paid out $323 million in the “Big Three” era after all. (Some fans have expressed concern that using one-year minimum deals to fill out the rotation could backfire if the free agents succeed and the Nets are stuck without their Bird Rights a year from now. The internal position is let the games begin! The free agents will have to prove they’re worth it ... and if need be, the team can use cap space and the common exceptions.)
Don’t expect the Nets to use their many exceptions in the near future, though. In addition to seven trade exceptions, including four above $4.5 million, they currently have the full mid-level exception at $12.4 million and the bi-annual exception at $4.4 million. If there’s a trade now or at the deadline, they could use a TPE to facilitate things as they have in recent years. Using the MLE and BAE isn’t likely and not just because of financial considerations. By this point in free agency, there’s not a lot of talent worth big or bigger bucks.
And this exercise should also tell you one reason why pundits now understand that the Nets didn’t have much interest in Damian Lillard. His contract is staggering particularly for a player who turned 33 on Saturday and will be paid $62.3 million when he’s 37. Marks was willing to take on James Harden’s bag in 2021 because he believed that Harden, combined with Durant and Kyrie Irving, was worth the investment, indeed could win it all. Not so much with Lillard.
As we have said multiple times in previous Off-Season Reports, things can change, things can change, things can change. But thus far they haven’t.
It now appears that at least one of the three free agents signed by the Nets this summer took a pay cut. Mike Scotto of Hoopshype reported Saturday that Dennis Smith Jr. passed on a bigger deal with Charlotte, where he played last season, in return for an opportunity and some love.
Charlotte offered Smith Jr. more than a minimum contract, league sources told HoopsHype, but it wasn’t enough. For Smith Jr., he saw a greater opportunity to play in Brooklyn, whom he heard from immediately at the start of free agency and was a priority, which also appealed.
Smith Jr. will make $2,528,233 guaranteed next season on a vets minimum deal. The 6’2” 25-year-old. had revived his career in Charlotte as a defensive specialist at the point of attack.
Lonnie Walker IV also intimated he had other offers. He had signed a one-year, $6,479,000 deal with the Lakers a year ago. Now, he’s playing for a third of that.
The Nets made it known that the Summer League would be a time for the players they signed to audition for two-way deals. Every NBA team has the option of signing three. Before Summer League, they gave one to Jalen Wilson, their 51st pick in the June Draft, leaving them with two. The Nets did sign RaiQuan Gray to a two-year two-way at the end of last season, the second year being 2023-24, but it isn’t guaranteed.
So who besides Wilson has done well on the Nets Final Four team? Start with Armoni Brooks and again, Scotto writes the Nets have liked what they’ve seen from the 6’3” shooting guard.
Armoni Brooks has made a strong case for a two-way contract with the Nets during an impressive Summer League stint. Multiple EuroLeague teams have also expressed interest in Brooks, who’s averaging 16.7 points and shooting 48.9 percent from the field and 45.5 percent from three-point range in four games for Brooklyn thus far.
Brooks, who’s 25, has the most NBA experience of any Summer League Net: 74 games. Moreover, the Nets signed him off a free agent workout at HSS, indicating they were hopeful about his prospects.
Gray, on the other hand, has not had a good Summer League and his two-way is not guaranteed.
The youngest player on the roster, 6’0” point guard Kennedy Chandler, has had an up-and-down four games. He’s averaging 14.8 points, 5.5 rebounds, 5.0 assists and 2.0 steals, but is shooting only 37.0% overall and 12.5% from three. He could get signed to a Long Island contract either directly or as an affiliate player, if the G League is a route he wants to take. He has two more years and $3.7 million left on the guaranteed three-year deal he signed with Memphis a year ago. Another young player who was seen as a candidate for a two-way, Jordan Hall, hasn’t played much.
And what about David Duke Jr., now in his third Summer League? The Nets declined to extend him a qualifying offer in June but he chose to play in Vegas anyway. It’s hard to imagine him wanting to go the G League route again. A first team G League All-Star last season, he’s proved himself there. He appears to be auditioning for a standard deal either in Brooklyn or elsewhere around the league.
“I’m always optimistic about that, but I try not to focus too much on that,” said Duke, who’s averaged 17.5 points and 2.5 steals going into the Final Four this weekend. “I think if I take care of the stuff on the court, everything will fall into place.”
When can we expect the final two-way signings? Might take some time, but if players like Brooks have competing offers, it could happen sooner rather than later.
Forgetting the future for the moment, the present has been quite entertaining for Nets fans who have been watching the Summer League roster get to the Final Four. Congratulations to Trevor Hendry, who’s risen through the ranks with the Nets, first joining the organization in 2014 in a video capacity. That’s two years before Sean Marks arrived.
Jalen Wilson in the community
Even before he steps on the court at Barclays Center, Jalen Wilson is contributing to the community. Before Summer League began, he and Wilson, the sporting goods manufacturer, put together a promotion.
So far, Wilson & Wilson have raised $7,050 for local YMCAs in Brooklyn!
What happened to Lonnie Walker’s signature hair?
In his first two years in the NBA, Lonnie Walker’s hair was his signature, piled on top of his head so high that the joke was he was 6’4” but 6’10” if you counted the hair...
There was no joke behind the hair, though. It was a way for Walker, who was the victim of sexual abuse from ages 7 to 10, to cope. He spoke about it with Chris Carrino this week, as Brian Lewis recounted Saturday.
“Growing up, I was sexually assaulted, and there was a point of time where I didn’t really know much about anything else besides just that,” Walker said this week on the “Voice of the Nets” podcast. “So I grew my hair up. I wanted to feel like I had some type of ownership in my life, or some type of something that I can call mine. … I just had my hair. I used to always touch it, used to always play with it. Kept me sane. That’s what really helped me out, helped disguise a lot of things, helped me get by, even sometimes if I wasn’t the happiest person in the world. …
“It was honestly a costume, a disguise,” Walker told Carrino. “But as I got older, it gave me confidence. It gave me my swagger. It gave me who I was. When people thought of Lonnie, [they] thought of me with the hair. Then you go on to draft day where I had the floating hat. So it didn’t really become a disguise once I came into the league, it became just who I was, what I represented as far as having your own swag and your own confidence and your own aura.”
But ultimately, he felt he had gotten beyond what happened and when he did, it was time to cut the hair. It was an emotional day...
“And once I hit a point where I was reaching a new chapter in my life, I decided to cut it. Understanding the past is the past and me knowing the bigger picture, which is knowing that I’m not the only one,” he told Carrino.
Steph Curry was positively gleeful on Saturday when he made a hole-in-one, the equivalent of a half-court 3-pointer...
Of course, it is a great achievement, but we think it might in reaction to this on Friday night...
Sabrina Ionescu (@sabrina_i20) just set the all-time record for NBA or WNBA with a score of 37 PTS in the FINAL ROUND of the #Starry3PT Contest to be crowned the NEW 3-PT CHAMPION | @starrylemonlime pic.twitter.com/YcGy3fDfBq— WNBA (@WNBA) July 14, 2023
Good night, Steph.
Time for a shootout.