NBA Free Agency 2012: No News Might Be Good News For Bucks

Happy July 1st, NBA players!

Call it the Christmas of the NBA calendar, since there's perhaps no more profitable day of the year than the first day of free agency. While there's no shortage of teams looking to dump salary (and big names) ahead of the more punitive luxury tax rules that kick in next summer, there are predictably just as many (or more) teams that will be happy to blow their cap space this summer on guys they will likely be happy to dump a year or two from now. Cap space: opiate of the NBA general manager?

The big news of the first 12 hours of free agency not surprisingly came from New Jersey Brooklyn, where Billy King has reportedly agreed to keep Gerald Wallace for $40 million over four years while also pursuing via trade Joe Johnson's toxic contract, Luis Scola's less toxic but still unappealing deal, and unrestricted free agent O.J. Mayo. And all that is just the appetizers for what the Nets are hoping will be a franchise-altering main course: bringing back Deron Williams and netting the biggest fish of all, disgruntled/confused superstar Dwight Howard, who has once again stated his preference for ending up in Brooklyn.

Among other things, Portland is also reportedly readying a (gulp) max offer for the Pacers' restricted free agent Roy Hibbert, though they might lose their own RFA if the Timberwolves reported $45+ million offer for Nic Batum happens. Neither player is of course "worth" that much money, but July is when fiscal responsibility goes to die and the line between ambition and desperation becomes hopelessly blurred.

But for now things appear relatively quiet in Milwaukee, with the Bucks appearing to take a wait-and-see approach on the first day and their top free agent, Ersan Ilyasova, also not among the players receiving loony contract offers. At least not yet. After the jump we look at where the Bucks stand at what might come next.

• Bucks' cap in a nutshell: Fine, but no free agent bonanza expected. At the moment the Bucks have $50.5 million committed to 10 players, excluding rookies John Henson and Doron Lamb. As a first round pick, Henson immediately counts against the salary cap in the amount equal to his first year rookie scale figure ($1.52m), which brings the Bucks' cap number to $52 million even for 11 players. Like all first rounders, Henson will eventually sign for the maximum 120% of his scale figure, which will add another $300k to the Bucks' cap number. As a second rounder, Lamb doesn't count against the cap until he signs, likely for the first year minimum, which teams don't need cap space or a separate exception to do. Note that it's typical for second rounders to sign later in the summer after teams have gotten their rocks off in free agency. If the Bucks do have an exception left over, they could offer Lamb slightly more than minimum in order to lock in a third year at a low price. The Bucks did the same with Luc Mbah a Moute and Jodie Meeks.
• Cap figure. We've already heard that the cap won't be lower than it was the past two seasons ($58 million), though we won't know the specific final number until the end of the moratorium. But at around $58 million the obvious conclusion is that the difference between the Bucks' committed salary figure and cap number is right around the value of the mid-level exception ($5 million). However, it's a bit more complicated than that when you factor in free agent holds (see below).
• Free Agents: Ilyasova, Delfino and Brown. While the Bucks are in a pretty good situation with regard to long-term salary, they're not likely to be making any big moves this summer as things currently stand. To retain their respective Bird rights, both Ilyasova ($4.83m) and Carlos Delfino ($6.65m) have cap holds which together wipe out any effective cap space the Bucks might have. Kwame Brown also has an $8.1 million hold as a non-Bird free agent, though I'd guess the likelihood of the Bucks retaining him for anything close to the $7 million he earned last season is zero. Doesn't mean they won't add another true center, but it certainly won't come with a big price tag.
• Renouncing free agents. The Bucks can rid themselves of the holds by renouncing all three players to use their cap space on someone else, but then they can't use the Bird exception to re-sign them. That's especially important for Ilyasova since he'll almost certainly require more money than the Bucks have in cap space. It's less of a issue for Delfino, since he'll likely only make $2-3 million and could be brought back with another exception. Brown is in the same boat; they won't renounce him unless they're making a move that requires it, but it doesn't come with any major strategic consequences.
• Amnesty not expected. The Bucks could open up significantly more cap space by amnestying either Beno Udrih or Drew Gooden, but John Hammond has already said they had no plans for that. It's not surprising given the money is effectively a sunk cost and the Bucks likely wouldn't have the ability to spend the extra cap space on a star who's worth the hassle.
• MLE vs. cap space? To make a move without renouncing one or both of Ilyasova/Delfino, the Bucks can use the mid-level exception rather than clear cap space. As long as Ilyasova is unsigned you can assume any free agent signings will involve using the MLE or bi-annual exception (up to two years starting at just under $2m annually). And once that happens the Bucks can't use cap space later, since the MLE and BAE have to be renounced (much like a cap hold) to maximize cap space. If the Bucks lose Ilyasova early on in free agency, his cap hold disappears and they could opt to also renounce Delfino, Brown, BAE and the MLE in order to use cap space. The benefit is that they would then also have the cap space exception equal to $2.575 million. But like last year there's not a huge difference in terms of dollars--which direction they go is more predicated on the timing of when signings happen.
• Ersan's options. The Brooklyn rumors are of course significant in that Ilyasova has been mentioned as a potential target of the Nets for some time. That interest would likely disappear if they managed to acquire Scola's deal or load on Johnson's huge contract, and of course Ersan won't take nearly the same priority as Williams and Howard. Even so, there's no shortage of teams that will be interested in Ersan, so it figures to be just a matter of time before the offers come rolling in. The question is how big they'll be.
• Bucks' interest in Ersan lessening? Michael Hunt writes that it might be time to let Ilyasova make his big money elsewhere, and you can certainly sense the Bucks' attitude toward Ersan shifting. After the Andrew Bogut trade, the Bucks emphasized the move as key in enabling them to re-sign Ersan, but by last week they seemed to be taking a more realistic tone. Hammond spoke of presenting Ersan a "fair offer," which sounds more like the Bucks will give him something in the range Hunt describes ($7m per) than breaking the bank for $9-10 million.
  
