For James Harden, NBA’s over-38 rule levels financial math for 76ers, Rockets

Ever since reports of a potential James Harden reunion with the Houston Rockets started picking up steam on Christmas, many fans around the NBA have wondered if it could simply be a leverage play.

For many, it’s hard to envision Harden leaving a superior team like the Philadelphia 76ers for less money. And in most scenarios, a pending free agent’s existing team has the ability under the league’s Collective Bargaining Agreement to offer the most guaranteed money. It’s simply a matter of whether that team is willing to do so, which is where outside leverage to force their hand could help.

But in this case, based on Harden’s age, that usual equation doesn’t quite apply. Bryan Toporek of Liberty Ballers explains:

Since the Sixers have full Bird rights on Harden, they would typically be able to offer him both one more year and higher annual raises (8 percent) than any of his free-agent suitors this offseason. However, the “Over 38 Rule” in the current collective bargaining agreement will limit the leverage they have over the Rockets in free-agent negotiations.

The Over 38 Rule applies to any contracts that cover four or more seasons, one of which begins after the player turns 38. In that scenario, the “aggregate salaries” covering a season after the player’s 38th birthday “shall be attributed to the prior salary-cap years pro rata on the basis of the salaries for such prior salary-cap years.”

In plain English: The Sixers can only offer Harden a four-year max contract this summer, not a five-year max.

For those interested in details, the Liberty Ballers article dives into the financial specifics. Harden turns 34 years old this August, which means he would turn 38 prior to the final season of a hypothetical five-year extension. That’s why the unique rule comes into play.

The Sixers would be able to offer Harden slightly larger annual raises than the Rockets. However, that’s effectively offset by the fact that Pennsylvania has a state income tax, whereas Texas does not.

In short, while Harden sticking around in Philadelphia certainly isn’t implausible, it won’t be because of money. Assuming the Rockets are willing to offer a maximum contract in money and years, they’ll be roughly on par, financially, with what the Sixers can propose.

Game on.


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Story originally appeared on Rockets Wire