The NBA’s ‘second apron’ seems bad, to me

A new threshold of punishment for spending has arrived in the NBA, and it’s not great.

This article is free for anyone to read, but please consider becoming a Patreon subscriber to allow me to keep writing posts like this one. Sign up to receive articles like this one in your inbox here.

It’s not that Major League Baseball’s rules regarding the luxury tax and penalties are great. Let’s just get that out of the way now. The luxury tax has effectively been a salary cap for the league, albeit a soft and unofficial one, and new restrictions like the “Cohen tax” meant to discourage the wealthiest teams from truly and continuously flexing their financial muscle already makes that much more apparent. When teams like the Yankees can lie about their available resources and you can also kind of squint and get why they’d want to lie, that’s a problem.

All of that sounds pretty good in comparison to what the NBA has going for it starting with this upcoming season, however. A “second apron” has been introduced that makes the NBA’s actual soft salary cap more like a hard one. In short, you can basically spend and spend to retain players already on your roster, within the existing rules of what max contracts look like in that capped system, but if you’re over this second apron — it’s a threshold, just like with MLB’s system — and need to acquire more players. Well. You basically can’t. Per The Ringer’s explanation:

Enter the dreaded second apron—and a dastardly new menu of penalties for the NBA’s highest spenders. Next season, teams that exceed $190 million in player salaries—roughly $50 million above the estimated salary cap—will forfeit most of the tools they use to add talent. It’s a long, complicated list of restrictions. They’re prohibited from acquiring players in sign-and-trade deals—or from using their own free agents in a sign-and-trade. They won’t be allowed to aggregate multiple players to send out in a trade. They can make one-for-one trades only if they take back the same (or less) salary—but not a single penny more than they send out. They lose the use of any existing trade exceptions. They’re banned from including cash in any trade. They can’t buy draft picks.

Essentially, a second-apron team is boxed in, left with limited trade options and the ability to sign only minimum-salaried players. Phoenix—with a projected league-high payroll of $206 million next season, most of it tied up in Kevin Durant, Devin Booker, and Bradley Beal—is the new second-apron poster child. They badly need more size, playmaking, and shooting, but the new rules will make it nearly impossible to supplement their stars. “They’re as hosed as you can be, for a team with two of the best players in the league,” says a rival team executive.

You’re already seeing teams cut players or let them walk or send them off in sign-and-trades in order to free up space and steer clear of this second apron, prioritizing flexibility over pure talent. The defending champion Celtics have been an exception, and have in fact signed two of their players to max extensions — including the richest contract in the league for Jayson Tatum, the first $300 million player in league history — but they’re able to do that because the core of their team is under contract for the next couple of seasons already: they don’t need to make any big adds, as their rotation was already loaded with enough depth to win an NBA championship this past season, and they were able to bring back the bench and role players they needed to maintain that depth on the kind of deals they were still allowed to make despite their spending. The teams trying to catch up to their depth to challenge them in the 2025-2026 season have been more timid about what that’ll cost, and what it will do to their flexibility.

It’s not that the NBA was an easy league to upgrade your roster in before with the salary cap in place, but the fact there were so many different ways to exceeding it, just one exception after another that could be exploited for the owner willing to fork over the extra cash, allowed for plenty of creativity that made it clear that the teams not doing those sorts of things either had cheap owners, a front office not up to the task, or both. Now, though, with spending beyond a certain point meaning you’re cut off from that creativity, we’re likely to see a continued reticence to even approach that level of spending, which will in itself limit the use of those creative exceptions, simply to create space, to leave in-season flexibility to react to the needs of the roster as they’re discovered. Which sounds like the kind of laissez-faire approach to roster building that plagues MLB far too often, and makes for a whole bunch of boring mediocrity disguised as parity.

On top of the team-building implications, I have concerns about what it means for player salaries. Stars and superstars are going to be paid — again, Tatum is going to get $63 million per year, putting him behind only Shohei Ohtani’s not-really-$70-million-per-season deferred deal as far as American sports leagues go. But what about role players? How many of them who would have been paid a little more healthily using one of the various exceptions carved out after exceeding the first salary cap threshold are going to have to settle for a veteran minimum deal, which pays more the more years of service you have, but tops out at $3.3 million at 10-plus years of service? Tatum is going to make $63 million in the 2024-2025 season, out of a salary cap expected to sit at around $140 million: that’s 45 percent of the cap space right there.

And there are still workarounds, and obviously the Celtics don’t seem too bothered by it, but they’re in a situation that allows them to ignore the apron for now, one they setup in the lead-in to the introduction of said apron, knowing it was coming. For everyone else, it’s already here, the effects already obvious, and I imagine it’s going to have a negative downstream effect on the size of salaries for non-stars. NBA players as a whole, on aggregate, will still be getting the percentage of overall revenue they’re supposed to by the terms of the CBA, but the median salary seems likely to suffer. It’ll be interesting to come back and check on this once we have a few years’ worth of data to look at, to see what kind of effect this second apron has had, if teams are willing to push right up against it without exceeding it, or if they purposefully steer tens of millions of dollars per year away from it out of an abundance of caution or simply an excuse to not spend when it’s become harder for others to do so, as well.

Visit my Patreon to become a supporter and help me continue to write articles like this one.