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Changes in NBA CBA agreement

Dec 31, 2016; Oklahoma City, OK, USA; Oklahoma City Thunder guard Victor Oladipo (5) and guard Alex Abrines (8) celebrate after a three point shot against the LA Clippers to end the first half at Chesapeake Energy Arena. Mandatory Credit: Mark D. Smith-USA TODAY Sports

The league and the NBA Player’s association agreed to a seven-year union agreement, which keeps the league from becoming a lock out league like it did in 2011. However, both teams can opt out in the final year of the deal, in 2023-24.

The agreement has to be ratified by Jan. 13, but is expected to have zero issues in getting it ratified.

 

According to Eric Pincus of Basketball Insiders, here how this all effects Oklahoma City:

BRI DOESN’T CHANGE, BYE AMNESTY

The split of Basketball Related Income or BRI, will not change. Meaning the player’s get 51 percent and the owners get 49 percent. Gone is the amnesty clause that was invented in the previous CBA agreement. Many Thunder fans wanted Oklahoma City to use the amnesty on Kendrick Perkins, but the Thunder never used it.

 

One tax-related change does stand out, for teams that trigger a hard cap, the spending limit will be initially $6 million above the tax threshold (up from $4 million).

The definition of BRI may have expanded, although the details aren’t included in the term sheet. For now, the projection for the 2017-18 salary cap remains $103 million.

MID-LEVEL & BI-ANNUAL EXCEPTIONS INCREASE

Starting next season, the mid-level and the bi-annual excemptions will increase by 45 percent of what is off the current CBA agreement. the mid-level will jump to $8.4 and the Bi-Annual up to $5.2 million. Starting with the 2018-19 season, the MLE and BAE will rise or fall at the same rate as the salary cap.

Similarly, veteran minimum salaries will adjust annually based on the salary cap, starting with a set schedule for 2017-18.

The rookie minimum, which serves as the amount teams are charged for empty roster spots below 13, climbs to $815,615. That’s lower cap room than what is scheduled under the current agreement, which is $254,122 per roster spot.

TWO-WAY CONTRACTS

This is a big deal for the Thunder as they utilize their D-League team maybe more than any team in the NBA. While this addition was leaked early on, it’s still major. There will be two more roster spots, bringing the total to 17, to use for players who will spend considerable amounts of time in the D-League. These players will be signed to two-way contracts, allowing them to make different salaries based on their current assignment. Current D-League salaries range from $19,500 and $26,000. Hockey has a similar structure in the two-way contracts.

It’s expected to help teams in the D-League attract more fringe players. Instead of heading off to Europe, it could help the talent increase and improve the league overall.

DESIGNATED PLAYER EXTENSIONS

Probably the largest and most significant change in the new CBA agreement is how players can sign extensions.

First off, extensions can now be signed to three and four-year contracts after the second year of their signing. Previously, it was the third. The extensions also are now a maximum of five years than four. The first year can be the max of 120 percent, up for 107.5 percent.

Maybe the most important, the DPE will apply to veterans in their eighth or ninth season with their original season who meet certain performance goals. Such as All-NBA, All-Star or Defensive Player of the Year, etc. These type of players can be signed to a super max contract.

There are only two spots per team and their max can be any where between 30 and 35 percent of the team’s salary cap in their first season.

This reaction is definitely in part of Kevin Durant’s departure from the Thunder. This is help to future teams in small markets. It gives them an extra advantage to keep their own free agents past the original nine years in which they can keep them potentially now.

JUMP IN SALARIES

Minimum salaries ramp up, depending on years of service, to as much as $2.3 million for those 10 or more years in the league. The league reimburses teams for the salary paid to a minimum player (on a one-year deal) over the scale amount of a two-year veteran’s minimum. For example, an eight-year vet will earn $2.1 million but the team will be responsible for a cap hit of $1.5 million.

The rookie scale for first-round picks also climbs for 2017-18 by 15 percent. Salaries also climb in the second year, first by five percent (instead of the previous raise of 4.5 percent) and then by an additional 30 percent. The third year jumps by 45 percent.

For instance, the top overall pick in the 2017 NBA Draft will have a rookie scale of $5.9 million, $6.9 million, $8.1 million and $10.2 million, for a total of $31.2 million.

Additionally, the cap hold for an unsigned first-rounder will be 120 percent of scale, which will further reduce the amount of cap space teams will have each summer.

Under the current CBA, the top-overall pick is scheduled to earn $5.1 million. That will climb to $7 million in the new CBA.

Cap holds for player at the end of rookie-scale contracts will increase from 200 percent to 250 percent for those above the league average – and from 250 percent to 300 percent for those under.

Teams can now send or receive up to $5.1 million in trades over the course of a season. Both rookie scale and cash in trade will also adjust with the salary cap.

Player raises will climb from 4.5 percent and 7.5 percent to five percent and eight percent.

RESTRICTED FREE AGENCY

The NBA’s moratorium is now set to end at 12 P.M. EST on July 6 each season. Previously, it was set for July 11, a whole five days shorter. Also, RFAs can now sign an offer sheet during the moratorium period, which previously they had to wait until afterwards.

Teams can still unilaterally withdraw their qualifying offer to their own restricted free agent, but the deadline to do so has been moved up from July 23 to July 13.

Teams are no longer permitted to state publicly that they will match any offer sheets on their restricted free agent.

Matching salaries in trade will be easier for teams below the tax. Where it applies, the margin for trades has increased from 150 percent to 175 percent.

Players and teams can also agree to reduce (or even eliminate) a trade bonuses – an issue that could have scuttled trades under the current deal.

Maximum salaries are now based on 25 percent, 30 percent and 35 percent of the cap, a more-straight-forward computation than the current rule.

The “Over-36 Rule” has been changed to “Over-38.”

The over-36 rule prevented teams from signing players to four- or five-year deals if they would turn 36 or older over the course of the contract. The rule was meant to protect teams from committing to players who would be unlikely to see the end of the deal.

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