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Sign-and-trade transactions are not a staple of NBA free agency. To call them rare would be an understatement. They’re useful in theory but complex and restrictive in practice.
Chief among their limitations is the near absence of upside for players. Sign-and-trade contracts do not allow them to land full-bird deals. They can span no longer than four years and only include up to five percent raises, making them indistinguishable from offers any new team can offer.
These agreements can still be useful when a free agent wants to join a capped-out squad, but superstar sign-and-trades are inherently bogged down by the “Base Year Compensation” clause in the collective bargaining agreement. As Larry Coon wrote in his CBA FAQ:
“If a team re-signs its Larry Bird or Early Bird free agent in order to trade the player in a sign-and-trade transaction, the player’s new salary is greater than the minimum, he receives a raise greater than 20 percent and the team is at or above the cap immediately after the signing, then the player’s outgoing salary for trade purposes is either his previous salary or 50 percent of his new salary, whichever is greater. The team receiving the player always uses his new salary.”
Let’s use Jimmy Butler (player option) as an example. If he’s maxed out as part of a sign-and-trade, he counts as a $32.7 million inbound salary for his new team, but only as $20.4 million—his 2018-19 cap hit—in outbound value for the Philadelphia 76ers. This creates an obstacle in any theoretical negotiation because Philly cannot accept more than $25.7 million in returning money without adding another player to the deal.
Further complicating matters, teams that receive players in sign-and-trades cannot be above the luxury-tax apron afterward. That’s a problem when trafficking in a market of capped-out teams.
Certain liberties will be taken as we navigate these many obstacles. For instance, there may be players with max deals coming that are too enormous to work around realistically. Although these may essentially be no-gos for sign-and-trade purposes when the time comes, any ideas with these as the centerpiece will be proposed as opt-in-and-trades—a la Chris Paul in 2017.
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Boston Celtics Receive: Kevin Durant
Golden State Warriors Receive: Gordon Hayward, Boston’s 2019 first-round pick
Who says Kevin Durant and Kyrie Irving (player option) need to join forces on the New York Knicks?
Putting both in the Big Apple is easier. The Knicks have the capacity to carve out two max slots, and as Durant told Yahoo Sports’ Chris Haynes in December, “I just want to make sure I get as much money as I can on my next deal.”
The Celtics cannot offer that opportunity. They have no real path to bankrolling his $38.2 million max salary and remaining under the apron while retaining Irving and Al Horford (player option). That Golden State profiles as a taxpayer even without Durant doesn’t help.
Brokering an opt-in-and-trade is cleaner. The Warriors must be cool with blowing past the apron while losing a top-five player, but that’s fine.
Gordon Hayward has perked up after a post-All-Star-break slump, and Golden State doesn’t have the spending power to net a better alternative in free agency. His role doesn’t need to change much when transitioning from Boston to Oakland, and the Warriors look like geniuses if he recaptures form amid a less complicated offensive pecking order.
Boston has zero to consider if Durant is willing to forgo a long-term deal until 2020. His arrival guarantees Irving’s return. Because Hayward needs to be the salary anchor, president of basketball operations Danny Ainge retains the assets necessary to make a serious, if not winning, Anthony Davis trade offer.
The Warriors can push for more than a first-round sweetener. They have that leverage. They won’t be left in shambles if Durant goes elsewhere, and Hayward’s contract (two years, $66.9 million) is hardly a net positive.
Including more draft-pick buffer shouldn’t be a deal-breaker for the Celtics. They have their own leverage in Durant’s wandering eyes but cannot land him without the Warriors’ help.
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Los Angeles Clippers Receive: Kawhi Leonard (player option)
Toronto Raptors Receive: Danilo Gallinari, 2020 first-round pick (from L.A., via Philadelphia)
Toronto has grown “increasingly confident” in its ability to re-sign Kawhi Leonard this summer, per TSN’s Josh Lewenberg. This is great news for Raptors fans, as well as anyone who wants other teams to follow in their footsteps—or those of the Oklahoma City Thunder—by taking on superstars considered imminent goners.
Still, the Raptors cannot run their victory lap just yet. Leonard had eyes for the Clippers as recently as January, per the New York Times‘ Marc Stein. Anything less than an NBA Finals appearance—maybe even a title—opens the door for him to bolt.
For the Clippers’ part, they can get Leonard without pursuing a sign-and-trade. They’re in line for more than $55 million in cap space if they renounce all their own free agents. They’ll have the ability to poach Leonard and flesh out a scary roster around him.
Talking about a sign-and-trade only makes sense if the Clippers are trying to simplify their path to dual-max slots. Offloading Danilo Gallinari’s expiring contract is the quickest way to get there, and he’s done his part to make it possible.
Teams won’t flinch at his $22.6 million price point following a career year that came on relatively good health. But trading him into cap space rests on the right free-agency suitors getting jilted by their primary targets. And while the Clippers have the breathing room to swallow some salary in any deal, they cannot bring back more than $8 million or so if they’re looking to pair Leonard with Kevin Durant.
Sending Gallinari to Toronto neutralizes this (admittedly minor) concern. Exchanging his contract for Leonard’s max salary ($32.7 million) leaves them with a $45-plus million purse—enough for a second superstar and perhaps another player of significance.
The Raptors’ willingness to sign and trade Leonard is up in the air, but the parameters of this deal fit their future. They needn’t start over if he leaves. They’ll still have Kyle Lowry and Marc Gasol (assuming he exercises his $25.6 million player option), and Pascal Siakam is that good.
