Why Charlotte’s Front Office is to Blame for Recent Struggles

On January 4, the Hornets topped the Thunder 123-112, improving to 20-16 and looking like legitimate Eastern Conference contenders. Since, the team has been in a downward spiral, losing nine of its last twelve games and finding itself in a crowded pack of mediocre Eastern Conference teams. Things will likely get worse before they get better, as the team opens a West Coast road trip on Tuesday in Portland. So what went wrong? To assess this, we need look no further than the struggles of the team’s front office this offseason.

The Belinelli Debacle

Last June, Charlotte traded its first-round pick, a $1.2 million rookie contract, for Marco Belinelli on a $6.3 million deal. The $5 million gap was the difference between keeping wing Courtney Lee and losing him in free agency. The choice of Belinelli over Lee (who signed a 4-year $48 million contract in New York) may seem innocuous, but the drop-off is substantial. Belinelli performed at replacement level according to both ESPN’s RPM and Basketball-Reference’s VORP, suggesting he may be worth only the minimum salary and replaceable with a D-League call-up. He has rated around replacement level throughout his career, with his abominable defense counteracting any offensive value he provides. Lee is, by the same metrics, a below-average starter; he has a long track record of solid offensive and defensive performance. Paying him into his age 34 season would have posed a risk, but at the reasonable price point he ended up agreeing to in New York this was a risk worth taking.

The trade also represented a gross undervaluation of the Hornets’ first round pick. Even late first round picks are extremely valuable, offering the chance of significant production on a below-market contract. Moreover, the pick was an opportunity for Charlotte to begin replenishing young talent, having sent away Noah Vonleh and two second round picks at the 2016 trade deadline. When presented with the opportunity to give up a first-round pick and $5 million in cap space for an aging, below replacement level gunner, walking away should have been an easy decision.

League Trend Recognition

Another message was clear this offseason; the league has shifted, and Charlotte has failed to keep up. Teams are trending smaller and emphasizing shooting, playmaking, and versatility. “Three-and-D” guys, who can defend the opposing team’s best wing scorer and stretch the floor, are immensely valuable in the new NBA. Charlotte not only let Courtney Lee walk at a fair price, but did the same with Troy Daniels. The young sharpshooter (he is a career 42% shooter from beyond the arc) was signed-and-traded to Memphis, who gets him on a bargain 3-year, $10 million deal. In exchange, Charlotte received… $250,000 in cash.

Those who would say that Charlotte has plenty of wings are missing the point of the small ball revolution; teams can hardly be too deep at wing in this NBA. If the Hornets had kept Daniels and Lee, they would have been able to find extra minutes for Batum and Michael Kidd-Gilchrist as small-ball fours. Instead, they find themselves with minimal depth, relying on the ineffective production of Belinelli and Jeremy Lamb as backup wings and Frank Kaminsky, a natural center, as a backup power forward (don’t get me started on what the Hornets turned down to get Kaminsky). While Kaminsky’s reputation as a shooter helps stretch the floor (although he is only 31% from beyond the arc in his career), he is not nearly quick enough to defend today’s fours. The Charlotte front office failed to adapt the team to the changing NBA, and they have paid for their sins in recent weeks.

Cap Management

Still worse for the Hornets, the front office failed to maximize future salary flexibility, showing an alarming lack of attention to detail and salary cap understanding. After exhausting their cap space on Hibbert and Sessions, Charlotte had the opportunity to exceed the cap and re-sign Batum up to the max. They ultimately agreed on a 5-year, $120 million deal, about $30 million below the max.

This presented Charlotte with an opportunity; they could front load the deal, maximizing future cap space and Batum’s trade value at zero additional cost. This would have entailed paying Batum $26.6 million in year one, then decreasing his salary by 5% in each of the four remaining seasons. Instead, the Hornets inexplicably decided to do the opposite, paying Batum $20 million in year one, increasing 7.5% per year (the maximum allowed under the current CBA). The higher future salaries cost the Hornets valuable future cap space and hurt Batum’s trade value. Convincing Batum to stay in Charlotte, and at less than a maximum, was a coup for the franchise. Backloading the deal was an inexcusable error.

The Ideal Offseason

Things could have gone much better for Charlotte. The ideal offseason was to pass on Belinelli, take a shot with the 22nd overall pick, and keep Batum, Daniels, and Lee on contracts with descending annual payouts. The order of operations is as follows. With cap holds on Batum, Daniels, Lee, Williams, and the 22nd overall pick, Charlotte would have just over $4 million in cap space to spend on a backup point guard. After exhausting this cap room, the Hornets could use the $2.9 million Room Mid-Level Exception to sign a backup big. Finally, Charlotte could have used its bird rights to exceed the cap to re-sign Batum, Daniels, Lee, and Williams, and to sign their first-round pick.

This scenario, the and the resulting future cap sheet are shown below. Charlotte would have found itself with a stronger, deeper, lineup (and one more suited to the modern NBA) this year, while also maximizing future cap room.

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On the surface, the Hornets had a solid offseason leading to some early success in 2016-17. Upon deeper investigation, the front office failed to maximize the team’s future outcomes.

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