Salient points of Billy Hunter’s memo to players on the tentative deal – NBA Lockout Update
The NBA owners and the National Basketball Players Association have reached a tentative agreement to end the lockout and formulate a new Collective Bargaining Agreement. In a move that seemed impossible only two weeks ago, owners
and players came together to compromise on key issues in a bid to save the NBA season for 2011-2012.
A 66 game season has been planned to begin on the 25th of December and players are expected to withdraw their lawsuits against the owners and re-form the NBPA. Once reformed, a vote will be held from the platform of
the NBPA over a new CBA.
It is expected that players would ratify the deal, but rumours were abound over the weekend about unrest among some players who thought Hunter gave in a little easily to the owners. In order to galvanize support for the deal and
clear out some issues about the concessions won by the union, Hunter issued a memo to players.
The salient points of the new deal, as presented in the memo and reported by ESPN, are given below:
1. BRI Split - Players receive a 49-51 band of BRI, with the expectation that players will receive 51% of BRI by year 6. The split is set on a base case of 50%, with the players receiving 60.5% of every incremental dollar beyond
the targeted amount, which is based on the mid-point of the agreed upon projections, or a symmetrical reduction in our share if revenues fall short of the targeted amount. The players' share this first season (2011-12) will be 51.2% of BRI.
2. System
a. Mid-Level Exception for Non-Taxpayers: The Mid-Level Exception's contract length is 4 years, every year.
b. Player Options: Player options are allowed for all players, as per the prior CBA. Owners dropped their demand to eliminate player options for high-paid players.
c. Escrow: 10% max withholding, 1% New Benefits Pool, system adjustments as necessary to avoid forecasted overage. Owners dropped their demand for unlimited escrow, carry over, true up, or banking.
d. Qualifying Offers: Beginning in 2012-13, players defined as "starters" - 41 games started or 2000 minutes, average over prior 2 seasons - will receive substantially higher qualifying offers. A first-round pick will receive the
greater of his existing qualifying offer or the qualifying offer amount made to the 9th pick of the draft ($4.67 million for the 2010-11 draft class). A second-round pick or undrafted player will receive the qualifying offer amount made to the 21st pick. A
first-round pick drafted 1-14 who is not a "starter" receives the amount offered to the 15th pick.
e. Max Salary: A player finishing his rookie scale contract will be eligible to receive a maximum salary equal to 30% of the Cap (up from 25%) if he signs with his prior team and is either: 1st, 2nd or 3rd team All-NBA 2 times;
an All-Star starter 2 times; or 1-time MVP.
f. Minimum Salary: The owners dropped their demand to reduce the minimum salary scale by 12%. The current amounts will not be reduced.
g. Rookie Scale: The owners dropped their demand to cut the rookie wage scale. The current amounts will not be reduced.
h. Extend-and-Trade: The owners dropped their demand to eliminate extend-and-trades. As with sign-and-trades, players moving pursuant to an extend-and-trade may not receive Bird annual increases or one year longer maximum contract
length.
i. Annual Increases: Annual increases will be set at 7.5% for Bird players and 4.5% for non-Bird players.
j. Taxpayers' Use of Mid-Level Exception & Sign-and-Trade: The owners agreed to a $4 million "apron" above the tax threshold. Teams may go above the tax threshold by $4 million to use the entire $5 million mid-level exception,
or acquire a player via sign-and-trade. Teams above the $4 million apron may use a $3 million/3-year mid-level exception every year.
k. Cliff: No change to prior proposal to reduce the cliff by 50%.
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