The NBA Draft tips off Wednesday night at the Barclays Center in Brooklyn, N.Y., and there is zero doubt the Dallas Mavericks‘ first pick will be Duke’s Cooper Flagg.
Something else lacking doubt: the value of the contract Flagg will sign with the Mavericks. The 18-year-old power forward, who will be the youngest top pick since LeBron James in 2003, is set to earn $62.7 million over four years. Year 1 is worth $13.8 million.
Rookie contracts for first-round picks are tied to the NBA salary cap, which is currently projected to be $154.6 million for the 2025-26 season, a 10% increase versus last season, with rookie deals up by the same percentage. French teen Zaccharie Risacher signed a four-year contract worth $57 million last year as the No. 1 pick.
The salary cap is based on projected basketball-related income (BRI). The cap figure is often tweaked just ahead of free agency opening, which is next week, as the league wraps up final accounting on the just-finished season.
Don’t expect any adjustments to the cap this year. BRI is set to soar next season, with the start of the league’s new 11-year, $77 billion media agreements with NBC, ESPN/ABC and Amazon. It will boost the annual payout to teams by 33% to $137 million in the first year, according to three NBA team executives. The payouts then jump 13.5%, followed by annual 7% increases.
The salary cap can only increase a maximum of 10% each season. The provision was new in the 2023 CBA to avoid one-time salary-cap spikes, such as the one that allowed the Golden State Warriors to sign Kevin Durant as a free agent in 2016.
You can probably pencil in 10% increases to the cap and rookie contracts through the end of the CBA after the 2029-30 season. It would mean a four-year, $92 million deal for the No. 1 pick in the 2029 NBA Draft.
Contract values drop steeply for picks lower in the first round. The Oklahoma City Thunder hold the 15th pick on Wednesday and are set to commit $22.5 million over four years to the selection. The Los Angeles Clippers have the final pick of the first round, which is slotted at $14.1 million.
The first two years of these first-round contracts are guaranteed with “protection for lack of skill and injury or illness,” per the NBA collective bargaining agreement. Teams hold options for years three and four, although typically only a handful of picks each draft class don’t have their options picked up. The 30 picks would earn a total of $787 million in playing salary over the next four seasons if all their options were exercised.
Teams must offer at least 80% of the “rookie scale contract” and can go as high as 120% of the rookie salary slot. In practice, almost every deal is completed at the maximum 120% of slot value, and these contract projections reflect that.
Second-round picks do not have any salary restrictions, but the players often sign deals for the league minimum or even two-way contracts with different salaries for the time spent in the developmental NBA G League versus the parent NBA team.
Last year’s second round included the selection of Bronny James as the 55th pick by the Los Angeles Lakers. He signed a rare deal for a second-rounder without two-way language for his time in the G League, where he played part of the season. The contract is worth $7.9 million over four years, with the first three seasons guaranteed.
The NBA system is similar to the NFL, where first-round picks sign four-year contracts tied to their draft slot. Cam Ward, whom the Tennessee Titans picked No. 1 overall, is set to earn $48.4 million, including a $32.2 million signing bonus. Bonuses soared 26% this year after being held down when the NFL “borrowed” money against future rookie compensation pools in 2021 to prevent a decline in deals following the 2020 COVID-19-induced revenue shortfall.
The NFL jump this year helped close the gap in contract values between the two leagues for first picks, which grew to 45% last year, but is now 28%. The NHL and MLB also have restrictions in place on salaries for draft picks.
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