How to run payroll

how to run payroll


CLEVELAND – Regardless of the outcome of these NBA Finals following a thrilling first four games, it appears the Cleveland Cavaliers are set up to be championship contenders for a long time.

Besides the obvious reason that LeBron James is back in Northeast Ohio presumably for the remainder of his career, the Cavaliers have a nucleus – including Kyrie Irving, Tristan Thompson and Timofey Mozgov ­– that not only is ready to compete now but has the potential to grow stronger.

But to continue on this trajectory, the Cavaliers – specifically, owner Dan Gilbert – are going to have to spend big. How big? Perhaps more than any team in NBA history has ever spent. Cleveland could become home to the league’s first $200 million team.

Here’s a look at some of the tough decisions Gilbert and Co. will have to make to keep the core of the team together and, more importantly, to keep James happy:

The returners

Although James is likely to opt out of his contract in order to secure a bigger raise this summer, we’re going to count him – along with Irving, Anderson Varejao, Timofey Mozgov (team option), Mike Miller (player option) and Joe Harris – as players who are set to return next season.

Those six together will combine to make just over $56 million in 2015-16 – $11 million below the projected $67 million salary cap.

Kevin Love, in a suit following a shoulder injury, can become a free agent. Photo: NBAE via Getty Images

Kevin Love

One of the more fascinating subplots of the Cavaliers’ postseason has been people openly wondering whether the team is better off without Love, who suffered a season-ending shoulder injury when he got tangled up with Kelly Olynyk in Game 4 of Cleveland’s first-round sweep of the Celtics.

It’s a nonsensical argument: Love is the best shooting big man in the league, has the capability to be a one-man offense, is an elite rebounder and a clear top-20 player in the league. But it has added a new level of intrigue to Love’s free agency this summer, which has been the most discussed offseason subplot over the past few months.

The Cavs undoubtedly want Love back – they gave Andrew Wiggins to the Timberwolves to get him in a trade last summer – and the guess here is they’ll get him. Regardless of the way Love formats his next contract or how many years he signs for, the deal will be worth somewhere in the neighborhood of $19 million, which would move Cleveland’s payroll to $75 million .

The restricted free agents

Cleveland heads into this summer with three key restricted free agents: Thompson, Iman Shumpert and Matthew Dellavedova.

The Cavaliers can keep all of them if they want. There is no doubt Thompson will be back — and he won’t be cheap. He reportedly turned down a $13 million per year extension last fall, and after a stellar postseason run (sharing an agent with James doesn’t hurt) he’s going to get a bigger number. We’ll say just below the max, with a deal starting at $15 million per year.

Matthew Dellavedova Photo: Getty Images

Shumpert will draw free-agent interest. Almost every team is trying to accumulate athletic defenders who are capable of making 3-pointers. The former Knick seems likely to get a contract similar to what Jazz guard Alec Burks signed for last summer: four years at $40 million, making his first year around $10 million.

Then there’s Dellavedova, who became the surprise breakout star of these playoffs after stepping into the starting lineup once Irving was lost with a fractured kneecap. Dellavedova is a decidedly mediocre player – a decent backup point guard who shot over 40 percent from 3-point range this season but doesn’t excel at anything – who seems destined to get more money than he’s worth.

If Dellavedova gets a deal starting at $5 or $6 million, there’s always the chance the Cavaliers could walk away. But we’ll say the new cult hero sticks around for a nice raise up to $3 million per season.

That means these three players would combine for $28 million, moving the Cavaliers up to $103 million for 10 players, and with two huge question marks remaining.


Smith Photo: EPA

J.R. Smith

Once again, Smith has turned back into a pumpkin during the playoffs. He’s shooting a dismal 14-for-47 – including 7-for-28 from 3-point range – through four games of the Finals.

There was lots of chatter about Smith potentially turning down his option for the third and final year of his contract and hitting free agency. That could either save the Cavaliers more than $6 million next season if he leaves or could cost them more if they keep him and there’s an unlikely bidding war for his services.

For argument’s sake, say Smith opts to remain in Cleveland for his option of $6.4 million, which would move Cleveland to just south of $110 million for 11 players.

Add in James Jones – a longtime James friend – for another million, as well as the salary of the No. 23 overall pick and Cleveland will be at roughly $113 million for their roster without factoring in the final piece in their arsenal.

What to do with Brendan Haywood

Brendan who? Haywood is the center behind Kendrick Perkins on the Cavaliers depth chart – which should tell you all you need to know about his skills these days.

But Haywood, 35, isn’t on the roster for what he can do on the court. His unique contract spikes to a fully non-guaranteed year worth $10.5 million next season, which could be used as a trade chip to bring in another high-salaried player despite the Cavaliers being well over the salary cap.

The problem is about that would cost. If the Cavaliers don’t trade Haywood and just cut him, their combined salaries for 15 players, with two roster fillers, would be a little north of $113 million. With luxury tax payments, that skyrockets to around $206 million. shattering the prior record of $193 million the Nets spent in 2013-14.

If you add another $10 million to this Cavaliers roster, pushing the payroll to roughly $123 million, it would mean the Cavaliers would pay around $145 million in luxury taxes alone – a truly staggering sum, sending their combined payments next season toward the $300 million threshold.

Dan Gilbert was fortunate to get James back. But to keep him happy and continue building this team around him, the Cavaliers are going to have to make very difficult cuts — or Gilbert is going to pay a record-setting premium to keep it together.

Greg Monroe’s replacement was acquired by the Detroit Pistons. Photo: NBAE via Getty Images

You don’t often see trades during the NBA Finals. But one went down Thursday — the Pistons acquired Ersan Ilyasova from the Bucks for Caron Butler and Shawne Williams — with a surprising array of ramifications.

Let’s start with Detroit, which netted a power forward in Ilyasova who perfectly fits what Stan Van Gundy is looking for. Ilyasova is a solid rebounder and 3-point shooter, and should provide plenty of floor spacing for burgeoning young center Andre Drummond, similar to what Van Gundy had with Ryan Anderson next to Dwight Howard with the Magic.

The trades also signals Greg Monroe is on his way out of the Motor City. Monroe, who averaged 15 points and 10 rebounds last season, took the unusual step of signing a one-year qualifying offer in order to become an unrestricted free agent this summer.

There has been plenty of speculation that Monroe – who is repped by David Falk, Michael Jordan’s agent – will be headed to the Knicks, where he would give Phil Jackson a low-post scorer.

For Milwaukee, the trade was a straight salary dump. While Ilyasova is on a nice contract, especially with the salary cap going up – he is making $7.9 million this year with a $8.4 million team option for next season – Milwaukee could wind up with more than $20 million in cap space once they waive Butler and Williams, both of whom have expiring deals.

That will make it easier to swallow a massive raise for swingman Khris Middleton, who is likely to get an eight-figure contract as a restricted free agent. And there will be some cash left over to add to a roster that was one of the league’s more surprise playoff teams last season under first-year coach Jason Kidd.


Category: Bank

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