The word supermax sounds more like a comic book character than anything to do with NBA free agency. While it may be a unique term, supermax contracts have a major impact on free agents and NBA teams.
The supermax provision allowed Steph Curry to agree to a $201 million contract to remain with the Warriors. It will be the biggest contract in NBA history.
What is a supermax contract, and what players are eligible to sign this type of mega-deal? In short, it is a contract extension for players who meet certain criteria. The designated-player exception (known commonly as the supermax) was added in the most recent NBA collective bargaining agreement to give teams a better chance to retain their own star players. In particular, it could help small market teams compete in free agency with larger markets.
According to The Atlantic, the supermax deals allow the current team to offer $70 million more than any other team. This is a massive difference even to players who are multi-millionaires. What players are eligible? This is where is gets complicated.
A player needs to either be entering (or have just completed) his eighth or ninth season. As The Atlantic points outs, players aiming to eventually land a supermax deal would sign a contract extension after their rookie deal. After this extension, eligible players could sign a supermax contract. For most of the eligible players, the supermax deal would be their third NBA contract.
In addition to the time threshold, there is a performance element that a player must reach to be eligible. The Washington Post lays out this criteria which includes all-NBA teams:
A player qualifies for the DPE [Designated Player Exception], which can be used to give a player a contract extension or to sign him as a free agent, if he does one of the following:
1. He makes one of the three all-NBA teams or is named either defensive player of the year or most valuable player the previous season.
2. He has made one of the three all-NBA teams or has been named defensive player of the year in two of the prior three seasons or the league’s most valuable player in one of the three prior seasons.
And this crucial stipulation: He has to be on the team that drafted him or has to have been traded on his rookie deal to another team.
The rule may not help as many small market teams as the league hoped. Gordon Hayward and Paul George both missed out on being named to the all-NBA teams, meaning they are not eligible for supermax deals. It remains to be seen if the Jazz can keep Hayward, but George already informed the Pacers he planned on signing elsewhere after the 2017-18 season.
However, it looks like it will give Oklahoma City an advantage in retaining Russell Westbrook, who is eligible for a supermax extension this off-season.
How much is a supermax contract worth? ESPN reports players’ supermax salary can be up to 35 percent of the salary cap. The 2017-18 salary cap has been reported to be $99 million, which is less than originally expected.
It is too early to tell how the supermax contracts will impact free agency, but it does put a lot of money on the table for the NBA’s elite players.