While working through the many twists and turns related to Kevin Love reportedly being on the market for the first time, it made sense to put together an article formatted as a Q+A to address some of the bigger questions and misconceptions surrounding what has and will go on.
Q: So what is Kevin Love’s contract situation, anyway?
A: Love has a guaranteed salary of $15,719,062 for the 2014-15 season and a player option worth $16,744,218 for the 2015-16 season. He has until June 30, 2015 to accept or decline that option, though he can choose to do so earlier if he likes.
Q: I’ve heard that teams have advantages to retain their own players. How would that work here?
A: Whenever he hits the market, Love will be an Unrestricted Free Agent. That means the team that controls his rights when his contract ends does not have the opportunity to match a contract Love signs with any other franchise.
That said, the league has developed a system using what are commonly called Bird rights (after Larry Bird) that gives teams some added flexibility to keep their own players. In this case, there are two advantages: the potential for a five year contract and greater maximum raises per season.
Under the current system, the maximum salary Love can sign for in the first year of his new contract would be the same whether it is with a new team or his old one. For someone with Love’s years of NBA experience, that number is the larger of 30% of the salary cap (not calculated the same as the actual salary cap because where would the fun be if it were easy?) and 105% of his salary from the previous season. While we do not know the first figure for sure without the Basketball-Related Income for the previous season which has not happened yet, in Love’s case these numbers should be pretty similar. If he declines his player option for 2015-16, 105% of Love’s previous salary (2014-15) would put him at $16,505,015 for the first year of his new deal.
From there, we can figure out what the difference in raises could mean in actual dollars. The team holding Love’s Bird rights can offer max raises of 7.5% of that first year salary each future year while all other teams can only offer 4.5% increases off that same salary. In Love’s case, this works out to a difference of $3,214,033 over a four-year contract. Not a small number but clearly not insurmountable either.
The larger difference comes from the potential for a fifth season. In Love's case, this makes the comparison between a four-year deal worth approximately $70,611,609 with a new team (likely with the fourth season coming as a player option like Dwight Howard) compared to a five-year deal with a similar final year player option worth a total of $95,867,581. While that difference seems large at the moment, we should remember that Love will be 30 years old when that fifth-year likely comes into play and 29 if he declines the fifth-year player option, so with clean health and quality play he can fairly expect to get close to that value on his fourth contract. It reduces a risk to be sure but may not make a huge long-term difference if things go well.
Q: So, what assurances could Love give his new team that he will stick around?
A: Shockingly little when it comes down to it. The new Collective Bargaining Agreement reacted to the Carmelo Anthony trade and extension by making it much harder to extend contracts. This explains the shockingly few we have seen outside of players coming off rookie contracts which do not have the same restrictions.
Love could choose to pick up his player option, like Chris Paul did with the Clippers as a part of the blockbuster deal that sent him from New Orleans to Los Angeles. While that adds another year of production for the new team, it does nothing to secure Love’s long-term future with the franchise and actually pushes the clock back for that kind of resolution.
Q: So Love has some leverage in this situation?
A: Yes, he does.
While some teams may pursue Love without any assurances that he will stay long-term, we have to expect that the uncertainty would decrease the amount a franchise would be willing to offer. Since Minnesota has no obligation to trade Love at all and would be prudent to take the best offer (even though Kevin McHale did not do that the last time Minnesota traded a star player), it seems unlikely that a diminished offer would be the best on the table.
As such, Love can play a role in his own immediate future by indicating teams that he would be more willing to commit to either by picking up that option season or by being acting more open to a longer-term contract.
Q: Can he sign a longer term contract now to get rid of that risk?
Under the current CBA, many contracts are not eligible to be extended. Even those that are eligible cannot be extended earlier than three years after the active contract was signed. Since Love signed his current extension January 25, 2012 partially due to the lockout, he cannot agree to any extension earlier than January 25, 2015. While the current system makes it unlikely Love would agree to an extension in the first place, the fact that he cannot under any circumstances makes it a little clearer.
Q: What about some sort of “wink, wink” agreement?
A: Well, it could not have any binding authority because that would violate the circumvention clauses in the CBA. Love and his agent could give a team their word but it would be wholly unenforceable should he change his mind in the interim.
Q: So what does all this mean for Minnesota?
A: To me, it means that they should not trade Love unless he makes it clear and unconditional that he will not return to the franchise for the 2015-16 season and beyond. While there certainly could be some interesting offers on the table, they will likely come in the form of quantity over quality. It appears wholly unlikely that any Love trade will yield a player as good or better than Love and since we know that star players are of the utmost importance in today’s NBA, that changes the value for Minnesota. A package involving picks and/or young players would be nice but would it be enough to even make the playoffs in a stacked Western Conference?
