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Houston Rockets

So the Rockets are Hard-Capped… Now What?

The Houston Rockets will face a hard cap in 2015-16. David Weiner breaks down the impact of the Montrezl Harrell signing and where the team goes from here.

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Montrezl Harrell Houston Rocket rookie

With the recent signing of Montrezl Harrell to a three-year, $3.1 million deal using a portion of the Non-Taxpayer Mid-Level Exception (MLE), the Houston Rockets finally answered a key question many have been asking over the past two months, ever since they agreed to a three-year, $10 million deal with K.J. McDaniels using a significant portion of the MLE.

That question:  Are the Rockets willing to subject themselves to a hard cap at the “apron” level ($88.74 million) by using the Non-Taxpayer MLE?

The answer:  Apparently, yes.

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The Rockets now sit approximately $1.56 million below the apron level.

I addressed many of the factors surrounding Harrell’s situation in my last cap update.  Take a look at that piece for more context.  This article will focus on what the Rockets did to set up the Harrell signing and how Houston will attempt to navigate the hard cap this season.

Setting Up the Harrell Signing

Before signing Harrell, the Rockets needed to make a few moves to create a sufficient amount of room below the resulting hard cap.  This helps explain why Houston and Chuck Hayes decided not to proceed with a partially-guaranteed veteran’s minimum deal.  It may also explain why the Philadelphia 76ers ended up signing Christian Wood, who had previously agreed to a partially-guaranteed deal with the Rockets after going undrafted in the 2015 NBA Draft.  With Hayes and Wood on the Rockets’ books, it would have been difficult to give Harrell the deal he wanted.

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Exhibit 9s . . . Lots of Exhibit 9s

During all this time, the Rockets still needed to fill out their training camp roster.  But in order to maximize room under a hard cap, Houston preferred to sign their training camp invitees — none of whom has a terrific shot at making the regular season roster — to a particular type of contract containing what is called an “Exhibit 9.”

Regular player contracts, even non-guaranteed contracts, still protect players from injuries suffered while playing for their teams.  A player signed to a (regular) non-guaranteed contract who gets injured in training camp continues to count against his team’s cap until he returns from injury.  An extended injury to such a player could have potentially disastrous consequences for a team right up against a hard cap.

By contrast, player contracts containing an Exhibit 9 (while still providing players with a per diem, lodging expenses and medical insurance) limit a player’s compensation to $6,000 if he gets injured.

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However, in order for a team to sign players to Exhibit 9 contracts, it must have at least 14 regular contracts on its books.  But with Harrell unsigned, the Rockets only had 13 contracts once they re-signed Jason Terry.  This is where Daryl Morey and his staff got a little creative.

The Rockets apparently signed Remi Yusuf to a regular non-guaranteed contract, then followed that signing up by signing each of Will Cummings, Denzel Livingston, Chris Walker and Josh(ua) Smith to Exhibit 9 contracts.  Once Harrell signed his contract (giving the team a 15th “regular” contract), the Rockets waived Yusuf.  Had Yusuf not been waived but later gotten a season-ending injury in training camp, he could have counted as much as $947,276 towards the luxury tax and the hard cap determination, as opposed to only $6,000 under an Exhibit 9 contract.  (For what it’s worth, I have a feeling that Yusuf may be the recipient of an Exhibit 9 contract from the Rockets once he clears waivers.)

Impact on Signing Free Agents

Even hard-capped, the Rockets should still have room to add to the roster beyond just “Exhibit 9 guys.”  However, expect Morey & company to be more judicious in their signings than in years past.

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The Rockets can sign a player to the veteran’s minimum, either now (for the full two-year veteran’s minimum amount) or later in the season (during which that amount prorates downward based on the number of days remaining in the regular season).

Houston still has about $1.27 million left of its Non-Taxpayer MLE it can use.  Unlike the veteran’s minimum salary, the MLE does not begin to prorate downward until January 10, making the MLE an even more attractive alternative to the minimum after the trade deadline, when several key older veterans negotiate buyouts with their former teams in hopes of latching on with a contender.

The Rockets also have a few small trade exceptions (described in my last cap update) they could use to claim a player off waivers.

With 14 guaranteed contracts spread fairly evenly across all five positions, don’t expect the Rockets to be eager to sign another player to a guaranteed deal.  They will probably bide their time and see if a good enough player “shakes loose” in free agency.

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Impact on Trades

Trades are where the hard cap may have its most profound impact on the Rockets.

Even before the hard cap was imposed, Houston was subject to the more restrictive salary-matching rules for taxpaying teams, which limit incoming salary to 125% (plus $100,000) of outgoing salary.  The hard cap adds another layer of restrictions on top of that.

For instance, let’s say the Rockets have the opportunity to trade three players in exchange for one significant player.  Even if such a trade would work under salary-matching rules, the Rockets would still need to fill out their roster to meet the league’s minimum roster requirement of 13 players.  Even signing 1-2 players to veteran’s minimum salaries could push the team above the apron level and could therefore make the trade illegal.

