Indiana Pacers Still Sitting Below NBA Salary Floor With Regular Season Under Way

Most NBA teams spend the offseason trying to keep their spending below a certain threshold. Whether it’s the salary cap, the luxury tax line, the apron, or an arbitrary number set by ownership, most franchises attempt to spend within certain parameters.

The Indiana Pacers are in a totally different situation. With the offseason dust settled, the Pacers have just ~$94 million in salary guaranteed to their roster as well as about $1.8 million that will be spent on three waived players. In total, the team has just shy of $96 million it will pay out over the course of this season, as of now.

The NBA has a salary floor that teams have to hit. It’s essentially a minimum salary an organization must spend on players, and the number is 90% of the salary cap in a given season. This year, that means the salary floor is just under $111.3 million.

The Pacers are over $15 million away from the floor with the season already underway. If a team fails to reach the minimum salary required for a roster, they must pay the difference out to the players who were under contract during the season, meaning each player would effectively get a bonus over what their contract dictates their salary to be.

Most organizations prefer to reach the salary floor so that they are instead getting the most out of every penny that they spend. It is likely that Indiana will, at some point this season, make some moves with the goal being to add team salary — and possibly add assets in the process.

The NBA does not calculate how much a team has spent during a season until the campaign ends, so the Pacers have until next April to reach the salary floor, if they plan on doing so. But they will have to be creative to make it happen with the regular season already underway.

There are several manners in which Indiana could add salary to their books during the regular season. Some are simple, while others are more complicated. “What I would tell you is I’m excited because we have optionality,” President of Basketball Operations Kevin Pritchard said before the season. That optionality gives the blue and gold multiple methods to reach the salary floor before the season ends.

Sign Players

The simplest way for Indiana to add salary would be to sign players to bigger contracts. Any additional player salary the Pacers acquire this season counts toward the salary floor.

The Pacers roster is currently at the maximum number of players, so they would have to waive or trade away a player to bring in someone else. James Johnson and Oshae Brissett have non-guaranteed contracts and could be waived to facilitate a signing if needed. Any money already paid to a waived player would count toward the blue and gold reaching the salary floor.

There aren’t many free agents out there that are currently worth a big contract. Some interesting young players are on the market that Pacers could explore adding later in the season, though, such as Killian Tillie, Eric Paschall, Josh Jackson, Joe Wieskamp, or Jared Butler. But none of them are worth giving a bloated contract to unless there are non-guaranteed future seasons on the deal.

Another way the Pacers could add salary via a signing is by converting their two-way contracts to more expensive standard contracts, as they did last season with Duane Washington and Terry Taylor. Any signing would have to be for a salary that is larger than the league minimum to add to the team’s total salary, assuming they waive Brissett or Johnson to facilitate the conversion.

A player with a guaranteed contract could be waived, but that is less likely. If a player is signed mid-season, only the salary paid to them over the remainder of the campaign counts toward the salary floor.

Make A Trade That Adds Salary

The Pacers can generate up to roughly $28 million in salary cap space, which is relevant for trades. If the Indiana front office is so inclined, they can take in that $28 million amount in salary in a trade without sending any money out.

That is, of course, the most extreme version of a lopsided trade the Pacers could make. But Indiana doesn’t have to match salaries in trades so long as they are at most $100,000 over the salary cap once the trade is complete. Trades are an easy way for the blue and gold to get closer to the salary cap floor.

If the Heat were to trade Duncan to the Pacers for a second round pick, for example, the Pacers would add ~$17 million in salary this season and reach the salary floor. That trade would likely never happen — it’s just an example — but if the Pacers can find a trade where they receive about $15 million more in 2022-23 salary than they send out, it would get them to the minimum required salary.

It should be noted that only the salary the Pacers pay a player post-trade counts toward the salary floor. For example, if they receive a player in a deal with a $20 million salary exactly halfway through the season, they would only get $10 million closer to the league minimum team salary.

If the rumored Buddy Hield and Myles Turner for Russell Westbrook and draft picks trade ends up happening, the Pacers would add just shy of $8 million in salary. They would still need to make other moves to reach the salary floor.

Renegotiate Current Contracts

Turner is the only player on the Pacers roster who is eligible to have his contract renegotiated and extended. Any day from now through February 28, 2023, Indiana and Turner could agree on a renegotiation and extension. Starting on March 1, this option is no longer possible.

Renegotiations are only allowed for players who signed a four-year deal at least three years ago. Turner signed his current deal in 2018 and is in the final year of a $72 million contract.

Technically, the Pacers could renegotiate Turner’s contract as high as his maximum salary this season, and then have it decrease in future years. That would help the team reach the salary floor by adding tens of millions of dollars to the team’s total salary.

But Turner likely wouldn’t accept an extension, especially given where he and the Pacers are at right now. And the rebuildng Pacers may not want to extend him, either. This option is extremely unlikely, but it is technically a way that the team could add money to the books.

In all likelihood, the Pacers will use more than one of these tactics to add to their team salary this season if they want to reach the salary floor. Using only one of these options would be tricky, in practice — it’s hard to add $15+ million in salary via one signing or one trade during the season.

Indiana has until next spring to reach the salary floor, but expect the front office to be active as the season progresses so the team can reach the minimum required salary before the 2022-23 campaign ends.