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Hoops Rumors Glossary: Gilbert Arenas Provision
Gilbert Arenas hasn’t played in the NBA since 2012, but his legacy lives on in the NBA’s Collective Bargaining Agreement. The NBA introduced the Gilbert Arenas provision in the 2005 CBA as a way to help teams retain their restricted free agents who aren’t coming off standard rookie scale contracts.
While Arenas isn’t specifically named in the CBA, the rule colloquially known as the Arenas provision stems from his own restricted free agency in 2003. At the time, the Warriors only had Early Bird rights on Arenas, who signed an offer sheet with the Wizards starting at about $8.5MM. Because Golden State didn’t have $8.5MM in cap room and could only offer Arenas a first-year salary of about $4.9MM using the Early Bird exception, the Warriors were unable to match the offer sheet and lost Arenas to Washington.
The Arenas provision limits the first-year salary that rival suitors can offer restricted free agents who have only been in the league for one or two years. The starting salary for an offer sheet can’t exceed the amount of the non-taxpayer mid-level exception, which allows the player’s original team to use either the mid-level exception or the Early Bird exception to match it. Otherwise, a team without the necessary cap space would be powerless to keep its player, like the Warriors were with Arenas.
An offer sheet from another team can still have an average annual salary that exceeds the non-taxpayer’s mid-level, however. The annual raises are limited to 5% between years one and two, and 4.5% between years three and four, but a team can include a significant raise between the second and third years of the offer.
As long as the first two years of a team’s offer sheet are for the highest salary possible, the offer is fully guaranteed, and there are no incentives included, the third-year salary of the offer sheet can be worth up to what the player’s third-year maximum salary would have been if not for the Arenas restrictions.
Based on a projected three percent salary cap increase for 2021/22, here’s the maximum offer sheet a first- or second-year RFA could receive this coming summer:
| Year | Salary | Comment |
|---|---|---|
| 2021/22 | $9,536,000 | Value of non-taxpayer’s mid-level exception. |
| 2022/23 | $10,012,800 | 5% raise on first-year salary. |
| 2023/24 | $30,913,906 | Maximum third-year salary for a player with 1-2 years in NBA. |
| 2024/25 | $32,305,032 | 4.5% raise on third-year salary. |
| Total | $82,767,738 | Average annual salary of $20,691,935. |
In order to make the sort of offer outlined above, a team must have enough cap room to accommodate the average annual value of the contract. So a team with $21MM in cap space could extend this offer sheet to a first- or second-year RFA. But a team with only $17MM in cap space would have to reduce the third- and fourth-year salaries in its offer sheet to get the overall average salary of the offer down to $17MM per year, despite being able to comfortably accommodate the first-year salary.
The application of the Arenas provision is infrequent, since first- and second-year players who reach free agency rarely warrant such lucrative contract offers. First-round picks sign four-year rookie deals when they enter the NBA, so the Arenas provision generally applies to second-round picks or undrafted free agents whose first NBA contracts were only for one or two years.
The Arenas provision hasn’t been used for the last several offseasons. Based on our data, it was last relevant during the 2016 offseason, when multiple teams made use of the Arenas provision as they attempted to pry restricted free agents from rival teams.
One relevant example from that summer was Tyler Johnson‘s restricted free agency with Miami. The Heat had Early Bird rights on Johnson, who had only been in the NBA for two seasons. The Nets attempted to pry him away with an aggressive offer sheet that featured salaries of $5,628,000, $5,881,260, $19,245,370, and $19,245,370. It wasn’t the maximum that Brooklyn could have offered Johnson, but the massive third-year raise was a tough pill for Miami to swallow.
Overall, the deal was worth $50MM for four years. If the Heat had declined to match it, the Nets would have flattened out those annual cap hits to $12.5MM per year, the average annual value of the deal. However, due to the Arenas provision, Miami was able to match Brooklyn’s offer sheet with the Early Bird exception, even though the Heat wouldn’t have been able to directly offer Johnson a four-year, $50MM contract using the Early Bird exception.
