What the Bulls can do with Zach Lavine

After the 2023-2024 season, two-time All-Star Zach Lavine will be owed a remaining $137.9 million guaranteed over 3 seasons (the last of which is a $48,967,380 player option in 2026-2027). In the 2024-2025 season, the Bulls’ total cap allocations currently totals at $214,758,518 (this is including cap holds). This figure would see the bulls well over the $141 million luxury tax. The second apron for the 2024-2025 season will be just under $190 million.

Option #1: Keep Zach Lavine

If Zach Lavine remains on the Bulls payroll going into next season, the Bulls would appear to be on their way to being a luxury tax team in three of four consecutive seasons (barring any trades or unlikely moves ex. Lonzo Ball opting out of his player option). If this is the case, the Bulls would be subject to a repeater tax. There are also operational implications of being a team in the luxury tax including limitations on mid-level exceptions (MLE) as well as trade limitations and overall roster flexibility. The Chicago Bulls active roster cap for 2024-2025 is $132,153,794 which is under the salary cap max, however the Bulls have three notable pending free agents in Demar DeRozan, Patrick Williams, and Andre Drummond. The qualifying offer for Patrick Williams alone would put the Bulls into the luxury tax.

Until now, the Bulls core group of players have underperformed the expectations of Bulls’ fans and front office since Vucevic, DeRozan and Ball were acquired in a 5 month span in 2021. If Zach Lavine is on the roster next season, the Bulls will be banking on Lavine and Ball to make full recoveries, and, with the emergence of Coby White, the Bulls can be competitive. If they lose Demar however, the team will have a difficult time replacing his scoring ability, leadership and clutch performances. If they re-sign him, the Bulls would be would be making a significant financial commitment to bring back the same group of players that have not yet had team success, and this would likely move the Bulls above the apron level.

Option #2: Trade Zach Lavine

Zach Lavine has been in trade rumours for most of the 2023-2024 season, however there was no genuine market for his services even before his season-ending injury. While Lavine continues to be a legitimate 3-level scorer, analysts from around the league there have been questions around the league with regard to his his defence and ability to impact team success, and in light of this, teams are largely unwilling to take on a near $45 million cap hit for multiple seasons. This is especially the case in light of new rules regarding the second apron regarding MLE, player signings, and trade restrictions. Nevertheless, if the contract of Zach Lavine were to be traded, what type of contract would be coming back in return?

1. If the Bulls are under the salary cap they would be able to take back up the amount that keeps them under the salary cap plus an additional $100,000.

2. If they are over the salary cap but not in the tax, they can take back up to 175% of the outgoing salary (not exceeding $5 million), plus $100,000. This would mean that in return, the bulls can receive contracts in return worth up to approximately $48,131,390.

3. If the Bulls are over the luxury tax threshold but under the tax apron, the Bulls can take back the lesser of 125% of the outgoing salary plus $100,000, or the outgoing salary plus $5 million. Again, the Bulls would be able to receive contracts in return worth up to approximately $48,131,390. The Bulls can also use a traded player exception (TPE) to acquire player(s) salary up to the amount of the TPE plus an additional $100,000.

4. If Bulls’ team salary exceeds the second apron level, they must find a trade partner willing to exchange player contracts where the incoming salary does not exceed 100% of the outgoing player's salary, and without the aggregation of multiple outgoing player contracts for less player contracts. The Bulls in theory could also use a TPE to absorb the incoming player(s) salary (100% TPE plus $250,000) but they do not have one that large (they do not have a TPE at all at this time).

 

Option #3: Buyout

The buyout option is highly unlikely but for the sake of exploration:
If the Bulls decide to part ways with Zach Lavine and they are unable to find a trade that is beneficial to them, they may decide to begin negations with Lavine regarding a contract buyout. In a buyout, the player would agree to give up a portion of their salary in exchange for the freedom to sign with another team. Lavine has close to $140 million guaranteed over the next 3 seasons so the buyout option would certainly not be ideal for the Bulls - they could be paying close to the $100 million mark (let’s say) for a good player not to play for them. Additionally, this would be by far the biggest buyout in NBA history.

Option #4: Renegotiation

 

On July 7 2025 Zach Lavine’s contract can be renegotiated, as it will be the 3rd anniversary of the signing of the 5-year $215.16 million contract, as long as the Bulls are under the salary cap. The Bulls can renegotiate and extend the contract of Zach Lavine next summer if they are in need of immediate cap help aid. The last salary cap year of Lavine’s contract can be renegotiated for a decrease of no more than 40% if the player contract is renegotiated and extended simultaneously. Lavine would need to agree to the decrease of course, the benefit mainly being longer-term security.

The Bottom-Line

Zach Lavine’s name will continue to be synonymous with NBA trade rumours going into the 2024 offseason. The Chicago Bulls have some important decisions to make this summer specifically in regards to whether or not to re-sign Demar DeRozan, (who is eligible up until June 30 to sign a 3-year $130M extension with Chicago) and what to do with the contract of Zach Lavine. The Bulls chose not to enter into a rebuild in the 2023-2024 season. Will they continue to try to and make the team better or do they finally give in and sell their assets? Whether or not Zach Lavine begins the 2024-2025 season in a Bulls uniform is still to be determined, but as an NBA fan I hope that wherever he ends up playing for that he makes a full recovery and returns to his all-star form.
 

Published March 16, 2024.