The one financial unknown in this blockbuster trade with the Boston Celtics is Keith Bogans’s: while all other contracts are set, the Nets have to sign-and-trade Bogans to make this deal work. So how much will he earn? It’s more than you think.
the Brooklyn Nets are acquiring three contracts: Paul Pierce (worth $15,333,334), Kevin Garnett ($12,433,735) and Jason Terry ($5,225,000). That’s a total of $32.99 million in salary.
When teams are in the luxury tax — as the Nets are — the amount of money they can acquire in a trade is equal to 125% of their outgoing salary, plus $100,000. So to make the trade work, the Nets have to send out about $26.3 million in salary — $26,313,656, to be exact.
Currently, the Nets are trading Kris Humphries ($12 million), Gerald Wallace ($10,105,855), MarShon Brooks ($1,210,080), and Kris Joseph ($788,872), which adds up to a figure of $24,104,807. That’s a difference of $2,208,848. So Bogans’s contract only needs to be that $2.2 million figure, right?
The trick lies in something called “base year compensation,” a relic from the old collective bargaining agreement. It’s supposed to prevent teams from signing players specifically to help facilitate trades. In a sign-and-trade deal, the player’s salary is either his previous salary or 50% of his new salary, whichever is greater.
In Bogans’s case, his previous salary is the veteran’s minimum, around $1.2 millon. That’s not going to work. So the $2.2 million figure has to be 50% of his new salary.
That means that to make this trade work, Bogans’s starting salary is going to be a little over $4.4 million next season, or nearly quadruple his salary last season. Bogans has never had a salary over $2.6 million.
It doesn’t end there. Contracts that are signed as part of sign-and-trade transactions are for a minimum of three years, which would set Bogans’s earnings at $13.2 million over three seasons at a minimum. If the standard 4.5% raises are included in the contract, that’d push the contract to $13.85 million — just a little under Bogans’s entire career earnings ($14.1 million).
For the record: only year one has to be guaranteed in any sign-and-trade contract, so there’s a chance that Bogans will “only” earn $4.4 million next season and that’s that. You think he’d mind? He made $4.7 million in the last four seasons combined.
As a “3 & D” guy I respect: enjoy your new contract, Keith Bogans.
As always, I lean heavily on my own interpretation of Larry Coon’s CBA FAQ, one of the greatest documents known to man. Am I wrong? Is there an error? Let me know.