When a team matches an Arenas-provision offer sheet, it also has the option of flattening those cap charges. However, that option is only available if the team has the cap room necessary to accommodate the average annual value of the deal. Otherwise, the club has to keep the unbalanced cap charges on its books. When Johnson’s cap hit for the Heat jumped from $5,881,260 to an eye-popping $19,245,370 in 2018/19, it became an albatross — the team eventually sent him to Phoenix in a salary-dump deal at the 2019 deadline.
This coming offseason, there aren’t many restricted free agents who will be candidates for an Arenas-provision offer sheet. A handful of intriguing RFAs-to-be, including Duncan Robinson, Devonte’ Graham, and Gary Trent Jr., were former second-round picks or undrafted free agents, but they’ll all have three years of NBA experience when they hit the open market, so the Arenas rule won’t apply to them.
The best candidate for an Arenas-provision offer sheet may be Lakers wing Talen Horton-Tucker, who turned heads during a strong preseason in December. However, Horton-Tucker’s regular season playing time has been limited and his production has been modest. Teams may be tempted to put pressure on the Lakers by presenting THT with an aggressive offer sheet, but unless he takes another major step forward, it’d be surprising to see him get a three- or four-year free agent offer worth more than the standard non-taxpayer’s MLE.
Finally, just because a club is given the opportunity to use the Arenas provision to keep its restricted free agent doesn’t mean it will necessarily have the means. Here are a few situations in which the Arenas provision wouldn’t help a team keep its restricted free agent:
- If a team only has the taxpayer mid-level exception or room exception available, it would be unable to match an offer sheet for a Non-Bird free agent if the starting salary exceeds the taxpayer mid-level or room exception amount.
- A team would be unable to match an offer sheet for a Non-Bird free agent if it uses its mid-level exception on another player, including another one of its own Non-Bird free agents. A team could use Early Bird rights to match if those rights are available, however.
- If the player is a Non-Bird or Early Bird free agent with three years of NBA experience, the Arenas provision would not apply — only players with one or two years in the league are eligible.
Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA’s Collective Bargaining Agreement. Larry Coon’s Salary Cap FAQ was used in the creation of this post.
Earlier versions of this post were published in 2012, 2015, and 2018 by Luke Adams and Chuck Myron. Photo courtesy of USA Today Sports Images.
Warriors Notes: Looney, Wiseman, Wiggins, Poole, Smailagic
After opening the door over the weekend to a possible starting lineup adjustment, Warriors head coach Steve Kerr made a change at center on Monday night, inserting Kevon Looney into his starting five in place of rookie James Wiseman, as Nick Friedell of ESPN details.
Looney scored just two points on the night, but he was a plus-21 as Golden State defeated Minnesota 130-108. While the lineup change was effective on Monday, Kerr wasn’t ready to commit to it becoming a permanent solution.
“From the beginning, we’re trying to win games too,” Kerr said, per Friedell. “And so I have to figure out what that means. All it meant tonight was let’s start Loon, let’s try to get off to a better start, flip their roles, and I think it worked out well. It doesn’t mean I’m going to do it the whole year. It just feels like what I should do right now.”
Here’s more on the Warriors:
- Following Monday’s win over Minnesota, Kerr admitted that he’s not ignoring the impact that beating the Timberwolves – and keeping them near the bottom of the NBA standings – has on the Warriors’ draft outlook (Twitter link via Anthony Slater of The Athletic). Golden State will receive the Wolves’ first-round pick if it doesn’t land in the top three.
- Andrew Wiggins, who had spent his entire NBA career in Minnesota before being traded to the Warriors a year ago, praised Golden State’s “winning culture” after beating his old team on Monday. “It’s very positive over here, very positive, everyone’s getting along. No egos, nothing like that,” Wiggins said, per Friedell. “Everyone just wants to win. It’s just a winning attitude, winning culture, everything is about winning.” Although Wiggins didn’t specifically address the Wolves’ culture, it’s probably safe to assume he wouldn’t describe it in exactly the same terms.
