In a rising salary cap environment, productive players with options in their contracts are heavily incentivized to test free agency. It’s common sense. Consider Kyrie Irving. When he signed his rookie extension in the summer of 2014, the salary cap was $63 million. Last offseason, when he had to decide whether to pick up the option on the final season of that contract, the cap was over $109 million. Over the past half-decade, the cap has grown so rapidly that, short of injuries or rapid decline, player options have largely been a formality. Players wanted to get to free agency as quickly as possible.
But in 2020? Most veterans will want to sit out. The spending spree of 2019 deprived most teams of 2020 cap space even before the pandemic. Now? The best-case scenario is likely a cap freeze, and a decline is not off the table. Those same player-options have become life rafts. Nobody wants to dip their toe into such an uncertain free-agent market. In 2019, 12 of the league’s 26 player options were declined.
That number is going to be substantially lower this time around. There are 28 player options on the board, according to Spotrac. The overwhelming majority will be exercised, most without a second thought. But of those 28 options, nine stand out as possible opt-outs. Some make significantly more sense than others, and we could see a surprise or two, but the total number will wind up being closer to four or five. Below are the players who could credibly improve their financial standing through free agency rather than passivity, and how their teams might respond to such a decision. But first, a quick glance at the options that we should expect to be exercised without much thought:
Who’s staying put:
DeMar DeRozan: There have been rumblings that he is unhappy in San Antonio, but $27.8 million is just too much to pass up in a market that features only three teams projected to even have that much cap space.
Otto Porter Jr.: When was the last time a non-star passed up over $26 million after a season in which he played only 14 games?
Andre Drummond: The Pistons traded him specifically to avoid paying his $25.4 million option.
Nicolas Batum: One of the last remaining 2016 albatrosses, Batum is a fringe starter making $24 million.
James Johnson: He’ll go back to making the minimum once his $14.4 million salary expires.
Kelly Olynyk: In a normal environment, $12.5 million might be beatable, but not in 2020.
Tony Snell: It’s not nearly as farfetched as it seemed in 2019, when the Bucks gave up a first-round pick to dump him, but he’s not coming close to $11.5 million in this market, and the Pistons should be able to give him enough minutes to pad his stats next season.
Jabari Parker: It’s been a long, wild ride, but Parker’s days making much above the minimum are coming to an end. You have to be far better on offense to justify $6.5 million for a total defensive liability.
Rodney Hood: Kevin Durant can pass up an option after rupturing an Achilles, but mortals can’t. Hood is keeping his $6 million.
Enes Kanter: Boston, well above the tax, is going to look to dump Kanter’s $4.9 million. Nobody wants to pay that much for a center that can’t defend in space.
Robin Lopez: Lopez isn’t a minimum-salary player, but the center market is so deep that $4.9 million from a contender (featuring his brother) just isn’t getting topped.
Stanley Johnson: He scored 60 points all season. At $3.7 million, that’s over $61,000 per point.
Austin Rivers: He may be able to do better than the minimum, but he seems to like Houston and it’s a perfect setting for a player of his skill-set. Of these players, he is the likeliest surprise, but remember, he only got the minimum last offseason, a relative boom time.
Willie Cauley-Stein: The Mavericks acquired Cauley-Stein to replace Dwight Powell, but he opted out of the bubble. Catching lobs from Luka Doncic is too tempting to opt out of even a minimum deal, though.
Mike Muscala: He might be able to get the minimum elsewhere, but there’s not much upside to that risk, and he should get minutes in Oklahoma City.
James Ennis: The minimum in Orlando is valuable right now. There’s no state income tax in Florida, and Jonathan Isaac’s injury will give him minutes.
Mario Hezonja: This will likely be his final NBA contract, so he should savor the $1.8 million he is owed before heading back to Europe.
Davis is the only player on this list that is guaranteed to decline his player option. That option would pay him $28.7 million. Even if he wants to stay with the Lakers, he is virtually assured a sizable raise by opting out of his deal and signing a new one. Davis, as an eight-year NBA veteran, is eligible for a contract starting at 30 percent of the salary cap. Under last season’s $109.14 million cap, that would have paid him over $32.7 million. The expectation right now, despite the coronavirus pandemic damaging the league’s finances, is that the cap stays the same. Even if it falls, it would have to drop over $13 million to cost him enough money to opt into that $28.7 million. There isn’t going to be a $95 million cap, therefore, Davis is opting out and taking the raise.
