A Dissenting Opinion on Gordon Hayward’s Max Contract

July 28th, 2014 | by Clint Johnson
(Photo by Andrew D. Bernstein/NBAE via Getty Images)

(Photo by Andrew D. Bernstein/NBAE via Getty Images)

Everything is awesome!  Everything is cool when you’re part of the team1, especially when they pay you $63 million dollars!

That is pretty much the sentiment in Jazz land.2  Following the Jazz formally matching Charlotte’s $63 million offer sheet to Gordon Hayward last week, general manager Dennis Lindsey stated,  “We have always seen Gordon Hayward as a significant part of the future… [and] are pleased [he] will remain a member of the Jazz for many years to come.”  Hayward’s agent, Mark Bartelstein, spoke on behalf of his young client, saying, “It’s always a wonderful thing when your own organization values you so much that they’d match a contract like this. I think it makes a great statement to Gordon about how they feel about him and value him.”

To wrap up the love-fest, USA Basketball invited Hayward to their summer camp, where 19 of the best players in the NBA will compete for 12 slots on the US National Team.

It is a good time for Gordon Hayward, the Utah Jazz, and Jazz fans as well.  Such is the majority belief.

Even given my appreciation of Hayward, I feel differently.

Consider the competitive landscape of the modern NBA.  It’s recent dominating forces, the San Antonio Spurs and Miami Heat, illustrate the paramount importance of maximizing talent on limited expenditure.

Over the past four seasons, Miami has invested practically all its salary cap space in three players: LeBron James, Dwyane Wade, and Chris Bosh.  The return on their investment?  Three players who each earned four consecutive All-Star appearances, one of whom won two MVP awards.  That production far exceeds the player production for other teams that have made similar investments to employ the three star model, such as the Thunder (Kevin Durant, Russell Westbrook, Serge Ibaka) and Knicks (Carmelo Anthony, Amar’e Stoudemire, Tyson Chandler).

The Spurs demonstrate how to make the math work without employing the best player on the planet,3 a more realistic model for the small-market Jazz.

Tony Parker, All-NBA player and fringe MVP candidate, has a career high season earning of $13.5 million in 2010-11.  That ate 23% of the team’s salary cap.  The Jazz will pay Hayward $14.8 million in 2014-15, slightly more than 23% of the cap.  Then recall Parker was less expensive than this every other season while Hayward will make more in successive years of his deal.

Percentage wise, this Hayward contract will prove as great a hit to cap space as Tony Parker has ever cost the Spurs, and more than the reining champs typically devote to their best current player.  Manu Ginobili has never cost the Spurs more than 24% of the cap either.  The Spurs have executed contracts similar to Hayward’s for two sure-fire Hall of Fame players.  In contrast, most people would say Hayward will do well to make one All-Star game.

Post David Robinson, the Spurs have paid only one of their players proportionally more than the Jazz will pay Hayward the next four years.  Tim Duncan has made $18 million or more five times in his career, totaling 31%+ of the Spurs’ cap space in those seasons.

Spurs titles in those years: Zero.

Duncan’s average salary in the five seasons he earned a ring: about $11.5 million.4  He placed in the top four in MVP voting four times these seasons, winning the award once.

The Spurs have ridden three Hall of Famers to five titles by investing roughly the same cap space in each star that Hayward will absorb from the Jazz these next four years.

Maybe five rings in these specific seasons are mere coincidence.  But I think not.

Don’t mistake what I am saying.  Giving Hayward a max deal coming off his rookie contract will not, in and of itself, restrain the Jazz’s championship ambitions via their budget.  However, if the Hayward deal, both the final product and the process by which it came about, becomes a precedent that certainly will.

Consider the Jazz’s financial position prior to this contract.

First, they extended Derrick Favors for four years at an estimated $12 million a year plus unlikely incentives.  That is, by most assessments, a fair market deal with ample potential to become a bargain.5  In addition, the team stands in good position to extend Alec Burks for a similar fair market to bargain contract.  Somewhere in the $6 – $8 million range seems likely.

That potential $18 – $20 million for those two players represents 29% – 32% of next season’s cap.  That’s excellent budgeting, especially given their production in relation to Hayward.

Derrick Favors is the Jazz’s best player.  He was last season and projects to continue to be so going forward.6  There are loads of metrics more reliable than dollars that bear this out.

Hayward’s career best PER is 16.8, and he earned it playing off of Al Jefferson and Paul Millsap.  Last season, Derrick Favors posted a PER of 19.