- Jordan Poole and Alen Smailagic will join two-way player Nico Mannion in the G League bubble, Kerr confirmed on Monday, per Marcus White of NBC Sports Bay Area. All three players will depart Sunday and will suit up for the Santa Cruz Warriors at Walt Disney World next month. “Hopefully we stay healthy during that time so those guys get as much experience as they can,” Kerr said. “They all need to play.”
Hoops Rumors’ 2020/21 NBA Reverse Standings
Throughout the 2020/21 NBA season, Hoops Rumors will be maintaining a feature that allows you to keep an eye on the tentative 2021 draft order. Our 2020/21 Reverse Standings tool, which lists the NBA’s 30 teams from worst to first, will be updated daily to reflect the outcomes of the previous night’s games.
Our Reverse Standings are essentially a reflection of what 2021’s draft order would look like with no changes to lottery position. We’ve noted each club’s odds of landing the No. 1 overall pick, based on the league’s current lottery format.
[RELATED: Hoops Rumors Glossary: Draft Lottery]
In instances where two non-playoff teams or two playoff teams have identical records, the order in our standings isn’t necessarily definitive — for draft purposes, the NBA breaks ties via random drawings, so those drawings would happen at the end of the year.
Of course, the 14 non-playoff teams all draft before the 16 playoff teams, even if some non-playoff teams have better records than those that made the postseason. Our reverse standings account for playoff seeding, though for now they assume that the Nos. 7 and 8 teams in each conference will earn those final two postseason spots. Since the NBA’s new play-in format opens the door for the Nos. 9 and 10 seeds to sneak into the postseason, we may have to account for a little movement in the draft order at season’s end.
Traded first-round picks are included via footnotes. For example, the note next to Golden State’s pick says the Warriors will send their pick to the Thunder if it’s not in the top 20. As of today, the Warriors’ pick projects to be 18th, meaning that pick wouldn’t change hands.
Some conditions on traded picks are quite complex, leaving little room to fully explain them in our footnotes. We broke down all the details on those traded first-rounders right here.
Our Reverse Standings tracker can be found at anytime on the right sidebar under “Hoops Rumors Features” on our desktop site, or on the “Features” page in our mobile menu. It’s a great resource not just for monitoring a team’s draft position, but also for keeping an eye on whether or not traded picks with protection will be changing hands in 2021. So be sure to check back often as the season progresses!
Note: Mobile users are advised to turn their phones sideways when viewing the Reverse Standings in order to see team records and lottery odds.
Warriors Notes: Starting Five, Wolves’ Pick, Mannion
The Warriors suffered their second consecutive loss on Saturday in Utah, dropping to .500 (8-8) on the season. In the wake of that blowout, head coach Steve Kerr left the door open to the possibility of making changes to his struggling starting lineup, writes Anthony Slater of The Athletic.
“It’s going to take us 20 games to figure out where we really want to be with our rotation,” Kerr said. “We’re at 16 now, and I think getting a pretty good look at everything. We just had two bad losses in a row, so we have to assess everything. No doubt.”
Kerr has suggested that Golden State’s starting five – Stephen Curry, Draymond Green, Andrew Wiggins, Kelly Oubre, and James Wiseman – has the highest upside of any of the team’s lineups, but the results haven’t been there so far. That unit has played 161 minutes together, while no other five-man group has played more than 37. In those 161 minutes, the Warriors’ net rating is -20.3.
The team will have a good opportunity to turn things around this week, with home games against the 4-11 Timberwolves on tap for Monday and Wednesday.
Here’s more on the Warriors:
- Nearly one year after the Warriors and Timberwolves made a blockbuster trade involving D’Angelo Russell and Wiggins, Anthony Slater of The Athletic explains why he thinks Golden State has gotten the better end of that deal. As Slater outlines, neither Russell nor Wiggins has been a major difference-maker, but the Warriors were able to avoid the tax last season by dumping salary in that trade and are still owed a Wolves first-round pick that will likely land in the lottery.
