© USA TODAY Sports

The 2023 NBA Draft, and the leadup to it, saw some big swings as far as 2023 cap space and spending power projections go. With one set of moves, the Oklahoma City Thunder cut their cap space in half, and the Sacramento Kings created jumped into the free agency fray. The Washington Wizards kicked off a rebuild, while the Boston Celtics and Phoenix Suns took on some high-salary players.

In addition, in the days ahead of the draft, the NBA released updated cap and tax projections for the 2023-24 season. The cap projection went up from $134 million to $136 million. The tax projection went from $162 million to $165 million. That’s a 10% raise for both.

That leaves the league with a pretty even landscape of spending power this offseason. Eight teams project to have cap space, 10 are projected to have the Non-Taxpayer MLE available, seven teams project to have the Taxpayer MLE, while five teams look like they’ll be up against or over the second tax apron and won’t have any signing exceptions available.

Cap Space Teams

  1. Houston Rockets - $60.9 million

  2. Utah Jazz - $47.2 million

  3. San Antonio Spurs - $38.6 million

  4. Sacramento Kings - $35.6 million

  5. Indiana Pacers - $32.2 million

  6. Detroit Pistons - $30.0 million

  7. Orlando Magic - $23.9 million

  8. Oklahoma City Thunder - $16.6 million

Eight teams project to have cap space this summer. Not only will these teams likely go the cap space route, but they’ll also have the $7.7 million Room Exception too. Under the new CBA, the Room Exception has more spending power than the Taxpayer MLE does. So, these eight teams are kind of in control of the free agent board.

The Rockets lead the way with over $60 million in cap space. For a while, it looked like a large chunk of that space was being allocated to chasing James Harden. Now, it seems like Houston will spread some of that money around, as they are reportedly interested in several veteran free agents. One thing to keep in mind: The Rockets have seven players on first-round rookie scale deals, plus they added two more at the 2023 Draft. And Kevin Porter Jr. and Jae’Sean Tate are signed as well. That means there’s potentially a lot of roster movement coming in Houston, if they spend big on free agents.

The Jazz projection is still a little up in the air. Jordan Clarkson seems likely to opt out, even if he eventually re-signs on a long-term deal. Talen Horton-Tucker is 50-50, while Rudy Gay will likely opt in. If Horton-Tucker opts out, this projection will jump up to $57 million. No matter what, Utah’s rebuild has plenty of flexibility, both in terms of the cap sheet and draft pick treasure chest.

The Spurs already won big, literally and figuratively, by drafting Victor Wembanyama. Now, it’s about San Antonio deciding when it’s time to add veteran talent to Wembanyama and a promising core of other young players. It may not be this summer, but that time is coming soon.

Sacramento swerved at the draft when they traded Richaun Holmes and their first-round pick and took no money back. That puts the Kings in a spot to be players in free agency. They could use another forward or a wing with size. This free agent class has a lot of intriguing options, and Sacramento could be in play for all of them, as they are the only playoff team with cap space.

Indiana had a nice draft night. They increased their cap space a bit, and added some future draft picks. The Pacers still need more size on their roster, so look for them to target forwards and centers via signings or trades. Something to keep an eye on: Indiana only has one or two roster spots to fill. That puts them in position to overpay a targeted player on a one- or two-year deal that they feel is a perfect fit.

The Pistons came away from the draft with an additional first-round pick, so they gave up a bit of spending power this summer. But $30 million is enough for Detroit to be in range for just about any available free agent. The question: Sign free agents or continue the process of eating salary for future assets?

Orlando has a young roster and not a lot of roster spots. With almost $24 million to spend, the Magic can be aggressive on targeting a specific player or two. If Orlando decides it’s time to move on from Jonathan Isaac, they can add almost $10 million to this projection, for nearly $34 million in spending power. But don’t look for fireworks. Orlando is focused on being patient and not rushing this rebuild.

The Thunder have already used a chunk of the cap space they’re going to create. Oklahoma City took on Davis Bertans’ and his $17 million deal from the Dallas Mavericks at the draft, in order to move up to draft Cason Wallace. That leaves the Thunder with about $16.6 million in flexibility, but they also don’t really have any roster spots open. That means that space is more likely to get used up in a trade of some sort than it is in a free agent signing.

