Amare, LB, Lou and Channing - what the Suns CAN and CANNOT do, under the CBA

I've seen lots of comments on the articles lately regarding our impending free agents (Amare Stoudemire, Channing Frye and Louis Amundson) and potential trades (Leandro Barbosa and, to a lesser extent, Jason Richardson).

I think people are a little unsure what all the Sun CAN and CANNOT do with these guys, under the cap rules, and how their status impacts the Suns ability to sign people.

Hopefully, this post will alleviate some confusion and allow us to talk more intelligently about what should happen with these guys over the summer months.

A really great FAQ on the salary cap is located here: Larry Coon's FAQ on the NBA Collective Bargaining Agreement

Applicable highlights

Here are a few tidbits related to the Suns players.  Feel free to jump down to Conclusions if you find yourself already glazing over at the mention of salary cap details.

  • Exceptions to the cap

    • Larry Bird Exception - minimum 3 yrs with same team, up to 9 mill per year until their 7th yr in league, at which point it can go higher.  Amare qualifies, but Lou and Channing do not

    • Early Bird Exception - available after minimum 2 years with same team - can be up to 175% of current sal or league-average, whichever is greater. Lou qualifies for this one, but not Channing

    • Trade Exception - if an over-the-cap team trades a player to another team that is under the cap, they can take back lesser money and get a Trade Exception for the difference. (example - trading LB to Memphis for a second-round pick, gives us $7.1 million trade exception).  This can only be used if the team is over the cap at the time of the trade, and only in another trade (not free agent signing) 

  • Using exceptions when the team starts BELOW the salary cap (which would happen IF Amare opts out by end of month)

    • If the total of all applicable exceptions (Disabled Player, Bi-Annual, Mid-Level and/or Traded Player exceptions) put the team over the cap again, then the team cannot use BOTH exceptions and free cap space. They just get the exceptions only.  If the total of those exceptions still leaves the team under, then those exceptions go away entirely. Basically, a team can have exceptions OR cap room, but not both.

    • After an uneven trade (ie. LB for a second-round pick to free another $7 million), if the team is already further below the cap than the traded-player exception, then that exception never comes

    • What this means to the Suns: 

      • If Amare opts out AND the Suns renounce his Bird rights, the Suns get the cap space and NO exceptions.  They only get the money they are under ($13 after Amare opts out, up to $20 mill if LB is traded for cap space)

      • If Amare opts out AND the Suns keep his Bird rights intact, the Suns keep all their exceptions as if they are over the cap and Amare stays on the cap as well, as a 'salary hold'.  They must do this to retain his Bird rights and give him a 6-year contract (either directly or as part of sign-and-trade in which they get talent back)

  • How Amare, Channing and Lou still count against us:

    • Non-Bird free agents count 120% of prev sal until renounced (Cahnning, Lou). Bird Free agents (Amare) - 150% (assume caps at max, which is 19 mill + 10.5% raises per yr)

    • How this affects the Suns: unless the Suns RENOUNCE Amare, Channing and Lou, they still count against the cap until they sign with someone else.  Renouncing means that the Suns give up the right to give a bigger contract using Bird Rights (Amare) or Early Bird (Lou), making us just like any other team.

  • There's MAX contracts, there's MAX extensions, and then there's Kobe Bryant:

    • From another team, Amare could get a MAX of $16.224 mil per year to start, with 10.5% increases for up to 5 years

    • An EXTENSION can be 3-6 yrs, starting 105% of final-year salary on existing contract (for Amare, that's $16.4 mil this year, $17.7 mil next year), then 10.5% raises per year.

    • Kobe got his current contract under an old CBA, so his went into the low-20s per year.  On his extension, he got 105% of that final year + raises.  That's why his extension was so big.

    • Only contracts of 4+ yrs can be extended, excluding Lou and Channing from this discussion

The skinny on Amare

Amare can get the MOST POSSIBLE money, by a long shot, this month.  Before opting out, Amare could extend with the Suns starting at 105% of next year's $17.7 million, for up to 6 more years at 10.5% raises per year after that.  This assumes the Suns want Amare for 7 more years at max money.

  • Max value: $158.48 million over 7 total years from today. 
  • Final season salary: $28.34 million in 2017

The second-most money Amare can get is to opt out of next year's contract, but still re-sign with the Suns OR be signed-and-traded using the Suns' Bird Rights for up to 6 total years from today (about $25 million less overall).  Otherwise, Amare can sign outright with another team for up to 5 years from today (and $50 million less overall).


[Note by Seth Pollack, 06/10/10 9:01 AM MST ]

I checked with the team and Larry Coon on the Amare extension situation. Larry says Amare can get a 4 year extension plus remaining year for a total of 5 more years.

The Suns say he can get a 5 years extension plus remaining year for a total of 6 more years.


The skinny on Channing

Channing can get any amount up to $9 million a year for up to 5 years, from anyone in the league.  The Suns have no bargaining power over anyone else.  When he opts out, the Suns will renounce (if that's even required here), since he does not qualify for any exception he'd take.  The Suns can still re-sign him, even after renouncing.


The skinny on Lou

Lou will still count against our cap at a little over $1 millon unless the Suns renounce his rights.  But in this case, it's in Lou and the Suns best interest to keep his rights unless the Suns ernounce Amare.  Until then, Lou qualifies for the Early Bird exception because he played for the Suns for 2 years and they're over the cap as long as the Suns keep Amare's rights.  The Suns would wait to resolve the Amare situation before doing anything with Lou. 

If Amare re-signs, extends or is signed-and-traded, then the Suns can give Lou up to $5.8 mil a year using Early Bird Rights and STILL have the regular $5.8 mill exception for another player (Channing?).

If Amare signs outright with another team, the Suns are suddenly $13 million under the cap, and all exceptions are thrown out the window in lieue of cap space.  In that case, the Suns have to replace Amare, Lou AND Channing for $13 million total.


The skinny on LB and J-Rich

If the Suns trade those guys away for some additional cap space (to a team that is below the cap), that space can only be used to sign free agents if the Suns were UNDER the cap (including applicable exceptions and cap holds) at the time of the trade.  This gets tricky, and probably needs a different post.  But suffice it to say, the Suns can likely only use LB and JRich's salaries toward trades, and NOT to get more free agents.



The Suns entire summer depends on Amare. 

If he stays, then the Suns could also re-sign Lou and Frye (or someone else like him) for pretty good contracts and STILL be under the luxury tax next season.   And with the huge gap in money between extending and bolting, two things are quite obvious:

  1. Amare has 50 million reasons to stay active with the Suns in negotiations
  2. The Suns have a BIG, WIDE window in which to negotiate something less than Max and still get Amare more than any other team can offer.  His $17.7 option year is huge this month.

If Amare leaves via sign-and-trade, the Suns would still be able to re-sign Lou using his Early Bird exception, plus have an $18 million trade exception from Amare which could be used for a separate sign-and-trade with a willing partner.  Don't expect Cuban to trade Dirk here... 

If Amare leaves outright, then the Suns need to start wiggling around with LB for more cap space because they would only have $10-13 million left (after cap holds on Lou, Griffin and 2 second-round picks are included) to replace Amare, Lou AND Channing.


Good luck, Steve Kerr!!!

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