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Cap recapture when there was salary retention in a trade

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Old
01-12-2013, 04:30 PM
  #1
BaseballCoach
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Cap recapture when there was salary retention in a trade

The question has come up about a guy like Luongo being traded and not finishing his career. Then suppose Vancouver took on some of his salary an cap. How would the recapture work?

If things are logical, I believe the original team will get MORE of the recapture, as they should, since they are agreeing to take part of the cap hit for the acquiring team.

Take a contract that goes like this
10-10-10-7-7-5-5-1-1-1
Total dollars committed 57, cap hit 5.7

Say the guy plays for Team-1 for 2 years, and Team-2 for 5 years, and suppose that Team-1 retained 20% of remaining salary and cap hit. Then, this is what I think SHOULD happen.

First let us look at what happens if there is no salary/cap retention in the trade.

Team-1 gets a frozen cap recapture of $8.6M, because they paid $20M and had a cap hit of $11.4M, over two years.
For the first five years after the trade, Team 2 paid $34M and got hit with cap of $28.5M, so they have a cumulative recapture of $5.5M.

Now the player retires, three years early. Team-1 will have a cap adjustment of $2.867M for each of three years, while Team-2 will have a cap adjustment of $1.833M for each of three years.

Let us now add the 20% retention clause.

Team-1 has now paid the following
10-10-2-1.4-1.4-1-1 for a Total $26.8M
and has absorbed cap hits of
5.7-5.7.-1.14-1.14-1.14-1.14-1.14 for a Total $17.1M

Team-1 now has a cap recapture of $9.7, which is $1.1M more than they had in the first case, which is correct, since $1.1M is 20% of the $5.5M recapture that Team-2 would have had.

Team-2 has now paid the following
8-5.6-5.6-4-4 for a Total $27.2M
and has absorbed cap hits of
4.56 x 5 for a Total $22.8M

Team-2 now has a cap recapture of $4.4M, which is $1.1M less than they had in the first case, which is correct, since $1.1M is 20% of the $5.5M recapture that Team-2 would have had.

Does anyone know if this is how it would work under the actual terms of the CBA?

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Old
01-12-2013, 05:05 PM
  #2
jpchabby
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Quote:
Originally Posted by BaseballCoach View Post
The question has come up about a guy like Luongo being traded and not finishing his career. Then suppose Vancouver took on some of his salary an cap. How would the recapture work?
Would this mean... that... he plays forever and never retires?

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