The NBA Offseason Dictionary Series: Breaking Down 1st & 2nd Apron

 

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This is the first official blog for my new series: “The NBA Offseason Dictionary”. I got a lot of positive feedback from Explaining the NBA Luxury Tax, so I decided to start a series defining NBA offseason terms. These are terms you repeatedly hear analysts and reporters talk about, but might not fully understand.

In this blog, the two terms I will be breaking down are 1st apron and 2nd apron. These terms are directly associated with a team’s salary cap and the luxury tax line. As a brief reminder:

Salary Cap: The limit on how much a team can spend on player salaries.

Luxury Tax Line: If a team spends more than this amount, they have to pay extra money as a penalty.

The NBA announced last week that the luxury tax level for the 2024–2025 season is $170.814 million, while the salary cap is $140.588 million. The 1st apron is $178.132 million, and the 2nd apron is $188.931 million.

1st Apron:

The 1st apron is the initial threshold above the luxury tax line that carries financial and team-building restrictions. For this upcoming season, if a team spends between $37.544 million to $48.343 million above the salary cap, they will be faced with 1st apron restrictions, which include:

• Not being able to use a special type of money (called the bi-annual exception) to sign free agents.

• Receiving less money to sign mid-level players.

• There are limits on how much salary teams can take back in trades.

• Teams can’t sign players who were cut by other teams, known as buyout players

An example of a team currently in the 1st apron of the luxury tax is the Los Angeles Lakers. LeBron James just signed a 2 year, $101.3 million extension. LeBron took a minor pay cut as he could have earned up to $104 million on the extension, but that would have put the Lakers in the 2nd apron. In the 1st apron, they still have the opportunity to sign a mid-level player to help shape out the roster.

2nd Apron:

The 2nd apron is the higher threshold above the luxury tax line that imposes even stricter financial and team-building restrictions than the 1st apron.

For the upcoming 2024-2025 season, if a team exceeds the salary cap by $48.343 million or more, they have fallen into the 2nd apron of the luxury tax.

Restrictions under the 2nd apron include:

• Teams lose the ability to use another special type of money (called the taxpayer mid-level exception) to sign players.

• Teams have more trade restrictions, like not being able to combine player salaries to make trades.

• Teams can’t sign players who were cut after a certain date (March 1).

• Teams won’t be able to trade their first-round pick seven years into the future.

The Phoenix Suns are an example of a team currently in the 2nd apron of the luxury tax. Their big 3 alone (Kevin Durant, Devin Booker and Bradley Beal) are set to make a combined $149,265,751 next season. For this example, let’s say they want to trade Jusuf Nurkić and Nassir Little, these two players combined are set to make $24.8 million for 2024-2025. Because the Suns are in the 2nd apron, they cannot trade away both of those players in exchange for one player making $24.8 million.

Why It Matters


Fairness: These rules are designed to make sure all teams have a fair chance by preventing big market teams from spending way more than others.

Team Strategy: Teams have to think carefully about how much they pay their players because going over these lines limits their ability to sign new players and make trades.

Have a question or comment?  Feel free to drop it below.