It's easy to lose track of all the moving parts surrounding the Atlanta Hawks this summer. They must find a new assistant coach, build a summer league squad, and upgrade a deficient roster with little financial flexibility.
However, one major decision will be made before the end of this week. If Danilo Gallinari is still on the roster come Thursday, June 30, then the 33-year-old is owed all $21.5 million remaining for the final season of his contract. If Atlanta's front office chooses to waive the veteran power forward, they will only owe him $5 million.
Despite internet rumors, no outlet has reported the Hawks official plans for Gallinari's future with the team. Waiving the veteran power forward would be an easy cost-cutting measure for general manager Landry Fields and team president Travis Schlenk.
If Gallinari is waived, Atlanta would be able to use the non-taxpayer midlevel exception, which is $10.3 million, and a $4.1 million biannual exception. Should the front office decide to keep Gallinari on the roster (at least for now), then the $10.3 million non-taxpayer midlevel exception turns into a taxpayer $6.4 million exception.
The NBA salary cap and the jargon used in the CBA can be confusing. So let's start from the beginning. The salary cap for next season is projected to be $122 million. Meanwhile, the luxury tax threshold is $149 million (meaning the luxury tax kicks in at that point). The luxury tax apron, which hard-capped teams must remain below, is $155.2 million.
Teams without cap space still have spending power to add external free agents through midlevel exceptions. Exceptions are grants offering teams an additional way to sign players. Taxpayer midlevel exceptions are awarded annually to teams who are above the salary cap and above the luxury tax apron.
If an over-the-cap team operates below the luxury tax apron, it has access to the $10.35 million non-taxpayer mid-level exception. A non-taxpayer midlevel exception contract can be up to four years in length. That type of team also has access to the $4.05 bi-annual exception (unless it was used last offseason). If a team uses the non-taxpayer midlevel exception or bi-annual exception, it’s hard-capped at the apron for the remainder of the league year.
Long story short, Atlanta can create immediate cap space right before free agency hits by waiving Gallinari. Their total taxable salaries would decrease by $16.5 million. It seems overwhelmingly likely that Atlanta chooses to waive Gallinari unless his expiring contract is needed as filler as part of a larger trade package.
Once a decision on Gallinari is made, then we are officially off to the races in free agency. The decision will also signal the front office's plans for the future. Stay locked into AllHawks.com for breaking news, highlights, and analysis.
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