Philly Front Office

[UPDATE: The Jazz have entered the chat. With recent moves, the Jazz can create between $18m and $28m in cap space to dangle in front of restricted free agents. There seems to be some discrepancy as to whether Svi Mykhailiuk’s contract is guaranteed yet or not. Here’s hoping they want to lease that space for picks instead]

So far in free agency the Sixers have signed Trendon Watford, resigned Eric Gordon, and lost Guerschon Yabusele. I know, I’m tired from all the parties thrown for those moves too, but we need to talk about why Quentin Grimes can’t be added to the cap sheet yet. Speaking of which, here you go.

Sixers Contracts

Restricted Free Agency

I want to set everyone at ease that there is basically a 99% chance he is going to play for the Sixers next season. The main reason for that confidence, Grimes is a restricted free agent. Restricted free agency in the NBA means that any team in the league can offer the RFA a contract, but the original team gets 48 hours to match that deal. This limits the market in two ways. First, teams have to offer an amount high enough going in so that the original team doesn’t match it; otherwise, what’s the point? Generally, teams don’t like to overpay for players. Second, the offering team has its cap space basically put on hold for 2 days while the other team considers a match. Once that offer sheet is signed by the player, it is an official deal and there is no backing out. He is either getting it from the offering team or the original team, so the offering team can’t spend that money in the meantime. As a side note to both these points, the original team is using Bird Rights to resign the player which means it basically will not affect their salary cap (that is a gross over-simplification). The offering team on the other hand needs to either use an exception or cap space to make the deal. They are not coming from similar positions.

Who Can Sign Him?

Apparently, Grimes is looking for something in the ballpark of $25m per season. Same here, man. Who could possibly give that to him? In my Free Agency Prologue I mentioned that only a few teams had money to spend with only the Nets able to offer more than the Non-Taxpayer Mid-Level Exception (NTMLE) of $14.1m. Well, who is left after 4 days of spending?

• Nets – between $22.5m and $17.5m
• Hornets – $14.1m
• Bulls – $14.1m (but still need to sign Josh Giddey who won’t come out of that money, but could make things tight)
• Pacers – $14.1m
• Wizards – $14.1m
• Blazers – $14.1m
• Jazz – $14.1m
• Warriors – $14.1m (but only if they lose Jonathan Kuminga)

There is always the possibility of a sign and trade move, but that would be contingent on the Sixers taking back salary in exchange for draft assets. That does not seem likely for us or the acquiring team. Maybe if a team had a glut of forwards to match our glut of guards? That’s the only way we are playing ball.

The boogeyman here is still the Nets. It is possible that they could offer him that $22.5m by renouncing their own free agents. Most analysts do not see that as likely though, with the Nets poised to rent out their remaining cap space to other teams for draft assets.

Then there is the Sixers. What can we offer him? Since we have his Bird Rights, we could technically offer him anything up to a max contract. However, with certain apron and tax constraints coming into play, the highest the Sixers would probably go is around $20m. This would take us agonizingly close to the 2nd apron this season since we are already at $186m right now. They would still probably match a Nets offer of $22.5m though (and especially $17.5m).

Negotiation

Grimes might want his money, but that doesn’t mean the Sixers are just going to give it to him. Daryl Morey is much more aware of the spending power of other teams than we are, so he is not going to just overpay. The Sixers have all the leverage here. Let’s take the Nets out of it for a minute. The most any other team could offer him is $14.1m. If anyone makes that offer, it would likely be in the form of a 4-year deal with 5% annual raises totaling around $60.7m. Sixers match that no problem.

Can anyone other than the Nets do better than that? Well, as we saw with the Bucks, things can happen in the NBA. Still, at this stage in the offseason, a team getting that much under the cap is pretty much impossible. $60.7m is his ceiling from the rest of the league.

Ok, so why haven’t the Sixers offered him $61m and called it a day? There are two possible answers to this:

The Sixers are playing hardball. By signing Grimes to literally any contract, the team will exceed the tax threshold. Granted, the tax isn’t finalized until the end of the season and the Sixers have gone out of their way to avoid it before, but they would be on target to blow past the mark by signing him to a $15m AAV deal. The tax number would be around $200m and come with a tax of around $30m. So, what happens if no one offers Grimes that NTMLE? Well, there are two possibilities. He could sign his restricted free agent tender that’s around $8.7m or take the Sixers best offer. I don’t know what that best offer is, but you would imagine that the Sixers want to keep him around. Maybe it’s 4/$45m starting at $10m with 8% raises? Even that $5m haircut means $12.5m less tax. Afterall, if no one is offering him money, how good could his market be anyway?

Grimes is betting on himself. In this scenario, he simply doesn’t want to accept 4 years of NTMLE money and wants the bag. He is 24 years old and entering his prime. This means that he is telling the Sixers that if they don’t give him the money he wants, he will simply sign his qualifying offer of $8.7m and enter unrestricted free agency next season when more teams have money. The plan would be to ball out and make the Sixers regret not paying him when they had the chance. There’s also the possibility that he has to fight for minutes on a guard heavy squad or gets hurt too. It is a gamble.

What Happens?

In the end, he is going to be a Sixer, simple as that. The only question is if it is going to be for the $9m qualifying offer, for the $14.1m NTMLE, or for slightly more if the Sixers want to keep the relationship nice and cozy. Any way you slice it, he is coming back.