How Dallas, Indiana, Chicago, and Los Angeles Clippers are creating extra cap space this summer

It’s a super small thing, but the teams who are agreeing to terms early with their own restricted free agents are seeing a slight benefit – they can rescind the qualifying offer for those players and open up a bit of extra cap space. It’s not a tactic that works for every restricted free agent, but there have been four so far this offseason who have agreed to re-sign with their incumbent teams and therefore added cap space back to their team’s coffers.

In Dallas, both Dorian Finney-Smith and Maxi Kleber have agreed to return to the Mavericks. Finney-Smith had a cap hold of $1.93 million after his third year in the league, while Kleber had a cap hold of $1.82 million. However, now that both players have agreed to come back and the Mavericks no longer need their match rights, Dallas can pull both players’ qualifying offers in order to lower they cap holds to $1.62 million each, which opens up about another $500k in cap space for the Mavericks to use. As of this writing, Dallas has $22.92 million in cap space available to them.

In Indiana, the same trick applies to Edmond Sumner, who had a similar $1.82 million cap hold and now drops to $1.62 million. The Pacers now have $2.13 million in remaining cap space, including the partially guaranteed contract of Alize Johnson, though newly-agreed T.J. McConnell also fits Indiana’s Room Exception; if they move him to that exception, then they’re back up to about $5.55 million in space.

Chicago can apply the same idea to Ryan Arcidiacono’s new contract, which will start at around $2.86 million, though could be higher depending on how they structure things. He had counted for $1.82 million on their books as a restricted free agent, but he’ll fall down to $1.62 million after agreeing to terms with the Bulls.

Perhaps the most important of these moves came in Los Angeles, when it was reported that the Clippers had agreed to terms on a three-year deal with Rodney McGruder for $15 million. Due to starting more than 41 games last year in Miami, McGruder, who was claimed by Los Angeles near the end of the season, had a qualifying offer and cap hold of $3.02 million. That qualifying offer, now rescinded, moves his cap hold back down to $1.62 million, which puts another $1.4 million in cap space on the Clippers’ books.

It’s particularly important for the Clippers because of their chase for Kawhi Leonard, who still has yet to make his decision. If McGruder had counted for his full $3.02 million, they would have had to move on from at least one of him, Ivica Zubac, Sindarius Thornwell, or Tyrone Wallace in order to open up the requisite cap space to sign Leonard to his max deal, but that extra $1.4 million gained by agreeing to terms with McGruder makes it possible for them to sign him outright and keep everybody else intact. The Clippers have $33.71 million in cap space right now. Should they agree terms with Zubac, who has a $1.93 million cap hold, the same principle would apply and they would gain an extra $300k in cap space by pulling his qualifying offer.

There are other players who are still free agents to whom this tactic would apply: Khem Birch in Orlando, Ray Spalding in Phoenix, Jake Layman in Portland, and Nando De Colo and Patrick McCaw in Toronto. Of those teams, only Phoenix has cap space, so they’re the only ones who would benefit from doing something like this.

In all four of these circumstances, the team will use whatever version of Bird rights they have on the player to exceed the cap after using up all of their other cap space first.

It’s important to note that this isn’t available with every restricted free agent. Players who were formerly first-round picks have the same cap hold whether they’re restricted or unrestricted, so Dallas cannot pull the qualifying offer for Kristaps Porzingis and obtain any extra salary cap flexibility. They can still do that, but there’s no reason to do so. The same applies for any other 2015 first-round pick hitting restricted free agency this summer.