Retaining E'Twaun Moore - Salary Cap Concerns

I saw the following tweet crawl across my Twitter feed this morning in the wake of E'Twaun Moore's strong performance against the Bucks (16 points, 7 assists) last night:

In the article, KC Johnson says the following:

The Bulls Need to Re-sign E'Twaun Moore

A surprise starter when Jimmy Butler was a late scratch with a swollen left knee, Moore picked up where he left off during Butler's previous 11-game absence. The steady veteran delivered 16 points, seven assists, and zero turnovers while playing strong defense.

Moore will be an unrestricted free agent this summer and has turned into a reliable, two-way combo guard that the Bulls can ill-afford to lose.

Moore really has proven he's a solid contributor on this team, and the Bulls would do well to bring him back. He's not the solution that's going to get the Bulls past the Cavaliers or anything, but he's been really solid as the team's third-best wing (behind Butler/Dunleavy) this year, and would be great to retain in free agency. But at what price? And with what cap ramifications?

As KC Johnson noted, Moore is an unrestricted free agent, and can sign anywhere a team has cap space or a salary cap exception to fit him in. In this environment with an exploding salary cap (estimates now have next year's cap approaching $92 million, via BBallBreakdown, via Zach Lowe), that includes most teams.

According to Basketball Insiders, the Bulls have about $65 million in guaranteed salary on their cap sheet heading into next season. This includes the following players: Rose, Butler, Gibson, Mirotic, Dunleavy, McDermott, Snell, Portis, Holiday. It does not include Pau Gasol's player option or the non-guaranteed deals of Felicio or Bairstow. It also does not include Joakim Noah. The Bulls will also have a cap hold for their mid-first round draft pick, and if the Kings draft pick is conveyed to the Bulls (yeah right, ha!), they will have another cap hold in place for that pick. Finally, the Bulls will have small roster charges for each player they are short of the minimum roster size.

Based on that, there are a couple different options the Bulls can utilize to re-sign Moore, but they really depend on how the Bulls utilize the copious amount of cap space they should have entering the offseason. There are essentially two options with regard to re-signing Moore: using the Bulls' cap space and using Moore's Early Bird rights.

According to the CBA FAQ by Larry Coon, the Early Bird Exception allows teams to exceed the salary cap to re-sign their own free agents. (As a complicating factor, Pau Gasol also is eligible to be signed via the Early Bird Exception and would have a cap hold that is a couple million dollars less than the maximum amount he could be paid via the Early Bird Exception after declining his player option.) To qualify for the Early Bird Exception, the player must play for two seasons without clearing waivers or changing teams as a free agent. A team may use the Early Bird exception to re-sign its own free agent for up to 175% of his salary in the previous season or 104.5% of the average salary in the previous season, whichever is greater.

The "average salary" for 2015-16 is not determined yet, but is estimated to be $5.74 million. This means an Early Bird exception contract for E'Twaun Moore could start at 2 years, $12 million, and he could be retained while the Bulls exceed their available cap space. (E'Twaun Moore will have a cap hold equal to 130% of his 2015-16 salary this offseason.) Early Bird Exception contracts can be up to four years in length with 7.5% raises season-over-season, so the longest, most high-paying contract Moore could receive under this exception is 4 years, roughly $26 million. If Moore is unable to secure more than $6m per year elsewhere, this will be one of the main advantages the Bulls have this offseason -- the ability to exceed the rapidly ascending cap by retaining Moore while utilizing the remaining cap space on needs other than backup wing.

In the event Moore is able to demand an amount north of $6 million per year from other teams, the Bulls would have to expend cap space to retain him. It's unclear what the best use of their cap space would be at this time, but based on the roster construction described above, the Bulls will need at least one rotation big man, one wing, and at least one backup point guard, and will only have their own cap space and the Room Mid-Level exception, which allows contracts up to two years in length, starting at $2.898 million per year.

Technically, the Bulls also could remain over the cap by maintaining all cap holds, including Joakim Noah's $20m+ cap hold, Pau Gasol's approximately $9.6 million cap hold, and Aaron Brooks' $3 million cap hold, and then sign E'Twaun Moore to Non-Taxpayer Mid-Level Exception, which starts at $5.628 million per year. This would, however, have the same effect as utilizing the Early Bird Exception, but for less total money, and at the added cost of not being able to use the Non-Taxpayer Mid-Level Exception on anyone else. This course of action seems extremely unlikely.

(I know there are a lot of other people here who know the CBA and salary cap stuff well, and this is an area where it's easy to miss something. Let me know if you think I've messed up somewhere in all this.)

The other question is: what is Moore actually worth in free agency? I think I've seen people say in the comments that they'd pay him up to between $6-8 million per year. Is that worth dipping into the Bulls' precious cap space for? I haven't really figured out what my preferred outcome is for the Bulls' offseason at this point, but I figured I'd put this out there for everybody's thoughts. I'm very interested in seeing how the Bulls' offseason plays out.

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