According to Basketball-Reference’s Win Shares, Hayward won the struggling Jazz 3.6 precious games last season.  Favors, 5.1.  And numbers don’t hold up the narrative of Favors’ offensive limitations, at least not in comparison to Hayward.  Last season the big man earned more Offensive Win Shares than Hayward (2.9 to 2.2), was the more efficient offensive option (a true shooting percentage of .556 to Hayward’s .520), and posted a near-identical points per 100 possessions (Favors’ 23.2 to Hayward’s 23.4).

Favors is also a year younger and has over 1,200 fewer minutes of NBA experience.  That’s star potential in excess of Hayward’s own substantial talent.  So, the Jazz locked up their best player for $12 million a season.

Alec Burks doesn’t have the same ceiling as Favors, but there is ample evidence he may match Hayward’s overall ability as a player, or even surpass it.

Burks created 26.1 points per 100 possessions last season with greater efficiency (.547 TS%) than Hayward.  More importantly, Burks is a year younger and has only half the in-game experience of his fellow wing, which suggests he likely possesses substantially more as-yet untapped potential.

Most of all though, Alec Burks’ ability and production comes at a likely bargain price.

Combine the rookie contracts of Trey Burke, Dante Exum, Rodney Hood, and Rudy Gobert to that potential Favors / Burks tandem and the Jazz look to spend only about $27 million next season, or about 43% of the cap, on an impressive pool of young talent.  That percentage of the cap would not substantially increase for several seasons, and depending on how much the cap grows, may even stay static.

By locking up Favors and Burks without overpaying, they could have established a culture of investing more equally in a greater number of players as well as staked precedent for future contract negotiations.

Assuming the team matured into a contender, which is reasonable given that amount of young talent and cap flexibility, the franchise would have created an environment where reasonable contracts are proven to lead to success on the court.  Simultaneously, multiple young players would have developed together, reinforcing relationships and a collective investment in winning.  Such are the conditions in San Antonio, and they form the foundation upon which they have managed to retain star players on less money than they could make by moving elsewhere in free agency.

There would be no guarantee of course, and the decision as to Enes Kanter’s future would substantially affect the equation, but at least the main ingredients of the Spurs’ financial formula would be in place.

Now add the Hayward contract and watch the potential ripple effect.

First, I have no doubt that the agents for both Alec Burks and Enes Kanter will use Hayward’s deal as ammunition in negotiations to extend their contracts.  They will reference $15.8 million per year as a standard for relative comparison and dare the Jazz to risk more situations where they have to either overpay to match an offer sheet or lose a valuable player as a free agent.  The team has lost leverage in their attempt to keep these players without compromising their checkbook.

What if Favors does prove a more productive player than Hayward?  Suddenly the $47 million guaranteed the Jazz gave him transforms from an act of good faith to an obvious discount.  The team expected no such discount from Hayward; in fact, they paid above his production value to really show the love.  Favors would have every right to expect similarly excessive compensation on his next contract as proof that the Jazz prioritize him at least to the extent they do Hayward.

The same scenario may play out several times over the course of a few seasons.  The Jazz have a handful of players who could realistically develop to the point of claiming production value roughly equivalent to Hayward’s by the end of their current contracts.7  Which of them is likely to take kindly to lower compensation in such a case?  Why should they?

The danger of this contract is that the Jazz have proven themselves willing to overpay on a major contract. Justifying refusal to do so again in the future has become harder.

If the Jazz are serious about maximizing the talent on their roster within the salary cap, Gordon Hayward’s max contract is a step in the wrong direction.

Clint Johnson

Clint Johnson

Clint Johnson is a professional author, writing educator, and editor. In addition to his writing center work at Salt Lake Community College, he designed, coordinates, and teaches in an experimental author residency program for a West Valley City public charter school. A frequent presenter at both writing and educational conferences, he writes about the Jazz as a break from his other writing work.

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23 Comments

  1. Brent says:

    Yes, it was a calculated risk by the Jazz to let Hayward go to RFA. One that the Jazz lost on. It isn’t a problem right now but could become one in the future as Gobert, Burke, Exum and Hood come up for new deals. The precedent is set as you say.
    However, San Antonio’s situation is different. The players love the coach, they love winning they don’t want to go anywhere else. You can’t say that about Hayward’s last year with Corbin at the helm. Tony Parker, Tim Duncan and Manu Ginobli have already made a lot of money. Hayward hasn’t.
    I don’t think the Jazz thought he would get a Max deal but such is the nature of RFA. To get a player to leave his original team, you have to overpay. The Jazz stated that they would match any offer, which they did.
    All of that being said, Hayward will likely flourish in a non slow it down, post centric offense. Snyder’s offensive schemes seem tailor made to a player like Hayward that can run, cut, dribble, pass and shoot. Still, you would like to have seen the production out of Hayward before paying him.

