Transaction Summary
- Waived Reed on 12/14 and Resigned him on 12/16 to 1 Year, $1,530,375 Veteran Minimum Contract (salary prior to subsidization for Cap Purposes);
- Signed Javante McCoy on 12/15 to 1 Year, $1,417,937 Contract and waived him on 12/16
Cap Discussion
Detroit’s Capsheet Prior to Transactions
DET’s team salary sat at $130,348,501 prior to the above transactions with the minimum 14 roster spots filled. Reed’s $7,723,000 was the only non-guaranteed salary on the roster. During the Regular Season, a player’s non-guaranteed salary accrues on a per-day basis until it becomes fully non-guaranteed on January 10th. The per-day amount is 1/174 of the total salary (174 is the total amount of days in a Season). As a result, Reed’s salary was accruing at $44,385 per day until he was waived.
Waiving Reed’s Contract
To stop his non-guaranteed salary from accruing at the per-day rate above, DET waived his contract. DET then absorbs his “Dead Salary” for the amount accrued until the day he clears waivers (unless he had been claimed by a team, at which point the claiming team would have acquired his entire contract/salary). In calculating his Dead Salary, you count the amount of days he was on the roster: from the start of the Regular Season through the day he clears waivers (not the day DET requests waivers). In Reed’s case, that is 56 days. You then multiply his per-day salary by his days on the roster to find his total Dead Salary: $2,485,563.
Detroit’s Capsheet After Waiving Reed
Waiving Reed’s first contract and absorbing his dead salary saved them $5,237,437, lowering their Team Salary to $125,111,064, which is below the Salary Floor of $125,529,200 (90% of the Salary Cap). If a transaction during the Regular Season drops a Team below the Salary Floor, the Team Salary must increase to the threshold by the end of the immediately following business day. While DET intended to resign Reed to a minimum contract, they aren’t able to do so until he clears waivers, which takes 48 hours. Therefore, they have to sign another player to reach the Salary Floor beforehand.
Signing McCoy/Resigning Reed
DET used cap space to sign Javante McCoy to a non-guaranteed 1-year, $1,417,937 contract on December 15th. This put DET over the Salary Floor within the one-day timeframe as they wait for Reed to clear waivers on December 16th. Then, on December 16th, McCoy is waived and Reed is signed to his minimum contract. McCoy accrued Dead Salary, which is calculated the same way as Reed’s was discussed above: $1,417,947 divided by 174 results in a $8,149 per-day salary. $8,149 x 4 days on the roster = $32,596 in Dead Salary.
Reed signs the one-year veteran minimum, which is subsidized down to a player with 2 Years of Service for cap purposes: $2,087,519. Then it’s prorated as of the December 16th signing for a cap hit of $1,427,671. Reed’s new contract is fully guaranteed, and because it is a free agent signing he can’t be traded for three months (and therefore can’t be traded for the length of the contract).
Detroit’s Capsheet After Transactions
DET’s final Team Salary is $126,571,331 after all transactions, which is $1,042,131 above the Salary Floor and $14,016,669 below the Salary Cap, saving them $3,777,170 in additional Cap Space while retaining the same roster prior to the transactions.
