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The Team-Building Impact of the Harrell Contract and Harris Non-Extension

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These things happened over the weekend. But what do they mean?

Cleveland Cavaliers v Los Angeles Clippers Photo by Harry How/Getty Images

It’s become pretty evident that everything the Clippers have done over the last month—well, probably over a year, but especially the last month—has been geared towards 2019 free agency, when the team has the flexibility to open up large amounts of cap room and pursue star players who will be on the market. Kyrie Irving, Jimmy Butler, and Kawhi Leonard are just some of the All-Star names that the Clippers could look to pursue a year from now.

So, they balked at offering a 5-year max deal to a 32-year-old Chris Paul last summer, opting instead to get assets in an unorthodox opt-in-and-trade deal. They gave Blake Griffin his 5-year max, but quickly turned around and traded him for flexible pieces in January of the first season of his new deal. The Clippers refused to offer DeAndre Jordan the large, long-term extension he was seeking. They were reportedly unwilling to take on Chandler Parsons’ contract in a deal for the 4th overall pick in last month’s NBA Draft. They only made the first year of Avery Bradley’s contract guaranteed, and only brought one-year deals to the table when luring free agent role players Mike Scott and Luc Mbah a Moute this summer.

Much of what the Clippers have done, even when questionable in a vacuum, has been justified through this vision of 2019 cap space. Largely, the fanbase seems to have accepted this strategy and deemed the measures taken by the team consistent with it. So, it seems appropriate to use this overarching strategy as a lens through which to view two pieces of Clipper news from this past weekend: Montrezl Harrell’s new contract, and Tobias Harris’ declined extension offer.

Montrezl Harrell Signs for 2 Years, $12 Million

Montrezl left little doubt last season that he belongs in the NBA. He was a decent, high-energy, part-time backup for a Rockets team in 2017 that played a unique, unconventional, up-tempo, defense-averse style that was particularly suited for an undersized, energetic, and athletic big man. But as a Clipper, he proved that he can excel in more standard NBA settings, filling the traditional role of explosive bench scorer, but doing it from a non-traditional position: center. Montrezl’s scoring was both staggering in efficiency and volume, scoring over 23 points per 36 minutes while maintaining above 63% from the field.

The man entered free agency this July poised to offer undeniable value to any team’s rotation. But contextual issues kept him from being a target for other teams to gamble on with salary cap room. Harrell is undersized at center and, at his best, only average defensively and on the glass. Much of his production is based on energy, which makes the step from “scoring 23 points per 36 minutes” to “scoring 23 points per game in 36 minutes a night” quite large. There’s doubt as to whether he can be a starter, and, well, how much are teams willing to pay for backup centers in today’s league?

That alone wasn’t enough to keep Harrell’s value down, though. What really impacted his free agency was his status as a restricted free agent, giving the Clippers the right to keep him by matching any offer sheet he signed with another team. For the best restricted free agents, rebuilding teams with cap space are often willing to gamble on overpays in an attempt to scare a player’s original team away. But would a team gamble enough to scare away the Clippers just so they could pay a backup center an 8-figure salary? I didn’t think it would happen, and it didn’t. Nobody chased after Montrezl early in free agency with big offers, and the Clippers wisely waited for a market to emerge. I fully suspect that their decision to offer him a 2-year, $12 million deal came as other teams began to discuss similar deals with him (likely at the taxpayer mid-level).

In terms of next year’s cap space, this stings a little bit. At an estimated flat $6,000,000 annual salary, he bites quite a bit into the Clippers’ potential cap room next summer. Even a core of just Danilo Gallinari, Lou Williams, Montrezl Harrell, Shai Gilgeous-Alexander, Jerome Robinson, and the Clippers’ 2019 first round pick leaves the team short of two 30% max salary slots next summer. Now, even if you take Montrezl out of that group and replace him with an empty roster hold (worth about $900,000), the Clippers are short of the $64 million in room necessary to give two veteran free agents maximum-salary deals. However, they would have room to hold on to Tobias Harris’ $22.6M cap hold and have a 30% max slot for one star free agent.

