Hollinger: Biggest and best cap-nerd moves of the 2024 NBA offseason

Blame the aprons? Not so fast.

The 2024 NBA offseason has found its bogeyman, and I’m not sure the rap is fair. While the new rules of the first and second tax aprons are being blamed for a lack of deal activity, the majority of the inaction is the result of other barriers. That includes the holdovers from the previous collective bargaining agreement — the luxury tax, most notably, but also pre-existing apron rules — and, less discussed, a far more punitive luxury tax situation that will take a particularly strong bite one year from now.

Cap nerds live for this stuff, and now we have as much as we can handle. The constraints of the 2023 CBA have also given us new, creative cap-circumventing shenanigans and other tricks to wriggle every inch of freedom from the legalese handcuffs.

That takes us to today’s theme: The top cap-nerd moves of the 2024 offseason. I’ve been dragging my feet on completing this, much like the many teams dragging their feet on completing their offseason shopping, but it’s time. We may end up waiting quite a while for the remaining shoes to drop; once everyone gets on a plane out of Las Vegas at the end of summer league, half the league is on vacay.

We’ve seen a lot of new tricks in the last year, and we’re likely to see more. I narrowed this down to my nine favorite, and even that was hard. Let’s dive in:

Spurs, Sixers and ye ole incentives trick

When can you use cap-room money that doesn’t actually count as cap-room money? When you sign multiple players with cap room and use unlikely incentives on the first contracts.

San Antonio and Philadelphia both pulled off this feat this summer to extend their cap space. The Spurs’ deal with Chris Paul, initially reported as $11 million, was actually for $10.46 million, with an additional $1.57 million (the maximum allowable 15 percent of base pay) in unlikely incentives.

The Spurs needed enough cap room to absorb all $12.2 million of base salary and incentives when he signed, but once he was on the books, his number went back down to $10.46 million because the incentives were considered “unlikely.” (The trick is for team and agent to come up with “unlikely” incentives that are as likely as possible so the player still gets paid. The assorted shenanigans involved are worth its own separate column. We haven’t seen the paperwork on Paul’s incentives yet, but two examples that could count as “unlikely” and still be highly attainable are Paul’s team winning at least 23 games — the Spurs won 22 last season — or Paul starting at least 20 games after starting 18 in Golden State last year.) That, in turn, left San Antonio with just enough room to take on Harrison Barnes’ $18 million salary for this season in a trade with the Sacramento Kings — provided he waived his trade kicker, which he did.

Similarly, Philadelphia extended its cap space by signing Caleb Martin to a four-year deal that pays him $8.13 million in base salary in 2024-25, with the maximal $1.2 million in “unlikely” incentives. The Sixers used $9.3 million in cap room to initially absorb Martin’s base salary and incentives, but once that was done, he was only on the books for $8.1 million. That allowed more breathing room to add Paul George and Andre Drummond.

Philly was just getting warmed up.

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Philly subs cap room to second apron

This seems impossible, but the Sixers managed to pull it off: Adding a max contract with cap room, then still ending up so far into the luxury tax that they’ll be pushing the second apron once they fill the rest of the roster.

Philly still only has 12 contracts but projects to zoom past the first apron and about $11 million into the tax even if the last two roster spots are one-year veteran minimum deals. How is that possible? Basically, through the magic of cap holds.

Some other bits added to Philly’s apron calculation even when using cap space, such as the incentives trick with Martin above, the room exception for $7.98 million for Kelly Oubre and veteran minimum deals for Kyle Lowry and Eric Gordon that combined to count for $3 million more than the rookie-minimum cap holds they replaced.

But the real reasons Philly’s payroll could balloon far beyond the cap — even after using room — were the artificially low cap holds for Tyrese Maxey and Kenyon Martin Jr. Maxey had a hold for just $13.3 million, but once Philly used the rest of its cap room, the Sixers bumped him up to a max deal that pays him $35.1 million in 2024-25.

