New NBA CBA - What's Changed?

Don't feel like reading the CBA? Well, we didn't either, but we did it so we could all understand it.  Here is a look at some of the key points we've found thus far.  More to come on this, along with analysis of how this will affect specific teams and players.


The Cap

The league will now contain harsher punishment for teams that exceed the salary cap.

The former standard, as established by the 2005 CBA, forces teams to pay a luxury tax of $1 for every $1 they go over the salary cap.  This was ineffective by most standards because the financial hardship of a luxury tax was relative to the income of your team.

The new CBA, however, won't be as forgiving.  Although it will implement the old luxury tax system for the next two years (so that teams currently spending over the cap have time to get back under), after two years the punishment for exceeding the cap will look like this:

Exceeding the cap by $0M-$5M = tax rate of $1.50 for every $1
Exceeding the cap by $5M-$10M = tax rate of $1.75 for every $1
Exceeding the cap by $10-$15M = tax rate of $2.00 for every $1
etc...

Every $5M is an extra quarter on the dollar.  As an extra incentive to NOT go above the salary cap, teams that do exceed in back to back years will be forced to pay a tax of an additional $1 for every $1.  So if the Lakers, for example, went two years at $7M over the cap, they would be forced to pay $2.75 for every $1.  If they went three years, they would have to pay $3.75 for every $1, and so on.

Salary Increase


The maximum salary increase in the old CBA was 10.5% for Bird players (single player on roster who has been with the organization for at least 3 years) and 10.5% for 'early Birds' (single player on roster who has been with the organization for at least 2 years), and an 8% increase for others.

The modern CBA allows for a 7.5% increase for Bird players, and 4.5% for all others.

Amnesty


Teams can now waive 1 player prior to every season under the new CBA.  Basically, after a player is waived, he goes into a hybrid waiver market where teams under the cap can bid on that player.  When a player is bid (or not bid) on, his former team must pick up the remainder of the contract.  The veteran players are not free agents, they are open to a bidding war.

Overview


The new CBA is a fresh start, and it will be interesting to see how the stingy financial rules will effect hte distribution of wealth, not only financially, but in terms of talent as well.