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The Third Contract

While justifiable and collectively bargained, the last two CBAs possess a few particularly interesting processes that have huge effects on decision-making. Some of these, like the Chandler Parsons situation (where the Rockets can pick up his super cheap team option and allow him to be Unrestricted in 2015 or decline it to have him Restricted this summer] and the repeater luxury tax get plenty of ink. However, one of the more interesting impacts comes from a more abstract place and deserves more attention.

In today’s NBA, most players have very little control over their destination for their first two contracts. The first typically comes by being drafted so the athlete has almost zero say in where he ends up. For high level players in particular, the gigantic disincentives in terms of financial security have meant that only Ben Gordon (not risking as much because a max deal was not on the table) has declined extending and spent two seasons in peril in exchange for unrestricted free agency.

These factors combine to create a fascinating set of circumstances when the second contract ends, as the best players have spent 7-9 years in the NBA (likely in the same city) and are just entering their primes in most cases. After having all that time with zero say, a vast majority of them enter the free agent market because the current extension rules are not favorable for young players due to limitations on contract length.

As such, the league sees high-level players able to be truly wooed for the first time in their professional careers with dramatically weaker disincentives to leave and a new CBA that makes sign-and-trades a less useful proposition. The combination of complete freedom and years of team control means that the third contract typically marks the first time we really get to know what a player wants in the short and long-term.

LeBron James and Chris Bosh used their third contract to join forces with Dwyane Wade and have reached the NBA Finals  in every season since The Decision.

Dwight Howard spurned the Lakers to make the Rockets a new Western Conference contender.

Ten years ago, Kobe Bryant publicly flirted with the Clippers before returning to the Lakers.

The third contract carries so much intrigue because as much as we think we know about NBA players, they never have the choices available to them earlier in their careers. There are plenty of valid reasons for someone to select their next location: team quality, connections with their current team, a good front office and/or coach, and a nice city to live in often carry weight in these circumstances. That said, each and every individual values those factors in different ways and can see the same landscape meaningfully differently. Thanks to a confluence of events from David Kahn not putting a five-year deal on the table for Kevin Love to opposing teams being restricted to offering four-year offer sheets, the next few summers will be full of tantalizing young talent finally gaining the freedom to go where they want.

Summer of 2014

All-Star snub Kyle Lowry looks to capitalize on a big season by being an unrestricted free agent for the first time.

Luol Deng and Emeka Okafor will also experience free agency for the first time since their second contracts were six-year deals grandfathered into the new CBA.

Rudy Gay has the choice of entering this class or the next one thanks to his big player option.

Astonishingly, Andrew Bogut would have joined this UFA first-timers group had he not signed an extension with the Warriors over the summer. Bogut has never been a free agent of any type in the NBA and will not be until 2017 with 12 years of service at that point.

While some people are already saying he may be close to done, Danny Granger gets an asterisk since he was a free agent this week but will have his first summer on the open market. 

Summer of 2015

While Kevin Love generates the most headlines, the third contract group for 2015 runs incredibly deep. Likely Defensive Player of the Year Roy Hibbert joins 13-14 DPOY Marc Gasol on the unrestricted market assuming Hibbert declines his player option.

If those three All-Star bigs were not enough, Brook Lopez has a player option as well and could leave Brooklyn if the team disappoints between now and then. His twin brother, Robin, will be in this class too, which could be something to watch considering their close relationship. In case this group needed another big, Robin’s current teammate LaMarcus Aldridge can select his team as well and should generate major interest around the league. You can add in DeAndre Jordan as the cherry on top.

Thanks to a five-year extension under the old CBA, Rajon Rondo will hit unrestricted free agency for the first time in 2015.  Rudy Gay, another member of the 2006 draft class, joins the group if he picks up his player option this summer. Philadelphia forward Thaddeus Young can add himself to the mix if he declines his option year while Arron Afflalo could be here as well if he declines his fifth year player option.

Finally, Omer Asik and Jeremy Lin will have a more normal free agency after back-loaded contracts as RFAs landed both of them in Houston while Wesley Matthews gets his chance after a “poison pill” deal put him in Portland two years before Daryl Morey got his two.

Summer of 2016

Kevin Durant gets the top of the marquee (as he should) but this strong group also includes Joakim Noah, Noah's Florida teammate Al Horford, and Mike Conley. Incredibly, Dwight Howard could be gunning for his fourth contract the same summer since he signed a deal with Houston that made his fourth season a player option.

Interesting starters like Ryan Anderson, Nicolas Batum, Danilo Gallinari, Wilson Chandler, Brandon Jennings and Eric Gordon (if he picks up his option) could join the party too.

Summer of 2017

Likely the first group of players to become UFAs under the next Collective Bargaining Agreement, Thunder teammates Russell Westbrook and Serge Ibaka and former teammate James Harden headline a group that includes Derrick Rose (get healthy!), DeMar DeRozan, Tiago Splitter, Taj Gibson, Jrue Holiday, George Hill, and Tyreke Evans.

We should see a vast majority of these players hit true unrestricted free agency since the current CBA limits the length of non-rookie extensions to three years after the end of their existing contract. Since these individuals should be good enough to get four or more, I fully expect them to maximize their potential security and enjoy getting wooed for the first time as professionals. This shifted reality could lead to the power dynamics in the league changing more frequently than under previous agreements and make July 1 a much more interesting time each year.

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