If Harrell had signed his $1.8M qualifying offer, which seemed possible if no decent offers came his way, the Clippers would have had just $3.5M on the books for his cap hold next summer, and then could have used his bird rights to exceed the cap and sign him long-term to a more expensive contract. However, he could have just as easily walked in 2019 as an unrestricted free agent. This plan is a bit of a compromise: the Clippers have to give up a little bit of their 2019 flexibility in order to keep control over Harrell, who is still only 24 years old, for another year. It’s true that the marginal increase ($5.1M more than an empty roster hold, $2.5M more than his cap hold if he had taken the qualifying offer) will have a very small impact on the team salary sheet in a year where the cap is expected to rise to $108 million—but it’s also true that a few dollars here and there adds up and matters in the big picture. While this isn’t highway robbery for the Clippers, they can take solace in Montrezl’s short-term, high-value contract being likely to serve as an asset no matter what direction they go: whether he’s a piece of the core used to entice a star, or flipped for a future asset to make room for one.

Tobias Harris Declines 4-year/$80 Million Extension

The rules around veteran extensions in the NBA’s collective bargaining agreement make deals pretty hard to reach. Teams are only allowed to offer a salary in the first extension year that is equal to 120% of the salary in the final season of the current contract, and raises are limited to the same 8% allowed in any bird rights contract. That means that for most star players who teams are interested in negotiating extensions with, the most that team can offer in an extension is significantly less than the player could get by re-signing with the team in free agency. That was the case several years ago with Blake Griffin and Chris Paul’s first free agency year with the Clippers, it was the case with Jimmy Butler and the Timberwolves a couple of weeks ago, and it’s the case with Tobias Harris now. Those are just a few examples among dozens.

Tobias is set to make $14.8 million next season. 120% of that is $17,760,000, and with 8% annual raises over four years (which, in addition to the final season of his current deal, would bring him to the maximum-allowed 5 years under contract), it would bring a contract to a total value just shy of $80 million. Compare that to what happens next summer: Tobias, with bird rights, would be eligible for a 5-year maximum-salary contract that (due to his NBA experience) could start at 30% of the salary cap. In a year with a $108M cap, that contract starts at $32.4M and is worth $35 million, $37.6 million, $40.2 million, and $42.8 million in each of the subsequent seasons.

Now, while of course we’d love to see the Clippers re-sign Tobias for 4 years and $80 million, we’re all aware that the market value for a 6’9” combo forward who averages 19 points, 6 rebounds, and 3 assists while shooting 41% from three is going to be more than that. At the same time, Tobias knows that a 5-year, $188 million deal is the same exact thing that the Clippers just tried to escape from with Blake Griffin. If they weren’t willing to pay it out to Blake, they certainly won’t for Harris, who has none of the All-Star or All-NBA appearances that Blake accumulated over the years. Still, there’s a lot of middle ground for the two parties to discuss next summer. Harris’ cap hold will be worth 22.6M, meaning that he only takes up that much of the team’s salary figure until the two sides reach an agreement on a new deal. So, if his starting salary is less than that number, it makes sense for the Clippers to sign him first, reducing his cap hit and opening up more space for other moves. But in the far more likely case that he will demand more than his 22.6M in free agency, meaning that the Clippers’ smartest play (assuming they don’t renounce his bird rights to create additional room) will be to sign him after utilizing their cap space.

In that respect, not much has really changed with Tobias. He’ll be a free agent next summer and the Clippers will have to deal with balancing retaining him and luring new free agents, as well as fully assess how willing they are to commit major money to him after trading Blake Griffin in the name of flexibility. It would have been lovely to have Tobias on the 4-year, $80 million extension that the Clippers offered, which would have reduced his cap hit next summer by almost $5 million, but everyone understands that the Clippers aren’t able to make a fair offer until next July. Similarly, it would have been great for the Clippers if Harrell had signed his qualifying offer, reducing his cap hit next summer by $2.5 million.

But on both counts, we got exactly what we should have been expecting for each of these players. Fortunately, the Clippers were in a good spot coming into this summer, with Harrell being restricted and Tobias only owed $14.8 million next year. Next summer, when their only choices may be to overpay Harris or let him walk to a different team’s overpay, the expected outcome may not be enough—they’ll need to make a big, positive move.