Future Free Agency Compensation Idea

[BonesJones]

For the past couple days I've been tinkering with an idea to make it easier for teams to rebuild after losing a star free agent. I'm not necessarily saying the current system should change, but I think this would be better for the league as a whole, and something they should consider when they draft the next CBA
Its a little bit of a long read, I tried to condense it while still being as clear as possible
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One thing I think the league has to change is to put free agency before the draft. In my proposal free agency will begin the last Monday of June running a week and a half to the following Wednesday. The draft lottery would be the next day on Thursday. The NBA Draft would be 9 days later on a Saturday.

This year:
June 29th-July 8th: Free Agency
July 9th: Draft Lottery
July 18th: NBA Draft
July 29th-August 6th: Summer League

Now the following is compensation for teams if they have a Free Agent leave in the offseason. Compensation is based off first years salary compared to the max that free agent could've recieved

TIER 1: 87-100% of MAX -
-Receive Compensation 1st round pick(counts as lotto pick, if not top 3, pick comes after last non playoff team, lowest winning% 1st),
-FA's new team's next available 1st round pick (Top 10 protected for current year, then top 6 next year, then top 3 for following years)

TIER 2: 72%-86% of MAX
-Receive Compensation 1st round pick (Starting after Tier 1 Compensation, lowest winning% 1st)
-Recieve FA's new teams next available 2nd round pick

Tier 3: 50-71%
-Recieve 2nd Round compensation (Beginning of Round)
-FA's team forfeits next available 2nd round pick
-Receive trade exception worth 60% of FA's average annual salary

*Compensation gets transferred accordingly based off new FA's acquired
*Sign in trade nullifies compensation of Tier 3 player or higher gets traded to in return.
*If not, compensation is knocked down one tier

CTEs - COMPENSATORY TRADE EXCEPTIONS
-If multiple CTEs recieved, they are combined into one
-Signing a Tier1 FA nullifies CTEs
-Signing a Tier2 FA reduces CTE total by 75%
-Signing a Tier 3 FA transfers the according CTE amount to the other team (say you have $10M in CTE, then sign Tier 3 FA for 1 year, $13M, your new CTE budget would be $2.2M
$10M minus (60% of $13M)

LOTTERY:
The Lottery would expand to include teams that lost Tier 1 and Tier 2 Free Agent's. A percentage of the lottery would be set aside as compensation
-If up to 7 Tier 1 or 2 FA's were signed, 25% would be set aside
-If between 8 and 13 T1 or T2 were signed, 30% would be set aside
-If 14 or more T1 or T2 FA's were signed, 35% would be set aside

COMPENSATION ODDS:
T1= # of Tier 1 FA's
T2= # of Tier 2 FA's
T1(x)= Total Percentage for T1 teams
T2(x)= Total Percentage for T2 Teams
y= % of lottery chance given for compensation

Lottery Chance: T2(x)=y(T2/T1*2)
T1(x): y-T2(×)
Chance Per Team: T1(×)÷T1
T2(×)÷T2

**Basically it doubles odds for teams that lost a Tier 1 Free Agent compared to those who last a Tier 2 Free Agent. The math allots it into the compensatory odds

HYPOTHETICAL EXAMPLE:
Note: This is just an example

(T1 POR) LaMarcus Aldridge MAX Spurs
(T1 CLE) Kevin Love MAX Lakers
(T1 LAC)DeAndre Jordan 19M Celtics
(T2 POR)Wesley Matthews 14.5M Pelicans
(T2 DAL)Rajon Rondo 15M Lakers
(T2 NO)Eric Gordon 10M Pacers
(T1 DET)Reggie Jackson 15M Knicks
(T2 DAL)Tyson Chandler 11M Magic

*New Orleans Compensation for Eric Gordon sent to Portland by signing Wesley Matthews

T1 Blazers 4.5%
T1 Clippers 4.5%
T1 Cavs 4.5%
T1 Pistons 4.5%
T2 Blazers 2.3%
T2 Mavericks 2.3%
T2 Mavericks 2.3%

Y=25/Y=30/Y=35
1: 20%/19%/18%
2: 14.9%/14.1%/13.3%
3: 10.8%/10.1%/9.4%
4: 7.9%/7.3%/6.7%
5: 6.1%/5.6%/5.1%
6: 4.4%/4%/3.6%
7: 3.2%/2.8%/2.4%
8: 2.3%/2%/1.7%
9: 1.6%/1.4%/1.2%
10: 1.2%/1.1%/1%
11: .8%
12: .7%
13: .6%
14: .5%
15* DET 4.5%
16* POR 4.5%
17* CLE 4.5%
18* LAC 4.5%
19* DAL 2.3%
35* DAL 2.3%
36* POR 2.3%

Draft Lottery Simulation
1st: 76ers
2nd: Blazers(T1)
3rd: Heat
4th: T'Wolves
5th: Knicks
6th: 76ers
7th: Magic
8th: Kings
9th: Nuggets
10th: Pistons
11th: Hornets
12th: Pacers
13th: Jazz
14th: Suns
15th: Thunder
16th: Pistons(T1)
17th: Cavaliers(T1)
18th: Clippers(T1)
19th: Mavericks(T2)
20th: Mavericks(T2)
21st: Blazers(T2)
22nd: Hawks
23rd: Clippers(BOS 16th pick)
24rh: Bucks
...
32nd: Grizzlies
33rd: Blazers (SA 26th pick)
34th: Cavs (LAL 27th pick)
35th: Celtics
36th: Nets
37th: Warriors

