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How Does the NBA Stretch Provision Work?

There are times when NBA teams take a huge leap on a player during free agency, signing him to a massive contract with big expectations. Unfortunately due to age, health or fit those players can wind up underperforming drastically and it leaves the organization in a tough situation with their salary cap sheet. This is something that the stretch provision can help out with.

How Does the NBA Stretch Provision Work? The NBA stretch provision was completely revamped in 2011 by the CBA. This type of provision allows teams to waive or release a newly signed player from their roster while still being able to spread out their remaining guaranteed salary. For example, if a player has a really bad year for his given team, they can decide to cut him from his one-year, $12 million deal. When doing so, they can choose to pay him $4 million across three seasons and lessen their total cap hit for the time being.

There are a lot of players that have been moved onto the stretch provision over the course of the NBA. Along with looking at  some of them, we will be diving deeper into the stretch provision and looking at why this is actually a benefit for teams at all.

Why would an NBA team use the stretch provision?

The most obvious reason an NBA franchise would use the stretch provision is to free up cap space so they can compete for a title. If a team has little hope of competing that year, there would not be much need to stretch a player, this would just mean your cap space is being eaten up year after year. Much better just to pay up the player in questions final year or years and move on.

If, though, you feel you are competitive and need a bit more cap space to sign the player you think will make the difference, the stretch provision is a great way to do it, especially if you have a player on your roster with little to no trade value. You wouldn’t always want to pay in draft picks to trade them away.

Another situation is around when certain players become free agents. Most established stars will have small windows every 3-4 years where they are Unrestricted Free Agents. If you have an indication a big name wants to sign with your franchise, you have to be ready that summer. So employing the stretch provision to get you to the required cap space may be essential.

A Few Concerns Regarding the Stretch Provision

On the surface, the stretch provision looks like the perfect addition to the NBA. It certainly helps out franchises when they go head first into a deal that doesn’t pan out in the long term. Whether the player is underperforming or getting into trouble off the court, it’s not important. Bottom line, the stretch provision seems like a great idea.

However, there are some concerns that could arise from time to time with this type of rule in play. Some insiders had thought that big market teams could just dominate the free agent market by manipulating the stretch provision. Not only could they offer more years on an initial bid to reel a player in, but they could then cut said player a year into the deal and end up losing very little financially. We thankfully haven’t really seen much of one team in particular over using the stretch provision rule in this way. It is something to keep an eye on as teams continue to adapt to the league around them and GMs try to find every edge to give them an advantage in assembling the best roster they can. Teams overpaying players on the back end of contracts and then stretching them out could artificially inflate the market and push smaller teams out of the running for the players they need to compete.

Luol Deng, LA Lakers and the Stretch Provision

In 2016 the new TV rights deal sent the Salary Cap into the stratosphere. Many GMs made many bad decisions. One of those was the LA Lakers signing Luol Deng. The Lakers signed Deng to a four-year, $72 million contract in the summer of 2016.

That season Deng played 56 games for the Purple & Gold. The following season (2017-18) Deng played just 13minutes. In the summer of 2018 the Lakers landed Lebron James in free agency and everything changed. They needed to contend (almost) right away and Deng’s remaining $30million+ contract was going to be a problem.

In 2018, they used the stretch provision to waive that contract and spread the remaining cap hit over several years.

  • 2018-19 – $14million*
  • 2019-20 – $5million
  • 2020-21 – $5million
  • 2021-22 – $5million

*(Deng also signed with Minnesota playing 22 games for $2.4million)

The Lakers did this because they wanted to free up enough space on their cap sheet to chase a superstar free agent. Targets included; Kevin Durant, Kawhi Leonard, Jimmy Butler and Klay Thompson. They would sign with Nets, Clippers, Heat and Warriors respectively.

LA would package their cap space, young stars and draft picks in a monster trade with New Orleans for star big man Anthony Davis in the summer of 2019. That season the James/Davis Lakers would win the NBA title in the Bubble in Orlando.

Deng would continue to be paid until the end of the 2021-22 season holding a not insignificant $5million on their cap sheet. The Lakers would have their second star alongside Lebron and their first title since Kobe was in his prime, in no small thanks to the stretch provision.

Other Players That Got the Stretch Provision Treatment

First of all, there are a ton of known players in league history that have been paid long after getting waived or cut from a team. Many of you may have heard of Timofey Mozgov. Mozgov was a huge beneficiary of the stretch provision. He was able to sign a huge deal with the Orlando Magic but didn’t hit the court often. Orlando didn’t want to deal with the hassle anymore so they stretched out his deal and got rid of him. From that point until the 2021 season, he racked up $32.7 million from Orlando and all he had to do was play zero minutes of basketball.

Another player that was entitled to money from a different organization was Joakim Noah. Noah was able to make about $6.4 million from the beginning of 2019 until the end of 2021. Additionally, we all know that he wasn’t out on the court much throughout this span.

Surprisingly, the Indiana Pacers were still paying Monta Ellis. Ellis should be a relatively familiar name for a lot of NBA fans, but he actually made $2.2 million for nothing while still a member on the Pacers salary cap.

These are just the players that ended up making a lot of money after getting hit with the stretch provision. For most, this type of idea helps out a majority of players when an injury or something else knocks them out of commission. It should be known that there are players who received the stretch provision and really didn’t get much help out of it. 

One Player That Could Be Handed the Stretch Provision

Just because a lot of the more memorable players that were hit with this provision aren’t playing anymore, doesn’t mean that current players aren’t about to receive this treatment themselves. For example, the Los Angeles Lakers have been rumored to be thinking about using the stretch provision on Russell Westbrook. The Lakers are currently slated to pay him $47 million next year if he stays on the roster. However, they could shift that number down to $15.6 million for the next three seasons if they wanted too. If you want a prime example of a stretch provision candidate, then look no further than the former Oklahoma City Thunder MVP. There is a catch though, NBA Insider Jake Fischer reported that the Lakers currently don’t want to use this provision on Westbrook. Apparently, they are not wanting any dead money down the line, which makes quite a lot of sense for a team that has an uncertain future given Lebrons age and mercurial tendencies.

Westbrook is a great situation to monitor when it comes to the stretch provision, and I personally don’t think that the team should use it on him. Los Angeles likely has too many other problems besides Westbrook that need to be addressed. LeBron James and Anthony Davis make this a championship contender if they both stay healthy, so it may well be safer to pay Russ his $47 million now than to stretch it out down the line to cause later issues. But if no trade partners for Russes final year emerge, the need to challenge for titles in the waning years of Lebron’s career may force their hand.