ORLANDO – The intoxicating effect of reaching the NBA Finals for just the second time in franchise history will prompt the Orlando Magic to loosen the purse strings and venture into the previously-dreaded luxury tax territory this summer to re-sign free agent-to-be Hedo Turkoglu.Magic President and chief executive officer Bob Vander Weide told FanHouse that ownership likely would approve paying the luxury tax for the first time if it means keeping the nucleus of this team together.
The Magic are one of 19 teams in the league who previously have avoided the luxury tax, which is a dollar-for-dollar tax paid to the league and distributed to teams that stay under the tax threshold.
"We've always avoided the tax, but winning has a crazy effect on people,'' Vander Weide said. "The [DeVos] family (which owns the team) is having fun right now. I don't think anyone has a willingness to stay in tax for 10 years, but to go in for a few years to ride this out, I don't think that's threatening to our family short term.''
The Magic had a player payroll estimated at $68.7 million this season, which is $10 million above the salary cap but just below the anticipated luxury tax threshold of $71.1 million.
With revenues dipping around the league, the luxury tax threshold is projected to drop next season to $69.4 million.
Re-signing Turkoglu, who is expected to exercise his option to become a free agent, likely would push them into the luxury tax. Vander Weide also said the Magic will be trying this summer also to obtain a true power forward to help Dwight Howard with the rebounding load.
"We like this team. We absolutely want to keep the core together,'' Vander Weide said. "We're in the Finals. Can I sit in the boardroom this summer and say 'hey, we need to do a little more financially to stay where we're at?' I think there would be some receptivity to that. We like our roster. Now if Turk gets some crazy offer elsewhere, well, we'll worry about that this summer. But we love what he brings to this roster.''Turkoglu, who would make $7.1 million next season if he remained in his current contract, is expected to command a long-term deal in free agency worth an estimated $10-$12 million annually.
The Magic already will have Rashard Lewis ($18.8 million) and Dwight Howard ($15.1 million) making big money, which doesn't leave much room in the economic model for a third player making over that $10 million mark. Yet Turkoglu's importance to this team has been as key as the other two.
The only other significant Magic player who becomes a free agent this summer is backup center Marcin Gortat. He is considered expendable, and as a restricted free agent, may receive offers around the league the Magic aren't willing to match.
The Magic, down 3-1 in the Finals to the Lakers, looked like a team that can be contenders for several more years. Howard, the center and centerpiece, is 23 years old. Lewis is 29. Turkoglu turned 30 in March. Point guard Jameer Nelson is 27.
Other than reaching the NBA Finals, the biggest reason the Magic have dropped their reluctance to pay the luxury tax is that they will be moving into a new arena at the start of the 2010-11 season, which Vander Weide believes will translate into an additional $20 million more in revenue each year.
"It's why we fought for eight years to get into a new building. Our break even model will go up because of all the new revenue sources,'' he said. "We've said for a number of years that we can't compete with teams like Indiana and Charlotte, teams in new buildings. All of a sudden, our revenue model adjusts by quite a bit, and more often that money goes into player salaries. That will really help us to keep this team together.''
Comments (Page 1 of 1)
Good luck with that. Even if you sign Turk, Howard, Lewis, and Anderson, You will still be facing Kobe, Gasol, Odom, and Bynum for the next few years, as they're young too. And better players to boot. That is, if you can even get to the Lakers, because you will have to get past the Celtics and the Cavs. Best case scenario is that you will have the 3rd best team in the country for a number of years. Keeping the status quo isn't going to get it.
Ed,
I would worry about Portland first. They have cap room and Trevor is a free agent. All they need is a decent small forward.
Hedo has really shown that he deserves a nice contract and pay raise. The Lakers should wrap it up in game five, but it would be nice to see them win it all back home in L.A.
It's a great Laker team, but nowhere near the dynasty teams of the past.
Ed,
You are not taking into account that Dwight's ceiling is still very high and each year his skill set grows exponentially. Also even though Jameer was an all-star this year, because of his injury, people, even Magic fans, are forgetting how much better he made this team when he was healthy. He was actually just as clutch at the end of games as Turk and Lewis. Fans have short memories. Jameer is a shell of himself right now. When he gets back to full-strength I like the Magic's chances against anybody. Even if they do not add a significant talent. The Magic's team chemistry has really grown this year. With the experience of this years playoffs they will continue to grow mentally tough. They have proven time and again in the playoffs that they will keep fighting.