Mark Cuban staying clear of luxury tax as he attempts to rebuild the Dallas Mavericks – NBA News
Mark Cuban is one pro-active owner. The Dallas Mavericks owner won the NBA championship back in 2011, but since then has been making tough decisions to keep his team relevant and competitive in the coming years.
After winning the NBA title, instead of going with the conventional approach of keeping the championship winning team together, Cuban started shedding salary off the books and released Tyson Chandler, who went and joined with the
New York Knicks. He did not do so because he does not like winning, rather it is quite the opposite.
Cuban wants his team to stay relevant and compete for the crown for years to come, and predicted the writing on the wall with the new Collective Bargaining Agreement. As part of the new CBA, the luxury tax in 2014 will be increased
from a dollar for dollar to three dollars for a dollar. This means that the Los Angeles Lakers $16 million tax bill for this year would be $52 million in 2014. That is a steep tax to pay for any team and will affect the ways teams pick up players when it is
enforced.
And Cuban knows that, which is why he is slowly and steadily creating cap space to sign quality players in free agency without going above the cap limit.
This season, Cuban had a good amount of cap space to sign a star player to a max contract. He went after free agent point guard Deron Williams, and brought everything he had to the table. However, Williams decided to stay with
the Brooklyn Nets.
“The money is secondary to the team-building strategy. Once you get above the tax apron [the $70.307 million luxury tax plus $4 million], there are limitations in player movement that I think have a big impact on how to build a
team,” said Cuban while talking to ESPN Dallas.com.
The CBA already bars teams above or close to the tax line from using their $5 million mid-level exception, and can only use the $3 million taxpayer’s exception. And in the year 2014, another law will kick in which will prevent
teams above the salary cap to do sign and trade deals. The sign and trade deal is the favourite tool for teams already in tax threshold, and use it to sign even more players to the roster. The Lakers just did so in free agency this month when they signed Steve
Nash, though they did not have the cap space to directly sign him.
Cuban has been very smart with his decisions considering how the CBA rules are going to affect a team’s ability to sign players. He sacrificed the past season for the sake of keeping some cap space in the hopes of signing Williams
without imposing too much luxury tax.
When Williams declined, and Cuban was unable to find another star player in free agency, he filled the team with role players, good enough to keep the team competitive next season, and signed them for one year only. Hence, when
free agency hits next summer, Cuban will once again have ample cap space to play with.
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