NBA salary cap to be reduced by $3 million to $12 million next season

NBA team executives are preparing to have a lower salary cap in place for the 2020-21 season. A report in the San Francisco Chronicle over the weekend stated the salary cap will be reduced by between $3 million and $12 million.

The salary cap last season was $109.14 million. In addition, teams were required to spend a minimum of $98.226 million on salaries, as outlined in this report.

The decreased salary cap will create necessary adjustments to roster building.

For example, signing an important role player or multiple players could be problematic for teams with limited room under the cap.

Take the Golden State Warriors, for example. Stephen Curry, Draymond Green, Klay Thompson and Andrew Wiggins have a combined salary of over $130.1 million.

The first three are probably untouchables, but where does that leave Wiggins?

Or as Morten Jensen wrote for Forbes.com: “The question here becomes: Which organization would be willing to take on Wiggins’ contract, that has over $94.7 million remaining over the next three seasons?”

Salary cap numbers

In the 21st century, the NBA’s growth on a global scale has led to skyrocketing salaries.

Case in point: The NBA salary cap was $35.5 million in 2000-01.

Ten years later, it was $58.04 million.

Then, in the 201-19 campaign, it was $101.869 million.

Financial challenges

After the NBA suspended on March 11 due to the global pandemic, there were projections of big financial losses. And a salary cap reduction was already being discussed.

Thus, as the NBA deals with a massive reduction in revenue projections for the 2020-21 campaign, negotiations are underway about taking increased escrow from players’ salaries, ESPN.com reported.

“Agents are bracing for the possibility of up to 40 percent of the escrow being withheld from players, sources told ESPN,” the website reported.

The NBA lost more than $1 billion in revenue during the COVID-19-impacted season.