Martin, meanwhile, had full Bird rights but a minimum cap hold of $2.1 million; the Sixers instead will pay him $7.975 million for 2024-25 on a two-year deal with no second-year guarantee. As a result, he’s essentially a walking trade exception (especially once we get to the 2025 offseason).

The Sixers could have had some of Martin’s money as likely incentives to potentially reduce their luxury tax hit if he stayed on the roster all year (he would have the same cap number through the trade deadline either way); however, that could have potentially reduced his cap number in the offseason for a salary match.

Theoretically, the Sixers also could have given him a max rather than his two-year, $16 million arrangement. However, that would have created other issues with the second apron and luxury tax. More problematically, it also may have attracted significant attention from the Circumvention Fun Police at the league office.

The other piece of this to consider is a loophole in the 2023 CBA: Using the room exception does not produce a hard cap of any kind, even though using the taxpayer midlevel exception (which is for less money) does cap teams at the second apron if they use it. The league may have assumed nobody would use all their cap room and then still blow through $40 million more on their cap sheet to nearly reach the second apron. The Sixers were here to remind it that somebody might.

When can you get a raise of more than the allowable 40 percent on a veteran contract extension? When you get traded before you’ve played a game under the new extension.

As a reminder, Dejounte Murray extended his contract for the maximum 40 percent raise in Atlanta in the 2023 offseason, taking his salary from $17.7 million plus incentives in 2023-24 to $24.8 million in 2024-25. On top of that, Murray negotiated a 15-percent trade kicker into the deal.

That kicker worked out handsomely when he was traded to New Orleans this summer before playing under the extension, thus entitling him to the 15-percent kicker for the first three years of the extension (but not to the fourth, which is a player option).

That meant a $12 million bag for Murray; split it evenly over the three years, and it bumps his de facto salary to $28.8 million for 2024-25 — a 63-percent raise on his salary the previous season.

Murray also has $2.1 million in incentives on the contract that were unaffected by the trade, $700,000 of which is considered likely; that’s why his cap number is listed at $29.2 million for the upcoming season.

New Pelicans guard Dejounte Murray is getting a nice pay bump this offseason. (Larry Robinson / USA Today)

LeBron’s pay cut

LeBron James took $1.3 million less than his max in 2024-25 with the Los Angeles Lakers after opting out and briefly becoming a free agent. He left the money on the table for a very good reason: It would have basically prevented in-season roster upgrades had he not. James’s pay dip allowed the Lakers to end up mere pennies below the second apron (and it allowed them to pay Max Christie $32 million over four years, but I digress…).

James’ sub-max contract is important because it’s Los Angeles’ only realistic pathway to acquiring a player who makes more than $20 million this season. The Lakers aren’t trading James or Anthony Davis, obviously, but their next highest-paid player, D’Angelo Russell, is only on the books for $18.7 million.

If the Lakers had gone over the second apron, they wouldn’t have been able to aggregate salaries in a trade and could only take back less money than they sent out in a player-for-player trade. Thus, they would have been “hard-capped” on any potential trade return at $18.7 million unless it involved James or Davis.

Now, they don’t have that restraint; they still can’t take back more than they send out but, crucially, they have the ability aggregate salaries. Combining, say, Russell, Gabe Vincent and Rui Hachimura would let them take back a player who makes up to $46.7 million. You can get to other numbers with different combinations of the many extremely available Lakers salaries; the larger point is that the Lakers have no practical limitation on in-season upgrades, whereas if James took his full max, they would have had a massive one.

Richaun Holmes’ extension

Before free agency started, Washington quietly executed one of the most creative deals of the offseason. The Wizards had a $12.9 million expiring deal for Richaun Holmes that was essentially dead money, but Holmes had a player option. Thus, the Wizards were in position to persuade Holmes to decline the option if he could sign a different contract more favorable to both parties.

