Should the NBA change the rules somehow to prevent these "super" teams?

[Superman]

That is absolutely not a problem. If a player said yea Lebron told me he wants to play together and I said he should come to Miami, and he said cool. Then Dwayne tells Pat Riley...there is no problem. No official of the team ever spoke to Lebron in this scenario.

And as for "planning" for it. It could never be proven...because I am willing to bet Pat Riley as well as all the other teams that did would have been planning for free agency of 2010 anyway. So, it doesn't hold water in my opinion.

It's tampering. If there were any evidence that the Three decided in 2008 that they would team up in Miami this offseason, and Wade went back and told Pat Riley to make it happen, the NBA would do something about it. It doesn't matter if he would have been getting ready for free agency anyways.

I doubt that it could be proven. And it's a little far-fetched, mainly because Miami offered contracts to free agents the past two summers, including Lamar Odom last year, so they didn't quite play it like they were just waiting for 2010.

 

[Superman]

No they would not because the bonus allowance I suggested would factor in tax rate + endorsement potential. So what LA and NY gain in tax subsidy would certainly be wiped out by the added endorsement potential.

The formula doesn't even have to be complex: take all endorsement money per team and compare team total to league average. The percentage over or under gets added to the local tax rate, this percentage is then multiplied by the value of the contract as the max allowable signing bonus. That's it.

That seems incredibly arbitrary. You'll factor in tax rate and endorsement potential (how can you even determine a value for endorsement potential?), but not cost of living?

 

[pdxKingsFan]

That seems incredibly arbitrary. You'll factor in tax rate and endorsement potential (how can you even determine a value for endorsement potential?), but not cost of living?

I just proposed a method - take all endorsement income on a per team basis and average that out. A team's percentage over or under the league average is added to the local tax rate. That percentage is then allowable as a signing bonus to the contract value. It's ridiculously simple.

No cost of living because a) player's are not required to live in their cities during the offseason, b) they travel 1/2 of the season and c) these guys aren't living in apartments and clipping coupons - when you reach a certain income level "cost of living" becomes "how much can I spend".

Besides, when have you ever heard about cost of living being a factor for why a free agent would choose one town over another? You haven't. How much did we hear about endorsement money and tax money this offseason and in the past? ALL THE FRIGGIN TIME.

 

[Superman]

I just proposed a method - take all endorsement income on a per team basis and average that out. A team's percentage over or under the league average is added to the local tax rate. That percentage is then allowable as a signing bonus to the contract value. It's ridiculously simple.

But endorsements are based on individual players, at least the ones we're talking about it. Chris Bosh isn't as marketable as LeBron James and Dwayne Wade, but if all three signed in the same team in a smaller market, the team would be allowed to offer all three of them a signing bonus based on average marketability. Back in the day, the Raptors were marketable solely because of Vince Carter. His endorsements weren't based on the fact that he played in Toronto. That's usually the way it is with big time players. More on that later.

No cost of living because a) player's are not required to live in their cities during the offseason, b) they travel 1/2 of the season and c) these guys aren't living in apartments and clipping coupons - when you reach a certain income level "cost of living" becomes "how much can I spend".

When you're talking about premiere players, sure. But it's still a factor. The wide-ranging cost of real estate throughout the country makes a big difference, whether the players live there full time or not. And even if they travel, that doesn't mean their families don't need somewhere to live. And it's pretty clear and undeniable that it costs a lot more to live in Miami or New York or LA than it does to live in Cleveland or Detroit or Indiana or Memphis. If we're worried about state tax, then why wouldn't we be worried about cost of living? It's just as varied. It could easily cost LeBron $8 million to build a home in South Beach, and that's pretty much what he's saving in tax money. It's a wash.

Besides, when have you ever heard about cost of living being a factor for why a free agent would choose one town over another? You haven't. How much did we hear about endorsement money and tax money this offseason and in the past? ALL THE FRIGGIN TIME.

We heard about endorsement money primarily because of LeBron's stated intention to be a global icon and billionaire athlete. We didn't hear too much about tax money, not that I can remember. And I really don't think it was that big of a concern when these guys made their final decisions. Amare could have gone to a team in a state with much lower taxes than New York.

