$200 million for Durant? It doesn’t add up

“Could Kevin Durant ink a $200 million deal in 2016?”

That’s the text of a tweet from Sports Illustrated. Chris Mannix wrote that “several executives believe a max deal for Durant in the new TV revenue-infused market in 2016 could be worth in the neighborhood of $200 million over five years.”

I thought that number sounded awfully high, so I decided to dig in deeper.

After the 2015-16 season, Kevin Durant will have 9 Years of Service in the NBA. Thanks to this chart from Larry Coon’s salary cap FAQ, we see that Durant’s maximum salary will be either 105% of his 2015-16 salary or roughly 30% of the 2016 salary cap, whichever is higher. I say “roughly” because a different formula is used to calculate maximum salaries, so the actual number is lower. Maximum salaries used to be an exact percentage of the salary cap, but these two numbers became decoupled back in 2005. For this example, I’m using 28%, which could be on the high side, as Brian Davis might say.

Durant’s salary in 2015-16 will be $20,158,622. 105% of that is $21,166,533. That’s his worst-case maximum salary scenario for 2016.

However, a tidal wave of money is coming into the NBA and it will splash the league in 2016, creating a giant pool of money for all to swim in. It could cause the salary cap to take a massive one-year jump, though it’s possible that the league and players agree to phase this in. Zach Lowe of Grantland wrote about the potential of a salary cap that would “break $90 million.” Tom Ziller of SBNation ran the numbers and came up with a potential salary cap of $94 million. For the sake of argument, let’s call it an even $90 million.

In that scenario, with my “28% of the salary cap” figure, Durant would be eligible for first-year salary of $25,200,000. He could get maximum annual raises of 7.5% off that base salary, or $1,890,000 per year. Add it up over five years – only Oklahoma City will be able to offer him a five-year contract – and the total is $144.9 million. Not bad money if you can get it, but it’s well short of $200 million.

(For those who are certainly wondering: if Durant bolted for another team, he’d be eligible for the same max salary, but he could only get a four-year deal with 4.5% raises instead of 7.5%. In that case, using these numbers, he’d be eligible for a four-year contract worth a little over $107 million.)

The only way I could get Durant to this theoretical $200 million was by jumping the salary cap to $125 million in 2016. I don’t see any way that’s going to happen. The salary cap for 2015-16 is projected to be $66 million. I can’t imagine any realistic scenario where the cap would nearly double in one year.

Maybe I’m overlooking something obvious here. Maybe these executives know something that I and people a lot smarter than me don’t know. Unless other significant sources of Basketball Related Income are on the way, the “$200 million” figure doesn’t add up.

And one final note: as I alluded to above, the league is interested in preventing such a massive leap in the salary cap. They are working with the players on ideas to “smooth” in this new money over a few years, resulting in artificially lower salary cap and maximum salary numbers. The two parties could come to an agreement on how to handle this over the All-Star break. That could render all of my number crunching moot and create a scenario where Durant collects LESS money.

Salary Cap $90,000,000

Annual Salary
$25,200,000
$27,090,000
$28,980,000
$30,870,000
$32,760,000

Total $144,900,000

Salary Cap $125,000,000

Annual Salary
$35,000,000
$37,625,000
$40,250,000
$42,875,000
$45,500,000

Total $201,250,000