NBA Rumors: New CBA Will Create a 'Soft Hard Cap' That Will Rarely Be Exceeded

It's no secret that the NBA's new collective bargaining agreement aims to rein in the teams willing to spend above and beyond in pursuit of a championship. But the league might have succeeded in instituting a de facto hard salary cap.

The Athletic's John Hollinger detailed the new "second apron" that punishes franchises with payrolls in excess of $17.5 million above the luxury tax:

"The result, multiple league sources say, is a tax regime so draconian that even these free-spending clubs may choose not to swim in the deep end. The likely end-game by mid-decade is what might be described as a 'soft hard cap' — one that can be exceeded, perhaps, in some situations, but in reality will be so limiting for most teams, at most times, that they will rarely if ever go beyond it."

Hollinger cited the Los Angeles Clippers and Golden State Warriors as teams that could be impacted the most right away.

The Warriors are currently projected to be $49.7 million above the luxury-tax threshold in 2023-24. Their flexibility moving forward is limited by the fact that they have Stephen Curry, Jordan Poole and Andrew Wiggins on multiyear deals.

The Clippers are projected to be nearly $39.9 million over the tax, and continuing to build around Paul George and Kawhi Leonard will command a high price. The pair have $48.8 million player options for 2024-25 and $51.7 million cap holds for 2025-26 if they become free agents that summer.

Under the current CBA, there wasn't a clear barrier stopping an ownership regime from writing bigger and bigger checks for a contender. Warriors majority governor Joe Lacob is basically doing that now.

Hollinger referenced how NBA owners included far more deterrents in the new CBA, which were reported on previously.

Teams above the second apron won't have the taxpayer mid-level exception to offer to free agents. They can't trade a first-round pick seven years into the future, and that pick will be moved to the back of the first round if they remain above the second apron for multiple years. Teams above the second apron also can't aggregate contracts in a trade for cap purposes, including "aggregating down."

"In other words, a team couldn't trade two players who make $20 million each for one who makes $30 million and one who makes the minimum, even though the net effect would be to lower payroll for a high-spending team," Hollinger wrote.

For as much as some fans have raised concerns over competitive balance in recent years, this season offered some compelling evidence that the status quo was working.

The Clippers are facing another disappointing playoff exit with George and Leonard both sidelined by injuries. The Warriors evened their first-round series with the Sacramento Kings on Sunday but look far from unbeatable. The Brooklyn Nets' experiment with Kyrie Irving and Kevin Durant backfired so spectacularly that it raised questions about the superteam approach.

But financial change is coming anyway.