2024 NBA Spending Power Projections: Post Draft Lottery Update

Keith Smith
Keith Smith, Resident NBA ExpertMay 12, 2024
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The 2024 NBA Draft order is almost fully set after the Draft Lottery saw some excitement. The Atlanta Hawks jumped from the 10th overall pick to the first overall pick. The Houston Rockets (via the Brooklyn Nets) jumped from the ninth overall pick to the third overall pick. And the San Antonio Spurs run of draft luck continued, as they not only jumped from the fifth overall pick to the fourth overall pick, but they also got the Toronto Raptors pick, when it slid down to the eighth overall pick.

The only remaining draft pick item is whether or not the New Orleans Pelicans will take the Los Angeles Lakers pick at 17th overall, or if the Pelicans will defer that pick to the 2025 NBA Draft. New Orleans has until June 1 to make the decision. Most expect the Pels to defer, given the projected strength of the 2025 draft class compared to this current one.

As the Pelicans decision won’t have any meaningful impact on our projections here, it’s time to update the projections.

A few notes:

  • We are using the NBA’s official projections for the salary cap and tax lines. Some are projecting greater growth than the 3.5% represented here, but we will always use the official projections from the league.
    • Salary Cap of $141,000,000
    • Luxury Tax of $171,315,000
    • First Apron of $178,655,000
    • Second Apron of $189,485,000
  • Max salary tiers grow with the cap. They are as follows:
    • 0-6 Years of Service: $35,250,000
    • 7-9 Years of Service: $42,300,000
    • 10+ Years of Service: $49,350,000
  • A projection has been made on all 2024-25 player and team options. Similarly, a projection was made on all partial and non-guaranteed contracts. And, finally, a projection made on renouncing free agents has also been made for cap space teams.
  • No trades, extensions or signings have been projected. Essentially, rosters are as they stand at the time of publication.
  • With the advent of the new CBA, the landscape has changed around the NBA. There used to be three basic categories of teams each summer: Cap Space teams, Non-Taxpayer Mid-Level Exception teams and Taxpayer Mid-Level Exception teams. Each season there would also be a handful of “swing” teams that could fall in one bucket or another.

In this new world, we have a fourth category: Second Apron teams. These are the NBA’s most expensive teams that the new CBA was largely designed to punish.

Under the new CBA, if you are at or over the second apron, you lose access to the Taxpayer MLE. In addition, the trade rules tighten up for these teams. Salary-matching in trades is limited to 100%, they aren’t allowed to aggregate salaries together in trades, they can’t participate in sign-and-trade deals, they can’t send out cash in trades (no more buying draft picks!) and they won’t be able to use TPEs.

Essentially, Second Apron teams are going to limited to re-signing their own free agents, making trades where they take back the same money as they send out (or less) buy trading one player out, signing their own draft picks and signing players to minimum salaries.

With all that said, here is the updated projected spending power for each NBA team in 2024 free agency!

Cap Space Teams (6)

  1. Detroit Pistons: $64.4 million

  2. Philadelphia 76ers: $61.3 million

  3. Utah Jazz: $38.3 million

  4. Oklahoma City Thunder: $35.3

  5. Orlando Magic: $25.2 million

  6. San Antonio Spurs: $21.3 million

This is the smallest group of teams we can confidently project to have cap space in a decade of doing this exercise. As more and more teams prioritize extensions and trades, cap space (and the number of impact free agents) has dried up. Still, as we write every time we talk about cap space, having this kind of room doesn’t just mean signing free agents. Cap space can also be used to facilitate trades, either for yourself or others.

The Pistons jumped up to the top of the list after a series of moves where they shed some long-term money to create even more cap flexibility. As it stands now, the only non-Rookie Scale player Detroit projects to have on their roster is Isaiah Stewart, who is starting a four-year, $60 million Rookie Scale extension. Simone Fontecchio will probably get a qualifying offer, as the third-year NBA player is the closest thing this roster has in terms of age and experience. Dropping back in the draft from the first pick to the fifth pick increased Detroit’s spending power by over $4 million. That makes for yet another year of massive amounts of cap space for Troy Weaver to work with.