- Within the same story, Slater says that – while the 2021 Timberwolves first-rounder owed to Golden State is top-three protected – the Warriors shouldn’t worry about Minnesota finishing with a bottom-three record. Even in that scenario, there’s still about a 60% chance that the Wolves’ pick will land in the No. 4-7 range and will change hands.
- The Warriors have discussed the possibility of sending rookie guard Nico Mannion, who is on a two-way contract, to the G League bubble at Walt Disney World next month, tweets Slater. “I haven’t played a full game since March 12,” Mannion said. “Going down there, getting into a flow, would be good for me.” The Santa Cruz Warriors are one of 18 teams participating in the revamped NBAGL season.
Following Specific Players On Hoops Rumors
Hoops Rumors makes it easy to keep up with your favorite NBA teams as they plot their next moves, and we also provide multiple ways to follow the latest updates on all of your favorite players, including the top free agents and trade candidates from around the league.
You can get news about players wherever you go with our Trade Rumors app, available for iOS and Android devices. The app, which is free, allows you to add a feed for any player and set up notifications that will alert you whenever we write about him. It’s the easiest way to keep tabs on specific players.
If you’re using the desktop or mobile version of our site, there are other ways to follow your favorite player(s). Every player we’ve written about has his own rumors page. You can find any player by using our search box, by clicking his tag at the bottom of a post in which he’s discussed, or by simply typing his name in your address bar after hoopsrumors.com, substituting dashes for spaces.
For example, LeBron James‘ page is hoopsrumors.com/lebron-james. Those player pages can be added to RSS readers too.
In addition to players, there are a number of other subjects you can track by clicking on the tags that we use at the bottom of posts or searching for them in the app.
For instance, you can keep tabs on our 2021 NBA draft stories right here. Items about the NBA G League can be found on this page. Expansion-related stories about the city of Seattle are all here. And you can simply scan our top stories here.
Avery Bradley Discusses Positive COVID-19 Test, Potential Return
Veteran guard Avery Bradley, one of several Heat players to miss time this month due to the NBA’s health and safety protocols, confirmed in a conversation with Chris Haynes of Yahoo Sports that he tested positive for COVID-19.
Bradley opted out of the NBA’s restart over the summer in large part because he has a seven-year-old son who suffers from a respiratory illness and didn’t want to risk his family’s health. When he tested positive during the second week of January, he had to self-isolate from his family members. He told Haynes that they continued to test negative, much to his relief.
While he was relieved not to have affected the health of his wife and children, Bradley was frustrated to have contracted the virus despite following all the required protocols, as he told Haynes.
“I was upset because I come to work and I do the right things, I come to work every single day and do all the protocols to make sure I’m protected so I can protect my family,” Bradley said. “To come up with the news knowing that I got it at work, I was a little frustrated to be honest. I was frustrated because I felt like it compromised my family’s safety.”
Bradley, who signed with the Heat in the offseason, was off to an impressive start with his new team before being sidelined, averaging 10.0 PPG on .490/.448/.778 shooting in seven games (22.9 MPG), while playing solid perimeter defense. He told Haynes he thinks he’ll be back in action for Miami on Wednesday night when the team faces Denver.
Heat forward Jimmy Butler is nearing a return as well, though Ira Winderman of The South Florida Sun Sentinel hears that the five-time All-Star is a couple days behind Bradley in the protocol process. If that’s the case, a Thursday or Saturday return may be more likely for Butler.
Jayson Tatum Returns For Celtics
Jayson Tatum, who reportedly tested positive for the coronavirus earlier this month, doesn’t appear on the latest injury report and will return to the Celtics‘ lineup on Monday night in Chicago, as Chris Mannix of SI.com tweets.
Tatum last played on January 8, when he scored 32 points vs. Washington. A day later, word broke that the 22-year-old had entered the NBA’s health and safety protocols, with a subsequent report indicating he had tested positive for COVID-19.
