A championship team is usually expensive. In 2019, the Toronto Raptors paid $ 25 million in luxury taxes. In 2018, the Golden State Warriors paid $ 32 million. When the Cleveland Cavaliers won it all in 2016, their bill was $ 54 million.
But the Los Angeles Lakers got a somewhat weird feat last season: they won the NBA title without paying the luxury tax.
And that’s good, because trying to turn the LeBron James and Anthony Davis couple into a kind of dynasty could prove very costly. How expensive? The Los Angeles payroll and luxury tax bill could top $ 250 million, just for next season.
Future free agent Dennis Schroder became eligible to sign a contract extension on February 16th. And given the impact he has had as a player in easing the burden on James, the Lakers are encouraged to retain Schroder, a guard they can’t replace through free agency.
Schroder turned down a Lakers preseason offer, and the two sides are expected to discuss it again now, sources told ESPN’s Adrian Wojnarowski in December. But as they get into these conversations, the Lakers need to be on the lookout for books, because the numbers could eventually force some tough decisions.
This past low season, new contracts for Davis and Kentavious Caldwell-Pope, plus the signing of Montrezl Harrell, pushed the Lakers to the luxury tax for the first time since the 2013-14 campaign. Next year will see extensions signed by James and Kyle Kuzma.
Meanwhile, most of the team’s role players (Harrell, Alex Caruso, Markieff Morris, Talen Horton-Tucker and Wesley Matthews) can be free agents. The Lakers also owe Luol Deng $ 5 million for next season.
The 2021 free agent market has been stripped of many of the most important names, as Giannis Antetokounmpo, Paul George, Rudy Gobert and James chose to sign extensions to stay with their current teams. But there could still be 10 teams with $ 20 million or more in the payroll and another handful with more than $ 10 million.
– Los Angeles Lakers (@Lakers) February 28, 2021
That means the Lakers could have competition to keep their role players. As an athletic base he can defend, unrestricted free agent Caruso will have suitors. League executives believe it could attract interest in the full range of mid-level exceptions, which is $ 9.5 million next season. (Caruso currently earns $ 2.7 million).
Horton-Tucker is another player who could have an intriguing free agency next summer. He is averaging just 6.7 points and 2.5 assists, but the teams look at him with interest.
The sophomore winger will be a restricted free agent, which limits the type of offers he can receive and gives the Lakers the ability to equalize, but that doesn’t mean making it easy.
“He’s a talented defender with great length and a great advantage who is only 20 years old. In this market, this is exactly the type of player you want to pursue,” an Eastern Conference executive said. “There could be some teams that put them to the test and give (Horton-Tucker) a bid sheet thinking they could pull it off.”
Horton-Tucker’s salary for the season can’t be higher than the full mid-level exception, which is that $ 9.5 million figure. But rival teams have the option to cancel an agreement, known as a poison pill contract, to make it difficult for teams to equalize. Players like Jeremy Lin and Tyler Johnson have been included in such deals in the past.
In that case, a team that wants to maximize pressure on the Lakers could offer the Horton-Tuckers a deal in the four-year, $ 60 million range, with the last two years reaching $ 19.7 million and $ 20.7 million, respectively.
Then there’s Harrell, who can choose to step out of his contract and receive a payment of up to $ 11,500,000 from the Lakers if they choose to re-sign him. With Marc Gasol at the end of his career and few ways to replace Harrell’s production in free agency, keeping Harrell could also be a priority.
Which brings back the decision that is sitting on the desk of Lakers general manager Rob Pelinka right now: what to do with Schroder.
Last low season, opener-quality escorts like Schroder did well in free agency. Bogdan Bogdanovic secured a four-year, $ 72 million contract with the Atlanta Hawks. Fred VanVleet received four years and $ 85 million from the Raptors. Two years ago, the San Antonio Spurs gave Dejounte Murray a four-year contract worth $ 64 million guaranteed, which could be the lowest point of a Schroder negotiation.
Keeping Caruso, Horton-Tucker, Schroder and Harrell at their potential market values could bring the Lakers ’payroll to $ 150 million. (Gasol’s $ 2.7 million salary is already guaranteed). This is without completing the list with other veterans or without retaining Morris or Matthews.
Once that is done, even with only minimum wages, the Lakers could be looking for a base payroll of around $ 170 million to keep the team intact. Add more than $ 100 million in luxury taxes and your commitments for the season that would raise between $ 250 million and $ 270 million.
The Lakers are an organization with a lot of money. They have the largest local television contract in the league, which pays in the range of $ 200 million annually. Spending has not been a problem in the past. Since the start of the luxury tax in the 2002-03 season, the Buss family has given the green light to more than $ 120 million in total to exceed the salary cap.
However, these numbers are a new threshold that will also result from two years of losses due to the COVID-19 pandemic.
No one should feel bad; the Lakers are one of the richest and most valuable franchises in the world. Its two future members of the Hall of Fame are locked in agreements.
But as the Lakers enter a period when they have to make contractual decisions about most of their team, there could be one or two difficult decisions on hand.
Bobby Marks contributed to this note.