    • Clint Johnson says:

      I think this is a fair assessment. You make a good point about the San Antonio situation being different. With so much being said about adopting their approach, we shouldn’t forget how multifaceted that approach is. How much deviation can there be without compromising the results they get? That’s my concern about this contract. They don’t overspend for their best players; to the contrary, they underpay. Everything that compromises our ability to do the same is a potential issue in building a contender.

  2. cw says:

    I agree with you Clint. The jazz screwed up last year estimating Hayward’s FA market, and it was not that hard to estimate the market. If they had figured out the market and could have resigned him at 13 a year or whatever, they would have 1. saved a bunch of money. 2. Been better able to trade him at the deadline, the draft, the FA period. THat would have been selling when he was high at a time when there were lots of significant pieces out there to buy. They could have traded him for Bledsoe for instance and then done something else in the draft. Cleveland or Milwaukee might have been more amenable to trading for their picks if Hayward was available. The way you win trades is you trade overvalued pieces when you can because you theoretically get more in exchange.

    And you are completely right about the precedent Haywards stupid contract sets. I’m very sure Alec Burks believes he’s better than Hayward and who knows how he’s going to feel if he ends up making 5 million dollars a year less. And he is definitely incentivized to not extend, kick ass in the next year, and go to FA, which means again, it will be much harder to trade him at a time when you might really want to trade him.

    What worries me most though, is if the Jazz like Hayward for more than Basketball reasons, i.e. he’s a clean cut young white guy. I can see that appealing to the Miller’s (and maybe Lindsey?). If he’s on the team for more than just basketball reasons, it creates all kinds of problems, on the court an off.

    • Clint Johnson says:

      No surprise, I share some of your concerns. The lost money is what it is, a few million dollars a season against the cap. No killer, they can work in spite of that. The real litmus tests for me will be Burks and Favors. If they retain Burks at an affordable price and if Favors features at least as prominently in the on and off-court functioning of the team as Hayward, I suspect this contract will be a strategic positive. However, if the team reaches an impasse with Burks or Favors is relegated to a secondary role while Hayward stays front and center, then I will absolutely worry. We’ll all see it unfold together.

  3. LKA says:

    “If if and buts were candies and nuts we would all have a Merry Christmas.” There is a reason why GM’s are what they are and fans are what they are. Look at all the contracts the Knicks screwed up on and still have. Several other teams the same way.

  4. LKA says:

    Also might mention that Kobe gave praise to Hayward in the past. That does not happen very often. With the pay and expectations Hayward might break out to be that kind of player. I don’t think anyone would complain then. Hayward was also forced to play along side Foye and RJ over the past.Maybe a quality starting five and bench might be the answer.

    • Clint Johnson says:

      Hayward is a good player, and he could justify the contract. I simply don’t believe that is likely. As for Kobe Bryant’s assessment, personally, I don’t put too much stock in that. He was a great, great player, but he also said those who suggest his latest contract has hurt the Lakers don’t understand the game and that he is pleased with the off-season the Lakers have had. There is a lot Kobe says that I think is questionable.

  5. Mike says:

    I feel like if they didn’t match, Kanter, Burks, Burke would get the vibe they the organization would only take you for a discount, or let you go. If I were Hayward, and saw that the Jazz had to spend more money to just fill a roster, but wouldn’t spend a little more on me, that would discourage me.

    So wait, you would pay Biedrins 12 million to fill cap, but you wont pay me from 12 or 13/yr to 15 or 16/yr?

    Pay it to keep an asset…

    Not many 6′ 8″ guard/forwards in the league.

    • Yep, even if Burks really blows up he’s not getting a max offer.

    • Clint Johnson says:

      You certainly have a point. That said, if that was a major concern, it may have made more sense to simply extend him last season by overpaying rather than express skepticism that he would justify such a contract and then overpay him. If they wanted to send a message they believe in and reward their players, extending both Favors and Hayward would have sent a better message while saving money. Now, it may well look like they open their pocket books only when forced to do so and not as an act of good faith in a player’s ability.

      And I don’t discount free agent options that would have made the Jazz at least as competitive this season as Hayward. So while what you say is a legitimate consideration, I think there were ways to send the message that the team will spend to compete without overspending at gunpoint on Hayward.

