The New Orleans Pelicans won the NBA Draft Lottery, raising this year’s off-season excitement exponentially. The amount of salary cap space available to David Griffin and Trajan Langdon is all dependent on a possible Anthony Davis trade. Let’s break down the numbers.
The New Orleans Pelicans‘ new regime has been busy making positive moves to build the right culture throughout the franchise. Approximately forty percent of NBA players will enter some form of free agency, when including those with player or team options for next season. Those potential players will take notice of the Pelicans’ newfound commitment to recognized legitimacy, whether or not Anthony Davis is still on the roster.
New Orleans has reached its historical peak attractiveness as an NBA franchise. The Pelicans have two legit stars under contract now in Jrue Holiday and Anthony Davis. They will soon most likely add Zion Williamson on a rookie scale contract. However, Davis has asked to be traded.
David Griffin has publicly stated he will seek and audience with Davis in order to convince him to stay in a Pelicans uniform. Davis has yet to publicly warm to the idea, but is working out with Holiday this off-season. Holiday can keep persuading Davis while in the gym; Griffin has to pull off at least one more move to truly convince Davis to stay a few more years.
Zion Williamson is a great prospect, perhaps the most hyped since Davis seven years ago. Zion could be the best prospect until the 2030 draft, or whenever LeBron’s sons enter the NBA Draft. However, Davis wants to win now. No 19 year old rookie with an inconsistent jumper has ever been the missing piece for an NBA Finals run.
So, VPBO Griffin and GM Langdon have to upgrade the team around the Davis, Holiday, and Zion trifecta. That is presumably the most desirable outcome at New Orleans Pelicans HQ, but the front office must have alternate plans in place. One of Langdon’s first stated goals was ”sustainted excellence” for the New Orleans Pelicans. In his media session after being hired, Langdon was detailed in his vision, stating:
"“David talked about bringing in high-class people that are about the right things and doing things the right way, and moving forward in the same direction….As long as you have the right people and they have the right vision, with the same goals, you can do special things….Sure, we want to win, but want to build this organization the right way, with the right people, and have sustainable excellence.”"
Langdon also gave some insight into the team’s approach after winning the NBA Lottery.
"“I don’t think you can be in a win-now mode, when you have to develop a culture and there are a lot of things that need to be done, bringing in the right people on the bus and making sure we’re headed in the right direction. I think you can’t skip steps. If you look back, a lot of organizations when they try to skip steps, it puts them behind….Griffin has talked already about that we’re looking for small wins day-to-day….That’s one important thing we did in Brooklyn that led to the success there. It wasn’t ‘go out and get big-name players.’ It was ‘We’re going to build from within, develop and find diamonds in the rough that we think our coaching staff can develop’ from a G League player into a potential Sixth Man of the Year candidate (Dinwiddie), or a three-point champion (Harris)."
That does not sound like a general manager trying to lure Kevin Durant to New Orleans. The Pelicans will spend more time scouting and recruiting talented players that have less hype today but will provide more value next season. But adding that valuable talent to create a culture of sustained excellence costs money.
Gayle Benson has effectively given Griffin a blank check to fill out the front office and facilities. Though she can quickly throw money at a facilities issue, the salary cap means building a roster in more complex ways than building, well, a building. As stated above, how much money the Pelicans have to use for roster construction all depends on Davis.
The New Orleans Pelicans’ future rosters will be built using the assets and cap space created this off-season.
So let’s go through the options, looking at several scenarios. For this exercise, we will use the NBA salary cap numbers Shams Charania reported will be used for next season. The cap will be set at $109 million, with a luxury tax kicking in at $132 million. The following season, the cap will be around $118 million with a luxury tax line at $143 million.
In just the basic numbers, the Pelicans can find a positive manipulation. The luxury tax threshold jumps $11 million dollars in a year, roughly. Zion will never cost less than he does this season. If reports that Benson is not scared of the luxury tax are true, the Pelicans could front-load a contract so as to be above the tax line this year, but below it the next. This helps avoid the repeater tax, allowing for even more roster investment going into Years 3-6 of the Zion era.
But let’s not get too bogged down in details. Going into the 2019-20 NBA season league year, which begins July 1, the New Orleans Pelicans have only four players on fully guaranteed contracts. All numbers used come from the Pelicans page on spotrac.com.
- Anthony Davis – $27,093,019
- Jrue Holiday – $26,996,111 after incentives
- Solomon Hill – $12,758,851
- E’Twaun Moore – $8,664,928
New Orleans has $75,512,909 committed towards a $109 million salary cap. Jahlil Okafor was signed on a minimum deal, and the team holds an option worth $1,702,486. Okafor showed enough potential to be worth 1.4% of the Pelicans cap sheet. For these purposes, let’s assume New Orleans exercises that option in every scenario. The Pelicans have an extra asset, and a cap number of $77,215,395.
