So… Should We Plan Post-Lockout?

Today I was hoping to have be able to write some shady outline of what the Magic’s plan might be if the lockout ended. Things seemed so rosy and positive after two days of mediation seemed to bring a lot of constructive work and positive news to our doorsteps. There was progress on little issues throughout the three days. There were rumors that the two sides had agreed to a new mid-level exception and even a structure of a potential amnesty provision.

Progress was made.

Then reportedly, the two sides tried to turn to the elephant in the room — the split of basketball-related income and the structure of the salary cap — and hit an impasse. By the players account, the owners would not negotiate anything else without discussing the split of basketball-related income. By the owners account, the players would not budge any lower from 52.5 percent to begin the negotiations.

Believe who you want. The players seemed perfectly willing, according to Billy Hunter, to move to a 50-50 split depending on the system that set up. Of course, he may not have revealed that the players would not budge on the soft cap system the league has previously used and refused to go to a hard cap (certainly) or a flex cap (possibly).

There is a lot of negotiating in the system that has to occur before any team can begin planning for the future. And who is to say that anythign gained in the past three days will remain on the table when the two sides get over their anger at each other and get back to the bargaining table.

The sad part is, we might be back to square one and this entire week has been wasted. Expect David Stern to start cancelling more games in the very near future. Will it go to Christmas now? I don’t think anybody can say.

The other scary part is that the NLRB could rule in a couple of weeks that they are investigating an unfair labor charge against the NBA and enjoin the league from locking out the players. If that happens, the old collective bargaining agreement goes back into effect and we play games (and how that works will have to be sorted out). Of course, the NLRB could not do that and leave the players with, really, no leverage in negotiating (unless they decertify, but that nuclear option might be a long way off… maybe).

I do not think anyone can tell where this is going to go. Right now, Dwight Howard might have more certainty of where he is going to go in the summer of 2012 or Gilbert Arenas might have more certainty in his knee. Those are scary thoughts, because I don’t think Dwight knows where he wants to go. And I don’t have confidence in Arenas’ knee until I see him play firsthand.

So where do the Magic… where does the league go from here?

There is a lot of great work on the lockout being done everywhere. It does not really matter what I think or project because, frankly, neither I nor anyone really knows where this is going to end up. And it might be a while before we get where we are eventually going to go — part of the players’ unfair labor practice charge is that the owners always intended to lockout the players and lose the season to force through what they want.

It has been a while since we last talked about what the Magic specifically need to do once the lockout ends. So, I figure a reminder here will not hurt since we were probably closer than ever to a deal this past week. You cannot make any specific predictions of anything because nobody knows what the cap structure will look like and what tools will be available to Otis Smith. But there are certain things the Magic have to focus on once the lockout ends.

The first is going to be figuring out if and whether to use any amnesty provision that the collective bargaining agreement will contain. At this point it does not seem to be an if. There will be an amnesty provision contained in the new collective bargaining agreement.

It is safe to assume that the Magic, in order to clear some cap room, will use the provision on either Gilbert Arenas or Hedo Turkoglu. There are some proposals that will completely eradicate a players contract from counting against the cap. Another proposal would take 75 percent of the remaining salary of the waived player off the books, redistributing the remaining salary to count against the cap for the remainder of the contract. It seems like a fair deal. No word if this was ever agreed to… or if this will return to the table next time they talk.

If the 75 percent proposal passes, it would allow the Magic to redistribute the $15.6 million remaining on Arenas’ contract across the three remaining years of his contract. Orlando would take roughly a $5.2 million hit per year on Arenas. Better than $20 million. If you waive Turkoglu under this amnesty proposal, the Magic would be left to redistribute $8.6 million to distribute over three years — roughly a $2.9 million hit per year. Obviously, it would be better to cut Arenas under this proposal… unless Gilbert hints at exercising his early termination option in 2012 (don’t think he will).

Obviously, though, an amnesty provision does not get the Magic out of salary cap hell.

Free agency will be equally important for Orlando. Otis Smith is going to have to use his mid-level exception (or whatever exists) very wisely. There just is not a lot of money to throw around (or maybe there is… who the hell knows what the rules of this thing will be). The Magic have questions about whether they will be able to re-sign Jason Richardson, but who knows what tools will be available for Orlando to do that — or even if they want to.

You can already see how hard it is going to be even to think about the offseason at this point. These are just two points that Otis Smith should already be thinking about. But what can he actually do to prepare? Not much, I think.

Once an agreement is made, there will be likely two weeks before the insanity begins. And then… well, we will just have to wait and see.

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Philip Rossman-Reich

About Philip Rossman-Reich

Philip Rossman-Reich is the managing editor for Crossover Chronicles and Orlando Magic Daily. You can follow him on twitter @OMagicDaily