Change Change Change

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Published: August 2, 2017

It’s been quite the interesting offseason for the New Orleans Pelicans, at least from where I sit. The team’s lone significant move was to sign Jrue Holiday to a large deal. Combining that with other contracts on the books, even extended into the pre-offseason, the rest of the team’s moves have been

  • Out: Tim Frazier, Quinn Cook, Axel Toupane
  • Waiting: Dante Cunningham
  • In: Rajon Rondo, Ian Clark, Darius Miller, Frank Jackson

So, what’s so interesting?

The New Deals

The team has just 1 empty roster spot, and all their contracts are now guaranteed now that Crawford’s deal is guaranteed. Jackson’s deal is guaranteed for the next two seasons, with a partial after that, and he’s locked in at the minimum during that time. Miller’s deal is fully non-guaranteed in 2018-2019 for most of this season, then becomes partially guaranteed, the fully guaranteed early next season. Rondo and Clark are on 1 year deals.

Combining this with the 1 year left on Pondexter’s deal and the partial guarantee for Diallo next season, the Pelicans have a considerable amount money tied up in tradeable contracts designed to help teams shed salary were they to be traded, as such contracts proved valuable this offseason. Their non-guaranteed contracts did not help this in this area in July, so why would these guaranteed contracts help them after July?

Good question.

Dealing with the Hard Cap

It’s not a secret (you’re welcome) that the Pelicans have a not-obvious hard cap problem. This stems from their choices this offseason, total salary, and total incentives. The issue not being obvious comes from the unlikely incentives, which are significant, with Holiday being a major source at the moment. The issue is the same if they were likely, it just becomes more obvious, and less cap-savvy observers would have seen it earlier.

The team tried to avoid the hard cap for a while, trying to work trades for significant pieces. No deal materialized that was worth it. They eventually abandoned the attempts to get a significant piece in the short-term. In order to avoid the hard cap and retain trade flexibility, they were limited in the kinds of deals they could offer to free agents. This limit would have been in place if they made a trade that added significant salary, but it would have mattered less since they would have gotten their piece, in theory. Taking off the shackles of avoiding the hard cap . . . and accepting the prison of the hard cap . . . they give up some flexibility in total possible salary but receive some flexibility in what to offer free agents, gaining the full Non-Taxpayer Mid-Level Exception and the Bi-Annual Exception. They still have trade exceptions to use, as Mason discussed.

Still, these exceptions will in no way deliver a difference-maker of the kind a NBA that is increasingly stars-joining-stars.

So, why go this route rather than maintain maximum flexibility?

Change

The Pelicans have about $14.5m in contracts under $4m, each of which is just for a single season or very “friendly.” This is a significant improvement in terms of trade assets from prior to the moves that ended up hardcapping them, plus the coordinated moves. There is still room to add some value, as well.

This improvement by adding some NBA loose change has the following main effects:

  • These moves will help the team start strong. Without a strong start, I’m not sure the brass survives long enough to recover. I’ve never been on the hotseat talk, and I’ve been correct. Now I’m saying it, and I’m still correct.
  • These contracts for better players than those let go will give the Pelicans more trade assets in trade season than they had this offseason. They have picks to trade, and they have some contracts to add weight and a little PR value to a trade, but lower salary deals can be used to help tailor deals and take back longer term salary as part of the “value” a team will realize in trading away a 4th banana type player or even a star. A star will require a pick and either another pick or a pseudo-pick, such as Diallo or Jackson, plus some salary matching and cost-eating, of course.
  • I wrote about the Pelicans going a direction apart from “add shooters.” The claim is that the big men will draw attention, and they need to be surrounded with players with skills like passing and defense because open shots will be there, so they don’t need to be good career shooters or guys that can get their own shot. You can’t win a title with that, but you can win games. This would also make Holiday instantly more valuable in the system. This is what is going on. What I’m adding here is that this system with average players will paint a clear picture for any wing or guard considering a new locale of just how much they can help the Pelicans while joining two of the best in the NBA. It’s the new version of last year’s process.

