[Note: These rules are relevant for the 2016 offseason only. 2017 thresholds will be available after the salary cap is set. Expect the numbers below to rise slightly]
Here’s a quick rundown of the relevant rules with respect to the RFA offer sheet process:
- In order to maintain the right to match an offer sheet or receive draft pick compensation, teams must extend qualifying offers to their RFA’s by 5pm on June 27.
- If a team fails to tender a qualifying offer (or elect salary arbitration) the RFA immediately becomes a UFA and is free to accept any offer from any team. That option also includes returning to the original team at a lower amount than the qualifying offer would have been.
- Qualifying offers are not open for acceptance prior to July 1. They expire at 5pm on July 15 unless a team requests that the deadline be extended for a particular RFA player.
- RFA’s can make contact with all teams, including their own, regarding potential interest on June 28. They can’t sign new contracts or offer sheets until July 1 at 12pm.
- If an RFA wants to accept an offer from another team after July 1, paperwork must be submitted to the league outlining the terms of the proposed contract. The original team has 7 days to exercise their right to match the terms of the offer sheet. During this time, they are not allowed to trade the RFA player.
- If the original team chooses to accept the terms of the offer sheet, they are also not allowed to trade the player for one year from the date of exercising their right to match.
- If the original team declines to match the terms of the offer sheet, the player and his new team enter into a contract under the proposed terms. The original team is then entitled to draft pick compensation based on the following table:
|Calculated Offer Sheet Amount||Draft Pick Compensation|
|$1,239,226 or below||None|
|Over $1,239,226 to $1,877,615||Third Round|
|Over $1,877,615 to $3,755,233||Second Round|
|Over $3,755,233 to $5,632,847||First Round & Third Round|
|Over $5,632,847 to $7,510,464||First Round, Second Round, and Third Round|
|Over $7,510,464 to $9,388,080||Two First Rounds, Second Round, and Third Round|
|Over $9,388,080||Four First Rounds|
The offer sheet amount, for purposes of the draft pick compensation table above, is calculated by dividing total compensation by the lesser of the number of years of the offer sheet or five. This discourages offer sheets beyond five seasons as the compensation requirements will increase dramatically.
There are a number of additional rules when it comes to draft pick compensation. Here are a few key highlights (please see CBA Article 10.4 for full details):
- Teams must use their own original draft picks for purposes of offer sheet compensation. They cannot acquire picks from other teams, however, they can trade away their own picks and then re-acquire them at a later date.
- Teams owing picks for amounts up to $7,510,464 must have those picks available in next year’s draft (2017).
- Teams owing two picks in the same round must have them available in the next three drafts (or three picks in the next four drafts, etc)