Fear the second apron.
That is the message coming out of the NBA, where a mechanism to control player costs seems to be working so well that everyone is afraid of it. Management wants to control player costs, but when owners are citing the second apron as an obstacle to spending and team building, you know it’s working very effectively. We need to pay attention to this, as it will be a major negotiating point in the NBA’s next labor talks, with the league and the union having an opt-out after the 2028-29 season.
A bit of background: Aprons were approved in the collective-bargaining agreement in 2011 and are luxury-tax thresholds that govern roster building. The first apron, set at $209 million this coming season, is restrictive, sure — but the second apron, set at $221.7 million, is incredibly punitive, prohibiting certain trades and signings. Union officials, players, general managers and owners have all cited its impact, mostly in concerning or negative tones. New NBPA Executive Director David Kelly wants the second apron “softened” or removed. He took a not-so-subtle shot at previous NBPA Executive Director Tamika Tremaglio for agreeing to it, saying, “We did not propose the second apron. We should have done a better job of fighting back against the second apron. In the future … we will do a better job of fighting back.” Kelly also believes the apron system will hurt fans in the long run.
He’s not alone. Milwaukee Bucks forward Kyle Kuzma urged players to be ready for the next round of CBA talks, writing, “The first and second apron are starting to function like a hard cap on player value, team continuity, and player movement.” He added, “The owners and the league walk into these meetings with killers that continue to run circles around us time and time again. … Players deserve a PA that is just as sharp, just as prepared, and just as aggressive about protecting our upside.” You don’t need to read between the lines there. Management as killers? Running circles around labor leaders? I’ve rarely seen such public challenges of union negotiators. Kuzma added, “Teams are no longer making purely basketball decisions. They’re making fear-based apron decisions.” He feels that means teams lose their fan-favorite stars and the product suffers.
He may not be wrong about “fear-based apron decisions.” Just look at recent comments from owners. New York Knicks owner James Dolan, fresh off an NBA championship, said he is willing to spend to maintain his roster, but only to a point. “We’re willing to stretch, but there’s certain things in the NBA that you’d have to be suicidal to do. One of them is the second apron,” he told WFAN in New York. Suicidal? He also didn’t mince words in saying, “I’ll write as big of a check as possible, but I can’t write a check into the second apron.” Boston Celtics owner Bill Chisholm said after the team traded All-Star guard Jaylen Brown that it needed to avoid the second apron. “We would have gutted the team for our future had we not done these things. The second apron is a real thing,” he said, much to fans’ chagrin.
A number of team officials stressed to me that the second apron is affecting every decision they make on a roster and player costs. It will be very hard to build super teams, and once you cross into the second apron, it’s incredibly difficult to revamp an underperforming roster because there are so many punitive actions that limit options. The days of teams manipulating the luxury cap system are over. What is also over are the days of draft picks being worthless trade throw-ins. Accumulating draft picks is now critically important because it will be all about developing talent that’s locked in for four years, and even second-round picks are seen as currency because of their team-friendly financial parameters.
So, rosters will feature the haves and have-nots; the best players will get super lucrative deals, and the young players will get their league minimum. Most team officials expect the middle class to be squeezed. The result is what many love: parity, with eight different teams winning the past eight NBA titles. NBA Commissioner Adam Silver admitted the apron helps that parity, citing the Finals matchup between the Knicks and Spurs. “The storyline wasn’t big market versus small market,” he said. “That’s one of the things that we set out to accomplish with the system. And from that standpoint, it’s working.”
Owners love a hard cap; we are seeing how it can manifest in various ways and under different names. It’s what NBA owners seem to have now, and what MLB owners desperately seek. When asked if a hard cap was an unintended consequence of the second apron, Silver was almost giddy, declaring, “It’s certainly not an unintended consequence.” I wonder if Silver considered that a hard cap could go by the name of “second apron,” and how well it would work.
Abraham Madkour can be reached at amadkour@sportsbusinessjournal.com.