That’s the plan.

That’s the gamble.

I said before, they’ll take the hard cap when they have a trade lined up or they give up. In this case, they gave up, took the hard cap, and will try to line up a trade mid-season using their play as a draw to players while using their ability to absorb long-term salary and send away better talent than they had during the summer to engage the franchises.

It will require the team to function consistently and instantly. It will also require luck.

It’ll also be something that hasn’t happened yet, despite the best efforts. Getting pieces that are both available and that seem to be a value has yet to yield a return in trade. This fact has correctly called into question the strategy Dell has employed for years. I have no issue with the strategy, but I understand the criticism. So, to get what they want, they need to change their ability to change their change for something more conducive to doing some real damage in the West . . . and keeping Cousins.

Miscellaneous Tidying Up

  • An uninformed cynical person might think the Pelicans gave so many unlikely incentives so they could be forced to avoid the tax. This, however, does not hold water. If incentives are triggered or not, that will affect the tax, not their likelihood or unlikelihood. Likely or unlikely is simply a measure of if the incentive would have been triggered in the prior season, not an actual measure of likelihood. These designations affect room at the start of the season for a team that has room, which does not seem to be in the Pelicans’ meaningful future. The details of the incentives affect the actual likelihood. Even if they are held below the tax due to unlikely incentives, an incentive triggering can put them into the tax. Don’t get those mixed up. It’s not a rookie mistake . . . it’s complicated . . . but don’t go spouting off incorrect cynical garbage like it is authoritative when it rather makes you look stupid, ok?
  • Every team wants to win, and they all prefer to win now . . . it just depends on the cost. The Pelicans, however, are not in a place to sell all to win now. They have a hard problem to solve. Their ultimate goal is to get Davis to sign a new contract or an extension. Their proximal goal is to get Cousins to sign a new deal. That is part of the reason for signing Holiday. They can’t get rid of anything and everything, but it’s close. They can certainly send out picks. Picks won’t help them on their timeline at this point, and they can recover some in trading Davis likely, though that is not certain, as the Paul George trade shows. I think they can trade just about any piece of the depth, but they can’t trade all of it, at least not without shedding salary. They have to be able to field a team next season, not just win this season.
  • I don’t see the team stretching Asik or any player without a move lined up and ready to go. He gets easier to move by the day, like most players. There is not much return in waiving him sooner than later (the number of years changes, and shorter may be more desirable) when it will be easier to move him later. Why get less now and hurt for longer to boot? The total payment is the same, so there’s no return there. Also, if that is what you are going to do, waiving another player may get the move done with less pain later all while the Asik cost declines. As I noted, his particular non-guaranteed deal may actually have enough value to make him more desirable than people think. The Pelicans will take a worse deal if the worse deal can play.
  • Hat-tip to Mason here. I was thinking over Jrue’s contract when I was sorting out the hard cap issues, obviously. I asked Mason to think on why it’d be that particular value. As the details emerged, Mason pointed out that the contract value was very close what would place their guaranteed salary, incentives, the right exceptions, and a couple minimum contracts right at the hard cap. Mason was right. You can look at Jrue’s contract and see the offseason plan. If the plan were to just spend the MLE, they would have just spent it and not worried about working the trades. They were clearly considering doing that with, say, Nick Young, but they held out for the chances at a trade. That didn’t work out, so they went the free agent route. They structured Jrue’s salary and incentives in such a way as to keep Jrue’s salary as flat as possible over the life of the deal by offering him as much as possible in the first season. The last season has a little bump in his player option year, and my article shows some logic behind the total value. However, it is clear that the team had this fallback plan in mind from the start of the offseason. It also shows they are keeping any eye toward future seasons by keeping Jrue’s percentage of the cap as small as possible, given the total contract value. This gives insight into contract structuring generally, the Pelicans’ plans, and the kind of things a front office has to watch for years in advance. This long-term planning is another reason why trades are so hard to work. Anyway, good job, Mason. Proud to have you on board.
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