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Conclusion

The signing of Harrell has created a hard cap for the Rockets.  While this hard cap has already cost Houston guys like Hayes and Wood, it does not completely cut off any ongoing salary cap flexibility.  Trades and signings can still be made, albeit to a limited extent.  Meanwhile, Houston has locked up a first round-caliber talent to a long-term deal that will likely be a bargain in as little as one year.  This was apparently a trade-off that Morey and his staff felt was worth making.

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How the Kyrie Irving Injury Impacts Rockets

Houston’s draft positioning and offseason plans could be impacted by Dallas

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Kyrie Irving Injury

Dallas Mavericks guard Kyrie Irving was injured Monday night and the news dropped on Tuesday that the knee injury is serious — a torn ACL in his left knee that will end his season and a good portion of next season as well.

Brutal. I can’t think of an NBA team that imploded faster than the Dallas Mavericks.

You trade away a 25-year-old phenom who just hoisted you on his back en route to the NBA Finals a year ago. You cashed in that golden ticket to go all-in on a trio of aging stars in Kyrie, Anthony Davis, and Klay Thompson.

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Bold strategy, Nico. Let’s see if it pays off.

(Narrator: It’s not paying off.)

The Mavericks had some interesting potential this year and maybe the next couple of years once everyone was healthy, but now? Their star guard is likely out until the calendar year 2026 and Klay and AD aren’t getting any younger nor more durable. The Mavericks may have actually swapped their future for a present that never arrives — and Dallas GM Nico Harrison has to be feeling overwhelming pressure right now.

So how does this impact the Rockets?

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For starters, Houston has a game remaining on the schedule against Dallas on March 14th at Toyota Center — Davis may or may not be back for that game.

More importantly, Dallas is the 10th seed in the West at the moment, just 3.5 games ahead of the Phoenix Suns (11th seed). The Rockets control Phoenix’s first-round pick unprotected this season via a swap. We need as many West teams as possible ahead of Phoenix to keep them out of the play-in/playoffs and to push them as deep into the lotto as possible.

This complicates that. Phoenix’s remaining schedule is the toughest in the NBA by a good margin, with plenty of games left against the league’s best teams, so it still looks promising overall — but we’re talking about Kevin Durant, Devin Booker and Bradley Beal. They can still get hot at the right time while Dallas may struggle.

So keep a close eye on that. The good news is the Portland Trail Blazers are one of the hottest teams in the league and they are (shockingly) nipping at the Arizona squad’s heels.

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Taking a look ahead to the offseason, the Kevin Durant Pursuit will be big.

This one is a little more complicated for Houston. The Rockets really want Devin Booker but, as of now, the Phoenix plan appears to be to trade KD this offseason and retool around Booker. The Rockets will have interest in Durant but they’re not going to sell the farm (prospects and all the picks) for a 37-year old like they would for Booker.

Three teams that I’ve heard a lot about from Rockets circles that will be in the mix are Houston, Minnesota and Dallas — Timberwolves and Mavericks have been considered the main competition. But, a lot of this will depend on Durant himself and where he wants to play at this stage of his career.

Keep in mind also, if the Suns are “retooling” around Booker and Beal (holding the no-trade clause), then they could be placing a higher priority on win-now players over the return of their own draft assets. The Rockets definitely have the best assets overall to offer up in any trade package between those three teams, but if Phoenix does prefer finding the right ready-to-win players around Booker/Beal, that gives Dallas and Minnesota a real chance.

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This injury “may” take Dallas out of the equation, and they are/were definitely a contender for KD’s services given his past relationship with Kyrie and the way Dallas was positioned to win right now. Does KD at his age want to wait for Kyrie to be healthy?

And one last friendly reminder: The Rockets control that Dallas 2029 first (unprotected).

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Rockets Sign David Roddy to Two-Way Contract

Former first-round pick has played with the Grizzlies, Suns and Hawks

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David Roddy Houston Rockets

The Rockets made a move on Monday, signing former first-round pick David Roddy to a two-way contract.

The two-way spot opened up after the front office signed Jeenathan Williams to a standard four-year, $8.2 million contract (with friendly team options all along the way).

Roddy is 6-foot-5 and 250+ pounds but sports a 6-foot-11 wingspan. He was taken with the 23rd pick in the first round of the 2022 NBA Draft — six selections after the Rockets drafted Tari Eason. A standout in college, Roddy averaged 19.2 points, 7.5 rebounds, 2.9 assists, 1.2 steals, and 1.1 blocks per game during his junior season at Colorado State.

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Roddy, who turns 24 later this month, is a physical player who can play multiple positions. He’s a solid rebounder for his size/position. He has played in 165 games over three seasons with the Grizzlies, Suns, Hawks and most recently Sixers, averaging 6.2 points and 2.9 rebounds per game.