One tough to call variable is Julius Randle’s player option, worth $9,073,050. A case could be made for Randle to risk it on the open market, as he could find more money and years. However, should he misjudge his market, he could suffer a Nerlens Noel-type fate and end up making less money.
Randle will wait as long as possible (June 29) to make a decision on his option. Staying in New Orleans behind Davis and Zion would mean limited minutes. If Davis were traded, Randle could be a starter. A good year ending with a playoff appearance would mean a big payday. A mediocre year with average numbers on both ends of the court and his market is likely still the same.
If Randle opts in, the Pelicans’ guaranteed contract salary cap number would be $86,288,445. The Pelicans pros and cons are about equal for whatever choice Randle makes. He is young, and would be on an expiring contract, possibly increasing his trade value. He is also a defensive liability who may not like a reduced role in a contract year, no matter the Pelicans’ long term plans.
If Randle and Davis both elect to stay in New Orleans, that is not a bad Core Six to support Zion’s rookie year. Adding Zion’s rookie contract of approximately $10,000,000 brings the Pelicans’ cap number up to $96,288,445.
New Orleans’ decisions start getting tougher from this point forward. Welcoming an enthusiastic Randle and drafting Zion are relatively easy decisions. Deciding on the four non-guaranteed contract players begins the true test.
Christian Wood, Frank Jackson, Kenrich Williams, and Dairis Bertans all got some extended run to end this past season. Wood (24), Jackson (21), and Williams (24) will all be welcome back for this exercise. All three come cheap and will help lower the team’s cap and roster spot holds, allowing for more freedom to make moves. Bertans (30) is not a great roster fit going forward for several reasons.
Jackson will earn $1,618,520, Williams’ cap number is $1,443,842, and Wood’s is at $1,645,357.
The New Orleans Pelicans now have ten players on the working roster at a cost of $100,996,164, if all cap and roster holds are renounced. The Pelicans will likely move on from Ian Clark ($1,618,486), Darius Miller ($2,866,500) and Troy Williams ($1,443,842).
Trevon Bluiett ($1,442,842) and Stanley Johnson ($11,821,206) are the biggest unknowns. Johnson is 23, coming off a rookie contract. He has value in the NBA, but not $12 worth for this Pelicans roster. Bluiett is 24 and a known commodity. In most scenarios, his time is given to other developmental prospects.
The only two players with holds that deserve quick negotiations are Elfrid Payton ($3,600,000) and Cheick Diallo ($1,931,189). New Orleans has holds for two unused roster spots, totaling $1,794,316. Asumming Diallo and Payton return on similar salaries, the Pelicans cap number is now $106,527,353 without roster holds.
The working assumption is the New Orleans Pelicans will fill those two roster spots with minimum or 2-way contracts, negating their effect on the cap. New Orleans also has a $3.6 million trade exception from the Nikola Mirotic to Milwaukee transaction.
The Pelicans’ total roster cost, holds and all, presently eclipses $122 million. The good news is the holds will not count against the Pelicans as they try to move forward, as they are over the $109 million limit. New Orleans could stand pat, using only minimum contracts to supplement any bi-annual, mid-level, or trade exception additions.
Would that be enough to appease Anthony Davis? Could the New Orleans Pelicans work out more space?
Renouncing all but Payton and Diallo brings the Pelicans under the salary cap, but limits them even more. Tax payer exceptions would no longer apply, for example. However, if Randle opts out, the Pelicans have that additional ~$9 million to spend.
According to Basketball Reference, New Orleans has a 2019 cap number of just over $90 million committed, once Bertans is renounced. Sportrac has the Pelicans’ Active Salary Cap at $92 million, with a practical cap space number of $16,587,054 by using the Mirotic trade exception. Using the Basketball Reference numbers, the Pelicans could have closer to $19 million in space.
Effectively, the New Orleans Pelicans can spend $16 million on a difference maker, and fill out the roster with minimum contracts. Would adding any of the players making around $16 million this season lead the playoffs? Tobias Harris is on that list, but is also likely getting a raise this summer.
If Griffin and Langdon cannot find a difference maker to take slightly less than their market value, they’ll have to create a bit more salary cap space. They only real option to do so, is to make a trade.
The New Orleans Pelicans want to keep their two stars to begin the Zion Williamson era. They need to sign a difference maker to appease Davis, but lack the cap space. Is there any way to work the margins and keep the team’s core?
So we’ve settled on basic numbers. The Pelicans can effectively have $16-$19 million in cap space to add to the roster. Depending on who they sign, when, and how, there may be an exception to use if the Pelicans want to spend above the cap. But unless Davis stays, it is doubtful the Pelicans spend above the luxury tax of $132 million.
