Rob Pelinka and the Lakers may be chasing a max salary slot as hard as they chased a trade for Anthony Davis.
In the aftermath of the trade for Anthony Davis, there was some hand-wringing about the reported details of the deal. While some of those focused on the draft compensation (and resulting downside) the Lakers passed on to the Pelicans, more of it focused on the timing of when the trade would be executed, whether Anthony Davis would take his trade bonus, and how those factors would impact the Lakers cap space and, thus, their pursuit of top level free agents.
Initial reporting said the terms of the deal dictated a July 6th completion of the trade and that Davis would take his $4.1 million trade bonus. Taking the bonus would immediately reduce the Lakers cap space by however much Davis would claim of it (he could take the entire thing or only a portion of it). The July 6th completion would also deduct cap space, or so we were told, because the Lakers would be unable to use the salary of the #4 overall pick as salary ballast in the deal in order to make the deal work financially under the rules of the collective bargaining agreement. The result, then, would be the Lakers absorbing at least part of Davis’ salary into their cap space and reduce it further.
The final tally, then, would leave the Lakers with (roughly) $23.7 million in cap space to sign free agents. $23.7 is much less than the projected max slot (for players with 7-9 years of service) of $32.5 million. The Lakers were screwed and Rob Pelinka was an idiot, a bad negotiator, or both.
You see, if Rob were a good negotiator, he would have included terms that said the Davis trade would be executed on July 30th. He would have also included terms that Davis would waive his trade bonus. These terms would then have been leaked to the media, like the rest of the trade details and we’d know about them.
The worse scenario is that Pelinka is an idiot who did not account for the rule that states you need to wait 30 days to trade a draft pick after you’ve signed them to a contract for the purpose of aggregating their salary in a larger deal. After all, people like me and you know about this rule and would have accounted for this. Since this term is not in the deal, Rob must not be smart.
Those are the choices, here. Pelinka is either not good at negotiating or a dumb person (or, again, both!).
Call me crazy, but I’m not sure either of these are true. But we’ll get back to that later.
On Tuesday, David Lord (a Dallas based reporter who covers the Mavs), posted an article that explains how the Lakers still planned to create max cap space on July 6th, using a series of moves that included further trades of 2 or more of the remaining non-LeBron contracts on the roster — Moe Wagner, Isaac Bonga, Jemerrio Jones, or, yes, Kyle Kuzma. Here’s the key excerpt:
The Lakers path looks like this.
1) They will chase some player with a max salary offer. If successful, here’s where it will go next.
2) They will inform New Orleans that they will need to alter the AD trade slightly. I’m told this possibility was part of the trade discussion and agreement already in place, and New Orleans has been given latitude by the Lakers as well, allowing them to explore their own add-on trades that include pick 4 (due to them from LA) to go to another team to select in this week’s draft and maybe other pieces.
What alteration? They will let them know they will be adding a third team to the AD deal. Nothing will change between LA and NO, but by rule every pair of teams in a 3-way deal has to do a transaction with each other. So New Orleans and the other team will also have to do some transaction too. But it can be minor, as small as including a fake 2nd round pick, as we call them, or non-NBA “draft rights” on the books, most likely going both ways. Something. And if NO does a side deal of its own, then the Lakers will be doing the same sort of accommodation.
3) After that, the Lakers will find a team to take most of the other non-Lebron pieces under contract, to trade them away with no salary coming back. Maybe the players will be eagerly grabbed by teams, or maybe the Lakers will have to add a bribe with side value. But in any event, it should be very doable with such small salaries. And if it becomes a bit of a challenge, surely a Kuzma-Wagner package with a 2nd-rounder attached would have plenty of willing takers.
Which players? That part is hazy and flexible. Their available choices would be Mo Wagner, Kyle Kuzma, Ike Bonga, and Jemerrio Jones. Not all of them would be needed, but at least 2-3 based on salary. And each choice brings side issues to navigate with pluses and minuses. (We’ll explain below.)
4) Once the players are decided on, and a trade partner for them obtained, a trade for AD at that point would be immediately doable! No waiting. How? By including that secondary trade as part of the trade of AD to LA, making it a 3-way deal.
First, while we will credit Lord with the reporting of “latitude” (as he describes) that exists on both sides, agreed to by both teams, as already a part of a Davis trade, the idea of expanding the trade was something I first saw in print coming from Bleacher Report’s Eric Pincus and on twitter from our very own contributor Reed. The math on this checks out and creates a scenario where sequencing of the moves is just as important as the players (and their contracts) being sent out.
