It finally happened.
On Monday afternoon, Jaden McDaniels and the Minnesota Timberwolves agreed on a five-year, $136 million contract extension. The agreement came just hours before the extension deadline closed. It was a lengthy back-and-forth between McDaniels’ camp and Minnesota’s front office, which started in July, according to The Athletic. If both sides didn’t agree by Monday evening, then McDaniels would have had to wait until the summer of 2024, when he would have become a restricted free agent.
However, they “got it done.” Here was McDaniels’ statement on the extension via his Instagram:
Grateful to the entire Timberwolves organization – the owners, coaches, staff, my teammates, and our fans for their continued belief in me. I’m humbled and excited to continue being a part of this organization. I’ll continue to pour everything I have into this city and this team! 🐺💙
Most of the work from both sides was fine-tuning the minor details, similar to how Anthony Edwards‘ extension played out earlier this off-season. It wasn’t a question of if McDaniels would re-sign with the Wolves. Instead, it was a negotiation over the dollar amount. We all knew Edwards would get a maximum extension, but there was more uncertainty with McDaniels. Mikal Bridges inked a four-year, $100 million extension with the Phoenix Suns in 2021, so many thought Slim’s would be around that number.
The Timberwolves will owe McDaniels around $27 million per season starting in 2024, which is tremendous value for what he brings to the court and his oozing potential. However, Tim Connelly and his staff will dip into the luxury tax after this year.
The NBA’s new Collective Bargaining Agreement yields some punishments to teams that go too far past the first luxury tax apron and into the second. Minnesota won’t undergo any consequences this season; next year is when things start to get messy. That said, championship teams must spend money to reach such lofty goals. And the Timberwolves look like a team with that exact mindset for the first time in a long time.
Next season will be the first time in nearly 20 years that the Timberwolves will be in the luxury tax. There is one main reason for this. Before the 2021-22 season, the Wolves made the playoffs once in 17 years, and they hadn’t made the playoffs in back-to-back seasons since 2004. With over a decade of noncompetitive basketball, why would the team spend more money than they absolutely had to on players they were unsure would stick around long-term?
But the Wolves are winning again. With a new ownership group and President of Basketball Operations, they are financially committed to winning. There is one thing on the minds of everyone involved with the Wolves – winning a championship, which Monday afternoon’s news further highlighted.
With the regular season beginning Wednesday in Toronto, the vibes are at an all-time high for Wolves fans, and I couldn’t be happier for the community. However, I hate to be the bearer of bad news, but not everything is sunshine and rainbows.
With Ant’s supermax extension, Naz Reid’s $42 million extension, and Karl-Anthony Towns already sitting on a supermax contract, Minnesota’s front office’s decision to dip into the luxury tax for the foreseeable future seemed inevitable.
As a part of the new CBA, that dreaded second apron that Bobby Marks mentions above is an imaginative line no team wants to cross. According to The Sporting News, if a team spends more than the allotted salary cap for a season and goes past the second apron, which varies from year to year, then that team will undergo the following punishments:
- They would not be able to use a trade exception generated by aggregating the salaries of multiple players.
- They wouldn’t be able to include cash in a trade.
- Teams wouldn’t be able to use a trade exception generated in a prior year.
- First-round picks seven years out are unable to be traded.
- That team’s first-round pick is moved to the end of the first round if they remain in the second apron for three out of five seasons.
For the 2024-25 season, Spotrac.com is projecting the salary cap for every team to be $142 million, with the luxury tax line at $172.5 million and the second apron at $190.8 million.
Above is a look at Minnesota’s future cap sheet via basketballreference.com. Hypothetically, if the Timberwolves don’t re-sign Mike Conley, Kyle Anderson, and Jordan McLaughlin, adding in the McDaniels extension would put the team at $187.4 million, which is roughly $2.6 million under the projected second apron for the 2024-25 season. We can expect that Conley will likely return on a more team-friendly deal. However, it’s less certain that they’ll re-sign Anderson and McLaughlin.
Regardless, the Timberwolves will be up against the luxury tax next season, and looking at how the payroll is shaking out, a sizable trade may be on the horizon.
KAT has been the first on the chopping block this season in trade speculation, primarily due to his annually-growing contract. There is a world where Minnesota can keep its core of Edwards, Towns, McDaniels, and Reid. However, making it happen would cause the team to invest a good chunk of their total cap in those four players alone, which could cause issues if any of them suffer significant injuries.
October 23rd should go down as a great day in Timberwolves history. A team doesn’t regularly lock up a player of Jaden McDaniels’ magnitude. If they can stay healthy, the Wolves are poised to do great things this season and break the 19-year spell of not making it out of the first round. However, the extension to keep McDaniels in the Twin Cities and further bolster their playoff ambitions comes with some harsh realities for the Timberwolves.
