Designated Veteran
The league and the NBA Players Association came to terms on a new collective bargaining agreement last month. One of the CBA’s new rules, called the “designated veteran player exception”, was introduced in an attempt to keep star players with the teams that drafted them. The DVPE applies only to players with between 7 and 9 years of NBA experience. Players who fit that criteria can now sign contracts that pay them 35% of their team’s salary cap. Before the new DVPE, only 10+ year veterans could earn that percentage.
In addition to the 7-9 years of experience criteria, the DVPE also requires players signing for the maximum 35% to be recent winners of specific honors. A player qualifies if they were named MVP, Defensive Player of the Year or selected to an All-NBA team the season prior to signing the new contract. Players can also qualify if they have two All-NBA selections or DPOYs, or one MVP in the three seasons prior to the new deal being signed. These DVPE contracts can be six year deals, but players renegotiating while under a max contract can only sign extensions of five years. They also cannot renegotiate for a DVPE extension until they’ve played at least 3 seasons of their current 5 year deal.
So where does Butler stack up? As of right now, he doesn’t qualify. He’s currently playing his 6th NBA season and hasn’t won any such awards. But if we fast-forward to the summer of 2018 and Jimmy is still with the Bulls, he will be eligible for the DVPE with 7 years of experience. Given his rapid ascension from Most Improved Player in 2015 to his third straight All-Star selection and first as a starter this season, it’s very possible that Butler makes one of the three All-NBA teams next season. That’s all he would need to qualify for a DVPE max extension of five years in the summer of 2018. But remember, the Bulls have Jimmy under contract for the 2018-19 season at just $18.6 million. The front office won’t be under any obligation to renegotiate next summer if they don’t want to.
Big Money
Let’s assume the Bulls keep Butler through the 2018-19 season. In the summer of 2019, he’ll very likely opt out of his 5th and final year ($19.8 million). The NBA salary cap is projected to be around $109 million for the 2019-20 season, with the luxury tax at $132 million. Let’s say hypothetically that Jerry Reinsdorf and his cronies are willing to go into the luxury tax to give their superstar the highest possible offer. If Butler qualifies for the DVPE and the Bulls offer him 5 years at 35% of their cap, that would mean a total of $231 million and an average annual salary of $46.2 million. That’s nearly three times the $16.4 million he’s making this season.
Does that put things in perspective? The Bulls have an All-NBA caliber player on their roster. For the remainder of this season and through 2018-19, they can have Butler on the cheap if they don’t trade him. When the time comes, and if Butler qualifies, will they decide he’s worth that kind of new money? Jimmy will be making his first start in the All Star Game next month. What he accomplishes from there will help GarPax and Jerry cross that bridge when they come to it in 2019. For now, Bulls fans can be thankful that they have one of the NBA’s best players on one of the league’s greatest value deals.