The space between the $109 million cap level and the $132 million luxury threshold is not really an extra $23 million of space. That middle class of roster exceptions exist for going over the cap to sign a team’s own players. The complexities were detailed in Bourbon Street Shots’ series on operating above the cap and using cap room.
The point is, Pelicans fans should not go spending an extra $20 million on their dream roster. Trading away Moore or Hill would create space for all but a max level star contract. Shipping out both would clear room for Kyrie Irving, but only Irving. The Pelicans will need more depth to truly contend.
Trading away Moore and Hill for smaller contracts would create space, but might require the Pelicans depart with some future draft picks. Griffin might not be willing to gamble away the Pelicans’ future so early in his tenure. However, Davis, Holiday, Zion, Randle, Wood, Jackson, Diallo, and Williams is a good foundation for only $80 million. Add a star and two role players to that mix, and the playoffs are a reality.
Sadly, trading Moore and Hill away for no salary in return is practically impossible. No other general manager is going to want to help the Pelicans that much. The Pelicans’ front office brass will have to target cheaper contracts that could provide the same on-court value. That will be an easier task, especially considering Hill’s lack of playing time and high salary.
All of these scenarios involve Davis staying and New Orleans doubling down on a commitment to contend. Each are not only going to be difficult, but would put the Pelicans in a corner. After committing to such a project, New Orleans would have no cap flexibility and one injury could ruin everything.
Considering that Davis has yet to show any sign he wants to stay in New Orleans, those other avenues to future contention need to be explored.
Wish as they might, Pelicans fans know the reality. Anthony Davis asked for a trade out of New Orleans. A divorce is always hard on the finances. What would the Pelicans’ cap sheet look like after trading away Davis?
Anthony Davis asked for a trade and the New Orleans Pelicans season went spiraling down quickly. Now, the NBA world has to wait until July 1 for any Davis trade to take place. While hoping for the best, the Pelicans’ front office needs to plan for the post-Davis days at the Smoothie King Center.
The New Orleans Pelicans can still be a formidable team even if Davis is traded away. Jrue Holiday and Zion Williamson will be too talented and too much fun to finish at the bottom of the standings. The Pelicans’ new culture of sustained excellence will not allow for tanking.
Any Davis trade haul is going to include multiple players and draft picks. Those incoming players will likely have a smaller salary cap charge than Davis, creating extra cap space for the New Orleans Pelicans. Determining which trade offer to accept will weigh more options than just the talent and picks on offer.
Several playoff contenders will come up just short of the NBA Finals. That’s the nature of the game. A couple of those teams will decide to roll the dice and gamble on a star transaction, just like Toronto did for Kawhi Leonard. Toronto could decide to make the same gamble play twice, depending on how their NBA Playoffs run plays out.
Would Toronto send OG Anunoby ($2,281,800), Pascal Siakam ($2,351,839), and Fred VanVleet ($9,456,163), plus picks to New Orleans? Would Griffin value the extra bodies and almost $15,000,000 in extra cap room enough to jettison a perennial All-NBA caliber player?
Would adding Anunoby, Siakam, and VanVlet to the core of Holiday, Zion, Randle, Wood, Jackson, Diallo, and Williams be enough to compete for a playoff spot? The team would have room for two max slots, but would any star worth of over $30 million accept the offer?
Trading for young stars in the making might make more sense, but it’s a bet on the scouting department and player development system. So let’s look at a possible Boston Celtics offer.
Jaylen Brown ($6,534,829) and Jayson Tatum ($7,830,000) fit the description of potential stars in the making. Add Marcus Smart ($12,053,471) along with a few draft picks and the Pelicans have three ascendant stars led by Jrue Holiday and supported by Smart’s, uh, smart play on both sides of the ball.
All three combined make $4 million less than Davis. Add those three to the Holiday and Zion-led core and New Orleans would still have over $20 million to spend on the roster. That would be enough to afford another starter and a couple bench mob role players.
The Los Angeles Lakers’ offer follows the same pattern. The reported offer of Lonzo Ball ($8,719,320), Brandon Ingram ($7,265,485), Kyle Kuzma ($1,974,600), and Josh Hart ($1,934,160) still cost over $7 million less than Davis next season.
Without going through all of the 29 other teams, it’s fair to say that trading Davis away will not be the start of the Pelicans’ NBA cap purgatory. Quite to the contrary, trading Davis away might give the Pelicans more options in the future. Keeping Davis may lock the Pelicans into a contention window that divides the Zion era in two.
The Anthony Davis trade is about more than just the initial trade haul. The value of Davis’ presence next season will also be weighted against the opportunity cost of future cap space. If Davis stays, Griffin can make some small moves to create salary cap wiggle room. If Davis demands out, the New Orleans Pelicans will have plenty of options to contend immediately after his departure.