How LeBron James Would Fit in Cleveland Cavaliers Salary Cap Situation

The Cavaliers have been very quiet since the option deadline at the end of June. Let’s take a look at the salary situation now that some of the Cavs free agents have found new homes while LeBron remains available.

Apr 15, 2018; Cleveland, OH, USA; Cleveland Cavaliers general manager Koby Altman sits on the scorers table before a game against the Indiana Pacers in game one of the first round of the 2018 NBA Playoffs at Quicken Loans Arena. Mandatory Credit: David Richard-USA TODAY Sports | IMAGN IMAGES via Reuters Connect

After James Harden declined his player option, the Cavaliers lost both Dean Wade and Keon Ellis. The Cavaliers did re-sign Thomas Bryant in the intermediary, but all of the buzz has been around LeBron James.

Fans have been excited about the possibility of bringing LeBron back, especially since reports suggest he might sign for the veteran minimum. However, the Cavaliers have a complex salary situation to consider. 

With only $25 million in space before the first apron, let's look at a potential scenario where LeBron returns to the Cavaliers.

Re-signing Harden

While re-signing Harden is likely to be one of the final moves of the offseason, he is likely to return to the Cavs. I would anticipate Harden to sign a two year deal around $20-25 million with much of the deal guaranteed.

This may not be the $30 million deal that Harden was anticipating, but the Cavaliers can make it up in guaranteed money as Harden appears to be a perennial buyout candidate at this stage of his career. This would also be a small pay cut for what very well may be Harden’s last legitimate chance at a championship in addition to the allure of LeBron James.

With only $5 million left in space, the Cavaliers will have to decide whether to exceed the first apron or utilize the non-taxpayer mid-level exception(MLE) and get hard capped at the first apron.

Retooling

The smartest avenue available to the Cavaliers would be to clear cap space, stay under the first apron, and generate an MLE to offer to a free agent. The easiest way to do this would be to trade Dennis Schroder and either Sam Merrill or Max Strus for cap relief.

If the Cavaliers can move Dennis Schroder in a multi-team deal that lands the Cavaliers Bronny James and draft picks, the Cavs would save about $12.5 million. Depending on how much Harden will demand, Strus or Merrill(more likely Merrill) would also need to be traded for a player on a minimum contract or picks.

Filling out the last roster spaces

Assuming Harden’s return, the Cavs can anticipate 3-4 roster spots to remain open. One of these roster spots would go to LeBron on a veteran minimum deal, and another would be available to any player willing to sign for the MLE(about $15 million).

This MLE player could be anybody on the free agency market or obtained via trade; however, a popular theory amongst Cavs fans is that long-time Golden State Warrior Draymond Green might be enticed by such a deal.

The Cavaliers could fill the last spot or two with veteran minimum players that might be lured to the Cavs by LeBron’s presence like DeMar DeRozan. However, the Cavaliers would still own a bi-annual exception as well of around $5.5 million.

It would be wise for the Cavaliers to stash this bi-annual exception and any remaining salary cap room for potential mid-season roster adjustments ahead of the trade deadline.

The Cavaliers would also have additional financial flexibility should they choose to sign Summer League standout Meleek Thomas to a roster spot, rather than a two-way contract, as Thomas’ rookie contract would cost the Cavaliers slightly less than a veteran minimum player.