New ‘Derrick Rose Rule’ To Benefit Young Superstars

For nearly 150 days of an anxiety-filled lockout, N.B.A. players made every concession imaginable — on salaries and free-agent rules and payroll limits. But in the final hours of negotiations, they at last extracted some key compromises from the league. Some of the items are arcane. Many will seem minor to all but the most dedicated salary-cap enthusiast. But to the players, the issues were critical — so much so that they disbanded their union, filed a federal lawsuit and extended the lockout by two weeks to gain the concessions. From late Friday night to early Saturday morning, the players gained ground on the following items: ¶ Flexibility for high-payroll teams: The league agreed to create a $4 million cushion, or “apron,” that will allow teams near the luxury-tax threshold to use the full midlevel exception and to acquire players in sign-and-trade deals. The league had sought to ban teams from using those measures if doing so pushed them even one dollar over the tax line. Now, a team with a $69 million payroll ($1 million below the tax threshold) will be permitted to use the full, $5 million exception, pushing its payroll to $74 million, or $4 million over the line. A team at $69.5 million would be limited to just $4.5 million of the exception. The same framework will apply for teams acquiring a player in a sign-and-trade deal. This was a huge issue for players and their agents, because the proposed restrictions could have severely undermined a player’s leverage in free agency. ¶ Derrick Rose rule: Young superstars (those with less than six years of experience) negotiating a so-called “max” contract may now be eligible to earn 30 percent of the salary cap, instead of 25 percent. To gain that right, a player must earn All-N.B.A. honors (first, second or third team) twice or be voted an All-Star Game starter twice or be named most valuable player. Rose, who was named the 2010-11 M.V.P. as a third-year player for the Bulls, will be among the first to take advantage of the new rule. Oklahoma City’s Kevin Durant may be eligible because the extension he signed in 2010 has not yet taken effect. Under N.B.A. rules, a max contract is tied to league formulas, not a specific dollar amount. Durant could ask the Thunder for the extra 5 percent once the league reopens for business. ¶ Escrow tax: The N.B.A. will cap the withholding from paychecks at 10 percent — a measure that is used to ensure that players’ salaries do not exceed 50 percent of league revenues. If that withholding is insufficient to hold the players at 50 percent, the league will tap a newly created benefits fund, equal to 1 percent of league revenues. Under the league’s previous proposal, the escrow withholding would have been virtually unlimited, according to the players association. ¶ Options and trades: The league dropped its ban on player options and extend-and-trade deals. But a player who wants an extension as part of a trade will be limited to three years, instead of four, with raises of 4.5 percent, instead of 7.5 percent. ¶ Salary scales: The scales for rookies and minimum players will be frozen at 2010-11 levels, with future raises being determined. The league had sought a 12 percent rollback, to 2007-8 levels. Via (NYTimes)



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