The NBA’s offseason is barely a week old, but the Oklahoma City Thunder appear to be intent on keeping their 2017-18 roster intact for the most part despite not getting past the first round of the playoffs. They currently have the most expensive roster in the league but it is difficult to justify their $300 million in expenses next season based on the makeup of the team as it currently stands.
At the center of this mess is 15-year veteran Carmelo Anthony whom the Thunder acquired from the New York Knicks last summer to supposedly form a triple-threat together with Russell Westbrook and Paul George.
Unfortunately for OKC, Melo barely contributed anything last season. To make matters worse for the Thunder, he opted in on the final year of his contract worth $27.9 million by not exercising his early termination option. That’s to be expected, of course, and one that the team already knew would happen since Anthony won’t be able to find that kind of deal anywhere else.
In order to cut down on expenses, ESPN's Adrian Wojnarowski and Royce Young report that the Thunder are seriously considering parting ways with the All-Star forward. But is this the best course of action?
The Thunder are in a financial bind, one that should be a burden carried by a championship contender or the defending champion Golden State Warriors. It’s not one that OKC should be in unless they have a plan to slash their player salaries significantly.
How The Thunder Got Into This Mess
First, Anthony opted in to the final year of his contract.
Next, George re-signed with the franchise on a four-year, $137 million deal and Jerami Grant agreed to terms on a three-year $27 million deal. Then, there’s Nerlens Noel who will sign a two-year deal, including a player option in Year 2, for the veteran minimum.
Later, Raymond Felton agreed to return to Oklahoma City on a one-year, $2.4 million deal.
Oklahoma City crosses an historic threshold as the first $300M team in salary and projected luxury tax with the Raymond Felton signing. The Thunder now have a tax bill of $150M.
— Bobby Marks (@BobbyMarks42) July 4, 2018
The last deal involving Felton pushed their luxury tax bill above the $150 million mark, the highest in league history. Coupled with their $150 million in committed salaries, OKC is set to pay a whopping $300 million next season.
Deadspin’s Lauren Theisen broke down some of OKC’s biggest salaries next season:
“Aside from George’s max deal, which works out to around $34 million/year, the Thunder are also paying $35 mil to Russell Westbrook, $27 mil to Carmelo Anthony, and $24 mil to Steven Adams. The remaining $30 million or so of that massive payroll is filled out most expensively by Andre Roberson’s $10 million/year contract, and the resigning of Jerami Grant for slightly less.”
The majority of the team's humongous tax bill is being in the repeater tax which can be avoided if they waive Anthony. But should they do it?
Three Options with Carmelo Anthony
1. Use the waive-stretch provision
The Thunder could save around $100 million next season by waiving him and stretching his salary for the next three years. On average, Anthony’s salary will only be on the books for only $9.3 million but over a longer period rather than a one-time payment that cripples the franchise financially for next season only.
So with PG and Grant back, the Thunder would be looking at a salary plus repeater tax bill of $289.9 mm, w/out filling out roster. Stretch Melo, and that drops to $180.3 mm. So they could save over $100 mm by stretching a player who hurt them in the playoffs last year.
— Nate Duncan (@NateDuncanNBA) July 1, 2018
However, waiving and stretching the Syracuse alum will continue to make the Thunder feel the weight of Melo’s contract for two more years, keeping the team from building a championship contender during most of the lifespan of George’s new contract.
SB Nation’s Tom Ziller explained the Thunder’s predicament in the future by stretching him.
“Adding $9 million in dead cap weight in 2019-20 would really hurt OKC’s ability to add talent with the mid-level exception without drawing huge luxury tax bills. By deferring Melo’s contract over three years, the Thunder would make 2018-19 easier to swallow while making it harder to add help for Westbrook and George so long as they have them.”
Ziller underscores the case against stretching Melo, but the notoriety of having to pay $300 million on a roster that may only reach the second round of the playoffs at best may be a bit too much for the Thunder to swallow.
Of course, Anthony has to agree to this, too, but there is a huge chance that he concedes to this since he can sign for the veteran minimum on a team with championship aspirations. Two of those teams could be with his best buddies Chris Paul with the Houston Rockets and LeBron James with the Los Angeles Lakers.
One reason why they may not go in this direction is the possibility that when they waive Anthony, the Thunder could meet him and his new team in the playoffs where he becomes a high-profile role player. If OKC wants to go deeper in the playoffs, they may want to move Melo somewhere that he can be less of a threat to them down the line.
2. Trade him
Another option for the Thunder is to trade him to another team of their choosing. Rather than see Anthony on a team that they’ll face in the playoffs, later on, the Thunder could ship him off to an Eastern Conference team. This will be quite tricky as there are few teams in the East that Anthony may want to join and very few that would want him at the $27.9 million price tag.
That is unless it’s on a team that can compete for a title. But Eastern teams that have that ability are either not interested in trading for him (i.e. Boston Celtics, Philadelphia 76ers) or he is the one not interested in joining them (Toronto Raptors, Washington Wizards, Milwaukee Bucks) despite being potential title contenders. Also, Melo has a no-trade clause which he has to waive in order to move him.
And even if they trade Anthony, they’d have to absorb matching salaries anyway so that’s not helping them either unless the Thunder gain assets that are better suited to their style of play.
That leaves the last option.
3. Keep Him (Despite Reports)
The Thunder can suck up the $300 million and keep Anthony in their lineup in the hopes that he will play better with Westbrook and George who will continue to be the focal point of the offense as they were last season. Anthony will be extra motivated to be a good soldier this season since he’s playing for his next contract.
Who knows? Maybe he will rediscover his shooting and give the Thunder more than the 16.2 points and 40.4 percent field goal shooting he gave them last season. That was the first time that Anthony averaged less than 20 points in a season. Hopefully, for the Thunder’s sake, that will be the last if they intend on keeping him.
What Will the Thunder Do?
GM Sam Presti and the front office appear to be intent on getting rid of Anthony this offseason but the easiest route may be just to keep him and ride out the horrible decisions the Thunder made that led to such a financial disaster and then come back next season to better possibilities.
That means, unless Presti can find a very good fourth option or a solution that will help the team in the short term, the Thunder’s best bet is to take the third option and hope for the best.
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