Sports
The NBA's New CBA Changes the Game for Rebuilding Teams – The Ringer
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Stockpiling cap space isn’t really viable under the league’s new collective bargaining agreement. Is the Houston Rockets’ aggressive offseason spending a sign of things to come?
If this NBA offseason has taught us anything, it’s that teams are changing the way they rebuild. Just over a month ago, the league and the players association ratified a new collective bargaining agreement—one noticeably more hostile to the highest-spending teams and quietly more punitive for those spending the least. It has long been common practice for clubs with younger, lottery-bound rosters to pinch pennies for as long as possible, in part because it’s easier for a club with low expectations to get away with it. Before this new CBA, there was no real incentive for a team to spend before it was ready to win, creating an environment where a handful of organizations would roll into the season well below the salary cap in hopes of farming out that space to desperate teams at the trade deadline—while also picking up some draft picks for their trouble.
No more. The Pistons are currently slated to have the most cap space of any team in the field when the 2023-24 season begins: a sultan’s ransom of $315,000. In NBA terms, that’s a rounding error. A performance bonus. A far cry from the tens of millions in cap space that teams have operated under in recent seasons—because with this new CBA, not spending isn’t really an option.
Just look at the Rockets, who went from having the youngest roster in the league and tying the Spurs for the second-worst record last season to flexing as one of the biggest spenders in free agency. There are some organic reasons Houston would push to accelerate its timeline: The Rockets’ young talent could certainly use the structure and guidance that playing with real pros provides; the team already owes its 2024 first-round pick to Oklahoma City (albeit with some protections) as a remnant of the Russell Westbrook–Chris Paul trade; and the lack of a steady point guard, in particular, started to have real developmental costs for the most exciting prospects on the roster. Yet under this new collective bargaining agreement, it also just wasn’t viable for a team like Houston—which entered into the summer with almost $60 million in cap space—to do anything but spend.
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It generally takes NBA front offices a few seasons to fully adapt to the marketplace brought on by a new CBA, but the Rockets are the first team through the wall—working it all out on the fly and throwing around hundreds of millions for Fred VanVleet, Dillon Brooks, Jock Landale, and Jeff Green in the process. The rest of the league is watching—especially those in organizations on the verge of a rebuild. Houston has done well to balance out its splurge with a safety net, seeing as all of those deals come with a catch: team options for VanVleet and Green, declining salary over the contract term for Brooks, and a four-year deal for Landale (in name only) with the last three years unguaranteed.
These are the measures taken by a front office that can no longer afford to sit on its cap space as rebuilding clubs traditionally have. Under the previous CBA, teams were gently encouraged to spend up to 90 percent of the cap (a line known as the salary floor) by the very last day of the regular season, without any meaningful repercussions if they failed to. The new CBA moves that deadline to the first day of the season and gives it real teeth—erasing any unused cap space up to the salary floor, withholding luxury tax payouts for teams that fall short, and preventing them from making any transactions throughout the season that would decrease their total team salary. There’s no longer a point to those sorts of austerity measures. Not only will every organization have to spend up to the salary floor one way or another, but those that fail to reach that ledge will cost themselves more money and real team-building opportunities in the process.
So far, the result is a league in which lesser teams play more active roles in free agency or take on veterans through offseason trades, like Detroit did with Joe Harris or San Antonio did with Cam Payne and Cedi Osman. Last year, the Spurs entered the season with a subterranean payroll well under the salary floor and almost $30 million under the cap. They’re currently projected to start the 2023-24 season (and the Victor Wembanyama era) over it, as is virtually every other team in the field. Stockpiling cap space just doesn’t do much good anymore. Had any of these teams opted to spend up to only the floor, they would have just $13.6 million in room to absorb salary over the course of the season—not even enough to take on the likes of D’Angelo Russell or Marcus Morris. The fact that lower-spending teams won’t have as much cap space to rent out (or, at present, virtually no cap space to rent out) will make it that much more challenging for contenders to shed salary when the need arises.
All sorts of league business will be complicated by not having a few lottery teams with cap wiggle room just waiting around every year. Those would-be facilitators will behave much like these Rockets or these Spurs or these Pistons, which is to say something more closely approximating an actual NBA team. With that comes a chemistry experiment. Houston unquestionably has a better, more complete roster than it did last season. It also just introduced a bunch of veterans—including an All-Star lead guard and a presumptuous chucker on the wing—who are expecting to play significant roles into an ecosystem with young players still coming into their own. There’s a certain irony in the fact that Houston had all this cap space to use because it hadn’t yet shelled out for extensions for players like Jalen Green and Alperen Sengun—and yet, in using that cap space, they’ve brought in vets who will siphon off the minutes and touches and shots that factor into those extension negotiations.
The younger and cheaper a team is now, the more it will have to add—and the messier things might become. There’s a reason lottery teams don’t often spend like contenders on the cusp. With spending comes competing motivations. Brooks will make about as much next season as Green, Sengun, and Jabari Smith Jr. combined. How will that sit in the locker room when he goes 3-for-18 from the field while looking off his younger, extension-eligible teammates? And with spending, too, comes some measure of expectation. VanVleet is now the 14th-highest-paid player in the league. That just might become a talking point if he has another down shooting season or otherwise underwhelms as the steward of a developing team. The Rockets very much need a proven guard like VanVleet, and, as controversial as he may be, they need hard-nosed defenders like Brooks, too. But getting what you need could result in bringing Amen Thompson off the bench right after picking him fourth in the draft. It could mean permanently displacing Kevin Porter Jr. or not having the space to give Cam Whitmore a more consistent role out of the gate.
Zoom out, and you can see how the ripple effects of all this extend well beyond the rebuilding set. The fact that teams like Houston, Detroit, and San Antonio are stocking up on veteran role players could squeeze the market for those players’ services over time and reshape the NBA’s middle class. It was already difficult for teams with a single young superstar to decide when to ramp up their winning efforts, but effectively putting a spending requirement on those teams could shift their priorities—not to mention their timelines. The overwhelming majority of NBA contracts are fully guaranteed (or are at the players’ discretion), but increasing the need for teams to spend while giving them fewer places to dump salary could result in more of the noncommittal, non-guaranteed deals that Houston relied on this summer. Expiring contracts have dwindled in value since teams stopped using outright cap space to chase stars in free agency, but their value could bounce back in a league with fewer teams that are able to take on salary.
Every new CBA comes rife with unintended consequences, and we can’t yet know the full impact of an agreement that’s just 14 days old. Yet, at minimum, this new financial environment has the potential to completely change the internal dynamics of rebuilding clubs. Young teams still spend less. But in the NBA as we knew it, those teams were also encouraged by the system itself to be risk-averse—to hoard cap space by scraping their rosters bare, in the hope of parlaying that space into some last-chance deal right at the trade deadline buzzer. Operating that way, prudent as it was, made those teams materially worse and less interesting. It made the league less interesting. Now we get to see another way through the Rockets and their test-case roster in a market that no one fully understands.
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