The proposal from NBA owners that the NBA Players Association rejected last week called for the implementation of a hard salary cap at a figure lower than the league's current cap, but not until the 2013-14 season, according to sources familiar with the offer.
Sources told ESPN.com this week that the central change made by owners to past collective bargaining proposals called for easing in a more restrictive financial landscape over a three-season cycle as opposed to trying to impose a hard salary ceiling with immediate effect next season.
The league, sources said, regards this as a major concession, since the next two seasons would employ a salary-cap system with luxury-tax penalties not unlike the system currently in place. Teams currently operate with a salary cap of $58 million per franchise, with a dollar-for-dollar luxury tax imposed for every dollar teams spend over the tax threshold of $70.3 million.
Sources said the owners' latest proposal, however, does still call for immediate rollbacks of 15 percent, 20 percent or 25 percent to current contracts depending on salary levels, as part of the league's oft-stated desire to reduce payroll by roughly $800 million leaguewide on an annual basis.
The NBA's ongoing push for such sharp salary reductions, sources said, is what caused the quick rejection from the players' side, with the union also still determined to oppose a hard cap.
The NBA, sources said, likewise hopes to implement even lower salaries for rookies than they currently make based off the league's rookie scale. The league also would like to propose new rules that make it hugely advantageous for marquee players to stay with the teams that draft them.
The new rules would grant teams the ability to offer even more years and dollars to a designated "star" player than current rules allow, heeding the clamor from various small-market teams for such a measure after last summer's free-agent defections of LeBron James and Chris Bosh to Miami and the trades that sent Carmelo Anthony to New York and Deron Williams to New Jersey.
An SI.com report Wednesday said that teams, under the NBA's proposal, would not be able to unilaterally "tag" a player to be their designated star, as NFL teams can by using their "franchise tag" to prevent one chosen player from becoming a free agent. Under the NBA's proposal rejected by the union last week, teams would only be able to designate one player for preferential contract treatment if the player agreed to it.
Another key wrinkle from the rejected proposal, sources said, called for the ability for each team to shed one contract outright before next season through a one-time amnesty provision that wipes that contract off a team's books -- even though the player must still be paid -- reminiscent of a similar provision in the summer of 2005.
The league likewise has proposed to eliminate sign-and-trades in the next labor agreement. In a provision conceived by the league to inspire loyalty, teams are presently allowed to pay their own free agents more than anyone else. But that ability to offer a contract one year longer than the competition often has resulted in marquee free agents getting traded to the team they choose in free agency after first signing a larger contract with their original team, as seen with both James and Bosh last summer.
Although the players quickly rejected last week's proposal, sources close to the process have expressed mild optimism about the league's increased willingness to negotiate before the current labor agreement expires June 30.
ESPN.com's Henry Abbott reported Tuesday that Stern and NBPA executive director Billy Hunter have been quietly meeting face-to-face to negotiate on a fairly regular basis. The sides, sources said, met last week in Chicago with staffers from both sides present. The two sides are also set to talk this week in New York.
NBA owners are expected to lock out their players on July 1 if there is no new deal before the June 30 deadline. But against a backdrop of labor strife and ongoing legal action in the NFL, representatives of both the NBA and the players' union have recently softened their public rhetoric.
NBA deputy commissioner Adam Silver said April 15 that the league's goal is "a system in which all 30 teams can compete, and, if they are well-managed, to make a profit. We have never suggested to the union that there's only one way to accomplish that end."
But players association president Derek Fisher of the Los Angeles Lakers, explaining the union's quick dismissal of the league's latest offer, told ESPN.com last week: "Unfortunately, the proposal is very similar to the proposal the league submitted over a year ago. This last proposal doesn't look close to what we were expecting."
The union has pushed for a revenue deal similar to the current one, with Hunter insisting that a hard salary cap would effectively end guaranteed contracts, which he calls "the lifeblood" of professional basketball.
"We've had that right for years, and it's not something we're trying to give up," Hunter has said.
The league recently announced that, in addition to soaring TV ratings this season, 2010-2011 ticket sales were up roughly 1 percent. The union contends that the league's recent surge in popularity might have wiped out the losses caused by the recent recession, but league officials say that their overall loss has been reduced only from $340 million last season to $300 million this season, asserting that 22 of the NBA's 30 teams are losing money.
Marc Stein is a senior NBA writer for ESPN.com. ESPN.com's Henry Abbott contributed to this report.