Aug 14, 2012, 12:13 PM EDT
As it stands now (with the roster basically set), the Lakers will have a $99 million payroll — $17 million more than the second most expensive team in the NBA (Brooklyn at $82 million). The Lakers payroll the following season will be in that same ballpark.
I hear the questions from a lot of people outside Los Angeles — didn’t we just have a lockout, didn’t we just miss months of basketball to stop moves like this? We don’t just want a few super teams!
(Actually, ratings say that you do. And NFL-style parity both is impossible in the NBA and probably wouldn’t sell as well anyway, but that’s another discussion for another day.)
The other owners did want to stop this kind of payroll/team building and during the lockout they agreed to stiffer taxes discourage teams from this kind of spending. But those penalties don’t start to kick in until the 2013-14 season — that is when the Lakers will start to pay a stiff price for their payroll.
Cap guru and friend of the site Larry Coon explains it in an email to Henry Abbott at TrueHoop.
The Lakers will have a tax bill of around $30 million next July, and in retrospect, will view this season as their salad days — it’s the last one where the tax rate is dollar-for-dollar. Starting in 2013-14 the new “incremental” tax takes over, where being $30 million above the tax line will mean paying a whopping $85 million tax bill.
And it gets worse. Starting in 2014-15 teams will pay an even higher rate for being repeat offenders — defined as paying tax in at least three of the four previous seasons. A team $30 million over the tax line will pay — brace yourself — an additional $115 million in luxury tax.
After adding up their payroll, luxury tax bill, and revenue sharing contribution (projected to be $49.4 million in 2013-14), even the Lakers have to stop to consider whether this simply can be written off as the cost of doing business — and that’s the future if they’re paying players with salaries like Bryant, Howard, Gasol and Nash.
By the 2014-15 season the Lakers will be able to control their payroll better because Kobe Bryant, Pau Gasol and Steve Nash come off the books (we will assume Dwight Howard stays at a max deal). For example, Kobe could do what both Tim Duncan and Kevin Garnett just did, taking below their market value (salaries below $10 million) to help out the team.
But the Lakers are all in for the next two seasons with the roster they have. And with luxury tax and revenue sharing in July 2014 they are going to be writing about a $130 million in checks to the league in addition to their $100 million payroll. They can do some things to lower costs (amnesty Metta World Peace, for one) but if they want to compete for a ring those will be small dents. The big-ticket items, topped by Kobe’s $30 million salary, will remain.
Even with what Jack Nicholson pays for his seats and what Time Warner is paying to broadcast Lakers games on a new regional sports network, the Lakers will not be raking in large profits, if any. And remember, the Lakers are the Buss family business, they do not have billions coming in from other sources so that this is a toy. The Lakers need to be profitable.
But they have run the numbers and decided to chase the rings anyway. Which is what the other owners always feared.
Apr 19, 2014, 7:12 PM EDT
Warriors steal Game 1 in Los Angeles.
Apr 19, 2014, 5:30 PM EDT
It looked good as soon as it left his hands.
Apr 19, 2014, 4:06 PM EDT
Playoff games are played in the halfcourt and the Nets owned that in Game 1.
Apr 19, 2014, 2:39 PM EDT
A rare and raw show of emotion from a team’s GM was caught on camera.
Nash to Nowitzki: ‘What would you do if you were me? Would you come back?’ Dirk: ‘I’m not sure, bro.’ (VIDEO)
Apr 19, 2014, 2:00 PM EDT
Dirk Nowizki is brutally honest.
Apr 19, 2014, 12:30 PM EDT
“Garnett and Pierce are so old the Raptor had to ask his dad about them.”
Apr 19, 2014, 11:00 AM EDT
Words continue to be exchanged between two teams that clearly don’t like each other.
Apr 19, 2014, 9:29 AM EDT
The owners are behind Silver’s effort to raise the age limit. Now there’s just the pesky matter of negotiating with the players’ union.
Apr 19, 2014, 8:00 AM EDT
You can construct a scenario where the Pacers are in trouble… except they play the Hawks.
Apr 19, 2014, 2:15 AM EDT
Making your playoff preview reading convenient.
Apr 19, 2014, 1:54 AM EDT
Grizzlies’ guard will definitely be missed in the rotation.
Apr 19, 2014, 1:50 AM EDT
We may not see him on the sidelines of TNT games these playoffs.
Apr 18, 2014, 11:55 PM EDT
This should be the East’s most competitive first round matchup.
Apr 18, 2014, 10:31 PM EDT
How quickly can Miami flip the switch?
Apr 18, 2014, 9:16 PM EDT
Can the Pacers regain their early-season swagger now that the playoffs are here?
Apr 18, 2014, 6:45 PM EDT
Expect a fight by the end of Game 2.
Apr 18, 2014, 5:50 PM EDT
People shouldn’t sleep on the Raptors, particularly the Nets.
Apr 18, 2014, 5:05 PM EDT
Dallas has lost nine straight to San Antonio. Don’t expect that streak to stop now.
Apr 18, 2014, 4:19 PM EDT
All the draft lottery odds are here, so Lakers fans can look and see what that little run of wins to close out the season did to their odds.
Apr 18, 2014, 3:27 PM EDT
We look at all 8 first round series.
- Warriors take Game 1 from Clippers 0
- Nets defense smothers Raptors, gets Brooklyn Game 1 win on road 27
- PBT Extra: Are Pacers or Spurs in any trouble in first round? 5
- All PBT’s first round playoff previews in one place 0
- Grizzlies guard Nick Calathes suspended 20 games for violating NBA’s anti-drug policy 28