  6. Lets see what happens to the Spurs model when its time for Kahwi’s new deal. I’d be flabbergasted to see him agree to take much less than Hayward & Parsons, let alone, like, 33% less.

    • Clint Johnson says:

      Good point. I’m interested to see what happens with the Spurs post-Duncan for a similar reason. How much of how they run their franchise comes from him rather than Popovich, Buford, or Holt? Kawhi’s contract, and how he plays coming off of it, will show if they can continue their bargain budgeting ways.

  7. ScotsJazzFanIn London says:

    Everyone in Jazzland knows a mistake was made in not negotiating Hayward’s contract to happy ending last season, not least the Jazz organization itself.

    However let’s get this right, matching Hayward to a max contract at this stage of his career, is not the same as matching Lebron James, Chris Bosh, Carmelo Anthony to a max contract where their contract currently is. Its no where near as costly as their contracts with their experience, their MVP’s and their All Star appearances. Right now the Jazz have the flexibility to match Hayward and they still have some leeway to add another member of the squad this year to the tune of $6m or so if they so desire.

    Yes had they matched what Hayward’s agent wanted they might have $2-$3m more to add to that, had the Jazz then decided to put the boat out and go after a more expensive squad member they might have decided that as good a guy as Evans is to have around the team he is way down on the roster when getting minutes for the coming season it might be better to trade his $3m contract and put all that money together to add a $14m to the squad this season.

    Few are complaining at the money that Favors is getting this year. Bigs always get big money, apparently if we believe the silence we got Favors for a bargain because we negotiated early. But he’s on more money than Duncan. Is he the player that Duncan is? I like Favors, I like his defensive game, but I am yet to be convinced he is ready to step up offensively. We didn’t want to pay $8-$9m for Millsap yet Favors has yet to show the offensive game that Millsap has, nor the tenacity to keep up his energy levels up throughout the game despite being blessed with the gifts he possesses and his height and athleticism. He shows flashes of aggression and brilliance here and there, but their are many players paid less that keep those levels up higher for longer stretches in a game. Favors seems to have gotten the benefit of the doubt because we negotiated early at a less than max deal and the ole Bigs take longer to mature talk.

    Hayward earned playing time in the starting five ahead of all the others of his class in the squad because he was willing to play the team game, he didn’t just focus on his own stats, he did the little things that allowed his teammates to do the thing they do best the first couple of years. He was also the third highest scorer behind Al, and Paul. with his true shooting percentage right up there with his more experienced teammates. He was thrust into a bigger more demanding role last season, When Millsap and Al were allowed to walk off the roster and their shooting expertise was not replaced. Favors and Kanter did not step up into their roles in a manner that kept opposing defenses honest. Having no starting caliber PG at the beginning of the season didn’t help.

    Burks can score 20 easy points on his own like no one else can on this squad, but if he isn’t shooting well on the day, or a defense is able to stop his penetrative runs he does not adapt his game in the same way that Hayward does when his shooting is off. He does not yet make an an impact on the floor that helps his team when the ball isn’t falling through the net. At this point in his career he isn’t close to getting the contract that Hayward should have been offered never mind the max that Hayward got offered.

    Hayward’s contract though pricy, allows the Jazz to keep important members of the team together. The budget is increasing by $5m next year, and is projected to increase further still the following year. Keeping important members of the squad together is a message to the squad that the team believes in this unit. Last season Favors wanted reassurance that the team was going to stay together. Don’t underestimate how important that will be for Kanter, Burks, Burke and Exum going forward.

    • Clint Johnson says:

      You make some good points. As for the Favors vs. Hayward comparison, it’s hard for me to see a clear argument that Favors’ contract is likely to be an overpayment. Favors is younger and more productive by both the whole-game and the offensive metrics mentioned above, but more than that he’s making what Larry Sanders and JaVale McGee make per season. In comparison, Hayward is making more than all but a handful of players at his position, and the only one who is likely in his class as a player (sub All-Star) is Rudy Gay.

      Numbers show Favors to be the better overall player right now, he clearly has more potential for growth, he’s younger, and he’s making less money on a deal far more comparable to other teams’ contracts for similar or worse players. Hard for me to see a similar situation with the Favors contract.

  8. Mewko says:

    I think Dante Exum has a breakout year in 2017-18, his fourth year. Then he gets a 5 yr/80 million deal with the Jazz, whether extended in fall of 2017, or summer of 2018.
    Then Favors and Hayward both return for 3 yrs/30 million. We got us a big 3.

