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Irish Coffee: Rajon Rondo, financial planning for NBA free agency and a Celtics conspiracy that just makes cents
Posted By Ben Rohrbach On January 31, 2014 @ 5:49 pm In General | 2 Comments
Celtics  captain Rajon Rondo  is due $12.9 million next season — the final year of a five-year, $55 million extension he signed in October 2009 — and the NBA’s new collective bargaining agreement makes any suggestion he’d rather test the free agency waters  than sign another longterm extension an obvious one.
In the simplest terms, Rondo stands to make twice as much money on his next contract if he becomes an unrestricted free agent in 2015. So, when he tells reporters, “I may want to go through” free agency, as he did after Friday’s practice, who can blame him? For years, Paul Pierce  said the same, because it makes financial sense.
The following timeline — cobbled together using Larry Coon’s NBA Salary Cap FAQ  and input from the Celtics  front office — details what max contract Rondo can sign at different points over the next 18 months, and should help explain why Rondo won’t sign an extension this season and may not end up signing one next season.
(Even if Rondo doesn’t ultimately sign for max dollars, which he probably won’t, this exercise should still demonstrate the vast difference in money available to him at various times in his near future.)
Feb. 1, 2014 – June 30, 2014: Rondo can only sign a two-year, $28.8 million extension (2015-16: $13.9 million; 2016-17: $14.9M). Under the new CBA, teams can extend veteran contracts for a total of four years, increasing in salary by 7.5 percent each season. But any season under the player’s current deal counts toward those four years, so because Rondo is signed this season and next, he can currently only sign a two-year extension. However …
July 10, 2014 – June 30, 2015: Rondo can sign a three-year, $44.8 million extension (2017-18: $16M). Given the ACL injury that cost him almost a full year of basketball, he might be open to such security. As ESPN.com’s Chris Forsberg noted , such a deal would also set Rondo up to become a free agent again at age 32 in 2018, when he could command a five-year max deal worth 35 percent of the salary cap as a 10-plus-year veteran.
July 10, 2015: Rondo can sign an estimated five-year, $108 million free-agent contract with the Celtics  (2015-16: $18.6M, 2016-17: $20.0M, 2017-18: $21.5M, 2018-19: $23.1M, 2019-20: $24.8M). He’ll be nine years into his NBA career after next season and can thus command a maximum of 30 percent of the salary cap. These numbers are based off next year’s projected cap of $62.1 million and should actually be even higher in 2015.
In all likelihood, Rondo wouldn’t command a max contract on the open market, but there’s a lot of negotiating room between the $28.8 million he can accept now and the $108 million he could receive next summer. Regardless of which direction Rondo ultimately chooses, he stands to make more money remaining in Boston, since the rest of the league could only offer four years in free agency while the C’s can give him five. So, when he says, “I wouldn’t mind extending another 10 years in Boston,” as he did a week ago, that’s stating the obvious, too.
For conspiracy theorists out there, if Rondo signs a three-year max extension this summer, becomes a free agent in 2018 and then re-signs for the maximum of five years, he will have played exactly 10 more years in Boston. Considering he used a math equation to announce his return, it’s not out of the question he’s made that calculation.
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URL to article: http://greenstreet.weei.com/sports/boston/basketball/celtics/2014/01/31/irish-coffee-rajon-rondo-financial-planning-for-nba-free-agency-and-a-celtics-conspiracy-that-just-makes-cents/
URLs in this post:
 Celtics: http://audio.weei.com/basketball/boston-celtics.htm
 Rajon Rondo: http://audio.weei.com/basketball/rajon-rondo.htm
 any suggestion he’d rather test the free agency waters: http://insider.espn.go.com/nba/story/_/id/10375249/will-carmelo-anthony-sign-chicago-bulls-nba
 Paul Pierce: http://audio.weei.com/basketball/paul-pierce.htm
 Larry Coon’s NBA Salary Cap FAQ: http://www.cbafaq.com/salarycap.htm
 ESPN.com’s Chris Forsberg noted: http://espn.go.com/boston/nba/story/_/id/10340941/a-rajon-rondo-contract-extension-boston-celtics-makes-sense-eventually
 Celtics: http://media.weei.com/basketball/boston-celtics.htm
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