NBA teams remain uncertain about the trade bonus in John Wall's contract, league sources confirmed to ESPN. As Adrian Wojnarowski reported earlier this month, the All-Star point guard -- along with the rest of the Washington Wizards' roster -- is available to discuss in trade scenarios.
Interest in Wall is close to nonexistent around the league, per sources. Still, teams are going through the complicated exercise of trying to understand how a Wall trade would even work.
"There is a 99 percent chance that we would not trade for Wall, but I need to be prepared for that 1 percent," one team executive told ESPN.
Here's what's going on behind the scenes, both for opposing teams and the Wizards.
Breaking down the bonus
The bonus calls for Wall to be paid 15 percent of what is owed on his contract if he's traded.
If Wall were dealt now, the trade kicker theoretically could include his remaining $14.3 million for this season and $123.6 million of his supermax that is set to begin in 2019-20 -- resulting in an extra $20.68 million. (Wall's $47.3 million player option for 2022-23 is excluded here.)
For salary-cap purposes, $5.17 million would be added to each season of Wall's deal for the team acquiring him (excluding 2022-23), but Washington would be on the hook to pay Wall the full amount in a lump sum that would surpass his 2018-19 salary.
For salary-matching purposes in a trade, Wall's contract would be considered $24.3 million of outgoing money for a new team and $19.2 million for Washington:
Why the confusion?
Here's the sticking point: There's no way for Wall to receive that $20.68 million without surpassing the maximum salary threshold in the collective bargaining agreement.
Supermax rules prohibit the first year of a contract from exceeding 35 percent of the salary cap, which would be the case for Wall's deal with an extra $5.17 million next season. But Wall would also exceed the max salary this season by applying the full amount of his bonus to 2018-19.
There's no precedent for this, and it's something both the league and the players' union didn't see coming during CBA negotiations. After all, the goal of the high-priced supermax was to give teams a clear path to retain franchise players long term -- not trade them before the extension even begins.
Of course, Wall could elect to waive the trade bonus, and the situation would be resolved. The Wizards also could wait to trade him until after July 1, and the bonus would be voided, since he'll be making the maximum possible salary by that point.
The likely outcome
If Wall is traded this season, the consensus among teams consulted by ESPN is that his 15 percent bonus will only be applied to the remaining salary owed in 2018-19. That's $2.1 million -- paid by Washington but falling on the new team's cap sheet -- which would be added to Wall's $19.2 million as outgoing salary.
There would be no additional salary added to the three years of his supermax extension:
With Wall on the trade block, expect the league and the union to eventually provide clarity here.
The closing trade window
The trade market for Wall will not get better this summer, despite 12 teams having at least $25 million in projected cap space.
Here are two questions that I asked league executives regarding Wall's trade value.
1. If the guard were a free agent in 2019, would you sign him to a four-year, $171 million contract (his supermax deal)?
2. Is the Wall contract tradable in the offseason?
There was a clear consensus on both questions: No.
"Granted, every player in this league can be traded, but the Wall extension right now is the toughest contract I have seen a team try to move in 20 years," one team executive told ESPN. "I couldn't look my owner in the eye and tell him there is value with the player even if we didn't have to trade anything of significance."
Front offices have learned from their mistakes of overspending in 2016, and they're likely to take a conservative approach when committing to long-term salary. Yes, Kevin Durant, Klay Thompson, Kyrie Irving and Kawhi Leonard will likely get max deals, but there's more fear this time around about overpaying borderline stars and starters.
Despite the salary cap being projected to increase from $101.8 million to $109 million in 2019 and then $118 million in 2020, teams do not have an appetite for tying up 35 percent of their money in a point guard who has carried a heavy workload (35.9 MPG since 2010-11) without signs of future franchise-player-level production.
So even with the uncertainty surrounding Wall's trade bonus, his current $19.2 million salary is more movable than when it spikes to $38.2 million in July. Not only will teams balk at trading Wall into their cap space, but the capped out teams will also be stuck. Around 49 percent of NBA players are projected to be free agents this summer. Cobbling together $30.5 million in contracts to facilitate a Wall trade is next to impossible.
If there is an outside chance for Washington to move Wall, it is before the Feb. 7 trade deadline to a team that views Wall as an All-Star and has a void at point guard. The Phoenix Suns might be the only team that fits. (Keep in mind the Boston Celtics and Minnesota Timberwolves are prohibited from trading for Wall this season while they have players -- Kyrie Irving, Karl-Anthony Towns and Andrew Wiggins -- on similar designated rookie extensions.)
What approach should the front office take?
There is a for-sale sign attached to the Wizards' roster, but Washington is only 1.5 games out of the Eastern Conference playoffs despite an 8-13 record. If general manager Ernie Grunfeld is thinking short term, a weak conference will allow his team to stay in the postseason hunt despite underachieving early. That line of thinking would be buoyed by the belief that making the playoffs would dispel the cloud hanging over this franchise.
Having been in a similar situation in Brooklyn with Deron Williams, that does not work.
There was a trade proposal in December 2013 that would have given the Nets much-needed future cap relief without improving the basketball product. At the time, Brooklyn was 8-15, had the highest payroll in the NBA and looked listless in losses -- similar to what is going on in Washington.
Instead, the offer was turned down and Brooklyn averaged 41 wins in 2013-14 and 2014-15, reaching the playoffs but not advancing further than the second round. Williams was bought out of his contract in July 2015.
The lesson learned? Thinking big picture outweighs being mediocre. If a future-friendly offer for Wall emerges, the Wizards should take it.