Toronto Raptors could be the most expensive team in NBA history

The Toronto Raptors are focussing on bringing back a roster which won the NBA Championship last season. If they are able to do that, it will be extremely costly.

The Toronto Raptors posted the third highest salary among all NBA teams last season, trailing only the Golden State Warriors and Oklahoma City Thunder in terms of total cost. They were one of four teams to pay the luxury tax. After it was all said in done, they spent more than $162 million in salaries and tax payments.

And it was worth every penny. The Toronto Raptors won the first NBA Championship in franchise history, a Championship generated a TON of money for Maple Leaf Sports & Entertainment.

MLSE had the benefit from 13 additional home games with extraordinarily high pricing. TicketIQ recorded the 2019 Finals as the most expensive Finals in NBA history. Toronto was basically printing money at the gate all postseason long.

Generating a higher revenue for one season is nice. But the real bonus was the spike in franchise value. NBA titles create more fans. Having more fans increases a team’s long-term valuation. Just look at the Warriors, who are now third in NBA franchise value. Five years ago, they wouldn’t have even sniffed that valuation.

But no matter how much money you make, it’s hard to dish out hundreds of millions of dollars. If Kawhi Leonard returns and the Toronto Raptors run it back next season, they are projected to be deep in the tax and could have the most expensive team in NBA history.

Upcoming cost

It’s important to note, all of this is on the assumption Kawhi Leonard returns. If he decides to head elsewhere, Toronto’s tax-bill won’t be significantly smaller. It will be non-existent.

In a move expected by everyone, Marc Gasol opted into his $25.6 million player option. A wise decision considering the projected market for a 34-year-old center.

The last piece required to run-it-back is Danny Green. As an unrestricted free agent in search of his last big deal, Green shouldn’t be expected to take any hometown discounts. After all, any dollar he passes up will go directly to MLSE. I’m doubtful he’s willing to do that.

But Toronto has been meticulous about keeping their books clean for the summer of 2020. They clearly want to make noise that free agency, and at the moment, have less than $20 million on the books past this year. It’s very likely they offer Green a one-year deal at a higher cost, keeping him in Toronto for the short-term while keeping him out of the long-term future.

If he’s signed to a one-year deal, Green is expected to make somewhere around $15 million for next season.

The $1,618,486 minimum is the cost of a free-agent with two years experience in the NBA. If a one-year contract is signed with a player with more than two years experience, the NBA subsidizes the cost beyond that amount.

Assuming the Raptors bring back their core unit, they’re projected cap figure looks to be a minimum of $165,107,455, and that’s without having a 15th player on the roster. — A very likely scenario with a tax-bill of this size.

Next year’s tax line is estimated to be at $132 million, leaving the Raptors approximately $33 million over the tax. No team has ever been that high over the line, and if the Raptors don’t find a way to cut salary, they’re looking at a tax bill of nearly $100 million ($99,760,411 if you like precision).

That means, when you combine their actual salaries and tax payments, the Raptors will be paying approximately $265 million to keep the band together, about $103 million more than last season and the highest in league history.

The reason for the dramatic increase is the escalating cost of the luxury tax. If the Raptors just cut Danny Green’s contract from the payroll, their overall bill drops to $188 million. In a sense, Toronto will be paying $77 million for Danny freaking Green. — You could do this for any of Toronto’s expensive players under contract as well (Remove Serge Ibaka from the equation and MLSE saves more than $100 million).

That’s the price

If that’s the price, then that’s the price. Kawhi Leonard is having free agent meetings with multiple teams, and I’m guessing he won’t be super on-board with shedding salary for tax purposes. If he says he wants Danny Green to be back, Danny Green will almost certainly be back.

It’s not going to be cheap to keep the Raptors together, but $265 million is about the price for a single Raptors postseason game last season, so MLSE shouldn’t be hurting too bad.

A giant corporation like MLSE isn’t going to willingly lose money year-after-year. But the idea of eating an extraordinarily high bill in a gigantic revenue season isn’t terrible. Compare it to the optics of letting a key component walk for nothing, and it seems more than likely than not, they’ll be willing to pay it.

Toronto is hoping to keep the band together for one more season. To do that, it will cost them.