Lakers Math: How far above the luxury tax threshhold is Dr. Buss willing to go?

The Lakers have their 15th World Championship, and it is a spectacular time to be a Los Angelino generally, and a Lakers fan specifically. The parade will be one of the highlights of the year in SoCal, and I'm excited to be a part of our broadcast on 710 ESPN with a position at the Coliseum.

The question is, "Can Dr. Buss and Mitch Kupchak keep this team together?"  I was doing some Laker math today, and it's going to be financially demanding for the Buss family. Here's how I see it.

KOBE BRYANT
He can opt out of the final 2 years of his contract. He's currently set to earn $24M in 2009-2010 and $24.8M in 2010-2011. There's one theory out there that says Kobe could opt out and take less to make it easier for the Lakers to sign Lamar Odom and Trevor Ariza. I believe that's complete "pie-in-the-sky." C'mon. This is potentially Kobe's last big contract. If he opts out, he's in line for 5yrs and $135M - $25M next season, $26M in 2010-2011, $27M in 2011-2012, $28M in 2012-2013 and $29M in 2013-2014. How could you blame Kobe for getting what is rightfully his. God knows that he has earned every penny of it.

TREVOR ARIZA
I've done my own casual analysis, and, given that Trevor earned about $3M this year and that he's only 23yo, 6yrs-$48M seems about right. That would mean $6M next season, $7M in 2010-2011, $8M in 2011-2012, $8.5M in 2012-2013, $9M in 2013-2014 and 9.5M in 2014-2015. It is possible that he could get a much bigger offer somewhere else, and it's conceivable that he would take less to be a part of a very special championship group.

LAMAR ODOM
Made $11.5M this year, and there's a chance that a bad team with a bunch of cap room could make a big offer (Memphis, Charlotte, New Jersey or Minnesota), but that seems unlikely. LO will have to take less. Maybe something like 3yrs-$27M gets it done with a nice club option for 2012-2013 that provides incentive without keeping the Lakers on the hook for a big number for a 33yo Candy Man.

SHANNON BROWN
Appears to be an unrestricted free agent. He made $800,000 this year and was a steal.Possible 2yrs-$5M gets him to stay and develop.

JOSH POWELL
Lakers hold an option for next season at $959,000. That seems like a no-brainer.

These guys are already under contract with their 2009-2010 salary.

PAU GASOL - $16,451,250
ANDREW BYNUM - $12,526,998
ADAM MORRISON - $5,257,258
DEREK FISHER - $5,000,000
SASHA VUJACIC - $5,000,000
LUKE WALTON - $4,840,000
JORDAN FARMAR -$1,947,240

If all of those deals work out in my scenario, the Lakers will have a team payroll of $92,981,746 for next season. That would be $23,581,746 OVER the proposed luxury tax threshhold of $69.4M. The only team with a higher payroll in 2008-09 is the Knicks with $98.4M.

In an ideal world, Ariza, LO and Shannon Brown all return, but this will be a test of Dr. Jerry Buss' willingness to pay a big luxury tax number. In a struggling economy, when league revenues are down, is it unfair to expect any league owner to pay this kind of toll?

Comments

[John Albert Rudoff]

The question is not whether the Buss family can afford to, rather, can it afford not to in a competitive environment where the Lakers represent one of the few successes in a sea of economic failures. @ what price hope? Initiative?

[jason]

I listened to you and Ireland talk about this on the air and I think you're leaving out some very important information when it comes to determining what Ariza and Odom should or could get.

First off, there are only 5 teams that can offer more than $9 million to any one player - Memphis, Detroit, Atlanta (if they don't re-sign any of their free agents), Oklahoma and Portland. The pool of free agents this summer goes beyond just Odom and Ariza.

Second, the teams with that cap space might not even use it this summer or on a free agent at all. Does Detroit go after Odom or Boozer or David Lee this summer or do they see if they can take a shot at Bosh or one of the other 2010 free agents next summer? The cap space can also be used in a trade. Does Oklahoma spend their money on a long contract for a free agent or do they trade with a financially strapped team for a player on a shorter contract like Tyson Chandler?

Third, some teams simply can't afford to spend money. Half of the teams in the league needed a loan just to cover operating costs and I believe Memphis was one of them. Are they really going to be adding to operating costs that they can't afford as it is? That financial situation also gives teams with both the cap space and the ability to use it a great deal of leverage in making trades since they can take on big ticket players and send back nothing or next to nothing, just like Denver did last season with Camby.

You also shouldn't use what comparable players got in previous years as an example. The economy has changed and the market has changed. There are more free agents out there than there are teams with money to spend, so while a Bobby Simmons might have gotten $50 million a few years ago, he would not be able to get near that today. It's no different than the housing market. Just because your neighbor was able to sell his house for $1 million a couple of years ago, doesn't mean you can get that much for the same house now.

And finally, there's the length of the contracts to consider. The current CBA expires in 2010 and it doesn't look like the new one will be more favorable towards the players in terms of salaries, raises or length of contract. There won't be too many teams out there willing to sign a free agent long term only to find out that it cripples them long term once that new agreement comes into play.

[New Jordans]

It's great to hear from you and see what you've been up to. This blog makes me realize the energy of words and pictures. Keep coming up with ideas.

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