The Sixers have been bandied about as having double-max cap space and the like for months now. For a while, that seemed extremely unlikely. It’s still not really a thing, but they can get close. There’s a world where the only salary commitments Philadelphia has on the books are Joel Embiid at $51.4 million and Tyrese Maxey’s cap hold at $13 million. That would see the Sixers able to create nearly $65 million in space. That’s still not double-max cap space, but it’s really, really close. We’re going to stay a bit more conservative and project the 76ers to also keep Ricky Council IV and their draft pick, and that will put them at just over $61 million in space.

Utah made some moves to clear out a little long-term salary, or at least salary questions, at the deadline. That sees the Jazz set up to have over #38 million million in cap space. Danny Ainge is talking about going star-hunting this summer. If that fails, a large chunk of that will probably be reserved to do a renegotiation-and-extension with Lauri Markkanen. Even after that, Utah should still have a nice amount left over after to do some more work with.

Oklahoma City hasn’t seen enough from Gordon Hayward post-trade deadline to keep him on the books. They should hit the summer with only a few open roster spots and about $35 million to spend. That’s terrifying for the rest of the league, considering how well this extremely young team is already performing.

Orlando comes in fifth in cap space projections by virtue of having a roster full of players on rookie scale contracts and team-friendly deals. This includes all of the Magic’s best players. In the recent past, Orlando has eschewed cap space to re-sign or extend their own players. That seems poised to change, as the Magic are finally in position to really push the rebuild forward with an impact addition or two. And they need to do that before they have to start extending players like Franz Wagner and Paolo Banchero in coming years. In order to create meaningful space, Orlando will have to move on from one, or both, of Markelle Fultz and Jonathan Isaac. Both players have been extremely injury prone during their Magic tenure. One thing to keep an eye on: Orlando could let both go for cap space (renouncing Fultz and waiving Isaac), then bring them back on new deals at lower numbers, but with additional years added on. Fow now, we’re projecting Fultz is renounced as a free agent, but Isaac sticks around for the final season of his contract.

San Antonio could stay over the cap, if they wanted to keep their non-guaranteed and partially-guaranteed players. But having over $21 million to spend, along with two more lottery picks, puts the Spurs in position to add talent as they attempt to climb up in the Western Conference standings.

Cap Space – Non-Taxpayer MLE Swing Teams (2)

  1. Charlotte Hornets

  2. Toronto Raptors

Charlotte is in a bit of a weird spot. For another season, the Miles Bridges question hangs over this team. He signed the qualifying offer, so Bridges will be an unrestricted free agent next summer. Signs are pointing toward Bridges and the Hornets wanting to sign a new contract. If that happens, the Hornets will operate as an over-the-cap team. After dropping in the lottery, if Charlotte moves on from some players (including Bridges), they can create about $33.8 million in cap space. Keep an eye on this situation, especially with a fresh start in ownership, the front office and the coaching staff.

We’re now projecting the Raptors to forgo cap space this summer. This over-the-cap projection accounts for picking up Bruce Brown’s team option. Once Toronto signed Kelly Olynyk to his extension, that signaled they’ll probably stay over the cap and pursue upgrades via trades and value signings. If the Raptors were to decline Brown’s option, and waive/renounce other players (except for Immanuel Quickley), they could create $29.8 million in cap space. Keeping Brown, and others, is probably the better path forward, so we’ve updated this projection accordingly.

Non-Taxpayer MLE Teams (6)

This is usually the largest group of teams we have, and it may well still end up that way. But for now, we can confidently project only six teams to be in range of using the full Non-Taxpayer MLE.

  1. Brooklyn Nets

  2. Houston Rockets

  3. Indiana Pacers

  4. New York Knicks

  5. Sacramento Kings

  6. Washington Wizards

All six of these teams have two things in common: They look to have only handful of roster spots to fill and they have plenty of clearance under the first apron. That puts all of these teams in range to use the full Non-Taxpayer MLE without tripping into any hard cap issues.

In addition, unlike the swing teams, there isn’t a reasonable path to cap space for any of these teams. Indiana would be the closest, but they’d be punting on some valuable players to create cap space. That seems highly unlikely. Houston and Washington could have been swing Cap Space-Non-Taxpayer teams, but both took on money for next season in trades that has them likely to stay over the cap.

