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Offseason Outlook: Miami Heat

Guaranteed Contracts


Non-Guaranteed Contracts

Free Agents / Cap Holds

Draft Picks

  • None

Cap Outlook

  • Guaranteed Salary: $75,547,200
  • Options: $10,128,557
  • Non-Guaranteed Salary: $788,872 
  • Cap Holds: $1,768,586
  • Total: $88,233,215

The Heat will celebrate their second consecutive championship with another victory parade Monday in Miami, and all in attendance would be well-advised to embrace the moment. Though the Heat are betting-line favorites to win again next season, there's plenty of reason to believe the team's stay atop the NBA won't last much longer.

The future of LeBron James promises to be a topic of nearly ceaseless discussion for the next 12 months as he nears an early-termination option on his contract. Dwyane Wade and Chris Bosh have the same options in their deals, but neither of them are quite as certain to merit new max contracts on the open market as James is. There will be plenty of financial incentive for James to elect free agency next summer. He, like Wade and Bosh, took less than the max to sign with the Heat in 2010, but with a mounting stack of MVP awards, James not be so charitable this time around.

James will be looking at a Heat team with serious questions about its future, ones that have nothing to do with Wade's increasingly balky knees. The repeater tax in the new collective bargaining agreement is set to kick in for 2014/15, punishing teams that will have paid luxury taxes in that season and the three previous years. The Heat have been taxpayers for the past two years, and their guaranteed contracts for next season exceed the projected tax line of $71.6MM. Bringing back James, Wade and Bosh next summer would surely make the Heat taxpayers again, and for that year, owner Micky Arison would have to shell out at least $2.50 for every dollar he spends beyond the tax threshold. The farther into the tax the team goes, the higher the rate it will have to pay.

Up to this point, the luxury tax has simply been a dollar-for-dollar charge. That changes in 2013/14, when tax teams must pay at least $1.50 for every dollar above the tax line, regardless of how many seasons they've paid the tax in the past. That brings the dilemma into focus for this summer, since the cost of keeping the championship team together rises even before King James can bolt.

The easiest way for the Heat to cut next season's tax bill is probably to use the amnesty clause. They aren't going to amnesty James, Wade or Bosh, so the choice comes down to one of their other three eligible players: Mike MillerUdonis Haslem and Joel Anthony. Miller's contract, worth a total of $12.8MM for two more seasons, is the most expensive among the three. He seemed destined for the amnesty scrapheap until re-emerging in the Heat's rotation in the conference finals. The 13-year veteran became a starter in the middle of the NBA Finals, and just as he did at the end of last year's Finals, Miller proved that his three-point shooting is a critical part of the team's success. Still, he's overpaid for someone who's essentially a spot-up shooter, and even though it would be difficult to cut ties with a playoff hero, I think it would still be a wise move for team president Pat Riley and company.

Haslem and Anthony certainly merit consideration for the amnesty, and Anthony in particular, since he disappeared from the Heat's rotation once Chris Andersen arrived. Haslem was the starting power forward for most of the season, but Miller took his playing time in the playoffs as coach Erik Spoelstra more fully embraced the small-ball philosophy. Haslem played less than 10 minutes over the last three games of the Finals combined. Haslem's contract has $8.96MM left on it for the next two seasons, about $4MM less than Miller's deal. That difference would be multiplied by the increased tax rates, so the effective difference would be somewhere around $11.5MM, at least. Haslem, a Miami native, has been with the Heat for his entire 10-year career, so there are plenty of sentimental reasons to hang on to him, too.  

Anthony was the least productive player of the three this past season, and his remaining contract, worth $7.6MM over two more years, is the least expensive. Amnestying him instead of Miller or Haslem would help keep the rotation together for another run at a title, but Arison may be better off testing the depth of his pockets at another time.

The return of Ray Allen would help make the decision to amnesty Miller easier, since Allen is another of the team's elite three-point shooters. Allen is on the fence about his $3.229MM player option for next season. He had plenty of suitors on the open market last year, and even though he played a significantly reduced role this past season compared to what he had done with the Celtics, I think plenty of teams would line up for him again if he elects free agency. The Celtics were willing to pay him twice as much as he got from the Heat last summer, and while I don't think Allen will merit any offers of a $6MM annual salary this time around, he can probably do better than what he's set to make in his option year. At the very least, teams should be willing to offer him a multiyear deal that would give Allen more guaranteed money than a one-year option pickup would provide. The Heat could re-sign Allen to a deal with a starting salary of $3.708MM for as many as four years through Non-Bird rights. A multiyear deal could pose yet more tax issues down the road for the Heat, but that may be what it takes to bring Allen back.

