High Payroll, Big Trouble?

NBA trainging camps are just a few weeks away so I thought we would look at teams payrolls and determine what teams are making good money decisions and what teams are making bad choices. The problem with NBA contracts is that A. the money is guaranteed, and B. Players are way overvauled. This makes bad contracts extremely hard to trade. It seems that the NBA more than any other sport chooses players on potential rather than substance. Look at the New York Knicks, they have $140.5 dollar payroll for this up coming year (salary cap $53 million). The Knicks are probably the most poorly run Franchise in all of sports. The Knicks had the second worst record in the league last season winning only 23 games. If the Knicks double their win output from last season to 46 (realisticly the might win 30 games this year) the would be paying a little over $3 million dollars per win. The problem with the Knicks is they have a lot of aging players that at one time people thought they were going to be all-stars but fizzled out. This hurts because teams that can trade for these players value cap flexibilty rather than overpaid neverwas players.

Now lets look at a team like the Chicago Bulls, this years salary is almost $53 million. They added the #2 pick in the draft as well as the best defensive player in the NBA so lets say they win the same amount of games they won last year, 50. This comes out to a little over $1 million per win. The Knicks are spending 3 time more money for a win. Looks like the Bulls have Isiah Thomas’ number. As a matter of fact 3 of the highest payroll teams this year missed the playoffs last year and the Knicks and Trail Blazers (#5) will most definately be watching the playoffs at home again this year.
Heres a link to team payroll and players salaries www.hoopshype.com/salaries.htm

TV Deals Mean Big Money

Two years ago the ACC raided the Big East Conference looking for a more lucrative TV contract by boosting their strength in football.  In an attempt to postition their conference among the elite in college football, many thought the Big East would have to fold.  Well the Big East had plans of their own, raiding Conference USA which in the end has postitioned itself as a basketball powerhouse that rivaled the once dominate ACC.  The ACC was able to add a conference championship game in football and with that they were able to demand a the biggest TV deal in the history of college sports.  The Big East may have been become a more valuable conference than it was before the ACC raid.  I say that because they were without a doubt the best basketball conference last season.  There is no doubt that the ACC and Big East are the top two basketball conferences in the country.  The Big East was able to parlay their success in basketball into a 6 year deal with ESPN which begins in 2007-2008.  The battle for teams that began two years is now a battle for the almighty TV dollar.

New Arena

In class this week we have talked about stadium finance and how important it is to a sports franchise.  It just so happens that three teams in the NBA have arena issues.

The Seattle Sonics were recently purchased by Clay Bennett who isn’t happy with the current state of Key Arena.  The arena was built in 1983 and the renovated  in 1995.  Mr. Bennett has met with city officials to discuss building a new world class facility while the mayor of Seattle has proposed new renovations to Key Arena.  Mr. Bennett wants to keep the team in Seattle but  isn’t opposed to moving out of the downtown area and into a different region of the area if a deal can’t be reached with the city.

In Sacramento, the Maloof family has proposed a 1/4 cent sales tax to help fund a development in Sacramento that would house a new stadium for them.  The development would also include shops and resturants. They are currently searching for a sight for the development in which the Maloofs would invest $122 million of their own money over the life of the deal.

Last is the New Orleans/ OK City Hornets.  They will actually open training camp in october in New Orleans practicing at the New Orleans Arena and Tulane University.  They are slated to play 6 games in New Orleans this coming season.  Building a new Arena  in New Orleans has to be a priority if they want to get their team back.  The NBA is toying with going into new markets, Oklahoma City was a suprisingly good host to the Hornets last year and with the All-star game being in Vegas, New Orleans needs to come up with a plan for a facility or they could see the team say Bye-Bye.

Cap Room Doesn’t Sell Tickets

The Atlanta Hawks have gone through another off-season stressing to the fans that it is important to maintain their salary cap flexibility.  Last time I looked at the sports page I didn’t see any team getting wins for having the lowest payroll. I understand that the team doesn’t want to get strapped with unwanted contracts, see the New York Knicks, but not spending money doesn’t get the fans excited and therefore doesn’t sell tickets. 

My dad has been a season ticket holder since the early 90’s and is again this year.  When the salesman called to try to get him to renew his tickets he pitched the idea of the Hawks trading for Allen Iverson (Sells Tickets and Wins), trying to create a sense of optimism for the season.  I spoke with a member of the 76ers team this summer and he told me the Hawks could get Iverson for Al Harrington and a couple of throw-ins, and Iverson really wanted to come to Atlanta.

Speedy Claxton is not a starting point guard in this league, they tried to create the same hype when they dealt for Tyron Lue.  While Shelden Williams will be a soild role player in this league, but he is a forward not a center, and we already have our starting forwards in Marvin Williams and Josh Smith. 

The Hawks fan base is nonexistent and with an off-seasons like this it will remain that way.  Fans don’t want to hear about being patient, they want to hear what the team is doing to build a winner now. Note to Billy Knight: Cap flexibility doesn’t sell tickets, and so far it hasn’t produced many wins either.