NBA: “Loopholes! We got loopholes!! Get your…”
As the NBA heads into the heart of its in-season, trading season, a couple of items need be remembered to ensure those trades in your head are valid:
1) The NBA Trade Deadline is the 16th Thursday of the season, which falls on February 24, 2011, this year.
2) Teams cannot trade a player recently acquired via a separate trade for two months after the acquiring trade date.
a. So Vince Carter, Rashard Lewis, and Gilbert Arenas, acquired on December 18th, cannot be traded until February 18, 2011.
3) Unless, of course, that player is traded by himself, i.e. a trade not including another player from his team.
a. So when the Hornets traded Jerryd Bayless only a month after acquiring him from Portland, it was actually two trades.
b. Hornets acquired Jarret Jack, Marcus Banks, and David Andersen from the Raptors for Bayless and Peja Stojakovic.
c. Bayless was traded by himself for Andersen.
d. Peja was traded for Jack and Banks.
e. NBA teams are tricky.
4) A team cannot reacquire a player it traded in the same season, unless that player was waived. Remember Zydrunas Ilgauskas being traded to the Wizards last year, only to resign with the Cavs later that season?
5) For teams over the salary cap, the incoming players’ combined salaries cannot exceed 125% plus $100,000 of the combined outgoing salaries.
6) In a trade teams can include “cash considerations” up to $3,000,000 and draft picks.
7) When “cash considerations” are part of a trade, it is not included in the matching of salaries exchanged between teams. Draft picks are likewise counted as $0.
8) Base Year Compensation players, like Luis Scola, are hard to trade. So Luis Scola will be paid $7,775,378 but he would only count as 50% of that, or $3,887,689, in an exchange of salaries. This theoretically prevents the Rockets from getting equal value in trading him.
9) There are three types of exceptions for NBA Trades: Minimum Salary, Disabled Player, and Traded Player.
10) The Minimum Salary exception allows teams over the salary cap to acquire (sign or trade for) players making the minimum salary. I would go into further detail, but I hate typing the word minimum.
11) The Disabled Player exception allows teams to acquire a replacement player for an injured player.
a. The Rockets applied for such an exception when Yao went down.
b. So did the Mavericks when Caron Butler went down. Rejection!
12) Traded Player Exceptions can only be used in trades and are created when a team trades away only one player whose salary is greater than that of the incoming salaries. The exception amount is equal to that difference.
a. Example – The Rockets traded David Andersen on July 28, 2010 and received a 2nd round draft pick. The Rockets also created a $2,500,000 trade exception, Andersen’s salary, for themselves.
b. So when the Rockets traded Trevor Ariza ($6,322,320 salary) as part of the deal that brought Courtney Lee to town this past summer and received a $6,322,320 trade exception, a conclusion can be drawn.
c. The exception matches Arixa’s salary exactly.
d. Conclusion being that the acquisition of Courtney Lee ($1,352,640 salary) in that transaction was actually a separate trade as he was acquired using a previous trade exception.
13) The Rockets have four Traded Player Exceptions: Ariza – $6,322,320, Carl Landry – $1,647,360, Joey Dorsey – $881,000, and Jermaine Taylor – $780,871.
a. These exceptions cannot be used in conjunction to acquire a player with a $10,000,000 salary.
b. The exceptions must be traded alone, such as the manner in which they were created. They cannot be combined with another player’s salary to acquire a player with a larger salary. (Can’t add the Ariza $6.3 million to Shane Battier’s $7.3 million contract to acquire Steve Nash and his $10 million salary)
c. The Rockets can use only part of an exception and keep the remainder for a later trade.
d. The Rockets can combine a draft pick with an exception to essentially acquire a player without giving one up.
e. The exceptions expire a year after their creation. So Ariza’s expires on August 11, 2011.
14) A player who was a restricted free agent the summer before, umm Kyle Lowy, whose team used the right of first refusal to sign, cough Houston Rockets, cannot be traded for one year without his consent.
a. In Lowry’s case, the Celtics made an offer which the Rockets matched. So the Rockets cannot trade him this season without his approval.
There’s more, but I need to go read some back issues of Berkshire Hathaway’s Annual Reports to clear my mind (actual quote from 2008 Annual: “By year end, investors of all stripes were bloodied and confused, much as if they were small birds who had strayed into a badminton game.”)
Very informative piece. Nice work.
Lowry was offered by the Cavs, not Celts. Just to clarify this nice bit of information. Thank you.
I’ve never heard of this Arixa player, who was he?
One so many forget,
You have to have a roster spot for incoming players,and the roster is set at 15.
For example,the Rockets have 15 players under contract. They cannot trade away one player for 2,unless they clear a roster spot for the second incoming player. Teams can waive a player,but they have to pay his full salary and his entire salary counts towards the Salary Cap.
To use one of their TPEs(Traded Player Exception),the Rockets would have to create a roster spot.(Like they did by sending JT to Sacramento so they could get Williams.)
We will be giving away Jeffries soon, as in paying a team the remainder of his salary this year, most possibly Sacramento because they have lots of cap space. That will create one roster spot.
Great stuff. I feel less stupid than usual.
I am just happy there was the usual humor, albeit all the way at the end.
I glazed over a good bit but it was good info.