Unfortunately, it appears the Knicks and Joakim Noah have reached a point of no return. The conflict between Noah and head coach Jeff Hornacek rose to a different level after their loss in Oakland, but structural concerns have been there for a while as the prideful, well-paid veteran has not been in the team’s rotation.
With the news that Noah will not be with the team until further notice, it is worth taking some time to game out how the different ways this separation can happen affect the Knicks’ salary flexibility moving forward.
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First, the fundamentals. After this season, the Knicks owe Noah $37.8 million over two seasons. While he has a $17.8 million salary this season, there is not much flexibility on that component, so it will be largely ignored.
The most important element to know here is that one of the few pieces of finality on an NBA team’s books comes when a player is waived, whether that comes as a cut or buyout. Unless another team claims that player, their salary amount (subtracting the buyout amount, should one exist) will stay on the ledger, and there is no way to remove it — no amnesty, no trade, nothing.
The Pistons would love to clear Josh Smith’s $5.33 million per season running through 2020, especially since that obligation counts against both the salary cap and the luxury tax. Golden State has an even clearer example, as Jason Thompson’s stretched $945,126 will cost the team more than $3 million in luxury tax payments this season, and that payment likely increases for the 2018-19 season.
While the Knicks would love to resolve this issue via trade since that creates more flexibility, that looks incredibly unlikely at the moment because Noah’s contract has to be treated as entirely dead money due to his combination of ineffectiveness and toxicity with the team. That means their front office would have to either give up serious assets or take on even worse money, likely a longer contract, in order to move him, and mitigating the damage is similarly difficult and costly in terms of assets.
There are some possibilities, but those require a trade partner willing to look incredibly far into the future, or a team with even more catastrophic money on their books. Those exist but are hard to come by, and the trading front offices would still have to value their assets and contracts similarly enough to make a deal.
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Considering those challenges and limitations, it is fair to game this out assuming Noah will not be traded, and previous reporting has indicated the veteran is unwilling to leave money on the table in a buyout, which is similarly unsurprising. While that does not leave the Knicks with many options, choosing the right one matters a great deal because of its permanence on their books.
There are three basic payment timelines the Knicks can use...
Path One — Full Stretch
While players receive the entirety of their guaranteed salary when cut, the Collective Bargaining Agreement allows teams the ability to change the way that sum is on their books with the stretch provision. That opens the door for a team to take salary — only future years if the waiver/stretch happens after Sept. 1 of that league year — and spread it evenly over twice the remaining length of the contract plus one year.
In this case, the Knicks owe Noah $37,825,000 over two years, per Basketball Insiders, so that sum could be stretched and become $7,565,000 per year from 2018-19 through 2022-23. The biggest benefit of stretching Noah’s contract is clearing cap space for the 2018-19 and 2019-20 seasons, as it would reduce the amount on their books by more than $10 million each of those two years.
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The problem for the Knicks in the immediate is that they do not recoup much of the value of clearing that $10 million for 2018-19 because they still have significant committed salary, especially if Enes Kanter opts in for $18.6 million as expected. The stretch makes a bigger difference in 2019-20 when Kanter, Ron Baker and potentially Lance Thomas come off the books the same summer Kristaps Porzingis hits restricted free agency, if the two sides do not agree to an extension this offseason.
There are certainly benefits to fully stretching Noah’s remaining money, one being that the Knicks can do it whenever they want, including right now or after the trade deadline if they cannot find a trade.
Path Two — No Stretch
New York could also decide to take its medicine and waive Noah but simply keep his remaining money on the books without changing the timeline. That means heavier cap charges ($18.5 million in 2018-19 and $19.3 million in 2019-20) but no dead money beyond that point.
Considering the Knicks are currently comfortably between the salary cap and luxury tax for next season, the consequences would mostly come in the 2019-20 season when they could be looking at cap space, though that could easily push one more season if the front office can stay judicious with their spending that long.
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Like with Path One, the Knicks have the ability to initiate Path Two as soon as they want, but that decision and his cap hits become final the day after Noah clears waivers.
While those two paths are the only ones available now, there is a third one that probably makes the most sense if they are willing to tolerate a little awkwardness.
Path Three — Delayed Stretch
As detailed above, the stretch provision takes the money on a player’s remaining contract and spreads it over double the remaining seasons plus one. Since Noah has two years left, that means a five-year stretch.
However, the Knicks can implement a different payment schedule by waiting a little while longer. After Sept. 1 of a league year, that season of a player’s contract cannot be stretched, so it becomes a locked-in year on the contract. That has downsides in certain circumstances, but it also creates a situation where the Knicks can stretch only Noah’s 2019-20 salary before the 2018-19 season starts.
Instead of $7.6 million per season for five years, the delayed stretch keeps Noah’s 2018-19 salary whole and spreads the final season of $19.3 million over three years, so $6.4 million each in 2019-20, 2020-21 and 2021-22. Going this direction both reduces the dead money amount per season after 2018-19 and shortens the total obligation duration by a year, too, since Path Three ends the cap hits in 2022 instead of 2023 in Path One.
The delayed stretch also keeps the door open for the front office to discuss Noah trades through the 2018 offseason just in case a team changes its mind about the consequences of taking on future money or lowers the asking price in terms of assets. It should be noted that this path still has the stretch decision deadline of one day after Noah clears waivers, but management will have seven months of additional information on whether lowering its 2019-20 obligations by $12.9 million is a worthwhile endeavor.
Each of these three paths ends with Joakim Noah free to choose his next team and the Knicks on the hook for an identical $37.8 million, but how the front office structures those cap hits will substantially change the team’s options in future offseasons.