This coming offseason will be a pivotal moment in franchise history for the Pelicans.
I’m sure you’ve aware of the biggest deal to be consummated at the last trade deadline — the Pelicans landing DeMarcus Cousins — but it bears repeating: New Orleans road to a championship became clearer. The door to contenders status was locked before, yet now, the gateway is wide open.
The next step for the Pelicans is to find a way to push through that door before it closes shut again (i.e. when Boogie or AD’s contracts expire). The upcoming salary cap spike from $94 million to an expected $102 million will be the last big increase before the cap flat lines until at least the next television deal is signed.
Building a contender usually falls under two categories: a team either goes big and puts all their eggs (in this context, cap space) in one basket or it diversifies and goes for depth. In most cases, though, teams are not afforded the luxury of bringing in “max” guys so their best available route is through multiple drafts and then using free agency to fill in the roster gaps.
The reasoning for going all in is simple: It’s quick and talent always wins out in the playoffs. In the context of a game-every-other-day postseason schedule, talent wins out because teams can survive with having four or five players see 40+ minutes.
Yet, before the playoffs become a thing, teams have to slug their way through the regular season — where depth is king. The problem with the putting all the eggs in one basket theory is that one or two key injuries could derail postseason hopes like a house of cards. Depth allows one to survive the rigors of the regular season. Sure, the lineups will be less effective but they shouldn’t be detrimental.
So, let’s examine the 2017-18 salary cap sheet and keep your focus on Jrue Holiday — the biggest domino on the Pelicans’ offseason horizon. I’ve talked about his production being worthy of membership in a “Big 3” and the type of contract is likely to land as well as valuing his monetary worth (TLDR: not a max).
Pelicans 2017-18 offseason
|Omer Asik (stretch)||3,554,574|
|Jrue Holiday (cap hold)||16,929,777|
|roster spot charge (3)||2,446,845|
The Pels could open up as much space as $4.2 million if:
- Dante Cunningham opts out of his $3.1 million player option. (A widely expected move considering the minimum rises to $2.3 million and Bi-annual Exception (BAE) rises to $3.3 million).
- Renounce all free agent cap holds except for Holiday.
- Stretch the contract of Omer Asik.
New Orleans could free up an additional $4.1 million if they trade Ajinca’s contract for no salaries in return. Perhaps the front office could attach a future 2nd round pick and push their total cap space to $8.3 million.
At first glance, this would mean the Pelicans would be better off just operating over the cap since the Non-taxpayer Mid Level Exception (MLE) is expected to be around $8.4 million. However, operating below it allows the Pelicans to make uneven trades (i.e. incoming salary > outgoing salary) which opens up the ability to trade for a contract worth as much as 18+ million (with Solomon Hill going out).
- If the Pels prefer to have four big talents, they’ll need to operate under the cap this summer.
- If the Pels want to build depth around the Cousins-Davis-Holiday trio, they’re better served operating over the cap.
So, with that in mind, which route should the Pelicans take?
Again, we’re going to look at three catch-all statistics: RPM (from ESPN), WS and VORP (from Basketball Reference).
Note: All players who played at least 800 minutes over the last 4 seasons (2014-2017).
First off, it’s worth noting that all three histograms are bell-shaped and centered around 0 (i.e. a lot of players are paid the right amount). The histograms make one thing clear: players who earn 1 to 5% of the cap are rarely underpaid. In the context of the $94 million cap this season, guys who earn somewhere around $1 to $5 million are usually underpaid, or at the very least not overly overpaid. True to form, the Pelicans roster echoes this as Dante Cunningham (rightly paid), Terrence Jones (underpaid) and Tim Frazier (slightly overpaid) were all good contracts.
Another thing to note: the larger the contract becomes, the more the histogram skews to the left (i.e. overpaid). This should be common knowledge. In reality, a number of guys have the potential to earn a max contract — whether that’s a rookie max (20%~25%) or a veteran max (25+%).