The real question here is what sort of contract Davis does demand from the Lakers, and logically, there are three options:
- A one-year deal paying him something resembling that $32.7 million would get him back to free agency in 2021, when the cap could potentially start to rise again. That is far from guaranteed, though. The real advantage of a one-year deal, though, is that it aligns him with LeBron James, who has a player option of his own for the 2021-22 season. Should James decide to leave, it would give Davis the flexibility to do so as well. That isn’t likely, but with James you never really know. The other possible but unlikely advantage is that if the Lakers hope to create max cap space to pursue Giannis Antetokounmpo or another star, both James and Davis could leave some money on the table to help make that possible. This isn’t likely for a multitude of reasons, but given the careful way that the Lakers have managed their cap, it can’t be fully ruled out either.
- A two-year deal would pay him roughly $68 million, but it would also get him back into free agency at the optimal moment. If we assume that the pandemic is over by the 2022 offseason, the salary cap could begin to rise back to projected levels again at that point. It would also get Davis to 10 years of NBA experience. That would allow him to make 35 percent of the cap in the first year of a new deal. Depending on where the cap lands, that could get him a five-year deal worth something in the neighborhood of $250 million after the conclusion of that $68 million pact.
- A five-year deal under the terms of the 2019 cap would pay Davis roughly $221 million. Given his Klutch Sports representation, it seems unlikely that Davis would prioritize that guarantee over the flexibility and leverage of a short-term deal, but he’s had some injuries in the past, so it’s a slight possibility.
Davis will be able to demand a player option on the final year of any of these offers. The Lakers will deny no request of his after the postseason he just had, so he is free to dictate whatever terms he chooses.
The extension candidates
The projected luxury tax line is right around $132.6 million. Boston already has over $140 million committed for next season… before factoring in their three first-round picks and any free agency expenditures. This team is going to be expensive, and it has a serious incentive to avoid the tax for as long as possible. Jaylen Brown’s max extension is about to kick in. Jayson Tatum’s is coming, and if he hits the Rose Rule criteria, it is going to get even pricier. Kemba Walker has three max years left, and at the very least, a new Marcus Smart contract virtually assures that the 2022-23 season will be spent in the tax no matter what.
Boston can probably afford to pay the tax every now and then, and did so during the Big Three era, but this ownership group hasn’t touched the repeater tax. The Celtics want to put off starting that clock (three years in a row, or four out of five) for as long as possible. That’s where Hayward comes in. He’s guaranteed $34.2 million this season, but his earning prospects afterward, given his health and underwhelming showing in Boston, are another matter entirely. He might get another big deal in 2021 free agency, but it may have to come from a weaker team, and it almost certainly won’t be a long-term pact.
If Hayward wants to keep contending in Boston and buy himself some security, the Celtics could be interested in giving him a long-term deal at a substantially lower rate in order to avoid the 2021 tax. Let’s say, for instance, Hayward was willing to cut his salary in half, but on a four-year deal. He could guarantee himself almost $77 million while getting the Celtics out of the tax this year.
Would he take that? Probably not. Even this version of Hayward should be able to get the difference between those two figures relatively easily in 2021 free agency. Go much higher than that and the Celtics probably get queasy. Taking the Hayward hit now at least keeps him off of the books moving forward. Hayward has plenty of reason to doubt Boston’s loyalty after Danny Ainge traded Isaiah Thomas, so if he takes a below-market deal, there’s no guarantee he plays it out in Boston. This shouldn’t be viewed as extremely likely, but there may be a number that both sides can live with.
Orlando’s situation isn’t nearly as dire as Boston’s. The Magic are approximately $10 million below the tax line before factoring in D.J. Augustin, their first-round pick or 2019 first-round pick Chuma Okeke, who has yet to sign his rookie-scale deal. Even if they paid the tax this year, there is no reason to believe they’re in repeater tax danger moving forward. But without Jonathan Isaac, this is a lottery team, and rarely do small-market owners want to pay the tax for a lottery team.