So, Paul Pierce, Kevin Garnett, and Jason Terry are heading to Brooklyn, meaning the Celtics have cleared a ton of money off their books and can now be big spenders again.
The first two parts of that statement are true; the last part, not so much.
The Celtics will shed about $33 million in salaries — the combined total of what Pierce, Garnett, and Terry stood to pocket next season — but the Celtics also stand to take back five players and about $29 million in salaries from Brooklyn in the blockbuster swap that won’t become official until after July 12.
Boston’s net savings should be about $3.8 million — or, more simply, pocket change by NBA standards.
The summer is still young, and there are still cost-cutting moves that the Celtics could make, but, right now, they are set to have around $72 million on their books next season, placing them well over next season’s projected salary cap ($58.5 million) and just over the tax line ($71.6 million).
It’s a place that leaves the Celtics with little financial wiggle room.
“We don’t have cap space,” Celtics president of basketball operations Danny Ainge said Monday.
Now, in an effort to shed salary, the Celtics could still trade or cut players (Shavlik Randolph and D.J. White have nonguaranteed contracts) to get under the tax line. And getting under said tax line is more important than ever.
Up through this past season, teams over the tax line faced a dollar-for-dollar penalty under the terms of the NBA’s collective bargaining agreement, which, for deep-pocketed teams, meant a cost of several million dollars.
But starting next season, the penalty becomes progressive, moving to a $1.50-to-$1 penalty, with the ratio increasing for each additional $5 million that a team is over the tax.
Starting in 2014-15, teams that have exceeded the tax threshold in three of the previous four seasons will have to pay the “repeater” tax, which further increases the penalty that teams would have to pay.
For example, last season, a team $5 million over the salary-cap threshold would have owed $5 million in taxes, but it would owe $7.5 million in taxes next season, and, if that team were deemed a “repeater” in 2014, it would owe $12.5 million.
It only gets steeper from there.
Regardless, the Celtics don’t want to be a tax-paying team next season, Ainge said.
“But the good news about our team, and our owners in particular, is they have proven a willingness to pay tax,” Ainge added. “You don’t want to pay tax just to pay tax. But our ownership will pay tax if needed.”
The Celtics’ main priority right now, according to Ainge: “We need to clean our roster up.”
Boston acquired two 7-footers in last week’s draft: Gonzaga’s Kelly Olynyk and Colorado State’s Colton Iverson.
They also have eight players with guaranteed contracts: Rajon Rondo, Jeff Green, Brandon Bass, Courtney Lee, Avery Bradley, Jared Sulllinger, Fab Melo, and Jordan Crawford.
And, now, in their deal with Brooklyn, the Celtics are set to add Kris Humphries, Gerald Wallace, Kris Joseph, MarShon Brooks, and Keith Bogans.
That’s 15 players, the maximum an NBA team can have on its roster in season. (Though, Joseph’s contract isn’t guaranteed.)
Right now, the Celtics are under the “apron,” which is the mark $4 million over their tax line — about $75.6 million next season. But the Celtics will likely be hard-capped for next season, meaning their bottom line cannot be more than that amount for any reason through June 30, 2014.
The reason the Celtics will likely be hard-capped is because they’re accepting a player (Bogans) in a sign-and-trade, which automatically triggers the hard cap.
And because the Celtics are under the apron but facing a hard cap, they may not be able to add players with their available exceptions. So although they have the biannual and midlevel exceptions available, they couldn’t use them to sign a free agent to an amount that would take them over the hard cap.
However, as Ainge said, “Free agency, right now, is not a priority for us.”
The Celtics’ path to salary-cap space exists for 2014-15, but it comes with difficult decisions, such as whether to cut or trade certain players.
They could use the “stretch provision” on Wallace, allowing them to waive him and stretch his contract over several years to lessen the blow on their books.
Wallace is owed $30.3 million over the next three seasons, but if the Celtics “stretch” that contract, it could amount to $4.3 million a year for seven seasons instead.
It will take some juggling of the books, but, for the moment, even after unloading some large salaries, the Celtics will have to pinch pennies as they enter into the rebuilding stage.Baxter Holmes can be reached at firstname.lastname@example.org. Follow him on Twitter at @BaxterHolmes.