Rounding Up RFAs the Right Move

Credit: ESPN.com

The deadline for re-signing upcoming restricted free agents (RFAs) came and went at midnight Wednesday night (or Thursday morning, same thing) and many intriguing potential free agents declined that opportunity by committing to long-term deals with their teams. These players are James Harden (with his new team), Ty Lawson, Stephen Curry, Taj Gibson, Jrue Holiday, and DeMar DeRozan. That these teams wrapped up their free agents at market value or higher suggests that restricted free agency may no longer be a safety net for teams who have them.

Historically, RFAs have very little leverage in contract negotiations. Their teams have the right to match any contract offer, and since it would take a complete overpay from another team to force the rights-holding team from matching, usually little movement occurs. The most notable exception comes via the Poison Pill Provision (PPP) of the NBA’s Collective Bargaining Agreement, which was used by Houston to obtain Jeremy Lin and Omer Asik this summer and by Toronto when signing Landry Fields. However, the PPP couldn’t be used with any notable RFAs this coming summer, as all were first round draft picks who are not subjected to the PPP.

So why did teams decide to re-sign these free agents? Well, it’s difficult to narrow it down to just one reason. One notable factor is that a crapton of teams have significant cap space for next summer. According to John Hollinger (insider only), as many as 13 teams should have enough cap room to sign a player to a max contract just this summer. Some, such as Utah, Cleveland, Detroit, New Orleans, and now Houston, have a young core in place and would like to add some missing pieces who also happen to be young. Others, such as Charlotte and Orlando, just need as much talent as possible and might be willing to pay for it. Given that the unrestricted free agent market looks awfully barren (hello, bidding war for Josh Smith’s services!), you get an environment where even a below-average player like DeMar DeRozan gets a ton of money just because a team can spend it.

One ongoing example of the market going crazy is the Eric Gordon saga in New Orleans. Because of his injury history, they refused to give him a contract before the deadline last year. He played nine games at a decent level last season. But because they let him get to free agency, he received a max contract offer from Phoenix. The Hornets didn’t want to lose him without receiving compensation, so they were practically forced to match. Now, with knee injuries still nagging Gordon and his future in doubt,  the Hornets have little to work with and a lot of money to pay. The biggest peril of letting the market set the price is that the market for free agents might be inflated. Now that Gordon’s injured goods, the Hornets might regret not locking him up. While the Warriors did the same for Curry, they paid less than his on-court value because his health remains a question.

A second factor for the surge in signings could be a premium for youth. With the notable exception of an older but very valuable Taj Gibson (whose contract is, for my money, the best among all these), the newly signed players have yet to reach age 25. Stephen Curry and Ty Lawson are 24. James Harden and DeMar DeRozan are 23. Jrue Holiday is just 22. As rookie contracts have shortened under recent CBAs, and as most impact players now leave after just one year of college, youth hits the free agent market earlier than ever. Signing rookies to extensions prevents this happening, though at the cost of paying more for their services than their production warrants.

And third, another factor may be that all are considered key pieces of the future of their teams. The three point guards are expected to lead their team to the playoffs this year and down the road. Toronto expects DeRozan to be among the leaders of a rising contender, brimming with youth. Houston expects Harden to be the star the team builds around. And Chicago expects Taj Gibson to be the part of the backbone of one of the league’s stingiest defenses for years to come.

Upcoming free agents who haven’t re-signed mostly have questions about their places in the future of their franchises. For the re-signed players, the franchises gave indications that they wanted the players long-term. Tyreke Evans’s place in Sacramento’s future remains a mystery. They have no position for him now and look to have found someone else (DeMarcus Cousins) to build their team around. For someone like Brandon Jennings, who has a bit of an inflated sense of his self-worth, his team has no real direction, and despite having talent to build around they haven’t committed to any one plan. Jeff Teague’s Hawks just recently made several major personnel moves, and the team isn’t quite sure how it will look in the future.

Simply put: the teams that re-signed their players consider them part of the future and, even if some overpaid (mainly Philadelphia and especially Toronto), the market would have overpaid in place of the teams. And since they planned on retaining their players anyway, re-signing the players was the right move.

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