A few weeks ago a rumor came out that Memphis was looking to clear salary in any way possible to get under the dread tax line. Since, Memphis is considered a small market their ownership group decided that paying the luxury tax this year and potentially becoming a repeat tax payer was something they were not willing to do (for a short explanation of the tax check out our Rudy Gay Piece). After this information leaked the rumor mill started to swirl, Rudy Gay was mentioned as being the most likely to move followed by the rumor that they were gauging Zach Randolph‘s interest around the league.
In the end, nothing so drastic as this happened. The Grizzlies decided to send out some of their back end rotation players, to get under the luxury tax. Doing this without sending away any of their stars has to be considered a major win for Memphis. Ken Berger of CBS broke the deal via a series of tweets:
So full deal is Speights, Selby, Ellington and pick to Cleveland for Jon Leuer. Welcome to luxury taxonomics.
In this deal Cleveland is showing the benefits of being under the cap in the current NBA landscape. In the NBA trades have to match salary wise, meaning the value of the two side’s contracts exchanged must be within 125% + $100,000 of each other. The exception to this is if one team is under the salary cap, in which case they can take on more salary than the other team. Cleveland essentially traded it’s cap space for three players that will be in their rotation immediately as a well as a draft pick.
As Ken Berger mentioned in one of his tweets this deal is the type fans will become familiar with after the new Collective Bargaining Agreement, and its new punitive tax. In the new NBA, cap space has become even more valuable with teams looking to shed payroll to get under the tax.
This move was a win for Memphis because they were able to get under the tax without giving up one of their core starters. Any deal in which they gave up Rudy Gay or Zach Randolph to get under the tax would only bring back 75 cents on the dollar for these two stars. In avoiding moving one of these pieces Memphis was able to get under the tax while keeping its title hopes alive.
The deal is a win for Cleveland because they have added three promising young players, and a draft pick for a player that wasn’t in their rotation. Ellington is a very good shooter who can space the floor, Selby is a young scoring guard who can help the Cavs lackluster offense, and Speights is an offensive minded big man who can score in the post. Cleveland has found itself struggling on the offensive end many a night this year, these three players will help alleviate this problem In the new cost conscious NBA it was a win for both teams.