2nd Round:
38th: Mavs(T2) (LAL loses *34th pick)
39th: Mavs(T2) (ORL loses 2016 2nd R Pick)
40th: Blazers(T2) (NO loses *56th pick)

*Technically 41st and 63rd picks

 

[BonesJones]

Pro's:
-Creates more parity
-Discourages teams from overpaying
-Creates a more entertaining draft lottery
-Creates more avenues for GM's
-Less motivation for tanking (lower chance at winning/top 3)
-Separates playoff and non-playoff teams substantially in way of draft order

Cons:
-Might motivate a team to miss the playoffs instead of getting an 8 seed
-Possibly confusing

 

[PtldPlatypus]

I don't like the idea of teams losing picks if they sign a free agent. That could also hinder a rebuild. It seems that would severely inhibit teams' willingness to pursue other teams' free agents, and I imagine the players' union would strongly oppose such a notion.

 

[BonesJones]

I don't think I team will refuse to sign a LaMarcus Aldridge because they'll miss a chance to draft a Sam Deckker. You could make the first round pick they lose lottery protected, and I don't think that having the chance to sign a bona fide all star would be passed up because teams wanna draft someone who has a small chance to be one

 

[PtldPlatypus]

I more see it as penalizing the Hornets for signing Al Jefferson and Lance Stephenson, or the Blazers for signing an Andre Miller or a Wes Matthews. Small-market teams often have to overpay to get a decent free agent, and this system would make that overpayment even more significant.

 

[BonesJones]

I more see it as penalizing the Hornets for signing Al Jefferson and Lance Stephenson, or the Blazers for signing an Andre Miller or a Wes Matthews. Small-market teams often have to overpay to get a decent free agent, and this system would make that overpayment even more significant.

Blazers wouldn't have lost anything for Wes or Miller. It's only designed to take away a pick for a neat max player ($17M+)

 

[RR7]

I like the overall concept, but would definitely ned some tweaking. It's similar to what MLB does now. The biggest difference is how much more valuable draft picks are in the NBA, with the much smaller rosters and only 2 rounds. I think this is an idea that would need to be combined with the creation of a full minor league system, and 3 rounds of the draft, with picks likely coming in the 2nd instead of 3rd perhaps.

 

[PtldPlatypus]

Blazers wouldn't have lost anything for Wes or Miller. It's only designed to take away a pick for a neat max player ($17M+)

You have teams signing tier 2 and tier 3 free agents forfeiting second round picks as well.

Again, my main point is that anything that essentially penalizes teams for spending big money on free agents is going to be seen as hindering free agency and absolutely opposed by the players union.

 

[RR7]

You have teams signing tier 2 and tier 3 free agents forfeiting second round picks as well.

Again, my main point is that anything that essentially penalizes teams for spending big money on free agents is going to be seen as hindering free agency and absolutely opposed by the players union.

Agree with that, on the union. I'd think teams don't lose their picks at all for signing a free agent, but teams that do lose one get a compensatory pick maybe, in between round 1 and round 2, and then 2 and 3, depending on caliber

 

[KeepOnRollin]

I agree that there definitely aren't enough roster spots in the NBA to go to 3 rounds of the draft without also going to a true minor-league system.

 

[BonesJones]

It's not 3 rounds. It's 5-15ish picks added as compensation. Obviously theta a lot to it that would have to be tweaked just right. I like the idea of giving a compensation pick at the end of the lottery with a chance to win it. Would lessen the blow of losing a good FA. Maybe you don't take away picks, but u think compensation in way of draft picks and trade exceptions would create more parity and make for a more balenced league.

Idea: For a Tier 1 Free Agent, make the 1st round pick the team loses lottery protected. Usually if you sign a max FA you'll be in the playoffs. For Tier 2 (contracts around 14M-16M), don't dock a pick.
Tier 3 the other team recieves a Trade Experiment

I think the lotto system for compensation is a good idea, but what do yall think?

 

[3RA1N1AC]

I think compensatory picks after the lotto picks might work. If your team loses a max guy, you slot in an extra pick there.

How baseball does it, is if you designate a player with a qualifying offer, the other team loses their pick (top 10 protected) and your team gets a pick after the first round, before the 2nd round.

Then again, that's been a train wreck, and will probably be changed next cba.

 

[BonesJones]

I think compensatory picks after the lotto picks might work. If your team loses a max guy, you slot in an extra pick there.

How baseball does it, is if you designate a player with a qualifying offer, the other team loses their pick (top 10 protected) and your team gets a pick after the first round, before the 2nd round.

Then again, that's been a train wreck, and will probably be changed next cba.

Only problem is if teams would sign a guy a dollar under a max contract to avoid that team getting a compensation pick So maybe set is as 80% of the max you get a compensation pick. That way you got room to outbid teams, so it's risky trying to sign a guy at 79% because another team might pay 80% or more if they don't care about if there's compensation picks added.