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Volume 22 No. 48
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Jump in NBA cap leaves six teams under minimum spending limit

A historic spike in the NBA salary cap has helped put more teams further beneath the league spending limit than ever before, a union official says, despite a summer of healthy free agent spending.

NBA clubs have spent a record $3.5 billion on free agent deals this summer, more than twice what clubs spent two summers ago, but that hasn’t been enough to offset a rise in the salary cap from $70 million per team last season to $94 million for the coming season.

“A $24 million spike is the largest by far in the history of any sport probably, by dollars or percentage,” said Ron Klempner, National Basketball Players Association senior counsel.

The increase is due to the influx of money from the NBA’s nine-year, $24 billion media deal agreed to in 2014, nearly three times more lucrative than the previous deal. Players receive a percentage of overall league revenue under the collective-bargaining agreement.

“There are more teams that are confronted with the issue of the minimum team salary this year than in the past, in large part because of the spike,” Klempner said. The NBA CBA contains a provision that clubs that do not sign contracts equaling 90 percent of the salary cap must give the difference back to the players on that team. The teams have until the last day of the regular season, which for the coming season would be April 12, to get to the 90 percent level.

This year that 90 percent minimum team salary amount is $84.728 million.

As of last week, according to industry sources, six teams were significantly under that number — the Philadelphia 76ers, Brooklyn Nets, Denver Nuggets, Minnesota Timberwolves, Phoenix Suns and Utah Jazz.

The 76ers’ spending level was about $70 million, followed by Brooklyn at $77 million and Denver at about $77.5 million, by the NBPA’s numbers. Minnesota, Phoenix and Utah were both more than $3 million under the minimum salary number.

“Teams engage in player transactions of one kind or another throughout the season, and we anticipate that all or virtually all of our teams will exceed the minimum team salary by season’s end,” said Mike Bass, NBA executive vice president of communications.

The clubs either did not return inquiries or declined to comment about their team salary levels.

Klempner said clubs “can sign free agents any time, and then they can also arrange around the trade deadline to take on salaries to avoid this minimum team salary obligation.”

Agents and other basketball sources said last week that they expected the clubs to get to the minimum team salary number, or at least much closer to it, by next April.

In fact, the Philadelphia 76ers were under the minimum at the beginning of the last two seasons but ended up spending their way past it.

The 90 percent minimum team salary is a new feature of the 2011 CBA. Previously, clubs were required to spend to 75 percent of the cap number or give the money back. The NBPA player representatives voted to have the players on the teams under the minimum receive the money in equal shares, based on time on the roster.

Two clubs gave money back to players the last two seasons. This past year, the Orlando Magic was $60,000 under the team minimum and the Portland Trail Blazers were under by $840,000. During the 2014-15 season, Orlando was under by $1.9 million and the Denver Nuggets were under by $800,000.

Staff writer John Lombardo contributed to this story.