Andre Iguodala faces a big decision this summer which will have massive implications for the Denver Nuggets.
He can choose to complete the final year of his contract next season at the hefty salary of $16.2 million. Alternately, he can exercise his early termination option (ETO), becoming an unrestricted free agent and either working out a longer-term deal with the Nuggets or signing elsewhere.
For the time being, he appears to be keeping his options open, and waiting until after the season ends to focus on weighing them.
Paola Boivin of azcentral.com has reported in a special to the Denver Post that Iguodala has yet to make any decisions regarding using his ETO, re-signing with Denver or testing the open waters of free agency:
“Obviously, you’re talking to your agent and you’re paying attention to trades, and salary caps that are being opened up through sign and trades and other guys who are in the same position as you,” he said. “It’s in the back of your mind. But as far as making a concrete decision, you really don’t size it up until the season’s over, because we have some opportunities to do some really good things here.”
This is consistent with statements Iguodala made last January, when Christopher Dempsey interviewed him for the Post:
“A lot of players have done it where they’ve gave up a large bulk of their contract, say, giving up $16 million to get $60 million,” said Iguodala, who turns 29 years old on Monday.
“In the grand scheme of things that makes sense. But if you give up $16 million and you get $20 million (it doesn’t make sense). So it’s all about playing your cards right and seeing where you’re at. At the end of the day winning takes care of everything, so if we win here, then hopefully the organization and myself will come to an agreement and we’ll continue to build on what we have here.”
If Iguodala plays out the final year of his current contract, the Nuggets will have nearly $68 million in commited salary for the 2013-14 season. To put this into context, the current salary cap is set at $58.044 million, while the luxury tax is set at $70.307 million.
Even if those figures increased next season, Denver would not be left with very much wiggle room, especially cconsidering that in recent years the Kroenke family and the Nuggets front office have been stickers for staying under the luxury tax threshold.
In other words, it certainly appears that the best option for the Nuggets would be for Iguodala to opt out, and to renegotiate a new, longer contract at a reduced salary. So it’s very encouragng to see Iguodala openly acknowleding that course of action as one which might be in his own self interest as well.
If the two parties can’t work out such a deal, re-signing (or replacing) free agents Corey Brewer and Timofey Mozgov, signing any new free agents, or even clearing room for the salaries of new draft picks all become much trickier financially, presuming Denver wants to stay under the tax limit. It would more than likely necessitate some off season trades which cut enough salary to accommodate Denver’s new or re-signed players.
The third possibility, that Iguodala opts out but signs with a different team, appears unlikely. Both he and the Nuggets organization have repeatedly expressed a desire to make this a long term relationship.
But it would have to be considered a setback for Denver to lose a player and asset of his value without getting anything back. They would have more financial flexibility, but it would be extremely difficult to replace what Iguodala provides them through free agency.
Of course, Nuggets fans can, for now, just enjoy the great success their team has been having recently. This is not something to worry too much about just yet.
But come summertime, what happens with Iguodala’s contract will be the single most influential factor in shaping the moves the Nuggets can and will make from the offseason through the following year.
So we’ll be keeping it on our radar screen. And as always, keep checking back with Roundball Mining Company for your Denver Nuggets analysis, news and rumors.
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