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SAFB
Join Date: Feb 2005
Location: Chile
Age: 19
Posts: 2,524
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Re: All About Carl "aka" CL Smooth
A post explaining the contract situation with Landry.
Quote:
There has been a lot of misleading posts expressing worries about Landry leaving the Rockets as a FA this offseason. The fact of the matter is, under the current Collective Bargaining Agreement ("CBA"), Landry simply cannot leave the Rockets for another NBA team against Morey's consent.
The reasons are set forth below:
1. Landry is a restricted free agent this offseason (and he would still be restricted if he becomes a FA before the next the next offseason, and the offseason after next-- pretty much all NBA FA with 3 years or less experience-- except for 1st rounders whose 3rd or 4th option had not been picked up). Rockets can match all offers received by Landry when he is a restricted FA.
The restricted tag on players generally impairs bidding (teams don't want to waste their time making an offer for a player who they clearly are not going to get) and even RFA who want to leave have often come back to their team (see Varejao).
2. Gilbert Arenas Provision:
This addressed the question whether any other team can make an offer the Rockets cannot match.
Being over the cap, Rockets must use a salary exception to make and match any offers received by Landry. The Rockets do not have Landry's "Bird Rights" (allowing them to offer up to the max) or "Early Bird Rights" (allowing them to offer up to the Average salary-- or the MLE). So they must use an available salary exception-- the MLE, the Bi Annual (starting at $1.91 million, up to 2 years, I think the Rockets will have this next season), and the non-Bird or minimum salary exceptions-- to sign him. The CBA now contains restriction (the Gilbert "Arenas Provision") on what kind of contract offers a player in Landry's position (non-Bird FA with 2 or less years in the league) or an Early Bird FA with 2 or less years in the league.
Basically, this provision does not allow an offer of more than the MLE be offered to Landry, this year or next year, by another team. Basically, there is no way another team can make an unmatchable offer. If Rockets do not match, it's due to their choice, not for any other reason. (It does mean that they need to keep MLE available until Landry signs in order to preserve this ability-- and likely use the MLE to sign him).
There is a way for a team with significant salary cap room to make him an offer that averages more than the MLE (for example, a team with $11 million cap room may be able to offer him something like a 5-year, $55 million contract, with the first 2 years at the MLE, and the last 3 years at/near the max, but I'd imagine someone with $11 million cap room would have a more established FA in mind... and guess what, the Rockets can STILL match such an offer)
(He can, I think, sign with Meccabi Tel Aviv, but if he wants back in NBA, I think the Rockets have the same rights-- will further verify this last point).
3. But what about the luxury tax?
It's true that if his salary is somewhat significant (say, near the MLE), it will likely push payroll above the luxury tax limit. But if they choose not to sign him for tax reason, it's still a result of choice. Besides, the Rockets have until the trade deadline to shed salary to get under the tax (like they did this year).
So, what does this mean as to the overall incentives for Landry as an FA this summer and for the Rockets?
1. If he really really really impresses and establishes himself as, say, a $8 million or $10 million per year player, he theoretically can get a big offer from another team (with first 2 years at the MLE, max on the rest), but that's unlikely even if he does impress.
The offer has to come from a significantly below-cap team (and not the Rockets, as far as I know), and that team would know their deal is likely going to be matched unless the numbers are looney.
Another team could be betting that Rockets tax concerns will end up in them not matching... but if Landry is really that good, it's most likely the Rockets will match and try to shed salary elsewhere. Les Alexander loves his stars.
Anyhow, the chances of this happening are remote.
2. Most likely, the game is going to be trying to negotiate the best deal he can with Rockets. Such a deal will be up to the MLE, and up to 5 years. So, what are the incentives:
He likely won't sign a 1 year deal. After 1 year, he's still an RFA and still subject to Gilbert Arenas. No matter how much he impresses, he could still only get big offer from another team with big cap room not afraid of Rocket matching. Besides, that' not much security against career threatening injuries.
He might sign a 2 year deal. He would still be RFA, but no longer subject to Gilber Arenas. A below cap team or the Rockets can give him a big offer, but RFA status inhibits bidding.
The team, of course would be glad to do either the 1 or 2 year deal, given that they still have control over him at the end of it.
A 3 year deal is probably likely. It's not as much security as a 4 or 5 year deal, but he does get to be unrestricted FA not subject to Gilbert Arenas at the end. If he impresses, he can get a pay day.
From the team's perspective, that locks up a good player for a decent amount of time, and does not subject them to too much of risk if something bad happens. If I were Landry, I'd want a 4th year player option if he could get it. May have to give up a little on the salary per year to get that-- Morey seems to be a hard negotiator.
A 4 or 5 year deal would give Landry more security, and the team would likely prefer it to a 3 year deal if they are confident he's going to outperform his salary for all these years. Whether Landry wants to lock himself in that long depends on his perceived risk of him becoming an high value player against his risk of injury/sucking during the next few years. Given his age (24 already) and his apparent confidence in his ability, my guess is he would risk another year of salary for an early pay day.
Anyhow, my prediction is Landry signs for 3 years, with a 4th year player option, at about $3-4 million a year. I don't think Morey will give him the full MLE because he knows the team has leverage and Carl would likely be willing to give up a bit on the up-front salary to preserve a pay day at the end of the 3 years.
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Credit to Carl Herrera on Clutchfans.
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