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Soft Cap

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Definition: The NBA's salary cap is described as a "soft" cap; that is, there are a variety of methods teams can use to exceed the cap in any given season.

The salary cap for the 2010-11 season was just over $58 million. But the Los Angeles Lakers spent $91.6 million on player salaries, the Dallas Mavericks $90.7 million, and the Orlando Magic $89.1 million. Only six of the NBA's 30 teams - the Thunder, Bulls, Cavaliers, Timberwolves, Clippers and Kings - spent less than $59 million on player payroll.

Salary Cap Exceptions

There are quite a few ways NBA teams can exceed the salary cap, but most of them have to do with signing free agents. Some of the most common exceptions include:
  • The "Larry Bird" exception, which allows teams to exceed the cap to re-sign their own players
  • The "Mid-Level" exception, allowing teams to exceed the cap in the amount of the NBA's average player salary for that year. The mid-level exception can be given to one player or split between several.
  • The rookie exception, which allows teams to sign their draft picks even if doing so would exceed the salary cap.
  • The minimum-salary exception, which allows teams to sign players to two-year contracts at the league minimum salary even when over the cap.
The owners' initial proposals for a new collective bargaining agreement reportedly eliminate all of these exceptions in favor of a "hard" salary cap that cannot be exceeded for any reason. The National Hockey League employs a hard cap, as did the National Football League, until their collective bargaining agreement lapsed.
Examples:
The NBA Players Association, understandably, wants the next collective bargaining agreement to employ a soft cap on player salaries.
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