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Hawks State of the Cap: 1996

We go back in time to look at the Atlanta Hawks salary cap situation from 1996.

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Hello, America Online. Here we are in the Summer of 1996 playing this new game called Pokémon and jamming out to the Macarena, what a time to be alive. Let’s take a few minutes to look at the Atlanta Hawks capsheet going into the 1996 off-season and trying to figure out what may or may not have happened. This is a bit difficult to decipher, but I’ll try my best to guide you through what could have happened during this wild time in in the NBA.

Atlanta’s Cap Situation

OK there’s a few ground rules to cover before I go into the Hawks’ cap situation. For one, the Salary Cap was set at $24.363M for that year and any salaries for a player under contract counted towards their cap sheet. An NBA team also had charges associated with their free agents plus 1st round draft picks, although those charges were only placeholders and not actual amounts that would be assessed to a team unless a contract was agreed upon for those specific amounts (they weren’t for any Atlanta players). In addition, NBA teams did not have "incomplete roster charges" to fill up their cap sheet as they currently do. You can blame the Miami Heat for that one.

Of note, the Hawks traded for Christian Laettner and Sean Rooks in the 1995-96 season by trading away Spud Webb and Andrew Lang. Christian had three years remaining on his contract while Sean Rooks would be a free agent at the end of the year and thus carried a cap hold in the 1996 off-season. So as an "update," when the Atlanta Hawks entered the 1996 off-season their books looked as so:

Start of 1996 Off-season

(Red values denote cap holds and not actual contracts. Contract data uncovered through Patricia Bender’s salary cap website and a bit of elbow grease through cross-checking Atlanta Hawks transactions)

Atlanta had very little cap space to start off with, although there were numerous teams in the NBA with cap space to absorb contracts due to a monumental bump in the television revenues. The 1996 off-season was extremely similar to the current 2016 off-season.

Shaq Wants Money

A recent article from a former assistant of Shaquille O’Neal documented that Atlanta might have been an option for Shaq to sign with. Shaq was a free agent and was eligible for a contract starting at....well up to $24.363M for any team other than the Orlando Magic. The Orlando Magic had the capabilities of signing Shaq for a contract starting at whatever value they wanted to. It could have started at $50M, although they didn’t have an incentive to offer it because no other team could offer more than $24.363 million. This is a bit off-trail, but Shaq was a free agent and open to seeing what teams would offer him.

During this time, Michael Jordan ended up signing a contract with the Chicago Bulls for $30M. Yes, that’s right. Michael Jordan signed for more than the Salary Cap and there weren’t many people who batted an eye at this.

Shaq had a fairly clear demand for salary, which was to start at around $10M in the 1996 Season but also extend for the maximum of 7 years with an opt out after 3 in order to gain Bird Rights. At the time, the maximum raises were 20% as opposed to the current 7.5% and contracts could be up to 7 with little restrictions on the number of player or team options. Said demands of Shaq would hypothetically total $112 million.

As to how this relates to Atlanta, it is said as such via a consultant to Shaq:

ATLANTA HAWKS: While Atlanta wasn't on our initial list, the Hawks quickly became a viable option when I, along with a colleague, took a call from current Los Angeles Dodgers CEO and President Stan Kasten about the Hawks' interest in Shaq. Kasten, who was president of both the Hawks and Atlanta Braves at that time, indicated that the merger between Hawks owner Ted Turner's broadcasting companies (CNN, etc.) and Time Warner would be able to generate significant ancillary income for Shaq.

On the basketball side, he viewed Shaq as the missing piece to a championship in Atlanta and was comfortable offering him a seven-year deal averaging somewhere between $10 and $15 million per year. He was not, however, interested in breaking up much of his team to do so.

This is kind of crazy to look back on, but in 1996, Kasten considered Mookie Blaylock and Christian Laettner to be the Hawks' foundational players. They weren't going anywhere. Two other players from a group consisting of Stacey Augmon, Alan Henderson, Grant Long and free agent Steve Smith also needed to be retained.