Tatum ultimately only missed five games for Boston, since three other contests on the schedule during his absence were postponed. The team went 2-3 without its All-NBA forward in the lineup.
In his first 10 games of 2020/21, Tatum appeared poised to enjoy a career year. His 26.9 PPG, 7.1 RPG, 3.8 APG, and .438 3PT% so far this season would all be career bests.
Although the Celtics will have Tatum back tonight, they’ll be without Kemba Walker, who will sit out the second half of a back-to-back set for injury management purposes.
Nets Reportedly Have Interest In JaVale McGee
The Nets, who are in the market for a veteran center after having traded Jarrett Allen to Cleveland, are said to be eyeing Cavaliers center JaVale McGee, according to a series of reports.
Sam Amico of FortyEightMinutes.com first tweeted that sources expected Brooklyn to pursue a trade for McGee, while Jason Dumas of KRON4 News said today (via Twitter) that the Nets are talking to Cleveland about a possible deal. Brian Lewis of The New York Post also indicated (via Twitter) that he has heard some chatter about the Nets and McGee.
The trade that sent Allen from the Nets to the Cavs left Brooklyn somewhat shorthanded at the five, while Cleveland now has an abundance of options in the middle. Besides DeAndre Jordan, the Nets’ potential fives – Nicolas Claxton, Reggie Perry, and soon-to-be-signed Norvel Pelle – are short on NBA experience. The Cavs, on the other hand, have nine-year veteran Andre Drummond starting at center, with Allen and McGee operating as backups.
As Dumas tweets, the Cavs don’t intend to flip Allen, but they could make Drummond, McGee, and/or power forward Kevin Love available before this season’s trade deadline. Dumas suggests Brooklyn has some interest in Love as well, but it’s hard to imagine how such a deal would work, given his $31MM+ salary and the makeup of the Nets’ roster.
McGee is a more realistic target for Brooklyn — his $4.2MM expiring contract could be absorbed using the Nets’ newly-granted disabled player exception if the team doesn’t want to send out any players to match his salary. The Nets still have multiple open roster spots, so making room on the 15-man squad wouldn’t be an issue either.
The Cavaliers, meanwhile, are expected to seek draft capital for any of the big men they move, per Dumas. Unless they’re willing to take on some unwanted salary, the Cavs probably shouldn’t expect more than a second-round pick for McGee or Drummond.
Southeast Notes: Butler, Bamba, Hawks, Len, Wizards
The Heat may not be without star swingman Jimmy Butler for much longer. According to Barry Jackson of The Miami Herald, the expectation is that Butler – who hasn’t played since January 9 – will clear the NBA’s health and safety protocols on Monday.
The Heat will be in action tonight in Brooklyn, but Butler will need a little more time to get his conditioning back up to speed and to pass a cardiac screening before he’s cleared to play in a game. Jackson says there’s optimism that Butler will be able to return later this week and that the same is true of Avery Bradley, who has also been in the league’s COVID-19 protocols for over two weeks.
Here’s more from around the Southeast:
- The sixth overall pick in 2018, Magic center Mohamed Bamba has an underwhelming NBA résumé so far, but it’s unfair to label him a bust since injuries and a lack of playing time have prevented him from showing what he can do, contends Jonathan Tjarks of The Ringer. The 22-year-old has been limited to 33 total minutes across four games so far this season.
- In an official press release, the Hawks shared details on their plan to begin allowing fans into their home games at State Farm Arena. The club will initially only fill the arena to about eight percent of its capacity.
- Alex Len was an ideal addition for the Wizards, who needed to fill a hole in their frontcourt and didn’t want to give up anything to do so, says Fred Katz of The Athletic. As Katz notes, the veteran big man was able to assume a rotation role immediately and looked comfortable in his first game with the team on Sunday.
- While the Wizards were back in action for the first time in nearly two weeks on Sunday, it’ll be a little while longer before things are “back to normal” for the team, writes Ava Wallace of The Washington Post.