Because Holmes is, shall we say, a less effective basketball player than he used to be, that type of contract definitely existed. Washington signed him to an extension that included an almost completely non-guaranteed year in 2025-26, with only $250,000 guaranteed. His pay in 2024-25, however, was adjusted downward by $228,549; Washington’s total outlay only increased by $21,451. In the NBA, that’s sofa change.

Why would Holmes agree to this? Because now he has a window in which to get a gigantic golden parachute. Washington (or his next team, if he’s traded this season) can take his contract into the offseason and then use his non-guaranteed deal in a trade; there is no cut-by date on the deal.

Perhaps no trade happens, and he just ends up being cut. If his salary is used as salary match in a deal, however, that guarantee immediately boosts to whatever dollar amount executes the trade match. In other words, the revised contract offers a risk-free way for Holmes to possibly get a windfall worth several million dollars before he rides off into the sunset.

Knicks’ Euro step around first apron

The first cap-nerd move of the summer might have been the best: the Knicks’ trade for Mikal Bridges that they managed to pull off while not capping themselves at the first apron.

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For those who aren’t familiar with all the assorted apron rules (which is basically all of us), a team becomes capped at the first apron if it brings back more salary than it sends out in a trade. The initial reporting of the Bridges deal was that Bojan Bogdanović would be the outbound salary; that was a legal trade, but because Bogdanović made $4 million less, it would have hard-capped New York at the first apron. That, in turn, would have been a serious problem because it would have prevented the Knicks from signing any free agents and might have roofed them on what they could offer OG Anunoby too.

The Knicks’ cap-savvy front office (it’s still weird to type this) was on top of the situation right away, but it was tricky because they essentially needed to add players to the trade after the initial outline of terms were agreed upon.

It seems the key element was declining DaQuan Jeffries’ $2.46 million team option, believe it or not, even though he ended up not being in the trade. The Knicks couldn’t combine Jeffries, Mamadi Diakite and Bogdanović for the salary match because two of the players had minimum deals … but if the Knicks could decline Jeffries’ option and then sign-and-trade him for slightly more than the minimum, that would work. As long as they had a Jeffries fallback, they’d have enough salary ballast in the trade to offset Bridges and avoid the hard cap. (The risk of another team jumping in to pay Jeffries was minimal; nobody was giving him $2 million guaranteed.)

The Knicks and Brooklyn Nets eventually agreed to similar terms with a better player in Shake Milton, but they couldn’t have guaranteed that endgame when they first shook hands in June. At that point, New York also almost certainly had other scenarios on the table that could have avoided the need for it anyway. (Besides, even if the Knicks could have cheated the starter gun on free agency, it hardly would have been worth it over a player like Milton. And New York still had further options in deep reserve, including shenanigans with second-round draft picks who can be traded 30 days after signing.)

As a result, the Knicks exactly matched Bridges’ incoming salary with their outbound Milton and Bogdanović salaries and a partial guarantee on Diakite’s previously non-guaranteed deal, capping themselves at the second apron rather than the first. That still has limits — functionally, New York can’t do a trade that doesn’t send out more money than it returns until next July — but the Knicks have a lot more flexibility now than they would have if capped at the first apron.

The other piece true cap nerds will appreciate is New York receiving the rights to Juan Pablo Vaulet in the trade, a 2015 draftee from Argentina who has absolutely no chance of ever playing in the NBA. This continues New York’s obsession with rights to overseas players, no matter how marginally alive they might be. The Knicks now have rights to 13 different individuals, six of whom are older than 35 and either retired or trending that way, and one of whom coached the Spurs’ summer-league team.

Mikal Bridges defends Jalen Brunson during a game last season. Now, they’re teammates. (Brad Penner / USA Today)

Spurs trade a two-way

Two-way players have always been trade-eligible, but we’ve seen very few of them moved this way over the years. That’s partly because so few have contracts that run into the following season; two-year two-ways remain relatively rare.

