Due to an undisclosed leak, News Corp has acquired and published details of last season’s spend.

The article written by Sydney-based reporter Matt Logue outlines how the championship-winning Sydney Kings didn’t buy a title. Interesting, the article, which is heavily weighted towards Sydney’s success despite spending under the cap, begs the question, could the leak have come from the Sydney Kings organisation? It seems plausible.

Add to this earlier in the year, Kings part-owner Andrew Bogut came out strongly at the end of last season and refuted claims the club paid for its chip.

“Your Sydney Kings salary cap spend was $1,501,592.63. We were under the salary cap for the season and just to keep things in perspective, that spend put the Sydney Kings in seventh for total spends. Yes, SEVENTH.” Bogut noted in his article to the fans.

The motivation by Bogut to publish the number originally was to give fans something “to be proud of”, so did the Kings have the most to gain from the leak?

Note: since publishing this article, Kings owner Paul Smith has publicly addressed the leak and stated the information did not come from the Kings.

You need to be careful with your twitter account. Choose your words carefully. And we don’t leak. If we have something to say we say it publicly, always have and always will.

— Paul Smith (@psmithtse) October 16, 2022

The NBL set its 2021-22 cap ceiling at $1,637,893.94, while teams must pay players at least $1,474,104.55.

Over the Soft Cap:

1. Perth Wildcats $400,000

2. Tasmania JackJumpers $90,000

3. Melbourne United $50,000

Under the Soft Cap:

4. Illawarra Hawks $80,000

5. New Zealand Breakers $125,00

6. SE Melbourne Phoenix $130,000

7. Sydney Kings $135,000

8. Adelaide 36ers $140,000

9. Brisbane Bullets $265,000

10. Cairns Taipans $300,000

These figures have risen by four per cent this season, the ceiling at $1,703,239.36 and the floor at $1,533,068.73.

The numbers don’t lie… or do they?

A point to note is that although the numbers presented in the article outline the final team salaries regarding the NBL’s salary cap, it does not show the ‘actual spend’ teams utilised to sign players last season.

Firstly, the way the cap works is it counts the games a player is rostered for and attributes their salary (as a percentage) for each game to the cap. This is why the cap floor ($1,533,068.73) and ceiling numbers ($1,703,239.36) are calculated to the cent and not just a round figure.

For example, RJ Hunter being injured in his first game means whatever figure the Kings paid him, only 3.6% of it (1 game divided by the 28 total games) would have counted toward the cap. Jaylen Adams played 21 of the Kings total 28 games therefor only 75% of his salary would be counted towards the cap.

Secondly, each team has a number of ‘marquee players‘ on the roster, which clubs also receive cap allowances for. Each team is able to sign up to four marquee players per season, and only a specified component of their salaries will be counted toward the salary cap.

Previous season’s ‘Marquee Player’ salaries

• Marquee player 1 salary cap hit: $171,654
• Marquee player 2 salary cap hit: $228,873
• Marquee player 3 salary cap hit: $286,091
• Marquee player 4 salary cap hit: $343,309

Total – $1,029,930

This exemption means that a team like the Kings, who had a number of high-profile players, could have spent any amount on their salaries and their total salaries, in terms of the salary cap, would be listed at $1,029,930.

In this scenario, the team could have paid all four salaries of $500,000 each, which would have totalled $2 million in player salaries but would have appeared in the salary cap as $1,029,930.

It would also be expected that ‘replaced players’ salaries would be omitted from the team salary cap, therefor a player like Jordan Hunter, who missed the season due to injury, would not be included in the salary cap numbers, but of course, the team would have had to pay out his contracted salary.

There are also other player salary exemptions, the Next Stars program is funded by the NBL, so the Kings roster would not have included the salaries of Makur Maker, who was a large part of the team’s playoff rotation and averaged 15.8 minutes per game during the year.

The NBL’s newest exemption, Reconciliation Action Plan Player allows teams to sign Aboriginal and Torres Strait Islander players without any of their salary counting toward the cap. This would have included Bilwali Bayles.

For a team like the South East Melbourne Phoenix, having Zhao Qi listed as a ‘special restricted player’ means a large portion of his salary is able to be removed from the salary cap numbers.

Additionally, the Tasmania JackJumpers are listed as spending $90,000 over the soft cap, however, it’s believed they operate under a cap exemption for a period of time as the league’s newest club. Meaning in addition to the reductions they would have received via the Marquee Player rule, the additional clause would have reduced what their final number was towards the salary cap even further.

How The NBL ‘Soft Cap’ Works

At the end of the season, the league sends out a complete summary of every team’s salary cap spending, including a breakdown of total player payments.

Every club has full transparency on what each team spends on their roster.

The NBL has a soft cap that revolves around a Salary Equalisation Subsidy or ‘luxury tax’.

Clubs that spend one per cent-15 per cent above the cap pay 25 cents of luxury tax for every dollar over the cap.

If the percentage spend is 16-30 per cent over, they pay 50 cents on each extra dollar. That rises to $1 for every $1 over if they exceed the cap by 31-50 per cent and finally, the tax is $1.50 for every $1 spent over the cap if the percentage spend is over 50 per cent above.

Final Thoughts

Whether Sydney personnel leaked the information or not may be a moot point, with the NBL repeatedly stating they are open to doing this in the past, it could even have come from someone internally within the NBL.

Either way, perhaps this ‘leak’ results in the NBL getting on the front foot and presenting this information publicly from here on in.

Did Sydney really spend less than seven other teams to win the championship… probably not (as mentioned via the player exemption rules) but what they clearly did is make the most of these exemptions, i.e. marquee player, next star, reconciliation player to compile a championship team that saw them also finish seventh in salary cap spend… and that’s still mighty impressive.