  The $7m figure is reasonable for Ersan's age/production level, but going a full five years would give me serious pause on anyone I didn't consider an all-star caliber player...which Ersan is not. Whatever happens, the Bucks will be hoping that teams with cap space end up finding bigger fish to fry this week, leaving Ilyasova to take the cap space scraps. Ilyasova's absolute floor is the mid-level, though it's important to note that he could make more money in Europe (factoring in tax and exchange rate impacts) at that point.
• The new...core? The team sounds increasingly likely to pony up to keep Jennings either this summer or next summer, while Ellis is already set to earn $11m next season and the Bucks have suggested they will discuss an extension this summer. I'm not sure if an Ellis extension could really go anywhere (are both sides really interested?), but it suggests the Bucks are at least entertaining the possibility of a Jennings/Ellis backcourt beyond next season.
  
  Most everyone is skeptical that's a long-term winner, but we all know the Bucks want to return to the playoffs and offer up an entertaining product now. Signing Ilyasova to a big deal would raise the worrying question of whether an Ellis/Jennings/Ilyasova combination is one the Bucks can stomach owing $30+m per season, but the Bucks gain flexibility next summer with Udrih's expiring $7m figure and at the moment have a very palatable $37m on the books, including Ellis' $11m opt-out figure and Jennings' $4.3m qualifying offer. That's the silver lining: even if the Bucks end up with a not-so-fearsome threesome each making somewhere close to $10m per, they aren't completing killing their cap situation for the rest of time. Tanking arguments aside (since we know that's not happening in the short term), much of it comes down to making the best of what you have vs. keeping your options open going forward. I believe it's possible to do both, but overpaying guys with long-term contracts just because it's hard to attract talent has not proven a strategy worth hanging your hat on. That's how the Bucks ended up with Mike Redd, Bobby Simmons, Mo Williams, John Salmons, Drew Gooden et al.
• Another wing? Ryan Kartje at FS Wisconsin wonders whether the Bucks will make a run at a wing, with Nick Young or Landry Fields mentioned as possibilities. The Bucks reportedly had inquired with the Blazers about Jamal Crawford back at the deadline, but the Bucks were apparently not one of the six teams that contacted his agent last night. While Lamb could excel as a shooter off the bench, the Bucks have to add at least one more guard/small forward--maybe one combo guard, one 2/3 shooter like Delfino. For what it's worth, I'll guess at this point that the Bucks add two players to bring them to 14 on opening night. If Ilyasova does come back then moving one of the current big men would make some sense as well.
• To the thrifty go the spoils? While the Bucks could certainly stand to add talent on the wing, I don't see using the full MLE (or equivalent cap space) as a prerequisite to a productive free agency. The Bucks are in pretty good shape cap-wise looking forward, but they'll have to consider the added cost of retaining Jennings long-term next summer and re-signing or finding replacements for Ellis, Mike Dunleavy and Sam Dalembert as well. Because of that, there's value in being sensible now to better enable the reloading that will be needed next summer.