The 2011-12 NBA season had a salary cap set at $58 million and the luxury tax kicked in at $70 million. The Magic’s projected salary cap for 2012-13 is currently about $66.7 million.
Jameer Nelson can opt out of his contract, or stay one more year at $7.8 million.
Earl Clark can opt out of his contract, or stay one more year at $1.2 million.
If either or both opt out, then simply subtract their salary from the $66.7 to get the Magic’s new salary cap total.
Other notes for 2012:
Dwight Howard in the final year of his deal paying him $19.5 million.
JJ Redick in the final year of his deal paying him $6.2 million. The Magic could actually terminate his deal by July 7, but that seems highly unlikely.
Justin Harper is in the final year of his deal paying him $762 thousand.
Von Wafer’s deal is not guaranteed.
Hedo Turkoglu, Chris Duhon, and Quentin Richardson all have 2 years left on their deals. Jason Richardson and Glen Davis each have 3 years left on theirs.
So what does all this mean?
1. The Magic will be over the cap. And although it doesn’t count against the cap, the team still owes Gilbert Arenas $42 million over the next two years. They don’t have much to spend and couldn’t if they wanted to.
2. The Magic have the mid-level exception. The MLE is now $5 million for a duration of four years for teams that are over the cap either before or after the signing, but did not pay luxury tax in the previous season. Orlando falls under this category. It can be split among two players if desired.
3. The Magic also have the minimum salary exception, allowing for them to sign any players to one or two year deals for the minimum salary. No limits.
So what will they do now?
1. Address the Dwight Howard situation first. Try to get him to agree to an extension. If that fails then a tough decision looms of either making other bold roster moves (trades) or making the boldest move and trading Howard.
2. Obviously who makes these decisions must be decided as well. Otis Smith? Stan Van Gundy? In my opinion, you can flip this decision and the Dwight decision, but the Dwight decision is simply more important to the big picture.
3. Figure out what Jameer Nelson and Earl Clark want to do. I have read where players don’t have to make a decision on their contracts until June 30 however, although it is being reported a decision must come from the two before weeks’ end. If that is the case, then good, the sooner the better for Orlando. The team would like to have an idea if they are going to need a new starting point guard or not.
4. Determine Ryan Anderson’s value. He’s a restricted free agent who was just named the NBA’s most improved player. He just turned 24 and has upside. He probably is never going to be an all-star, but he is already a solid starter. The Magic must allow for the other NBA teams to determine his value with their offers and then figure out if he is worth whatever that amount is, to the future in Orlando. This could be a decision that takes awhile, as knowing what Dwight Howard’s impact is on Ryan Anderson’s play is important to factor in as is who is coaching the team and if their is a philosophy change in the style of game the team plays.
5. Is Fran Vazquez coming? If so, it would nice to know before the draft and free agency.
6. Do you keep developing Daniel Orton?
So what happens at the draft and beyond?
1. The NBA Draft is June 28th. Free agency discussions start on the 1st, and signings begin on the 11th. At this point the Magic should have a new GM (if they are going to appoint a new one) and possibly, but not necessarily, a new coach. Clearly you hope to have some clarity on Dwight Howard’s situation. You should know by then Nelson’s and Clark’s intentions.
2. Either you are talking about a sign and trade with Ryan Anderson or you keeping him if the price is right. The Magic may be proactive with Anderson if they are looking to add another piece to appease Dwight.
3. The draft and/or mid-level could be used on replacements for Dwight, Jameer, or Ryan, or at least depth behind any of them. Even if Dwight and Jameer return, it could be just for one year. Small forward looks like an issue too.
4. The best trade assets Orlando has in order: Dwight Howard (duh?), JJ Redick, Ryan Anderson, and potentially Jameer if he returns. After that, teams aren’t knocking on the door for anyone else. Anderson cannot be traded until December 15th (or 3 months after signing) however.
I think we are going to be looking a completely different Magic team, and they have an entire offseason to figure things out. There are three basic options though.
1. Keep Dwight and keep status quo or make other trades to fix roster.
2. Trade Dwight and try to be competitive.
3. Trade Dwight, trade others, get younger, start from scratch.