The NBA’s New Second Apron Justifies Sixers’ Approach To The 2023 Trade Deadline

Ahead of the Feb. 9 NBA trade deadline, the Philadelphia 76ers shipped out Matisse Thybulle and the Charlotte Hornets’ 2023 second-round pick for Jalen McDaniels and a pair of future second-rounders. Although the swap of Thybulle for McDaniels was presumably the biggest selling point of the deal, it also pushed the Sixers under the luxury-tax threshold.

After the trade, team president Daryl Morey told reporters that getting below the tax line—which pushed back the clock on the repeater tax by a year—could make it more manageable for the Sixers to re-sign their array of free agents this offseason.

“I think as part of my job, I have to look at the bigger picture,” Morey said. “We have a lot of guys we’re gonna re-sign. The moves we did both improve the team and make it easier to keep this team together going forward.”

Now that details are emerging about the NBA’s new collective bargaining agreement, which will take effect in the 2023-24 league year, it’s becoming even more clear why the Sixers prioritized getting below the tax line this year.

Among the biggest changes in the new CBA is the implementation of a second salary-cap apron, which will be set at $17.5 million above the luxury-tax line, according to multiple reports. Teams that go above that line will not be able to spend the taxpayer mid-level exception, receive more salary in trades than they send out, trade first-round picks seven years into the future, sign players on the buyout market or send cash in trades, according to ESPN’s Adrian Wojnarowski.

Wojnarowski initially reported that those changes “will be eased into the salary cap over a period of years,” which suggests the second apron and the ensuing penalties will not necessarily be in effect for the 2023-24 season. But with the Sixers staring down a pivotal offseason, they’ll need to be mindful of how the implementation of the second apron will affect their team-building strategy moving forward.

The Sixers currently have $117.1 million in guaranteed salary on their books for next season, and Danuel House Jr. and Montrezl Harrell can add to that by picking up their respective $4.3 million and $2.8 million player options. The salary cap is currently projected to land at $134 million, while the luxury-tax line is projected to be $162 million.

James Harden, who is widely expected to decline his $35.6 million player option to become an unrestricted free agent this summer, will be the fulcrum of the Sixers’ offseason plans. If they re-sign him to a max contract (beginning at a projected $46.9 million), they’d be $2 million over the luxury-tax line with only eight players under contract. From there, re-signing any combination of Shake Milton, Jalen McDaniels, Georges Niang and Paul Reed would push them even deeper into the tax.

The Sixers will likely be well above the second apron if they do re-sign Harden this summer. If the corresponding restrictions go into effect, they would be prohibited from using the taxpayer mid-level exception in free agency, which means they could only sign external free agents to veteran-minimum contracts. With both the non-taxpayer mid-level exception and the room mid-level exception headed for significant boosts, per Shams Charania of The Athletic, teams below the second apron will be much better positioned to land impact free agents than teams above it.

The delay in the implementation of the second apron may be the Sixers’ saving grace. If the ramifications don’t go into effect in 2023-24, they’ll have at least one full season to get their books in order before considering whether to stay above that threshold. With both Tyrese Maxey and De’Anthony Melton eligible for contract extensions this offseason, the Sixers have a number of critical long-term financial decisions to make over the coming months.

They also still not be fully abreast of the changes in the new CBA. On Monday, John Hollinger of The Athletic—a former executive with the Memphis Grizzlies—said front offices hadn’t seen the full text of the agreement yet.

They’re “basically learning from media leaks like everyone else,” Hollinger tweeted.

Although the Sixers couldn’t have anticipated the exact specifics, they should have expected the new CBA to come down strongly on teams with the highest payrolls. In October, Wojnarowski reported that “in the wake of large-market contenders Golden State, Brooklyn and the LA Clippers running up massive payrolls and luxury tax penalties,” the NBA was “proposing a system that would replace the luxury tax with a hard limit that teams could not exceed to pay salaries.” The players’ union shot that proposal down as a non-starter, but it seemed clear that the league was looking to level the playing field between deep-pocketed and stingy ownership groups.

If the Sixers did believe the new CBA would crack down on high-spending teams, it behooved them to maintain as much short-term flexibility as possible. Stiffer luxury-tax and repeater tax penalties could have made their roster construction untenable beyond this season given their volume of free agents this offseason. Pushing the repeater tax off until 2024-25 at the earliest gives them a full season to digest the changes before the financial stakes ratchet up.

The Sixers’ ability to re-sign their free agents this offseason (particularly Harden) will ultimately determine the success or the failure of their trade deadline approach. But with this new CBA fast approaching in February, the Sixers were wise to maintain their financial optionality given how costly they could become as soon as next season.

Unless otherwise noted, all stats via NBA.com, PBPStats, Cleaning the Glass or Basketball Reference. All salary information via Spotrac or RealGM. All odds via FanDuel Sportsbook.