Like Lowry and Gasol, Gallinari comes off the ledger next summer. The Raptors can try running it back with the three of them and Siakam, then re-assess the big picture during the 2020 offseason—a scenario so potentially palatable that Toronto should be open to it even if Los Angeles plays hardball and refuses to include a first-round pick.
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Miami Heat: Kevin Durant
Golden State Warriors Receive: Goran Dragic (player option), Josh Richardson
Heat team president Pat Riley hopes to make a splash in free agency during the 2020 offseason when Miami will actually have some cap flexibility.
Kevin Durant granted the Heat a meeting in 2016 and might be inclined to do so again this year. They were a more attractive suitor back then, but Durant’s intentions are a wild card. He needs to have some degree of patience if he’s bolting the Warriors, and Miami still has Riley, a chance to sign someone else in 2020 and year-round sunshine.
Goran Dragic can nuke this deal by declining his $19.2 million player option. He is playing well over the past month, has rejoined the starting lineup and, going on 33, could be interested in a new contract that secures him more over the long haul.
That’s not enough for us to discard this suggestion. Unrestricted free agents are generally signing shorter pacts to begin with, and Dragic has battled right knee issues since the end of last season. He may have a tough time turning an opt-out into a profitable decision.
This return is easier for the Warriors to embrace than one built around Gordon Hayward. They remain above the apron but take back less money while adding more talent.
Josh Richardson doesn’t turn 26 until September and is owed a reasonable $32.5 million over the next three years. He doesn’t begin to replace Durant’s off-the-bounce playmaking, but he can create some looks from scratch and spends the rest of his time either cutting or nailing catch-and-fire threes.
Dragic is overpaid at the price of his player option, but he comes off the books next summer and beefs up the Warriors’ reserve ranks quite a bit. Let’s also not pretend a small-ball lineup including him, Richardson, Stephen Curry, Klay Thompson and Draymond Green isn’t ridiculously intriguing.
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Portland Trail Blazers Receive: Jimmy Butler, Jonah Bolden or James Ennis III (player option)
Philadelphia 76ers Receive: CJ McCollum, 2020 first-round pick (top-eight protection), 2022 second-round pick
Potential obstacles abound here.
First and foremost, Jimmy Butler must want to join forces with Damian Lillard in Portland. After that, the Blazers really have to want him, while the Sixers really have to want something for his departure.
In the event everyone’s wants align…things stay difficult.
Butler will only be worth $20.4 million in outgoing salary to the Sixers, so they cannot accept more than $25.7 million in return. They’ll have to include another contract if they’re getting McCollum.
Throwing in James Ennis III doesn’t sting, but he’s most likely opting out of his contract unless he’s dead set on being an Early Bird free agent next summer. Treating Jonah Bolden as an add-on is tougher to reconcile. He’s 23 and under team control for another three years, and the Sixers are already thin enough up front behind Joel Embiid.
Portland can toss in this year’s first-rounder to help move things along. (That doesn’t violate the Stepien Rule, which only applies to future drafts.) That’s a ton to give up for a free agent, but Butler is appreciably better than McCollum, and general manager Neil Olshey doesn’t have any way of digging up the cap space to sign him.
The Blazers also have to duck the luxury-tax apron by the end of this deal. That verges on impossible without another dump. They’re taking on more than $6.8 million in salary, so they’ll need to renounce Al-Farouq Aminu or, preferably, reroute one of their sizable expiring contracts (Maurice Harkless, Meyers Leonard, Evan Turner). The problem persists even if Butler signs a sub-max deal.
Whether the Sixers want to pay McCollum and Tobias Harris is a separate matter. They fit together and beside Embiid and Ben Simmons on offense, but McCollum is among the NBA’s worst defenders. He ranks 85th out of 115 shooting guards in ESPN’s defensive real plus-minus.
Whatever. If Butler wants to leave, the Sixers aren’t going to get better value—or any value at all.
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Utah Jazz Receive: Kemba Walker
Charlotte Hornets Receive: Grayson Allen, Dante Exum, Georges Niang (non-guaranteed), Utah’s 2019 first-round pick, Utah’s 2021 second-round pick
Utah and Kemba Walker can marry each other this summer without Charlotte’s help. The Jazz will have more than $33 million in cap space if their current draft position (No. 23) doesn’t noticeably improve and they waive both Derrick Favors and Raul Neto.
That opportunity cost isn’t nothing. Favors has never looked like a better fit during the Rudy Gobert era. Utah is plus-2.9 points per 100 possessions with a superhero defense when they share the floor and plus-5.8 when Favors jumps center as part of bench-heavy units, according to Cleaning the Glass.
Completing a Walker sign-and-trade amounts to the Jazz’s ideal offseason. They don’t have to choose between Favors and max cap space, and they add an established floor general who provides structure to the half-court offense without cramping Donovan Mitchell’s style.
Charlotte won’t faint with glee for a package of Grayson Allen, Georges Niang, a couple of picks and Dante Exum, who is out indefinitely (again) after undergoing surgery to repair a partially torn patellar tendon in his right knee.
The Hornets don’t have many options if they’re forced to explore sign-and-trades for Walker. They needed to flip him at one of the past two February deadlines to maximize his value, and the raise he’s headed for limits the potential pool of suitors.
A max for Walker will count as a $32.7 million incoming salary for the Jazz. He’ll be worth just half that ($16.4 million) in outbound money for the Hornets. That discrepancy is pretty much untenable. Expanding the deal to include more players and teams won’t even work in most cases.
The Jazz might be the only squad with the incentive to make up the difference. Keeping Favors on the books gives them a relatively clear path to $17 million in space. They’ll have the wiggle room to complete a lopsided sign-and-trade for Walker even if they don’t wait until their first-rounder counts as an actual salary 30 days after signing his contract.