The max should start at 25% (rookie max), but the cap spike of 2016 screwed everything up by decreasing the cap percentage of max contracts signed in a much smaller cap era. This includes players like DeMarcus Cousins, Serge Ibaka, Derrick Favors, Draymond Green and Kyre Irving: players who signed the rookie max (or close to it) pre-2016.
But, the total number of max contracts will continue to be overpaid ($10+ million) if history is any indication. That’s mostly because a bunch of max contract holders who, due to injury, became big overpays at their salary. This group includes Derrick Rose, Amare Stoudemire, Chris Bosh, Rajon Rondo and, of course, Eric
freaking Gordon. There are also buyout candidates, those who signed their max contract on the back end of their 20s and became unworthy of them as Father Time started winning. These are guys who usually become buyout candidates. Guys like Joe Johnson, Carlos Boozer, and David Lee. And don’t forget there was Kobe Bryant’s farewell tour.
This pattern would seem to indicate the Pelicans should take the route of going 15 deep and having a strong bench. That becomes clearer once you consider that max contracts are usually underpaid, on average, by $3.56 to $8.76 million, but they are overpaid, on average, by $9.5 to 11.6 million. That’s a big difference and one that, at this point, should probably scare you. And if we’re being completely honest with ourselves, Jrue is probably going to be overpaid this summer.
However, none of this is that simple though.
Consider this: the only reason most of the players who’re signed for very little (around 1 to 5% of the cap) and are considered “underpaid” is because they don’t hold as big a responsibility as max players. While max players are, usually, asked to shoulder bigger loads on offense, these small contract players aren’t. In fact, once you remove the stars drafted late in the draft (Gobert, Antetokounmpo, Green, Jokic), you’re left with mostly veteran role players like Zaza Pachulia, Patty Mills, Chris Andersen and David West. And those role players won’t perform as well without the max players doing all the heavy lifting.
So, chasing “max” players is still the better option, because that gives teams a better shot at signing cheap veteran help, and it could mean the Pelicans can FINALLY stop trading picks (i.e. become better participants of the “1 to 5%” underpaid contracts). These max players just have to be not on the wrong side of age and not injury prone. Easy, right?
The max players list isn’t very long; the most obvious candidates are Jimmy Butler and Paul George. Both were embroiled in trade rumors leading up to the deadline. These two are mostly a pipe dream, unless the Pelicans somehow luck into a top-3 2017 draft pick (especially with George, who will probably fetch a lower price with the threat of LA and the prospect of not getting the designated max contract lowering his trade value).
A Holiday/George (Butler)/Davis/Cousins lineup could definitely contend for a title. The group of players are young but good to great now — Butler is 27, Holiday, George and Cousins are 26, Davis is 24. With the exception of Jrue, all of them have relatively solid health. (Man oh man is that Jrue contract going to be interesting!) This path would open the door for those enviable veteran signings and could mean the Pelicans would finally start drafting in the low 20s and keep their picks.
More realistic targets, some who fall slightly below the 20% cap threshold, are Nicolas Batum, Goran Dragic, Eric Bledsoe and Ricky Rubio. All of them have red flags. Batum and Dragic are already on the tail end of their careers (Batum is 28, Dragic is 31) and prime candidates for overpay contracts. Bledsoe is not only on the tail end (going 28 in December), he’s also injury prone. Ricky Rubio is young (26) but he’s had a very inconsistent career to this point; however, he appears to be the best option, injury issues be damned.
Rubio doesn’t really depend on his athleticism and he could compliment the Pelicans Big 3 well both offensively and defensively. He isn’t ideal — an incredibly inconsistent shooter — yet ideal doesn’t mean wrong as New Orleans could use a more dependable distributor and pace setter if Alvin Gentry remains on the sidelines.
All the Pelicans really need is to squeeze another player through the current window. Trade for that max, or close to it, player and then round out the rest of the roster with subsequent veteran signings. Once accomplished, practice patience with with future draft picks and the championship window could remain open in New Orleans for a much longer time than any optimist dared dream possible just a few short months ago.