This was the snag. After running all the numbers, Smith, an All-Star caliber player, was probably the odd man out, and we didn't like the idea of losing Smith. Eventually, Atlanta, which had become a legitimate contingency option, fell completely out of consideration when it signed Dikembe Mutombo to a five-year, $50 million deal.

Very interesting.

Keep in mind that a $15M annual average contract with 20% raises and a maximum term of 7 years would start at $9.375M and total $105M. That’s the hypothetical target that Atlanta was referring to, and it was slightly less than reported demands of Shaq.

But let’s take a step back and figure out what the hell was going on.

Shaq Issues

Shaq ended up signing for a starting salary around $10.7M with the Lakers after they made various moves for a total contract value of $120M over 7 years. But Shaq had an option to escape his contract after 3 years, after which he would have Bird Rights and the Lakers could exceed the Salary Cap to re-sign him to whatever deal the seemed fit (although the CBA altered the rules and mandated an individual maximum salary). He ended up signing a 3-year extension at said maximum value.

Could Atlanta have gotten to the $10.7M? Sure! But given that the team needed to retain Christian and Mookie plus 2 of Augmon, Hendu, Long, and Smitty then it was kind of bleak. Obviously, the Snake is a prime target to be removed as well as Sean Rooks’ cap hold. Clearing those two alone totals $5.269M and leaves the team with $7,104,500 in cap space. One option would be to remove Norman, Augmon, and Rooks which gets the team to about $9.6M. If that wasn’t enticing enough for Shaq, then the team could get rid of Grant Long as well to clear space for $11.8M.

Option 1
Option 2

Although, the consultant alluded to Atlanta needing to shed Steve Smith. This might be an indication that Ken Norman might not be moveable, which I find a bit strange but oh well. If we look at Atlanta clearing Smitty, Augmon, and Rooks then that would be clearing enough space for a Shaq move. But is that then a roster that Shaq would want to join? It sounded like it was not.

Option 3

Atlanta could have pulled off clearing enough space for Shaq, from a financial perspective. But they didn’t.

This is similar to the Al Horford situation in that it was possible cap-wise but ultimately not done because of financial issues. Just because you can offer someone a $153M contract does not mean that you will or you should. After all, basketball is still a business and signing players comes with a cost.

What Atlanta Did

OK, so then what did Atlanta do? Well, they firstly decided that Dikemebe Mutombo would be a fine free agent at a 4 year $50M contract, which started at $8M. For a future hall of famer, this seems like a bargain. But the team did not have $8M in cap space, they had to trade away Stacey Augmon and Grant Long to Detroit for two first round draft picks and renounce the rights to Sean Rooks:

Sign Mutombo

Next, the team used up the rest of their cap space to sign Smitty............wait.

The team actually left some money on the table, about $962,500 in particular. The team could have used this amount to sign a free agent and then sign Smitty because of his Bird Rights and associated cap hold. So why didn’t the team use up their cap space and then re-sign Smitty? Well, I have no answer for you here.

At the time, I would have told you that the team done fucked up. Because they did, from a cap perspective. The team left money on the table that they could have used to sign various free agents to deals above the minimum of $247,500 at the time. They simply did not. Why? I’m not sure. Maybe David Stern was being a hard ass? I don’t know. I do know that they screwed up here, but this is like 20 years later so why are we going to beat dead horses? No reason to. I make misteaks all the time, so let’s just move on.

Final Roster Composition

The Hawks reached the Salary Cap after re-signing Smitty at his $4.5M contract and signing Preist Lauderdale to his rookie contract (which was 120% of his rookie scale caphold). After which, they only had 7 players on their roster. A team needs like a few more than that. So they signed 6 players to minimum contracts plus a 7th later in the season:

Veteran Minimums

After that? That was the team. Atlanta had a decent enough team to compete for a 2nd round exit and fans to huff and puff about their transactions. This kept on going until the 1999 lockout Season, at which point the team went ape-shit and started rebuilding.

I don’t want to talk anymore beyond this, I’ll leave that for another day.