And the counter argument to the endorsement issue is that when you're a big time player, you're going to get endorsements. Nike and Gatorade and Vitamin Water and all those companies don't care where you play, as long as your team is good and you get national TV slots.

 

[sidney]

Do you guys work for the IRS? sheesh.

No need to complicate this with cost of living/endorsement calculations. The universal motivator is self interest (greed)

The current system tries to help the small market by adding the extra contract year and a 3% difference in raises from year to year. As we saw with Bosh and Wade, the extra year incentive isn't working from a player perspective because the losing team will relent and do the sign and trade and give them the extra year. Then the only difference left is the 3% difference in raises. It's just not enough. The "incentive to stay" system is broken.

Widen that gap by making the extra year incentive a reality (extra year cannot transfer in a sign and trade) and making the difference in starting salary/raises more significant, and this issue solves itself. No need to kill free agency completely by making every free agent restricted either.

 

[pdxKingsFan]

Supes, it may not be a perfect solution but it is a way to try and get union buy in on the hard cap which I think is more important than ever. I don't understand why you seem entirely opposed to coming up with any kind of solution by discounting the idea entirely. I am sure the NBA math wiz's could actually come up with a formula that was more accurate. But I believe the idea is sound.

 

[Superman]

Supes, it may not be a perfect solution but it is a way to try and get union buy in on the hard cap which I think is more important than ever. I don't understand why you seem entirely opposed to coming up with any kind of solution by discounting the idea entirely. I am sure the NBA math wiz's could actually come up with a formula that was more accurate. But I believe the idea is sound.

My problem isn't just with the fix. It's with the notion that a fix is needed. I just don't think the tax issue is as big a deal as you do. Same with endorsements. We've parsed it out a lot further than was necessary, but that's mostly because that's what we do. On a fundamental level, I don't think it's a big deal. The Canada exception is different because the Raptors are the only team that has to deal with an entirely different tax system than 29 other teams, and that's why the NBA did something about it. I doubt that they'll do something about state taxes, and I strongly doubt they'd do something about endorsements. I think it's a minor issue.

And I also think that the transitive and ambiguous nature of state taxes and endorsements makes it hard to fairly compensate for those issues. I'm not just trying to blow your idea out of the water.

 

[Superman]

Do you guys work for the IRS? sheesh.

No need to complicate this with cost of living/endorsement calculations. The universal motivator is self interest (greed)

The current system tries to help the small market by adding the extra contract year and a 3% difference in raises from year to year. As we saw with Bosh and Wade, the extra year incentive isn't working from a player perspective because the losing team will relent and do the sign and trade and give them the extra year. Then the only difference left is the 3% difference in raises. It's just not enough. The "incentive to stay" system is broken.

Widen that gap by making the extra year incentive a reality (extra year cannot transfer in a sign and trade) and making the difference in starting salary/raises more significant, and this issue solves itself. No need to kill free agency completely by making every free agent restricted either.

I think in this case, the sign and trade benefits Toronto and Cleveland more than it benefits the player. The extra year isn't that big of a deal, I don't think.

 

[pdxKingsFan]

My problem isn't just with the fix. It's with the notion that a fix is needed. I just don't think the tax issue is as big a deal as you do. Same with endorsements. We've parsed it out a lot further than was necessary, but that's mostly because that's what we do. On a fundamental level, I don't think it's a big deal. The Canada exception is different because the Raptors are the only team that has to deal with an entirely different tax system than 29 other teams, and that's why the NBA did something about it. I doubt that they'll do something about state taxes, and I strongly doubt they'd do something about endorsements. I think it's a minor issue.

And I also think that the transitive and ambiguous nature of state taxes and endorsements makes it hard to fairly compensate for those issues. I'm not just trying to blow your idea out of the water.

Again though, it is only partially about fairness issue, it is mostly about throwing all the bones you can at the union to get them to bite on a hard cap. It seems that you are in agreement that the luxury tax system isn't working and while you've proposed progressive solutions to harden the blow the top 6 teams will likely continue to absorb it so long as they get the results they want.

BTW, the first time I heard about the FL tax issue was mid-90s it just isn't talked about much, but there is a reason such a large percentage of athletes keep residences there. And keep in mind that the NBA offseason = hurricane season.

