Image Source: NBA – Warriors
[Saba Sports News] Recently, the Golden State Warriors’ financial strategies have come under scrutiny due to their hefty luxury tax payments, leading to an initiative for significant team restructuring by owner Joe Lacob. The Warriors hold the record for the highest luxury tax payments in the NBA since the system’s introduction in 2002.
Despite efforts to lower costs, they are projected to spend around $360 million in total salaries and luxury taxes this season. Lacob emphasized on “The TK Show” that moving out of the luxury tax bracket is the team’s main objective for the upcoming season. He outlined a strategy for achieving this goal, aiming to avoid the severe penalties introduced in the latest NBA collective bargaining agreement, which penalizes teams heavily for exceeding certain luxury tax thresholds.
“Our Plan 1, or 1A, is that we’d like to be out of the tax, and we think that we have a way to do that. That kind of is the plan, not just under the second apron,” Lacob revealed.
The Warriors are looking to not just avoid these harsher penalties but to exit the luxury tax realm entirely, suggesting potential major changes to the team’s roster. With $137 million already committed in salaries for next season, the Warriors are poised to stay below the projected $172 million luxury tax threshold.
However, this calculation doesn’t account for key players like Klay Thompson, who is a free agent, and Chris Paul, whose $30 million contract is not guaranteed. Adjustments will likely be needed, including possible salary reductions for Thompson, who has acknowledged his declining performance, and a decision on Paul’s future with the team.
Additionally, the Warriors will need to consider the contract extension eligibility of young talent like Jonathan Kuminga. These factors underscore the challenging decisions facing the Warriors as they aim for financial flexibility.