However, some sharp teams have filled empty two-way spots late in the year by signing two-year two-ways that can carry over the offseason. It allows a summer of development work, yes, but the other benefit is that it gives teams trade-legal tender to complete deals without messing up their main roster or cap.

The Spurs, for instance, signed RaiQuan Gray to such a deal last March. It paid dividends when they sent Gray to Chicago to complete the three-team trade with the Bulls and Sacramento that brought Barnes to San Antonio and sent DeMar DeRozan to the Kings. If not for Gray, the Spurs would have had to send cash, a draft pick or a roster player to complete the deal, but this was by far the least costly pathway to get the trade to the finish line.

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Pistons’ free waiver claim

The Detroit Pistons were in an interesting position when they claimed Paul Reed off waivers from Philadelphia. Detroit was at the top of the league’s waiver position by virtue of finishing 2023-24 with the league’s worst record, and the Pistons also had heaps of cap room in which to claim Reed off waivers and fit in his contract.

But the cherry on the sundae was that Reed’s $7.7 million contract is also completely non-guaranteed in 2024-25. That generated the odd circumstance of the waiver claim being completely, utterly risk-free for the Pistons; if it turned out they had needed the cap room later, they could have waived Reed themselves and been no worse off.

However, one little bit of minutiae might be slightly relevant here: Detroit should have considered trading for Reed rather than claiming him off waivers, something that would have presumably cost $110,000 cash. The benefit is that Reed would be immediately tradable, something that isn’t true right now and won’t be until 30 days into the season because he was a waiver claim.

Detroit would have had the ability to use all its remaining cap space and then trade Reed for a player with a cap number of $15.22 million or less. Whether this opportunity would have come up is anyone’s guess and is, based on history, quite unlikely to happen before trade deadline season, but half the work of a front office is preparing for unlikely events in case they come to pass (like giving B-ball Paul the max on his next deal, of course, but we’ll get to that later).

Thunder pay it forward

Oklahoma City borrowed a tactic that other teams have used in recent years by moving salary from future seasons to the current one, in anticipation of a cap crunch in later years when their young stars become dramatically more expensive.

The key season here is 2026-27, when Chet Holmgren and Jalen Williams would begin what are likely max or near-max extensions of their cheapo rookie deals, one year ahead of Shai Gilgeous-Alexander’s deal becoming a supermax whopper in 2027-28.

That’s why the Thunder declined 2024-25 options on two players, Isaiah Joe and Aaron Wiggins, despite their deals being almost comically undervalued at about $2 million apiece. However, those two also had cap holds that were for the minimum, so much like Philly above, the Thunder could extend their cap space by signing Isaiah Hartenstein with room first, then double back and replace the cap holds for Wiggins and Joe with more expensive contracts.

The deal for Hartenstein, you’ll note, has a team option for 2026-27; it’s fine to have him making a ton of money the next two years, but they’re going to want to huddle before committing to having both him and Holmgren on big-dollar deals in 2027-28. The money is also front-loaded slightly (declines can only be 5 percent on a non-Bird free-agent deal, and a team option year can’t have a decline, so there are limits here) to put more money into 2024-25.

Similarly, Joe has a four-year deal with declining money and a team option in 2027-28; his cap hit went from $2 million to $13 million for 2024-25, when the Thunder had plentiful room, but it will only be $11.3 million in the more crucial 2026-27 season. Wiggins went from $12 million to $10.5 million in 2024-25 but dips to $7.99 million by 2027-28. (On a micro level, I thought they went overboard on the length and size of the commitment to Wiggins, but the big-picture idea of stuffing as much future money into 2024-25 was spot on.)

Overall, the Thunder put more than $20 million of future money into 2024-25 with the Wiggins and Joe deals, and it had no impact on their cap room to sign Hartenstein and didn’t put them anywhere near the luxury tax.

Required Reading

(Top photo of LeBron James and Tyrese Maxey: Adam Pantozzi, David Dow / NBAE via Getty Images)