Ricky Rubio Contract Negotiations

[BizarroJerry [enjin:6592520]]

Hicks, this is why everyone's preparing for another lockout in a few years. The player's association is even telling it's players to save their money! haha. I wish I could attach a link to the story, but it's true.

[Lipoli390]

Hicks --

You're mid-level guy will never be $10 million because that salary is set by fixed formula in the CBA. As for the max, there isn't any definition of a max guy. The max is simply a cap on how much any one player can make. It was intended to prevent one player from sucking up most of a team's cap space and effectively pricing all but a few high revenue teams out of the market for the League's superstars. It was a direct response to KG's first non-rookie contract with the Wolves, which was at the time the biggest contract in NBA history. It haunted the Wolves from that point forward because it make it extremely difficult to surround KG with talented players.

Who gets a max deal isn't something that can be determined by some forumula or subjective evaluation of a player's worth. It is determined by the market -- i.e., how much a team has to pay to sign a player. How much you pay for someone's services depends in part on what your rivals are willing/able to pay. But it also depends on your relative bargaining position compared to your rivals. For example, a company based in a less desireable location may have to pay more that many of its rivals to retain the services of the same highly coveted executive. That's the way the world works.

I honestly don't know what Rubio's market value is. Flip probably has a better idea because he talks to agents and other GMs regularly. I know that non-game changers like Parsons and Hayward are getting max money. I know that Bledsoe turned down $48 million over 4 years and that he will either get a significantly higher offer from another team or end up playing one year at the qualifying amount and then become an unrestricted free agent next summer. I suspect the Wolves will ultimately have to pay more for Rubio that other teams that are more competitive or in more desireable locales.

In my view, the bottom line for the Wolves in deciding what to pay Ricky should be guided by two overriding factors: (1) how much will it take to sign him here rather see him sign somewhere else; and (2) whether paying that amount would significantly impede the Wolves ability to put a roster together that can compete for a championship without putting the team over the luxury tax threshold. Based on the projected $80 million plus salary cap after next season, and assuming Love is traded for a Wiggins package, giving Rubio $15 million per year would likely keep Ricky here and would NOT impede the Wolves ability to stay under the luxury tax threshold while building the team around Ricky, Wiggins, and LaVine. The Wolves could even keep Pekovic and bring in Thad Young without any luxury tax consequences.

So the Wolves will need to take a very business-like approach to this. The goal is to build a championship contender within the framework of the salary cap. It's that simple. Glen can't afford to be penny-wise and pound foolish. If the Wolves think they can put $15 million per year to better use than re-signing Ricky then by all means they should do so. Maybe they'd rather sign Bledsoe or find a Hayward or Parsons type at that amount, although I think Ricky is a much better fit with Wiggins, LaVine and Pek than any of those players or types of players. Otherwise, signing Rubio at around $15 million per year isn't this terrible thing that some suggest.

Again, the max salary isn't some gold standard of a player's worth. It's a protection owners have from a player of LeBron's caliber (or KG in his prime) holding out for $50 million per year or more, which would be an amount that only a small number of super high revenue teams like those in LA or New York could afford.

[Lipoli390]

Hicks, this is why everyone's preparing for another lockout in a few years. The player's association is even telling it's players to save their money! haha. I wish I could attach a link to the story, but it's true.

Lloyd --

But note that the lockout, if it happens, will be instigated by the union, not the League. The current CBA has been and will continue to be very good for the owners. Only a handful of teams weren't profitable last season and I don't think those few teams lost a lot. Heck, Glen Taylor decided not to sell after last season and even offered to buy out all the minority owners of the team. Not the sign of a guy losing lots of money or a guy concerned about the current CBA.

What we're hearing is that the players feel they got a raw deal under the current CBA. The elite players and the powerful agents who represent them desperately want to eliminate the individual player cap (i.e., max contract) because they know it dramatically constrains what these elite players would otherwise be paid. In the meantime, as we're seeing this summer, owners are satisfied giving max contracts to players they think will really help their teams because they know the max amount isn't a franchise killer and that it will become relatively insignificant when the cap skyrockets under the new TV deal after next season.

These owners aren't as dumb as some think. They're making money and they know they can afford max contracts and still build good teams without exceeding the luxury tax. What owners should fear is the next round of CBA negotiations in which the union will fight extremely hard to eliminate the cap on individual salaries. That's something we should all fear as fans in small or mid-market NBA cities because those individual caps are a key to competitive balance.

To put it simply -- max contracts are our friend, not our enemy. The real enemy is the prospect of a CBA without an individual player max.

