Why do NBA Teams “Draft and Stash” International Players?

Ricky Rubio, 5th overall pick by Minnesota in the 2009 NBA draft, just recently signed a contract to play for the Timberwolves. (Photo courtesy of REUTERS/Lucas Jackson)

With the prospect of many international players being drafted in the 2011 NBA draft, I thought it would be useful to understand why some teams draft international players but do not sign them to contracts immediately. International players almost always play for another professional team whenever they are drafted by NBA teams. This fact sometimes causes snags in the process of bringing the international player to North America to play in the National Basketball Association. When these issues arise, a number of teams employ what is sometimes referred to as the “draft-and-stash” approach.

There are three main reasons for this strategy: 1) contractual issues; 2) developmental reasons; and 3) roster space. It is common for all three reasons to play into a team’s decision to “draft-and-stash.”

Contractual Issues

Because nearly all international players play for other professional teams when they are drafted, some contractual issues arise. Many player contracts, whether in the NBA or other professional leagues, are signed for multiple years. Just like teams are not allowed to skip out on paying a player’s salary, a player cannot leave the team and go play for another team (that would be a breach of contract). Therefore, international players commonly have a contractual obligation to their current professional teams. In order to get out of the contract, the player has to pay a “buyout.”

A buyout amount can be determined in a number of ways (imposed standard by the league, independently negotiated by players and teams, or expressly provided in the contract). Therefore, even though an international player was drafted by the NBA, the player must buyout his contract before he can sign with the NBA team. The NBA collective bargaining agreement has a provision that directly relates to buyouts of international players, which complicates things.

The CBA places a $500,000 limit on the amount of money an NBA team can contribute to the buyout of an international player’s contact. A team is allowed to contribute more towards the buyout, but any amount over $500,000 counts as a player salary expense on the team’s books. As most teams are over the salary cap, paying more than $500,000 is not commonly done.

This buyout contribution limit is the main reason that it took Ricky Rubio several seasons to sign with the Timberwolves. According to some reports, in 2009 Rubio’s buyout from Joventut Badalona (his international team) was upwards of $8 million. Because the Timberwolves could only contribute $500,000 to the buyout, Rubio was left to personally finance the remainder. Instead of coming to the NBA right away and paying that large buyout, Rubio decided to play two more seasons, which reduced his buyout amount.

Rubio’s buyout amount now is reportedly approximately $1.4 million, which is much more manageable for Rubio to personally finance with the help of the Timberwolves contribution. Also, Minnesota was able to secure some local endorsements for Rubio to aid in the remainder of the buyout, so it is likely that Rubio will not have to pay a dime of his buyout.

Because of the above described contractual issues that arise, many international players opt to stay in Europe for a few season upon being drafted.

Developmental Reasons/Roster Space

To illustrate this point, one need not look any farther than the starting power forward for the Oklahoma City Thunder, Serge Ibaka. He was drafted 24th overall by the Seattle Supersonics in 2008. At the time he was drafted, Ibaka had only been playing organized basketball for five or six years. Although extremely athletic, Ibaka’s talents needed some polishing. Instead of baptizing him by fire in the NBA, the Thunder organization allowed him to continue playing for his Spanish league team.

Ibaka played only one season in Spain after being drafted. That one season was all that he needed. He was able to come into the NBA as a rookie and make an impact for a 50-win playoff team. Not all players are ready to step foot on an NBA court immediately after being drafted. The NBA Development League is a great tool for teams to use in developing young talent. However, allowing a player to continue to play internationally is another valuable avenue for player development.

Roster Space

Teams also draft-and-stash international players because of a lack of roster space. Most of the time roster and developmental concerns go hand-in-hand. The Oklahoma City Thunder has another international player that it is developing overseas. Tibor Pleiss was drafted 31st overall in the 2010 NBA draft by the New Jersey Nets and the was subsequently traded to Oklahoma City. Pleiss is 7’1” center who is currently playing for the German team Brose Baskets of Bamberg. He is surely still developing his skills internationally, but even if he was completely ready, Oklahoma City is short on roster spots in which to place him. The team could likely release or trade a player to make room, but there is no rush. A roster spot will open up down the line and if Pleiss has progressed enough, Oklahoma City will make the call.

Not all teams use the “draft-and-stash” strategy. It has proven to be very beneficial to franchises that use it regularly – Oklahoma City being one and San Antonio being another (the Spurs drafted Tiago Splitter in 2007, but 2010-11 was his first season in the NBA). It is a great way to steal great talent later in the draft because many teams shy away from players that cannot contribute immediately. However, to use the strategy effectively, teams must be patient and invest heavily in international scouting.

With eight or more international players being projected to be taken in the 1st round of this year’s draft (and even more in the 2nd round), it is likely we will see several teams elect to “draft-and-stash” a 2011 draft pick.

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