Non-Taxpayer Mid-Level Teams

  1. Charlotte Hornets

  2. Chicago Bulls

  3. Cleveland Cavaliers

  4. Dallas Mavericks

  5. Memphis Grizzlies

  6. Minnesota Timberwolves

  7. New York Knicks

  8. Portland Trail Blazers

  9. Toronto Raptors

  10. Washington Wizards

These nine teams project to have access to the beefed-up Non-Taxpayer MLE of $12.4 million. It’s an interesting mix of playoff teams and rebuilding teams.

The Hornets are rebuilding, and they have a couple of key free agent decisions to make with P.J. Washington and Miles Bridges, who are both pending restricted free agents. Charlotte is likely to take care of their business with them first, before turning to fill needs in free agency.

Chicago should have the Non-Taxpayer MLE, pending contract decisions with Nikola Vucevic, Ayo Dosunmu and Coby White. Given the Bulls have a need at point guard with Lonzo Ball unlikely to play this season, that’s a spot to look at using some or all of the MLE on.

Cleveland should have the MLE to spend, even if they re-sign Caris LeVert. The Cavs also look ready to make another leap forward, so this $12.4 million should put them in a place to add a win-now veteran to help fill out the rotation. Keep an eye on a big wing that can shoot.

The Mavericks could be in range to use the full Non-Taxpayer MLE, even if Kyrie Irving signs a max deal at $47.6 million for next season. That’s what their draft day dealing opened up for them. Given they’ll only have a couple of roster spots to fill too, Dallas should be able to fit in an MLE signing.

Memphis is in a similar spot to Cleveland. They need to add a wing, a big and another point guard. Trading for Marcus Smart covers part of those needs, but the Grizzlies could still use more depth at the point (due to Ja Morant’s suspension) and up front (due to Brandon Clarke being out). This MLE will fill one of those needs, or potentially both if they split it between two players.

The Timberwolves should be in range of adding help via the MLE, pending what happens with Naz Reid. If he leaves town, Minnesota will have the full $12.4 million to spend. If Reid stays on a reasonable deal, the Wolves could still be in play to use some or all of the MLE to fill out their guard rotation.

The Knicks are in a bit of a weird spot, and that’s because of Josh Hart’s player option. New York and Hart agreed to push his option deadline back by five days. If Hart opts in, he’ll be on the books at just under $13 million. That would give the Knicks access to the full MLE, and they could then extend Hart’s deal to add years onto it. If Hart opts out, he’ll likely land a bigger deal and that will eat into New York’s ability to use the full MLE this summer.

Portland could use up most of their flexibility this summer, if they re-sign Jerami Grant, Matisse Thybulle and Drew Eubanks. If any of those players comes on a value deal, or any of them leave town, the Blazers will definitely have the full MLE to spend. And, of course, there’s always the option of a trade that sets the franchise down an entirely different path too. It’s fair to say the entire league is waiting to see what Portland chooses to do.

Toronto seems hellbent on avoiding rebuilding or going all-in. The Raptors should have the $12.4 Non-Taxpayer MLE to spend, pending what happens with Fred VanVleet and Jakob Poeltl. If one or both move to new teams, the MLE is a lock for Toronto. If they re-sign both to the type of contracts they are looking for, Toronto might be closer to having the Taxpayer MLE to spend. Everyone around the NBA is wondering exactly what the Raptors are up to.

The Wizards are on a new course towards rebuilding. They’ve already traded Bradley Beal and Kristaps Porzingis, and Washington isn’t done trading either. Pending where they finish things up roster-wise after further trades, the Wizards may not have a lot of use for spending the MLE on a veteran. But they’ll have it available, should they choose to use it.

Taxpayer Mid-Level Teams

  1. Atlanta Hawks

  2. Boston Celtics

  3. Brooklyn Nets

  4. Denver Nuggets

  5. Los Angeles Lakers

  6. New Orleans Pelicans

  7. Philadelphia 76ers

The Taxpayer MLE is no longer much of an advantage for the NBA’s more-expensive teams. It’s been knocked down to just $5 million in value, but the real kicker is that using the Taxpayer MLE hard caps a team at the second tax apron. That makes it hard to find the right amount of wiggle room to use this MLE, while staying under that hard cap.

