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Clippers Offer Kaman Extension

According to Jason Reid of the LA Times, the Clippers offered Chris Kaman a contract extension over the weekend.  The guaranteed offer is for 5 years and $50M, and also includes some performance based incentives.

It's a fair offer.  I'm certain that Kaman and his agent Rob Pelinka believe they could get more on the open market next year, but they could also get less.  Just ask Michael Olowokandi, who turned down an extension from the Clippers 4 years ago, signed for less money and fewer years, and is struggling just to stay in the league this pre-season.  

I'm not saying Chris Kaman is Michael Olowokandi - Kaman's work ethic alone distances him nicely from the Kandi-man.  But I am saying that all big man contracts - including that forgotten Clippers offer to Kandi and recent offers to Sam Dalembert (6/$60M), Nene (6/$60M), Eddy Curry (6/$60M), Jerome James (5/$30M),  Zaza Pachulia (4/$16M) - are paying for potential.  Sometimes it's better to sign the deal while the potential is still untapped, rather than waiting another year and proving that the potential will never fully be realized.  Do you think anyone would pay Dalembert $10M per now?

And let's face it: $50M is not chump change.  It's not an insult.  For a simple guy from a small town in Michigan, it's a lot of money.  Kaman says that he likes the Clippers, that he likes Mike Dunleavy and assistant coach Kim Hughes - here's his chance to prove that it's not all about money.

For a long-time Clipper watcher like myself, this development is significant for several reasons.  For one thing, it is the first time that the Clippers have ever offered to extend a significant player before he became a free agent.  With Brand and Maggette, as significant as those signings were as a measure of progress for the franchise, they waited until the players became restricted free agents before matching offers.  That's not a bad strategy - you let the market determine the value of the player, and then make a decision to match or not to match.  But it risks hurt feelings on the part of the player, and it also risks driving the price up.

More significant though is what appears to be a coherent, long-term strategy on the part of the team.  According to Reid, Kaman's offer won't go significantly higher because of the desire to re-sign Shaun Livingston next summer, while remaining below the Luxury Tax Threshold.

Hallelujah.  Not only because of the significance of Livingston (anyone who reads CN knows that I believe Livingston is the future of the franchise), but because of the recognition of the Luxury Tax Threshold as the `big-boy' cap.  

As much progress as the team has made in the last several years under Dunleavy (re-signing Brand and Maggette, paying for significant free agents Mobley and Thomas, trading for and then re-signing Cassell) the team has remained under the salary cap until this season ($57M payroll while the Cap is at $53M).  As recently as last May 30, Mark Stein wrote (Insider required) "But this is still Sterling. These might be the new Clips, but he wants them to operate right around the league's salary cap."  At the time I pointed out that no serious contender can stay below the cap, not even San Antonio, who uses their money better than any good team.  The Luxury Tax Threshold is the only realistic limit on spending, if you have any intention of winning playoff games.

According to Reid, the offer to Kaman, combined with an extension for Livingston next summer, would keep the Clippers under the projected Luxury Tax Threshold in 2008-2009.  

Despite their hope to retain Kaman, the Clippers probably would not offer Kaman a much bigger contract because of their salary-cap strategy.

The team is positioned to offer backup point guard Shaun Livingston a similar multiyear extension before the 2007-08 season, and it would approach the luxury-tax threshold if Kaman had more than a $10-million average on the books.

My hat is off to Dunleavy for getting Baylor and Roeser and Sterling to even understand the concept of the Luxury Tax Threshold.  They probably looked at him like he was speaking Urdu.  "But if we sign Kaman and Livingston, and keep our other guys, that's more than the Salary Cap.  How can we pay more than the Salary Cap?  Now, I know we can't pay less than some minimum.  That's been a problem before.  But is there a cap that's higher than the cap?  That doesn't make any sense.  Crazy NBA!  What will they think of next?!"

No one in the NBA can really actively plan for more than 2 years in the future.  There are too many variables.  The best you can do is to avoid the horrible decisions that will tie your hands in future seasons, but you can't actively plan that far out.  

That said, let's assume the Clippers are able to re-sign Kaman and Livingston for grown-up contract extensions (say Kaman signs for the 5/$50M, while Livingston commands 5/$60 - bear in mind, the maximum deal would be more like 5/$80M, which Livingston and his agent may think they deserve).  That would give them a core group in 2008-2009 of Kaman, Brand, Maggette, Mobley and Livingston, Tim Thomas and Korolev, making a combined $63M approximately.  Assuming the Luxury Tax Threshold goes up about 5% a year, it would be around $73M, leaving $10M to fill out the roster.  

Don't forget that the Clippers have benefited from bargain basement contributors like QRoss, James Singleton and Daniel Ewing.  Ross is going to get paid somewhere, and Singleton as well.  Ewing is replaceable with a draft pick.  And then there is Sofoklis Schortsianitis, MBFGC.  If you want to keep Ross and Singleton, you'll have to pay them.  And MBFGC is making about $1M per in Greece, so if he continues to improve, he'll probably be looking for $2M or $3M.  The bottom line is, the Clippers can look at a MONSTER 8 or 9 deep team, 3 seasons down the road, but they will certainly have to spend to the Luxury Tax Threshold to do so.

Back to Kaman - like I said, I think 5/$50M is a fair offer.  I would also hope that Clippers management would explain to Kaman the long term strategy.  Players in general would be wise to take into consideration the bigger picture, and realize that some times they need to sign for a little less in order to have a better team.  If Kaman and Pelinka decide to wait, that's fine.  Unless Chris takes a step backwards this year, he can undoubtedly command more on the free agent market next year - albeit playing for Charlotte or Orlando.  If they wait, then the Clippers can decide to match any offers, or they may allow him to leave, rather than risk losing Livingston, which would be disastrous.  Even if you lose Kaman, you bring over MBFGC for a lot less, have some money to sign free agents, and still have a very deep team.

It's nice to have options.