[khans2k5 [enjin:6608728]]

Lip - some of your points don't make sense to me. If we make Ricky an RFA, how do we have to pay more for his services than other teams? We would end up paying him exactly what other teams are willing to pay him. Also, Bledsoe will be signing the QO because nobody is giving him the max. I don't see him getting the deal he is looking for because the market for PG's isn't there this year. Most teams in the league have a good situation at the PG position. I don't really see a team that is going to throw the max at Ricky. LA? NY? Are they really going to throw the max at Ricky now that they've seen that he can't shoot and that limits how good of a player he actually is? To be honest, I would rather have Bledsoe next to Lavine and Wiggins. He's just as good of a defender even if the steals aren't all there. His freakish athleticism helps him stay in position. He's a better shooter and scorer than Ricky which is a better fit next to the young guys. He can play off the ball or be a primary ball handler which he learned playing next to Dragic last year. I'd rather have Bledsoe's 17.7, 5.5, 4.7, 1.6 than Ricky's 9.5, 8.6, 4.2, 2.3. That scoring is going to be needed while Lavine and Wiggins develop and Lavine is going to be a guy who needs the ball in his hands a decent chunk of time to play to his strengths. If it were up to me, I'd sign Bledsoe to the max next off-season when he gets even better and flip Ricky for a better starting 4 than Young or Bennett. Sorry if I'm adding guys we don't have yet, but I just think the Cleveland deal is going down after 30 days.

[TheGrey08]

Lloyd --

But note that the lockout, if it happens, will be instigated by the union, not the League. The current CBA has been and will continue to be very good for the owners. Only a handful of teams weren't profitable last season and I don't think those few teams lost a lot. Heck, Glen Taylor decided not to sell after last season and even offered to buy out all the minority owners of the team. Not the sign of a guy losing lots of money or a guy concerned about the current CBA.

What we're hearing is that the players feel they got a raw deal under the current CBA. The elite players and the powerful agents who represent them desperately want to eliminate the individual player cap (i.e., max contract) because they know it dramatically constrains what these elite players would otherwise be paid. In the meantime, as we're seeing this summer, owners are satisfied giving max contracts to players they think will really help their teams because they know the max amount isn't a franchise killer and that it will become relatively insignificant when the cap skyrockets under the new TV deal after next season.

These owners aren't as dumb as some think. They're making money and they know they can afford max contracts and still build good teams without exceeding the luxury tax. What owners should fear is the next round of CBA negotiations in which the union will fight extremely hard to eliminate the cap on individual salaries. That's something we should all fear as fans in small or mid-market NBA cities because those individual caps are a key to competitive balance.

To put it simply -- max contracts are our friend, not our enemy. The real enemy is the prospect of a CBA without an individual player max.

I do believe the player max is a good thing to have, but I think they need to raise player designation. Right now it's possible for 3 superstars to come together b/c they only make 25-30% of the cap. By increasing the designation so it's very significant makes it harder for superstars to come together since they're giving up that much more money.

Maybe something like the default player salary cap stays at 25%, but the player designation gives them an extra 10-15%. This being reserved for the truly elite players (teams will be much less likely to throw it around). I also think this designation should NOT follow the player if they are traded.

It's similar to the idea of allowing teams to give 1 player a roster bonus of some sort. As long as they are on the team they signed the contract with they get their roster bonus. If they are traded that bonus goes away. Switching from the designation to the roster bonus idea is probably even better.

If I recall correctly they started at a almost 16 mill which was a pay cut of 2-3 mill per season. Correct me if I'm wrong there. For simplicity's sake. Lets say 25% was exactly 15 mill four years ago (60 mill team cap). A 35% designation would have been an extra 9m/yr and a 40% designation an extra 12m/yr. Do think you think they would have all given that much money up 4 years ago?

[Lipoli390]

Kahn's -- I'm hedging against the real possibility that another team offers Ricky a full max deal, possibly with poison pill type terms. My point is that it would be reasonable to offer Rubio a flat $15 million per year deal (less than the total max with 7.5% annual raises) now rather than risk having to match something worse. Moreover, there is value in locking Ricky in now for sake of organizational stability. There is also value in avoiding a sour relationship with Ricky. Finally, the individual max will be going up substantially with the New TV deal so locking Ricky in now long term at today's annual max of around $14.7 million makes a lot of sense for the a Wolves.