 

[Superman]

Again though, it is only partially about fairness issue, it is mostly about throwing all the bones you can at the union to get them to bite on a hard cap. It seems that you are in agreement that the luxury tax system isn't working and while you've proposed progressive solutions to harden the blow the top 6 teams will likely continue to absorb it so long as they get the results they want.

If it's something that could be used to push the union closer to accepting a hard cap (or something more restrictive than what we have now), then that's a good thing. Just another bargaining chip, essentially. The union loves bonuses, whether warranted or not.

BTW, the first time I heard about the FL tax issue was mid-90s it just isn't talked about much, but there is a reason such a large percentage of athletes keep residences there. And keep in mind that the NBA offseason = hurricane season.

That raises another question, though. I just thought of Derek Jeter, and a tax issue he and some other Yankees had a few months ago. Something about them listing their primary residence in Florida in order to get the tax break. If that's the case, and a professional athlete can get his residence listed in a state with no state tax, then it doesn't really matter where they play. Anyone can just buy a condo in Jacksonville and avoid the state tax in their team's state. The bonus kind of loses it's strength.

I'm not a tax accountant and I don't really remember the details of the Jeter deal, so I don't know whether that matters or not. But if so, it kind of kills the whole idea that the state tax is an issue at all.

 

[sidney]

I think in this case, the sign and trade benefits Toronto and Cleveland more than it benefits the player. The extra year isn't that big of a deal, I don't think.

The extra year is a very big deal and allowing it to transfer in a sign and trade breaks the advantage of the home town team who will always accept it just to walk away with something when their options have run out.

Enforce that differently, make the starting max contract 10% lower when moving to a new team, up the yearly raise advantage to 5% instead of 3% and the home town will have a much better advantage at keeping stars it has drafted and developed. A star player is going to have to walk away from much more money than LeBron and Bosh did to change teams. That has to be the goal, IMO, if there is any hope for the future of small market teams.

 

[pdxKingsFan]

That raises another question, though. I just thought of Derek Jeter, and a tax issue he and some other Yankees had a few months ago. Something about them listing their primary residence in Florida in order to get the tax break. If that's the case, and a professional athlete can get his residence listed in a state with no state tax, then it doesn't really matter where they play. Anyone can just buy a condo in Jacksonville and avoid the state tax in their team's state. The bonus kind of loses it's strength.

I'm not a tax accountant and I don't really remember the details of the Jeter deal, so I don't know whether that matters or not. But if so, it kind of kills the whole idea that the state tax is an issue at all.

My understanding was that they have to pay local taxes on home games but road games have always been a source of contention. It may be a state by state thing for road games. I know Oregon goes after any money earned in Oregon because we are a zero sales tax state and we get a lot of tax leeches from WA state that try to have it both ways.

 

[venom_7]

Boston gutted their team. Traded away al Jefferson. The lakers traded away players who have the basketball skillset equivalent to my left ball sac.

Lakers traded the rights to Marc Gasol, who is better than Bynum. Obviously not as good as Pau, but that trade isn't nearly as one sided as everyone thinks.

 

[Superman]

Lakers traded the rights to Marc Gasol, who is better than Bynum. Obviously not as good as Pau, but that trade isn't nearly as one sided as everyone thinks.

Bynum wasn't part of the trade, so it doesn't matter. And it's also arguable that Marc Gasol is better. It's also worth noting that Marc Gasol wasn't better than Bynum when the trade was consummated.

I get what you're saying, but they traded a late second round draft pick that had not reported to the states and hadn't signed a contract with the team for an All Star 20/10/1.5 big man who was in his prime and held practically every franchise record for the Grizzlies. Marc Gasol was a throw-in to that trade, not a fundamental piece. The fact that he's turned into a pretty good player two years later doesn't change that the trade was lopsided when it happened.

 

[Superman]

My understanding was that they have to pay local taxes on home games but road games have always been a source of contention. It may be a state by state thing for road games. I know Oregon goes after any money earned in Oregon because we are a zero sales tax state and we get a lot of tax leeches from WA state that try to have it both ways.

I heard on the radio today that Frank McCourt hasn't paid a dime of federal or state taxes since he bought the Dodgers in 2004. These guys have incredible accountants, reputable or not.