The Wolves have a tough decision in front of them both in weighing offers and the downside risk of losing their elite player. After all, we can see how long it has taken them to recover from trading Kevin Garnett, though obviously there are other factors that hindered their progress.
Q: If Minnesota decides now is the time to move Love, what would they want in return?
A: While they will certainly have good offers on the table, we do not know what kind of assets they value most highly. While players that are good, young, and cheap will always be in demand, the rubber will meet the road with guys who are not all three of those things. Teams value draft picks differently too and that consideration has a dramatic effect on what offers are the most enticing for Minnesota President of Basketball Operations Flip Saunders and company.
Q: What about unloading contracts?
A: Moving high-end talent also can provide an opportunity to shed contracts as another benefit to the trading team. This gets hard to figure out for Minnesota because most of their deals that I would consider less desirable were signed recently by their current President of Basketball Operations. Since he signed Kevin Martin, Corey Brewer, Chase Budinger and Nikola Pekovic to their contracts less than a year ago, it would stand to reason that Saunders does not see them as albatrosses worth sacrificing assets to shed.
Q: Are there any complications in terms of draft picks?
A: Absolutely. One of the more interesting and misunderstood parts of the CBA is the Stepien rule named after former Cavs owner Ted Stepien. It says that no team can be without any first round picks in consecutive drafts looking forward. For example, the Lakers cannot trade their 2014 first round selection before the draft since they have already committed to the possibility of sending their 2015 first rounder to the Suns as a part of the Steve Nash trade. Once this draft finishes, it does not count towards the Stepien rule, which means the Wolves could come to an agreement with the Lakers where LA takes a player of Minnesota’s choosing and then consummates the trade after the draft concludes to stay in the clear.
In some relevant situations, the rules make deals more possible after the draft without involving 2014 selections. For example, right now the Warriors cannot trade a first round pick in the near future because they owe their 2014 and 2017 picks to the Utah Jazz. Unless they acquire someone else’s pick between now and then in a relevant year, Golden State cannot move a selection in 2015 or 2016 now because it would violate the Stepien rule. Once this draft ends, they could move their 2015 first round pick without limitation since the Stepien rule only looks forward.
The Lakers, Warriors, Heat, Knicks, Kings, Blazers, and the Timberwolves themselves have limitations stemming from the Stepien rule that may come into play.
Q: So, which teams do you consider the most reasonable suitors?
A: While we do not know exactly what Love wants in his next team, there are four general factors that high-end players look for and prioritize in their own way: current team quality, desirability of location, future outlook, and ownership/front office/coaching (what Steve Kerr called “The Troika” at his press conference with the Warriors).
By definition, teams trading for Love would be sacrificing assets for their future and possibly their present as opposed to signing him outright. This explains why I do not see the Lakers and Celtics as viable trade partners for Minnesota right now- the assets necessary to acquire Love now are the same pieces required to make the team good enough to retain him once free agency rolls around. In fact, I would argue that the Lakers trading for Love in 2014 actually makes him less likely to remain with the Lakers in 2016-17 since it would gut the team of useful players who should comprise the rest of their core.
That leaves teams that have talent already and can put together a package that leaves them with a winning team. The two frontrunners under this rationale have to be Chicago and Golden State in no order. Both teams have young players on cheap contracts and can make offers that give Minnesota plenty of talent while still retaining rosters that should be good moving forward. Phoenix gets into some trouble here because some of their best assets (Eric Bledsoe in particular) cannot be traded this summer in a Love deal without some seriously surprising developments.
Shifting towards the trade deadline could produce some interesting possibilities including the aforementioned Suns and Miami if they extend Chris Bosh this summer and would be willing to include him to acquire Love in a supremely cold blooded move.
Q: Should Kevin Love just bite the bullet and wait one more year for free agency?
A: It depends on where he would like to go. The Bulls and Warriors are available now, but may actually be harder to get to in 2015, especially if Chicago can acquire Carmelo Anthony a little over a month from now. Furthermore, getting all the way to free agency allows Minnesota to play hardball with those teams that would need to acquire Love by sign and trade because they do not have the cap space to sign him outright. We saw this in action last summer with Denver and Andre Iguodala after he agreed to terms with the Warriors but their subsequent relent into a sign and trade could be a relevant precedent here.
If Love wants to head to a team that should have cap space in 2015 like the Lakers or Knicks, free agency would be the way to go. Waiting allows the teams to keep their assets and the new CBA makes the difference in money less substantial than used to be. The fact that signing an extension does not make practical sense takes some of the incentive out of moving earlier, which is exactly what the owners wanted after Carmelo’s extend and trade to the Knicks.