NBA Expansion Series: Expansion Draft Rules

Keith Smith
Keith Smith, Resident NBA ExpertDecember 06, 2023
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NBA Expansion is coming. On Tuesday, December 5 in an interview with SiriusXM NBA Radio, NBA commissioner Adam Silver all but confirmed the NBA will expand. Silver didn’t make any commitments, but he again referenced Las Vegas and Seattle as potential cities and reaffirmed a post-new media rights deal timeline.

In Part 1 of our NBA Expansion series we talked how NBA expansion works, including potential timelines and how the bid process will work.

Now, we’ll cover the rules for an Expansion Draft and how Protected Player Lists actually work. The goal here is to educate anyone who is inclined to write about expansion or to undertake a mock expansion draft. This will hopefully serve as a guide to making those exercises as accurate as possible, while also providing some history behind previous Expansion Drafts.

(Note: This is assuming that the NBA follows the same rules that they have for previous expansion drafts. There is no indication that the league will change any of the rules or processes ahead of a new round of expansion.)

Timing of an Expansion Draft

Following past practices, the NBA will approve the addition of Expansion Teams a year or more ahead of them beginning play. Once teams are approved, the league will set a date for the Expansion Draft. This will take place in advance of that year’s NBA Draft.

In an ideal world, the NBA would likely want to schedule an Expansion Draft to take place in between the end of that year’s NBA Finals and the NBA Draft. This will allow for the Expansion Draft to take place without distracting from the Finals, but in advance of the Draft. With news that the league is considering a two-night NBA Draft, timing of each event can be sequenced to allow for maximum prep time.

(In 2004, the Expansion Draft was scheduled to be held on June 22, with a one-day pushback to June 23 if the 2004 NBA Finals went to a seventh game. That year’s NBA Draft was held on June 24. As the 2004 NBA Finals did not go to a seventh game, the Expansion Draft was held on June 22, with the NBA Draft on June 24.)

NBA teams would be given a deadline to submit Protected Player Lists in advance of the Expansion Draft, likely somewhere in the range of a week ahead of the Expansion Draft. To the best of our exhaustive research and knowledge, this information, both the deadlines and the lists themselves, have not been made public. Some partial lists exist, but the NBA has never made them publicly available.

Protected Player Lists

Each of the NBA’s existing 30 teams will be allowed to protect players ahead of an expansion draft. Teams are allowed to protect players who fit one of the following categories:

  • Players under contract

  • Players who are restricted free agents (there is a quirk to this that we will cover next)

  • Players who have a player or team option for the following season

  • Any player who is a pending unrestricted free agent cannot be protected

There are some more rules related to protecting players:

  • Each team can protect up to eight players (but can choose to protect less)

  • Each team must expose at least one player (but can choose to expose more) that can’t become an unrestricted free agent

  • If a restricted free agent is drafted, they automatically become an unrestricted free agent (if selected, the former restricted free agent can not re-sign with their original team)

  • Player status is as of the day of the draft (this pertains to players with player or team options)

Expansion Draft Order

As for the draft process itself, it’s fairly simply. In past expansions that featured more than one team, the NBA held a coin flip between the two teams. The winning team was given the option to select either the higher pick in that year’s NBA Draft or the higher selection in the Expansion Draft.

Note: Expansion teams are often saddled with conditions on how high they can select in a draft. Here are some examples:

  • 2004: The Charlotte Bobcats were given the fourth overall pick in the 2004 draft

  • 1995: The Toronto Raptors and Vancouver Grizzlies were given the sixth and seventh overall picks and were restricted from picking first overall for their first four years in the NBA

  • 1989: The Minnesota Timberwolves and Orlando Magic were given the 10th and 11th overall picks

  • 1988: The Charlotte Hornets and Miami Heat were given the eighth and ninth overall picks

In 1995, when the Toronto Raptors and Vancouver Grizzlies joined the league, the Grizzlies won the coin flip. They chose to have the higher pick in the 1995 NBA Draft, which gave Toronto the first pick in the 1995 Expansion Draft.

In 1989, when the Minnesota Timberwolves and Orlando Magic joined the NBA, the Magic won the coin flip. They chose to have the first pick in the 1989 Expansion Draft. That gave the Timberwolves the higher pick in the 1989 NBA Draft.

In the prior year in 1988, when the Charlotte Hornets and Miami Heat joined the NBA, the Hornets won the coin toss and selected to have the higher pick in the 1988 NBA Draft. That gave the Miami Heat the first pick in the 1988 Expansion Draft.

The Expansion Draft

Once the draft order is set, the teams are set for the draft. This is done in a back-and-forth order, not in a snake draft format. Here are some of the rules for the Expansion Draft:

  • Each NBA team can only lose one player from their unprotected list. Once a player has been selected, the remaining players from that team are removed from eligibility to be selected.

  • If a team is over the cap and has a player selected, they receive a Traded Player Exception (TPE) for the exact value of that team’s salary. (Note: This does not apply to restricted free agents. It must be a player who is under contract for the over-the-cap team to receive a TPE.)