[khans2k5 [enjin:6608728]]

There's no such thing as a poison pill max. Poison pill offers only apply to 1-2 year players under the Gilbert Arenas provision. The provision can only be used on guys who have been in the league for 1 or 2 years and are restricted free agents. You can't give him less than the max and then more than the max to make the average the max. They call it the max for a reason. You can't go over it. The worst it could get is a standard 25% max with 4.5% raises pending he doesn't become MVP of the league or make 1st team all-NBA. That's not worth trying to sign him to a flat rate way above his skill level. The most you save if you give him 15 now is 4 million dollars in the last year of the deal and there's no guarantee he gets a max deal to begin with. Only we can give him the 7.5% raises as part of an extension. Other teams can only give him 4.5% raises. If he's asking for the max, I don't see how he can get sour for not getting what he's not worth yet. The new tv deal salary cap won't hit next summer. It hits the summer after when he most likely already has a long-term deal in place.

[mjs34]

Lip, the designated player (5 year deal) has to have 7.5% raises included, so there is no flat rate allowed under that provision. If they give him the 5 years, he is getting over 85 mil total.

I think they should stand on a four year deal around the 48-50 mark, and if he doesn't take it, you wait till next season, or consider trading him.

SJM -- I don't think that's true. The CBA sets a max raise, but not a minimum. Only the first year has to be max. It can't go down, but it doesn't gave to go up.

Lip, this is from Larry Coon's page at the end of the rookie and veteran extensions section -

4 Raises in a rookie scale extension for a team's Designated Player must be 7.5%.

[Lipoli390]

There's no such thing as a poison pill max. Poison pill offers only apply to 1-2 year players under the Gilbert Arenas provision. The provision can only be used on guys who have been in the league for 1 or 2 years and are restricted free agents. You can't give him less than the max and then more than the max to make the average the max. They call it the max for a reason. You can't go over it. The worst it could get is a standard 25% max with 4.5% raises pending he doesn't become MVP of the league or make 1st team all-NBA. That's not worth trying to sign him to a flat rate way above his skill level. The most you save if you give him 15 now is 4 million dollars in the last year of the deal and there's no guarantee he gets a max deal to begin with. Only we can give him the 7.5% raises as part of an extension. Other teams can only give him 4.5% raises. If he's asking for the max, I don't see how he can get sour for not getting what he's not worth yet. The new tv deal salary cap won't hit next summer. It hits the summer after when he most likely already has a long-term deal in place.

Ricky could take the qualifying offer next summer and then become an unrestricted free agent the following summer when the new TV deal hits and drives up the max. He could get a lot more money then and go to a better team and/or bigger more cosmopolitan market. I'm not against waiting until next summer, but waiting has known and unknown risks, Flip will have to use his best judgment based on the inside knowledge he has about Ricky's intentions, his market value, and the value to the Wolves of locking up Rubio long term now for purposes of attracting free agents and building the team's brand.

My main point is that the max salary is not and was never intended to be synonymous with a player's abilities or performance. There's no such thing as a max player. The max cap was intended to protect the League from the market value that superstars would command in the absence of a cap. LeBron's actual market value is probably $70 million per year because a team with huge revenue streams like the Knicks, Nets or Lakers would probably offer him that amount. There's no such thing as a max player. There is only an individually player salary cap that artificially caps salaries of certain players below their market the market value.

[Hicks123 [enjin:6700838]]

Lip,

I completely understand how the market is set by supply and demand. And I also agree that the max deal was set to protect ownership from examples like you gave for LBJ (in fact I just read an article that stated he would be valued at around $70M as you state based on impact to team wins). But I don't agree that players don't have "values" based on where the max is set. As long as there is a "cap", then teams have to designate a value on the potential wins a player brings to the team. Since you can't afford to pay everyone a "max" deal, then you need to pay players more that are going to deliver a higher level of success to your team. If you want a winning team, you need to manage your cap accordingly and ONLY pay stars max type money. The teams that get stuck in purgatory are those that are forced to pay guys like Ricky Rubio $15M per year max deals when they clearly don't deliver that type of value on the court. And there are always situations where this doesn't apply. Parsons contract will make up 24% of the total cap for the Mavs. While the market dictated his contract, the Mavs situation of Dirk (who should be making $20M+) taking less than $8M next season is what allowed this to happen. His value as a player is not of a guy making 25% of the total cap space. In a vacuum, his contract is fine. But in the scheme of a 15 person team...he is severly overpaid. And the Wolves don't have the luxury of having a top 10 player willing to take an $8M contract so the team can overpay the necessary pieces to put together a competitive team.