Big spenders » The Utah Jazz are embarking on their most expensive season, having to pay the NBA's luxury tax for the first time.
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As much as they have valued continuity with respect to their coaching staff, players and front office over the years, the Jazz will make one dramatic -- and costly -- break with the past this season.
Despite the opposition voiced by late owner Larry Miller, the Jazz are poised to pay the NBA's luxury tax for the first time in franchise history, taking their place alongside the league's traditionally biggest-spending teams.
With $82.1 million in salary commitments, the Jazz would be assessed an additional $12.1 million in penalties for exceeding the league's tax threshold of $69.92 million, making this by far the most expensive season in their history.
"It's tough to end up with that payroll, period," Jazz general manager Kevin O'Connor said. "It certainly is. Now we've got to go out on the court and prove that it's worth it. Those are some of the things that are our responsibility."
"If you said to me, 'Could we afford an $82 million to $90 million payroll every year?' No, we can't do that," O'Connor added. "But there are some exceptions to the rule, and this is one of those years when we caught a lot of people in the last year of their contracts."
As they prepare to open the preseason tonight against Denver, the Jazz are facing the prospect of spending $94.2 million to bring back 12 players from last season's team that finished with a 48-34 record and eighth in the Western Conference.
The Jazz hardly fit the bill of a typical luxury-tax team, as they play in the league's sixth-smallest market and are not among its top tier of championship contenders, but circumstances have dictated otherwise this season.
Once Carlos Boozer, Mehmet Okur and Kyle Korver each decided in late June to play the final year of their contracts rather than opt for free agency, the Jazz effectively were saddled with a luxury-tax payroll. The pain only was exacerbated when Portland signed Paul Millsap to a four-year, $32 million offer sheet that the Jazz decided to match. The Jazz prepared for every contingency, O'Connor said, but that didn't make things easier.
"We didn't have a whole lot of options," O'Connor said. "We had one decision to make and that was on Paul."
As he talked through the various scenarios with the Millers, O'Connor said the main argument was keeping young players valuable to the franchise's future at the expense of a season of financial pain.
"We had talked for a long time that this was a possibility," O'Connor said, "but it could be a one-year possibility."
With a $65.8 million payroll last season, the Jazz will spend roughly 43 percent more to keep an almost identical team together, even as the recession takes a toll on teams around the league.
"I want the Millers to make the best decision they can," Jazz coach Jerry Sloan said. "I'm kind of caught in no-man's land with that. I want the players here to play. I appreciate [the Millers'] support in trying to keep players.
"I've always felt like it's important to keep players together, give them a chance to know each other. Your young guys get better as you go along. That's how you have a chance to build a team that's competitive."
Asked about the Jazz being a $94 million team, Sloan said, "That's up to them to prove who they are."
It is difficult to calculate payrolls with teams still making roster decisions, but the Jazz project to be in sixth behind only the L.A. Lakers, Dallas, Boston, New York and Orlando. The Lakers lead the NBA with a $91.3 million payroll, $112.8 million with the tax.
(The Jazz's payroll still could climb should they decide to add a 14th player to help fill the void left by Matt Harpring.)
As recently as August 2008, Miller said, "I do not intend for us to be a luxury-tax payer, but only because we have to have an economically stable franchise regardless of anything else." Through a team spokeswoman, chief executive Greg Miller declined to comment.
Unless they make a series of dramatic moves to slash payroll, the Jazz will pay the tax at season's end. By doing so, they also will lose out on a share of revenue from the league's tax-paying teams, worth $2.9 million to them last season.
The Jazz's players were largely uninterested in talking about the team's payroll. Andrei Kirilenko said he was surprised at the Jazz's willingness to pay the tax but added that he was happy to keep the roster together.
Okur called it a tough situation for the Millers, especially with the economy. "All we've got to do, go out there, even play harder, try to win more games," Okur said. Deron Williams added it was an issue for management, not the players.
"They said they were willing to spend money to make the team better, so I guess that's the way to do it," Williams said.
The long-term effects from this season's payroll are difficult to predict. Will the team have to raise ticket prices for next season? Will the Jazz face greater resistance from large-market teams for revenue-sharing concessions down the road? Most significantly, will the Jazz be reluctant to pay the tax in the future for a championship-caliber team if this season fails to meet expectations?
O'Connor declined to talk in specifics about what kind of playoff run the Jazz would need to break even with their current payroll. "What I want to do is have a very good basketball team and be an elite team," O'Connor said. "I can't go past that."
As determined as they are to pay the tax this season only, the Jazz have $50 million committed to only four players -- Kirilenko, Williams, Okur and Millsap -- for the 2010-11 season, while the NBA has projected its tax threshold could drop as low as $61.2 million.
"We control our own fate next year," O'Connor said. "We didn't this year."
Although it is difficult to determine exact payrolls with roster decisions still to be made, the Jazz project to have the NBA's sixth-largest payroll entering the season.
1. L.A. Lakers ($91.3 million)
2. Dallas ($87.7 million)
3. New York ($84.5 million)
4. Boston ($84.0 million)
5. Orlando ($82.5 million)
6. Jazz ($82.1 million)
Note: Teams will be assessed an additional dollar-for-dollar penalty for the amount they exceed the NBA's luxury-tax threshold of $69.92 million
D. Williams $13.521M
C. Boozer $12.657M
M. Okur $9M
P. Millsap $7.693M
M. Harpring $6.5M
K. Korver $5.164M
C.J. Miles $3.7M
R. Brewer $2.717M
E. Maynor $1.319M
R. Price $1.25M
K. Koufos $1.214M
K. Fesenko $870,000
A sampling of the Jazz's payroll history, from 1985-present:
» 1985-86 $3.185M
» 1993-92 $14.096M
» 1996-97 $25.782M
» 2001-02 $53.207M
» 2009-10 $82.056M
Source: Staff, Basketball-Reference.com
A sampling of the Jazz's payroll history, from 1985-present.
1985-86 $3.185 million
1993-92 $14.096 million
1997-98 $28.5 million
2001-02 $53.207 million
Source: Staff, Basketball-Reference.com