The Brooklyn Nets and the Boston Celtics agreed in principle to one of the grandest trades in Nets history on Thursday night. With trades, comes moving contracts, and with moving contracts comes ever-changing team salaries. Let’s take a look at how this trade affects the Nets financially.
What are they owed?
Paul Pierce: owed $15,333,334 in 2013-2014.
Kevin Garnett: owed $12,433,735 in 2013-2014 and $12,000,000 in 2014-2015.
Jason Terry: owed $5,225,000 in 2013-2014 and $5,450,000 in 2014-2015.
How does this compare to what the Nets would’ve owed the players that they’ve traded away?
The combined 13’-14’ salaries of Kris Humphries, Gerald Wallace, MarShon Brooks, Keith Bogans, and Kris Joseph next season are about $24.1 million (this assumes that the Nets would not have re-signed Keith Bogans and would have guaranteed Kris Joseph’s contract).
Compare that $24.1 million number with what the Nets will now owe Paul Pierce, Kevin Garnett, and Jason Terry ($32,992,069) and you get a difference of about $8.9 million, i.e. the Nets will have about $8.9 million more in committed salaries next season with the trade than they would have had without it.
How does this impact the Nets salary cap situation for next season? It doesn’t. The Nets were so capped out already that adding more salary simply means that owner Mikhail Prokhorov will have to pay a higher luxury tax bill and a higher team salary.
We can pencil in roughly $94.7 million in committed salaries for Brooklyn next season (this not only assumes that C.J. Watson opts-out, but it also doesn’t count any potential Nets signings such as Andray Blatche or Bojan Bogdanovic this offseason).
In 2014-2015, the Nets would have an additional $4.1 million in committed salaries with the trade than without it for that season. It would make their total committed salaries stand at around $83.5 million (this assumes the Nets sign both Tornike Shengelia and Tyshawn Taylor to their qualifying offers). Once again, it would leave the Nets well over the cap and still over the tax-line in either scenario.
In 2015-2016, things start to change: instead of having more committed salary with the trade than without it, the Nets will actually decrease the amount of committed salary. The $10,105,855 that is owed to Gerald Wallace in that season is now on the Celtics. It would leave the Nets committed to around $66.9 million (assuming Mirza Teletovic signs his qualifying offer) as opposed to $80.2 million (assuming MarShon Brooks signs his qualifying offer) with Wallace on the roster for that season: a savings of roughly $13.4 million.
The trade helps the Nets in the long run and has no significant effect in the short-run, since the Nets are completely capped out.
As long as Mikhail Prokhorov is ready and willing to pay an absurd amount of luxury tax in the next couple seasons (he has shown that he is), the Nets financial situation should remain manageable, if not better.
One more note in terms of finances: Paul Pierce has a $15 million expiring contract next season -- meaning that if Billy King was willing to do so -- he could trade Pierce for more pieces to either help the Nets contend this season or in the future.