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How August Stretch Provision Use Helped Teams

A key offseason date is approaching, as Monday is the final day that teams can waive players using the stretch provision to reduce the costs of their obligations for the coming season. The stretch provision is still useful after the end of August, but salaries for 2015/16 would remain the same for any player waived and stretched beginning Tuesday.

Last year, teams used the stretch provision on four players at the end of August, and their individual cases highlight many of the details involved with this salary cap tool. We’ll look at all four of them here:

  • Clippers waive Carlos Delfino — One of two players the Clippers acquired from the Bucks as part of the deal that sent Jared Dudley to Milwaukee, Delfino had a salary of a guaranteed $3.25MM for 2014/15 and a non-guaranteed salary of the same amount for 2015/16. Using the stretch provision on August 31st last year allowed the Clippers to spread the guaranteed money over five years, not just three, as would have been the case if 2014/15 were the final season on the contract, illustrating the advantage of using the stretch provision on a contract that features a non-guaranteed year. Thus, the $3.25MM was cut into equal fifths of $650K.
  • Clippers waive Miroslav Raduljica — The center was the other player the Clippers picked up in the Dudley trade, and he, like Delfino, had a non-guaranteed 2015/16 after a fully guaranteed 2014/15. Thus, the Clippers spread his $1.5MM in guaranteed money over five seasons in equal $300K parts. Those annual payments are even cheaper, at $252,042, thanks to set-off rights that triggered when Raduljica collected money from his deal with Shandong of China and pair of 10-day contracts with the Timberwolves.  The Clips had just $649,228 under their hard cap before they waived Delfino and Raduljica, so the stretch provision gave them $3.8MM in extra breathing room that helped them maneuver throughout the season. Stretching Dudley’s contract wasn’t an option, since he signed his deal under the old collective bargaining agreement.
  • Grizzlies waive Jamaal Franklin — Memphis let go of Franklin, whose minimum salary of $816,482 for 2014/15 was the only guaranteed money remaining on the final two years of his deal. Thus, the Grizzlies reduced his pay to a tiny $163,297 for each of the following five seasons. The release allowed Memphis to open a regular season roster spot and gain a small measure of flexibility under the tax line. The Grizzlies finished roughly $2MM shy of the tax.
  • Kings waive Wayne Ellington — The Kings only had about $100K in room beneath the tax threshold when they released Ellington, who was due $2,771,340. They’d traded for him earlier in the summer of 2014 in a deal that sent out Travis Outlaw, who signed his contract under the old collective bargaining agreement and was thus ineligible for the stretch provision. Ellington’s contract was stretch-eligible, and Sacramento took advantage of that. It was an expiring deal, so the Kings could spread Ellington’s salary over three seasons to reduce the yearly payment to $923,780. Ellington later signed to play with the Lakers for the five-year veteran’s minimum salary of $1,063,384. That helped defray Sacramento’s obligation via set-off rights. The Kings thus got to withhold $123,451, reducing their annual payout to Ellington to $882,630.

The Basketball Insiders salary pages were used in the creation of this post.

Is there a player under contract that you believe should be waived using the stretch provision between now and Monday’s deadline? Leave a comment to tell us.

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