The guard/forward has not shown efficient shooting, however — he’s a career 30.5% three-point shooter and just 68.4% from the line. His defense is better inside than out.

Ultimately, it will be those two things — three-point shooting and defense — that will determine his chances of carving out a consistent role in the league.

All in all, it’s a low-risk signing and the Rockets get a look at a prospect that fits their age timeline.

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Houston a potential landing spot for Ben Simmons post-buyout?

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Ben Simmons Houston Rockets

ESPN NBA analyst Brian Windhorst said on Thursday’s NBA Trade Deadline show that Brooklyn Nets forward Ben Simmons is working on a buyout and the Houston Rockets is a potential landing spot for him.

“Cleveland and Houston are two situations for Ben Simmons,” said Windhorst.

Rockets coach Ime Udoka was an assistant coach in Philadelphia in 2019-20 when Simmons was with the Sixers, before injuries took a significant toll. In fact, Udoka, when speaking about Amen Thompson earlier this season, brought up some comparisons to Simmons.

“The skill set is there, and it’s something that’s unique with his speed, athleticism, size, passing ability, and all those things,” said Udoka of Thompson. “I coached somebody, Ben Simmons, who had similar traits… as far as size and ability to push the pace, and find guys and finish. There are some similarities there.”

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Both Thompson and Simmons are known for their elite athleticism, defensive versatility, and ability to create opportunities in transition.

However, can Simmons help the Rockets today? That’s the tough question.

Simmons has played in 33 games this season, averaging 6.2 points, 6.9 assists, 5.2 rebounds, 0.8 steals and 0.5 blocks in 25 minutes a night. He does not shoot threes (like, at all) — he has only attempted two threes in the past three seasons combined.

Ideally, he does not play in front of your young forwards of Amen, Tari Eason and Jabari Smith Jr. and on that basis alone, I think I would pass. But, Ime loves defensive dogs and he could use some extra ballhandling on the roster. You can see that there’s little in the way of offensive organization when Fred VanVleet is out.

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There would be a comical full circle moment though if the Rockets did sign Ben Simmons, considering the Rockets were heavily criticized for trading James Harden in 2021 to Brooklyn instead of to Philadelphia for Simmons. The Rockets clearly made the right choice there.

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Rockets pick up another second-round pick in deal with Hawks

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Cody Zeller

The Houston Rockets are working the phones to do a little more asset management.

After acquiring a second-round pick from Boston to take on Jaden Springer’s salary, the Rockets made another similar move, absorbing the contract of Cody Zeller this season to get back a 2028 second-round pick.

Ironically, that pick is Houston’s own 2028 second-round pick that the Rockets sent to Atlanta in 2023.

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The Rockets waived Springer to make roster room for Zeller. They will likely do the same with Zeller in order to make room for a buyout signing in the coming days or weeks.

It’s a small move but it’s another good one on the margins. These second-round picks add up. The two the Rockets got in the past couple of days — Boston’s 2030 second and Houston’s own 2028 second — could be eventually combined in a deal that nets the Rockets a solid role player down the line. Houston did exactly this last season when they acquired Steven Adams from Memphis.

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So quick grade? Easy A. Solid asset management work by Rockets GM Rafael Stone and credit to Rockets owner Tilman Fertitta for being willing to spend millions just to get some extra seconds.

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Rockets Pick Up Jaden Springer, Second-Round Pick in Trade with Celtics

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Jaden Springer Houston Rockets

The NBA Trade Deadline is just over 24 hours away but the Houston Rockets have already made a move.

OK, it’s not that kind of move, but Rafael Stone and the front office did make a trade on the margins on Wednesday, picking up Jaden Springer and a 2030 second-round pick from Boston.

The Rockets leveraged their open roster spot and salary situation to take the contract of Springer off the hands of the Celtics, who are saving a ton in luxury tax payments by making the move. It’s smart business by the Rockets, who are doing this for a second-round pick in 2030.

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Now, usually a Celtics second-round pick is not worth much, but this is five years out so it’s a quality asset as far as seconds go. In today’s NBA, these kinds of picks have grown in value as key assets for being in a position to land solid role players. With the Rockets planning on being a playoff team for the next several years, this addition could prove useful in addressing future roster needs.

This trade framework between Houston and Boston may not be new to you. If you watched or listened to the ClutchFans Podcast on Monday, David Weiner, aka BimaThug, literally called out this exact possibility of the Rockets taking on Springer and landing a second-round pick.

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As for Springer himself, this was a player I liked quite a bit in the 2021 NBA Draft and I wanted the Rockets to take him at the Josh Christopher spot. He has not quite panned out just yet. He’s got good size for a point guard (6-foot-4, 200 pounds) but is not a strong playmaker and has not been incredibly accurate as a shooter (25.0% from three).

But he does have good defensive potential. Does that get Ime Udoka’s attention at all? Possibly, but the Rockets likely will get an end-of-the-bench look at him for the rest of the season before his contract expires this offseason.

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