Non-Taxpayer MLE – Taxpayer MLE Swing Teams (3)

This group is close to tripping into the luxury tax, or even over the first apron. Most of that is related to pending free agents that these teams could re-sign. And for a handful, they are close enough to the first apron, that the hard cap would become an issue if they used the Non-Taxpayer MLE.

  1. Chicago Bulls

  2. Cleveland Cavaliers

  3. New Orleans Pelicans

The Bulls, Cavaliers and Pelicans are all going to have free agent decisions to make. If they re-sign, or extend, those players to expected-value contracts, they’ll be butting up against the tax or even the first apron. That will take them out of range of using the Non-Taxpayer MLE.

The lone exception here is if Chicago were to lose DeMar DeRozan. If that happened, the Bulls would have more than enough room to use the full Non-Taxpayer MLE. That situation could resolve itself early, however, if DeRozan and the Bulls can reach an agreement on an extension.

Taxpayer MLE Teams (5)

The addition of the second apron has created a smaller-than-usual window for teams to be in position to use the Taxpayer MLE, but without creating issues against the second apron hard cap.

  1. Atlanta Hawks

  2. Dallas Mavericks

  3. Golden State Warriors

  4. Miami Heat

  5. Portland Trail Blazers

The Hawks are in a tricky spot. As it stands, they have a pretty small window to work within. And that’s before re-signing Saddiq Bey. But Atlanta also seems pretty likely to move off some long-term salary this summer. That could free up some much-needed flexibility. But dancing around the tax and the first apron is still pretty likely too. This only increased after jumping from the 10th overall pick up to the first overall pick. That added over $7 million to the Hawks books (from $5.5 to $12.6 million) for this upcoming season.

The Mavericks project to be around $13 million under the second apron, but they also only have a few roster spots to fill. That leaves enough room to use the Taxpayer MLE to add a player, with enough wiggle room to stay under the hard cap that would be created at the second apron.

We’ve moved the Warriors into this group. They continue to publicly indicate that they are going to get under the second apron, if not out of the tax entirely this summer. That would mean moving on from Chris Paul (he’s got a fully non-guaranteed $30 million contract) and re-signing Klay Thompson for roughly half what he makes now. That’s not really unrealistic, so we’ll take Golden State at their word and move them out of the second apron group.

Miami is always active and chasing upgrades. But they’ll be doing so while dancing around the first apron. It’s unlikely they’ll end up over the second apron, but it’s something to keep an eye on.

It might be a surprise to see the rebuilding Trail Blazers in this spot, but they took on a good amount of salary in the Damian Lillard trade, and the subsequent Jrue Holiday trade. Portland also re-signed Jerami Grant to a big contract too. And, somewhat surprisingly, the Blazers didn’t make any big moves at the trade deadline. As it stands, Portland sits just over the luxury tax line. That won’t be a thing for long, as a rebuilding team can’t pay the tax. But it will limit what kind of spending power Portland has this summer. Instead of free agent signings, look for the Trail Blazers to keep retooling their roster through trades.

Second Apron Teams (8)

This is our largest group of teams for 2024 offseason projections. This is a direct result of two things. First, the second apron exists now, and some teams are over or up against it. Second, several teams took the “gap year” (or maybe better put the “get your books in order year”) to load up. That’s got us in a spot where almost one-third of the league will be unable to add a free agent for more than the minimum this summer.

  1. Boston Celtics

  2. Denver Nuggets

  3. LA Clippers

  4. Los Angeles Lakers

  5. Memphis Grizzlies

  6. Milwaukee Bucks

  7. Minnesota Timberwolves

  8. Phoenix Suns

All eight of these teams are already over or right up against the second apron. Or they will be once they re-sign some key free agents. From there, this group will be limited to re-signing their own free agents, making trades where they take in similar (but not more) money, signing their own draft picks and signing players to minimum contracts.

Something to keep an eye on: Some of this group underwhelmed in the postseason (Clippers, Lakers, Bucks, Suns). That means they could look to move a player or two to start the process of cleaning up their cap sheet. But most of these teams are contenders, or could be contenders with better health or a roster move or two. That’s going to keep most, if not all, of them in a position to remain pretty expensive.

 


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