To spell it out, it would need to look like this:
- The Lakers renounce all their current free agents (Rondo, Bullock, JaVale, Lance, etc)
- The Lakers sign a max level free agent into the resulting cap space that comes from renouncing those free agents.
- The Lakers execute a 3-team trade to include, themselves, the Pelicans, and a presently unknown third team that will send out Brandon Ingram, Lonzo Ball, Josh Hart, and some combination of Moe Wagner, Isaac Bonga, Jemerrio Jones, or Kyle Kuzma. If Jones is included in the trade, his non-guaranteed salary for the 2019-20 season would need to be guaranteed first. The Pelicans would get Lonzo/Ingram/Hart and the third team would get the other players (likely Wagner/Bonga/Jones). If sweetners — like future 2nd round picks or cash need to be included to make this happen, the Lakers would add those to the deal.
There’s more context here, but that’s the gist of things. By trading every player on the roster not named LeBron and Kuzma, the Lakers could make a legal trade with the Pelicans for Davis after they’ve already used their cap space on a max player.
This sounds so simple. But few things in life actually are.
Shortly after Lord’s report came out, ESPN’s Adrian Wojnarowski and Bobby Marks reported that the Lakers were scrambling to make their trade with the Pelicans bigger by adding a 3rd team and including additional players — basically reiterating Lord’s report but leaving out any mention that there was any pre-agreed to latitude to do this.
Shortly after, Marks wrote a piece that detailed the steps of how a reworked trade would function, similar to Lord. Marks, however, was pessimistic it would happen, citing the Pelicans’ interests in wanting the Lakers to be bad (emphasis mine):
In such a trade, New Orleans would benefit by not being on the hook to pay Davis his $4.1 million trade bonus — but the Pelicans would also be granting the Lakers the cap flexibility to add a third superstar or an extra $9 million to fill out their bench. That seems unlikely when the Pelicans own multiple first-round picks via the Lakers in future years.
So, without significant additional assets headed to New Orleans from the Lakers or the other teams in the deal, there is little incentive for the Pelicans to allow this to happen.
So, how likely is any of this to happen? I’ve no clue, honestly, and won’t pretend I do.
What I will say, though, is that we should not act as though the Lakers are the only team looking to expand the parameters of this trade. The Pelicans have already been shopping the #4 overall pick in trade discussions. This has been widely reported.
If the Pelicans are successful in trading the #4 pick, I’d argue that team becomes a natural partner for the Lakers to engage with for a Wagner/Bonga/Jones trade as well. After all, that team would already be offering something the Pelicans want (making it more likely for them to agree to stay in the trade) and that team would satisfy the “touching rule” that stipulates when 3-team trades happen, all 3 parties must do some business with each other.
This brings me back to Pelinka. I understand he’s not highly regarded. I’ve criticized him plenty (both on podcasts and in print) and have read/listened to enough backlash against him to know that this falls into “where there’s smoke, there’s fire” as a real thing — or enough so that the perception of him might as well be the reality.
That said, if there’s one area of being a general manager that I believe Pelinka has his head on straight it’s in understanding the nuances of and details that surround the salary cap and collective bargaining agreement. Pelinka is a former high powered agent who’s understanding of such things is one of the key requirements. Understanding every loophole of how player compensation operates in order to optimize your client’s earnings is the job.
So, I would not be so quick to think that Pelinka didn’t have an understanding of the workarounds for getting to a max slot for a deal on July 6th. I might also posit that Pelinka, in understanding the tenor of the negotiations, either 1. understood that lobbying hard for a July 30th completion date with the Pelicans would be too costly (especially since he already gave up a lot) and/or too complicated (whoever gets drafted at #4 would miss summer league, and if the pick is traded, you have to get that new team to agree to this stipulation too) or 2. tried to work out the type of “latitude” Ford reported into the framework of the deal.
Or maybe the above is giving him too much credit. The truth, like it usually does, probably falls somewhere in the middle of it all.
In the end, though, the Lakers have an opportunity to still fulfill what they’ve been building towards the second they traded D’Angelo Russell to the Nets in order to get out from Timo Mozgov’s contract. That single move put the Lakers back onto the “cap space” plan of chasing stars that was abandoned after Jim Buss and Mitch Kupchak struck out in too many consecutive summers.
Whether Pelinka can complete it all, remains to be seen. But, regardless of how much planning and foresight was involved in the beginning, if he does, the perception of him will begin to change. And I’d imagine none of us would ever be happier to see our skepticism turned on its head.