    Exum: 22 PPG, 7 APG, 4.5 RPG
    Favors: 17 PPG, 11 RPG, 2.5 BPG
    Hayward: 14 PPG, 6 RPG 4.5 APG

    • Clint Johnson says:

      If Exum and Favors were to both reach near their ceilings, then Hayward would be a perfect third star. Hope you’re right.

  9. You can count the 16/5/5 players in most seasons on less than a single hand. Hayward as the focus of opposing defenses was by design. Let’s not pretend that happens again this year. And his shooting was an aberration, not the norm. He’ll get open looks under Snyder and you will eat your dissertation with hot sauce and crow.

    • Clint Johnson says:

      If Hayward proves worth every penny, I’ll be ecstatic. Could it happen? Sure. Do I think it likely? Nope. As for the 16/5/5 thing, just because a statistical outcome is uncommon does not mean that scarcity is a product of quality equal to the rareness.

      For example, there were four 13/7/4 players, including Lance Stephensen, last season. (One less player than those who achieved 16/5/5, actually.) If you up that total to 14/7/4 however, only two players make that threshold: Kevin Durant and Kevin Love. If Lance Stephensen had averaged only 0.2 points more per game, he would have been the third. Does that put Stephensen in a group with Durant and Love? No. That’s ludicrous, because both Durant and Love averaged better than 26 points per game as first offensive options.

      Statistical groups are often numerical oddities more than meaningful comparisons. Hayward is a 16/5/5 player with an average PER of about 16 (dismissing his rookie reason), which is most similar statistically to players like Chuck Person, Chandler Parsons, Larry Hughes, Hedo Turkoglu, Toni Kukoc, and Jim Jackson. I’m a big believer in Quin Snyder, but I don’t expect him to take a player of that caliber and turn him into someone who belongs in the conversation with the best of the 16/5/5 crowd.

  10. Aaron says:

    You make some fair points, but I am still 100 percent with David Locke on this one. I agonized over the likelihood of matching until I listened to his rationale (and he is one of only a few announcers who I feel is significantly more knowledgeable than me). Between the Jazz being required to spend at least 90 percent of the salary cap and the new TV deal that is basically considered a foregone conclusion at this point with the way franchise prices are blowing up, this will not be that bad a deal. I keep hearing the comparison to Kirilenko’s contract, but barring a catastrophic injury, I don’t believe Hayward’s deal will ever be the albatross AK’s was his last couple of years. Hayward is a more complete player, largely because of the ability to play point forward.

    As far as Alec Burks, you’re up in the night if you think his market value will only be $6 to 8 million after he leads the Jazz in scoring. I don’t know why there are so many fans who don’t consider him to be a huge part of the future. He’s already one of the best 10-15 finishers in the league, and he’s going to put up probably close to 20 ppg

    • Clint Johnson says:

      I don’t think it will be the Kirilenko contract either, but I disagree Hayward is a more complete player. Kirilenko was a more diverse and better player, especially when used to his full potential, which unfortunately wasn’t always the case here. He only scored 15 points or more a game in three seasons, but he also averaged 8 rebounds a game in two seasons, 4 assists or more in two seasons, over 2 blocks five seasons, and 1.5 steals fives seasons. As long as you didn’t expect him to be your first offensive option and were willing to let him be heavily involved in the offense (much like Boris Diaw), he was dynamic and affected the game in every way possible.

      As for Burks, to be clear, I believe his value should be higher than $8 million, just as I believe Hayward’s value is less than $15.8. But the market value is a different story: it overvalued Hayward and, for a number of reasons, has likely undervalued Burks. I think the Jazz will extend him for a contract in that $6 – $8 range and it will be a bargain deal. If they don’t extend him, I think he has a good enough season to hit eight figures on the open market.

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  12. LKA says:

    Burks and Kanter have to be extended some time in October or they too will be RFA. I would agree with a 8 mil figure for Burks and would also try for a five year contract. The jury is still out on Kanter. As of now he is not a top player on the charts. So jazz could get him on the cheap side and then let him flourish. I would try to get him on a four year, with the last year being a team option. Given the starting role with Favors I really think Kanter can be the beast we hope he can. With a good coach I think the Jazz will be glad they kept him.. Right now though he is the best trade bait.

    • Clint Johnson says:

      I think Kanter is the most likely of the young pieces to be traded as well. My guess is he and his agent will look at her per 36 scoring and rebounding numbers and his age and expect the young big man premium that is so common in the league. I’d be surprised if they are looking for less than eight figures a year, and I don’t think the Jazz will consider that.

      Burks for $8 million would be a steal, in my opinion, so I hope we’re right.

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