  • The teams then alternate selections until one player has been selected from each team. In the case of the Charlotte Bobcats in the 2004 Expansion Draft, they selected 19 players and the draft was then ended. Charlotte could have selected between 14 and 29 players, but chose to stop at 19 selections.

  • Morbid as it may be, the NBA reserves the right to conduct a similar process in what they call a “restocking draft”. This process would be undertaken should a team suffer a tragedy that permanently prevents five or more players from being able to play (death, dismemberment or permanent disability).

You might be wondering what happens if a team has more than eight players that they want to keep. If that is the case, the existing team can work a deal with one, or both, of the expansion teams to select or not select certain players.

How this has worked in the past is the team has made a trade with one of the Expansion Teams to select a certain player, or to not select certain players. Here’s a brief example of pre-Expansion Draft trades that teams have made with this in mind:

  • 2004: The Bobcats acquired the second overall pick in the 2014 NBA Draft from the LA Clippers in exchange for the fourth overall pick and the 33rd overall pick in the 2014 NBA Draft. As part of the deal, the Bobcats agreed to select Predrag Drobnjak in the draft. (The Bobcats drafted Emeka Okafor and the Clippers selected Shaun Livingston and Lionel Chalmers.)

  • 2004: The Bobcats agreed to select Jahidi White from the Phoenix Suns in exchange for a future first-round pick. (That pick conveyed in 2005 and Charlotte drafted Sean May.)

  • 1995: The Grizzlies agreed to select Rodney Dent from the Orlando Magic in exchange for a future second-round pick. (That pick conveyed in 1996 and Vancouver drafted Randy Livingston.)

In addition, teams will sometimes make selections during the Expansion Draft with future trades in mind. The Charlotte Bobcats made two such select-and-trade deals in 2004:

  • The Bobcats selected Zaza Pachulia from the Orlando Magic. Pachulia was then traded to the Milwaukee Bucks in exchange for the 45th overall pick in the 2004 NBA Draft. (Charlotte drafted Bernard Robinson.)

  • The Bobcats selected Sasha Pavlovic from the Utah Jazz. Pavlovic was then traded to the Cleveland Cavaliers for a future first-round pick. (That pick conveyed in 2007 and Charlotte drafted Jared Dudley.)

On the flip side, existing teams will often leave players unprotected in an Expansion Draft that are have an undesirable contract. A team could attempt to incentivize an Expansion Team to select that player by offering a draft pick or another player in a trade. If that happens, the existing team removes the salary from their books and, if over the cap, creates a TPE for the amount of the selected player’s salary.

Post-Expansion Draft

Once the Expansion Draft is complete, the Expansion Teams more or less run like every other NBA team. Expansion Teams do work under a reduced salary cap (as well as a salary floor that is 90% of the Expansion Team’s cap) for their first two years of existence. In Year 1, Expansion Teams are limited to 66.6% of the league-wide salary cap. In Year 2, that goes up to 80% of the league-wide salary cap. In Year 3, everything normalizes, and Expansion Teams are treated the same as the rest of the league.

(Note: The above is a change from the previous of a Year 1 cap of 80% of the league-wide salary cap and a Year 2 cap of 90% of the league-wide salary cap for Expansion Teams.)

As noted above, if a team selects a restricted free agent, that player becomes an unrestricted free agent. That player cannot re-sign with the team they were with pre-Expansion Draft. The Expansion Team would have their unrestricted free agent rights (Bird, Early Bird or Non-Bird) as appropriate, and a corresponding cap hold.

If a team selects a player with a player or team option, that player or team can still choose for the player to become a free agent by not exercising their option. The Expansion Team would then have their unrestricted free agent rights (Bird, Early Bird or Non-Bird) as appropriate, and a corresponding cap hold.

If an Expansion Team waives a player they selected in the Expansion Draft prior to the beginning of the season, that player’s salary is removed from their cap sheet. The player is still paid, and the salary still counts towards the team’s salary floor, but the team no longer has a cap hit for the waived player.

What’s Next

Now that we’ve covered the timeline and process for expansion, as well as the rules for an Expansion Draft, we’ll move into some of the strategy components in future articles in the series.

In the next installment, we’ll cover what the cap sheet for an Expansion Team would look like in Year 1 and Year 2. We’ll do a couple of mock examples to explain how an Expansion Team might handle their cap in Year 1 and Year 2. We’ll do these examples as if Expansion was happening this coming year, ahead of the 2024-25 season. That way, we can use real world examples as far as players and salaries go.

After that, we’re going to dive deep into the history and strategy of the past couple of rounds of expansion. We’ll cover protected lists (to the extent we are able, as this information is not publicly available) and the Expansion Draft strategies themselves. We’ll look at this both for the Expansion Teams, as well as the existing teams.

Then we’ll look at the post-Expansion Draft work that teams did and what their inaugural rosters looked like. From there, we’ll examine how long it took Expansion Teams to become competitive: How long before the playoffs are a reality? How long before the team won a playoff series? And when did they become a real contender?

Then, we’ll start the Mock Expansion Draft process. We’ll put together some Mock Protected Player Lists (based off current rosters) and the strategy behind them. And then we’ll run a Mock Expansion Draft, and explain the strategy that we took for each team involved. We’ll do several versions of this, right up until we have Expansion for real!

 


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