Atlanta’s roster is a bit of a mess. They have a ton of long-term salary committed to several players, and other key players are up for extensions and new contracts soon. The Hawks will probably forgo using the MLE this summer, and will keep it in their back pocket to use later, if necessary.

The Celtics ability to use the Taxpayer MLE is linked to Grant Williams. If Williams leaves, Boston can put themselves in range to use the MLE. If Williams re-signs, then Boston is too tight to the second apron to use the MLE.

Brooklyn’s spending power this summer is dependent on what happens with Cam Johnson. The Nets are clear of the tax for now, but only by about $10 million. If they re-sign Johnson, or are forced to match an offer sheet at or above $20 million, Brooklyn will be over the tax line. They should still have enough room under the second apron to use the Taxpayer MLE, but it’ll be tight.

The Nuggets could have enough wiggle room to use the Taxpayer MLE and to stay under the hard cap at the second apron, but only if they lose Bruce Brown. If Brown re-signs on a team-friendly deal using his Non-Bird rights, then things probably get too tight for Denver to use the MLE and to stay under the hard cap.

The Lakers are in an interesting spot this summer. They could still be a cap space team, but all signs point to the Lakers staying over and re-signing several of their own free agents. Even fair-value deals will push Los Angeles up near, or over, the tax line. If they can work things to use the Non-Taxpayer MLE, while re-signing players, that would be a huge win. But this one will probably leave the Lakers with about $5 million extra to spend beyond re-signings.

New Orleans has enough clearance to use the full Non-Taxpayer MLE without tripping into hard cap range at the first apron. But the Pelicans are likely to try and stay out of the tax entirely. That means they’ll limit themselves to somewhere between the Taxpayer MLE of $5 million and the Non-Taxpayer MLE of $12.4 million to spend this summer.

Philadelphia’s exception availability is almost entirely dependent on what happens with James Harden. If Harden re-signs for the max Philadelphia is likely limited to the Taxpayer MLE. If Harden takes a good chunk less than the max, and he did that last year, that should open up the Non-Taxpayer MLE for the Sixers.

Super Tax Teams (no signing exception)

  1. Golden State Warriors

  2. LA Clippers

  3. Miami Heat

  4. Milwaukee Bucks

  5. Phoenix Suns

Since we did our last spending power projections after the trade deadline, the new CBA terms were released. In the new agreement, one of the penalties against the most-expensive teams is that they lose the ability to use the Taxpayer MLE. And that’s one of the penalties that triggers immediately, while several others don’t kick in until the 2024-25 season. That means these teams are limited to trades, re-signings, signings draft picks and signing minimum deals.

The Warriors are the poster boys of the new super tax penalties. They’ve already moved some long-term money by swapping Jordan Poole for Chris Paul. But that’s for down the line. This summer, Golden State is still well over the tax line and will be even more so, should they re-sign Draymond Green.

The Clippers are Enemy 1A for the new super tax penalties, just behind their neighbors to the north. LA has a pretty full roster, so they’ll focus on trades to being in any outside help.

Miami is already wildly expensive, by virtue of re-signing their own players. That’s not a criticism, as those deals have all been solid enough values. But now the Heat have to re-sign a couple of key free agents in Gabe Vincent and Max Strus. Retaining even one of them will push Miami up and over the super tax line.

The Bucks could end up dodging the super tax and opening up a little spending power, but that would be at the expense of Khris Middleton and/or Brook Lopez. Milwaukee would rather re-sign those two, and a few other key free agents, than have minimal ability to sign an outside free agent.

The summer of 2023 was intended as a “grace period” for the NBA’s most-expensive teams. The idea was for them to take a year to get their books in order before the big penalties started hitting in 2024. The Suns went the other way. They looked at this as their last chance to add big money, and they did so by trading for Bradley Beal. Phoenix is now limited to re-signing their own players, maybe another trade or two and then filling out with minimum contracts.