Re-signing Allen would make it easier for the Heat to bring back Andersen, too. The team would barely be able to exceed the minimum salary to re-sign the Birdman without dipping into the $3.183MM taxpayer's mid-level exception. The Heat would have to use that exception to replace Allen if he leaves, and since they'd probably like to find another outside shooter with Allen gone, that would probably signal an exit for Andersen. 

The Heat experimented with lineups that didn't feature a traditional point guard at times this season, including during the Finals, when those groups were effective down the stretch in games. That might lead to speculation that the Heat could turn down their $4MM option on Mario Chalmers, but I don't think the team envisions giving Wade or James significantly more ballhandling duties while forcing one them to guard opposing point guards every night. James was effective stopping Tony Parker in the Finals, but that's a heavy burden for a player who has so many other tasks, and I think the Heat would be loath to saddle him with such duty in the regular season. Norris Cole doesn't appear ready to assume a starting role, and finding a cheap replacement for Chalmers who could share the position with Cole would probably weaken the team quite a bit. I don't think the Heat will try to skimp here, particularly given Chalmers' relative youth on an otherwise aging roster.

If Riley is to get creative in a quest to save money, it would probably involve a trade. Bosh has drawn mention as a potential trade candidate, and the perception remains that he's the most expendable of the Heat's three stars, particularly after his scoreless performance in Game Seven of the Finals. Miami would probably target a cheaper big man as part of a trade, but inexpensive size has long been the most difficult-to-find commodity in the NBA. Bosh isn't a traditional rim-protecting center, but his speed and long arms make him a disruptive presence on defense. Even if Bosh is overpaid to some degree, the Heat would probably be looking at a downgrade for their roster next season if they traded him, risking another shot at a title.

Wade's trade value is at an all-time low, but if the Heat are to deal away one of their stars, he's probably the best choice. His up-and-down play this postseason proved that he has to perform at an All-Star level for the Heat to win against the best opponents. If he can no longer do so consistently, the Heat might be better off trading him for someone who can. An underpaid star wing player is usually easier to find than a big man with similar credentials, so that's another argument for trading Wade instead of Bosh.

Still, no player on the roster is as much part of the fabric of the Heat's culture as Wade is. He took the sharpest discount among the team's three stars when they signed in 2010. Wade has the superstar credentials and the intimate knowledge of what it's like to be "the man" in Miami, even if he's no longer either of those things. That could help him recruit a replacement for LeBron if the four-time MVP leaves next summer. The intangibles in play as part of any Wade trade could be enough to scuttle the idea before it crosses Riley's mind.

This offseason figures to be about small-scale maintainance of a championship roster instead of earth-shattering moves. A third championship in a row, which would put Miami in the elite company of the Celtics, Lakers and Bulls as the only franchises ever to accomplish such a feat, is within the team's grasp. That's probably worth the cost of ignoring concerns about the future for one more year. Riley and the Heat pursued a similar strategy to chase the 2006 title with Shaquille O'Neal and company, bottoming out in 2007/08 with a league-worst 15-67 record. It didn't take too long for the Heat to rebound from that nadir, and with warm weather and no state income tax, not to mention a growing championship tradition, the team probably wouldn't take too long to bounce back from a similar crash. If 2013/14 must be a swan song for the LeBron-era Heat, expect the band from the last two or three seasons to remain largely intact for one more. 

Additional notes:

  • James Jones and Rashard Lewis have player options that are no-brainers to exercise, so the Heat can count on spending nearly $3MM to seat them at the end of the bench. 
  • There's mutual interest between the Heat and Greg Oden, but since there are several teams reportedly in the mix for the former No. 1 overall pick, it will probably take more than the minimum salary to bring him aboard.  The only other way the Heat could sign him would be via the taxpayer's mid-level exception. If the team re-signs Allen and doesn't have to use the exception to find a shooter to replace him, Oden could be an alternative to re-signing Andersen.

Cap footnote:

  1. Varnado's contract becomes guaranteed for $250K if he's not waived on or before opening night, and it's guaranteed for $500K if he's not waived on or before December 15th.

Storytellers Contracts and Sham Sports were used in the creation of this post.

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3 thoughts on “Offseason Outlook: Miami Heat

  1. DiegoC

    I think Felton would be a good fit for Miami and i would love to see what Greg Oden can do for Miami

    • Bobby Sweet

      All Greg Oden can do is sit on the bench. In street clothes.

  2. Rick Thompson51

    Marcus camby would be a good fit he blocks shots, rebound and he can score and he won’t cost much

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