Values Of 2023/24 Mid-Level, Bi-Annual Exceptions

The salary cap for the 2023/24 NBA league year has officially been set, with the league announcing that the cap will be $136,021,000, a 10% increase on last year’s number.

Under the league’s current Collective Bargaining Agreement, the values of the mid-level, room, and bi-annual exceptions are tied to the percentage that the salary cap shifts in a given year. Because the cap figure for 2023/24 increased by 10%, the values of the mid-level and bi-annual exceptions increase by the same amount.

There are a few more wrinkles involved in the calculation of this year’s figures. As part of the NBA’s new Collective Bargaining Agreement, the non-taxpayer mid-level exception is receiving a one-time 7.5% increase in addition to the usual 10% bump, while the room exception has been increased by 30% (plus the usual 10%).

The taxpayer mid-level exception is headed in the other direction, dipping to a flat $5MM this season after being worth approximately $6.48MM last season. It will resume increasing at the same rate as the cap going forward.

Listed below are the maximum annual and total values of each of these exceptions, along with a brief explanation of how they work and which teams will have access to them.

Mid-Level Exception (Non-Taxpayer):

The non-taxpayer mid-level exception is the primary tool available for over-the-cap teams to add free agents. As long as a team hasn’t dipped below the cap to use cap space and doesn’t go over the first tax apron ($172,346,000) at all, it can use this MLE, which runs for up to four years with 5% annual raises.

Mid-Level Exception (Taxpayer):

Besides being worth less, this exception will now only allow for signings of up to two years instead of three, as a result of the new CBA. The goal was to reduce the ability of taxpaying teams to continue adding talent.

This exception is essentially available to teams who expect their total salaries to fall between the first tax apron and the second apron ($182,794,000). It’s not available to teams above the second tax apron, so a team that does use it becomes hard-capped at that second apron. A team that uses more than $5MM of its mid-level exception will be hard-capped at the first apron.

The taxpayer MLE can be used to sign a player for up to two years, with a 5% raise for the second season.

Room Exception:

Although this is also a mid-level exception of sorts, it’s colloquially known as the “room” exception, since it’s only available to teams that go below the cap and use their cap room.

If a club goes under the cap, it loses its full mid-level exception, but gets this smaller room exception, which allows the team to go over the cap to sign a player once the team has used up all its cap space. It can be used to sign players for up to three years, with 5% annual raises.

Bi-Annual Exception:

The bi-annual exception, as its name suggests, is only available to teams once every two years. Of the NBA’s 30 clubs, only two – the Sixers and Heat – used it in 2022/23, so they won’t have access to it in ’23/24. The league’s other 28 teams could all theoretically use it this season.

Still, even if a team didn’t use its BAE in ’22/23, that club doesn’t necessarily have access to it for the coming year. As is the case with the non-taxpayer MLE, this exception disappears once a team goes under the cap to use room. It’s also not available to teams over the first tax apron — using the BAE creates a hard cap at that apron.

The BAE can be used to sign players for up to two years, with a 5% raise after year one.