The summer of 2020 was supposed to bring closure for the NBA's top team. Weeks after challenging for their first championship since 1974, the Milwaukee Bucks would be able to offer superstar Giannis Antetokounmpo the largest contract in NBA history, valued at a projected $254 million.
Antetokounmpo agreeing to such a deal would help prove that a mid-market team could retain a franchise player with strong team-building. It would also provide justification for the supermax rules, which were introduced in the 2017 collective bargaining agreement.
Now, Antetokounmpo's upcoming supermax decision is full of uncertainty. The Bucks are chasing a title under unprecedented circumstances as the NBA restarts its season, and free agency will hit in October with the league's financial future lacking clarity.
How will the new realities of the league and an uncertain salary cap affect Antetokounmpo's massive decision this fall? And what are the implications for Milwaukee and the rest of the NBA if Antetokounmpo, 25, either signs a new deal or declines the supermax -- potentially making him one of the best free agents in league history in 2021?
Here's a look at the big questions and some early answers.
How Milwaukee's supermax offer will work
Typically, the NBA salary cap is set using a formula based on basketball-related income (BRI) from the previous season. The league also keeps teams informed of future cap numbers based on revenue projections, and in June 2019, those projections were for a $117 million cap in 2020-21, with a bump to $125 million for 2021-22.
The cap is important here, because the financial value of the Bucks' supermax offer to Antetokounmpo will be based on a percentage of the salary cap for 2021-22 -- the first year of Antetokounmpo's new deal -- though there's now no certainty that number hits the initial $125 million projection.
With the NBA expected to lose at least a billion dollars in revenue due to the coronavirus pandemic, the preseason conflict with China and the potential to not have fans in arenas next season, the league and the players' union are expected to ditch the BRI-based formula and collectively bargain new cap and luxury-tax numbers for both 2020-21 and 2021-22. That's the only way to provide some sense of stability for teams as they plan their rosters moving forward.
We don't know where those cap numbers will fall, though many around the league expect the 2019-20 numbers to hold for 2020-21, meaning a $109 million cap and a $132 million tax. The cap would likely rise for 2021-22.
Since Antetokounmpo qualified for the supermax by making multiple All-NBA teams (and winning MVP), Milwaukee will be able to -- and assuredly will -- offer him a five-year contract right at the start of free agency in October, with a salary starting at 35% of the 2021-22 cap. By then, the cap for the next two seasons should be set, so the Bucks and Antetokounmpo will know the actual value of the offer.
Here's the financial breakdown of the offers the Bucks -- and free-agent suitors in 2021 -- could have made to Antetokounmpo based on the initial cap projection. Any team other than the Bucks would be limited to offering Antetokounmpo a four-year deal for a smaller percentage of the cap.
$125 million cap
2021-22: $43.8M (MIL) | $37.5M (new team)
2022-23: $47.3M (MIL) | $39.4M (new team)
2023-24: $50.8M (MIL) | $41.3M (new team)
2024-25: $54.3M (MIL) | $43.1M (new team)
2025-26: $57.8M (MIL) | N/A
Total: $253.8M (MIL) | $161.3M (new team)
Let's assume that the league and the union negotiate a smaller cap number than that given the upcoming financial challenges, with an artificial smoothing approach that puts the 2021-22 cap at $118 million. Here's what the offers would look like in that case:
$118 million cap
2021-22: $41.3M (MIL) | $35.4M (new team)
2022-23: $44.6M (MIL) | $37.2M (new team)
2023-24: $47.9M (MIL) | $38.9M (new team)
2024-25: $51.2M (MIL) | $40.7M (new team)
2025-26: $54.2M (MIL) | N/A
Total: $239.5M (MIL) | $152.2M (new team)
Milwaukee will have multiple advantages over the other teams interested in Antetokounmpo, including:
The Bucks are the only team that can offer a starting salary of 35% of the cap for five years. Under a $118 million cap, Milwaukee could offer $87 million more in guaranteed money -- though a new team could close some of that gap by re-signing Antetokounmpo to another max deal in 2025-26.
Due to the years-of-service rules, the next time Antetokounmpo could sign a contract for 35% of the cap with a team other than Milwaukee would be in the summer of 2023, when he'll be a 10-year veteran.
The Bucks have the best record in the NBA and a roster built for sustainable success -- whether they win the 2020 championship or not. That wasn't the case for the New Orleans Pelicans when Anthony Davis requested a trade before the Pelicans could make their supermax offer one year before his free agency.
How would a supermax affect the Bucks' finances?
When Milwaukee decided to let Malcolm Brogdon go in free agency last offseason, owner Marc Lasry said that there was going to be a balancing act of building a championship roster while considering the impact on team finances.
"I think our stance is pretty similar," Lasry told reporters. "I don't think we have an issue of being in the luxury tax. I think part of it is we know we're going to be there. We're definitely going to be there in a couple of years, so that's not the question. The question ends up being, was re-signing Malcolm an imperative? I think re-signing Malcolm was a luxury. And our view was that Malcolm is a phenomenal player, but for that amount of money, we thought we could have those dollars better spent elsewhere. And we'll find out."
Lasry's stance will be tested over the upcoming seasons. The Bucks will be right at the luxury tax for 2020-21 if the line holds at $132.7 million, though there's some flexibility with the $7 million non-guaranteed contract of Ersan Ilyasova. (Ilyasova's deal becomes guaranteed if he is not waived by 5 p.m. ET. on Oct. 18.) That will be true even if Antetokounmpo passes on the offer, because he's under contract for next season.
If Antetokounmpo agrees to the deal, the Bucks' front office will need to be creative when building out the back end of the roster for 2021-22. They do have their core players on long-term contracts, along with former first-round pick Donte DiVincenzo and two additional first-rounders on the way (via the Indiana Pacers in 2020 and their own in 2021). To fill out the rotation, Milwaukee will have to resort to the same type of low-cost signings it pursued in 2020 with Robin Lopez, Kyle Korver and Wesley Matthews.
Here's Milwaukee's cap sheet for the next four seasons, along with some estimated cap and tax projections.
The likelihood is that Milwaukee will be a tax team for the first time since 2002-03 beginning next season. However, keep in mind that there is a cost associated with building a championship roster. The Miami Heat, Cleveland Cavaliers and Golden State Warriors all paid a luxury-tax penalty in the seasons they won championships last decade.
Resources to build out the roster
If Antetokounmpo decides to sign the supermax, here's a year-by-year breakdown of the ways in which the Bucks can continue to build the roster around him:
2020-21
The draft: first-rounder via Indiana
Early Bird rights on free agent Pat Connaughton
Cash to send or receive in a trade
Ilyasova's $7 million expiring contract
D.J. Wilson is rookie extension-eligible
Exceptions: midlevel, biannual and minimum
2021-22
The draft: own first-round pick
Cash to send or receive in a trade
DiVincenzo is rookie extension-eligible
Possible early Bird rights on Matthews and Robin Lopez
George Hill's expiring contract
Exceptions: tax and minimum
2022-23
The draft: own second-round pick
Cash to send or receive in a trade
Expiring contracts in Eric Bledsoe and Brook Lopez
Exceptions: midlevel, biannual and minimum
2023-24
The draft: own first-round and second-round picks
Cash to send or receive in a trade
Khris Middleton's expiring contract
Cap space flexibility: up to a projected $30 million in room to spend
Exceptions: midlevel, biannual and minimum
What if Antetokounmpo passes?
Would you take the reigning MVP for one season, even if you could lose him for nothing in free agency the following year? If you polled all 30 NBA teams for the answer to that question, a large majority would say yes. Just ask the defending champion Toronto Raptors about Kawhi Leonard.
If Antetokounmpo decides to hold off on his decision until the summer of 2021, the Bucks should not make any panic moves. If he demands a trade, that's a different story, but Milwaukee should be confident that it can make the best financial and basketball pitch. Plus, the Bucks would have one more season to recruit him as legitimate title contenders.
And a potential reduction in the cap would help the Bucks when it comes to Antetokounmpo's potential suitors.
Under a $118 million cap, the Los Angeles Lakers would see their projected cap space go from $29 million to $22 million -- $13 million short of Antetokounmpo's first-year salary of $35.4 million. The Dallas Mavericks would see their projected $37 million in room shrink to $29.6 million -- $6 million short of a max offer. The Heat would be a contender, with at least $50 million in projected room, but they'd have only $12 million to fill out the rest of the roster.
Barring big moves, the other teams with cap space would be the Hawks, Hornets, Bulls, Cavaliers, Pistons, Grizzlies, Knicks, Suns, Spurs and Raptors. The Raptors will have a max slot available -- even if they re-sign Fred VanVleet this summer -- but Antetokounmpo would be leaving $90 million in guaranteed money on the table to join them. It's possible that in a year Antetokounmpo decides a new home is worth it, but that's a risk the Bucks should be willing to take.