Back in October, I wrote that (a) the Houston Rockets had enough room to use the Jeremy Lin trade exception, possibly the Bi-Annual Exception (BAE) and still use salary matching rules to take on additional salary and (b) the luxury tax would not be a significant deterrent for Rockets owner Leslie Alexander.

Well, Rockets GM Daryl Morey has been busy following this very plan.
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It’s happening.

As first reported by Yahoo! Sports, Josh Smith will be a Houston Rocket. The 6-foot-9 forward was shockingly cut by the Detroit Pistons earlier this week and will clear waivers at 5:00pm Eastern Time today, paving the way for him to sign with the Rockets.

As discussed in the podcast on Monday, this seemed like it was going to happen based on the behind-the-scenes chatter at the Toyota Center. There were too many reasons for this marriage not to occur — Smith has history with the city of Houston and has wanted to be here in the past, he is close friends with Dwight Howard (his former AAU teammate) and the Rockets could extend to him their bi-annual exception (roughly $2.1 million), something other contenders could not offer.

There are several intriguing possibilities here with Smith. It’s a low-risk, potentially high-reward move for the team’s depth that could bolster the bigs rotation and put the Rockets in a better position to make another trade. As a result, it will be interesting to see how this impacts the future of either Terrence Jones or Donatas Motiejunas in Houston.

That’s not to say that Smith doesn’t have his flaws. Smith shot a career-low 39.1% from the field for the Pistons this season (just 24.3% from three-point range), and that’s on high volume (14.0 shots per game). His shot selection has been panned by fans and media for years. But the big hope is that he can make a real impact defensively and in transition — two of his strong suits historically. Meanwhile, on the offensive side of the ball, playing a lesser role next to the likes of James Harden and Howard could make the game easier for Smith.

But at this price, there’s not much to dislike here. If it doesn’t work out, Daryl Morey and company haven’t risked much at all in terms of cap or dollars.

Some highlights of Smith’s last season with the Pistons:

The Rockets made good on their intention of pulling off a trade by December 19th, acquiring small forward Corey Brewer from the Minnesota Timberwolves and guard Alexey Shved from the Philadelphia Sixers today. The deal was first reported by Yahoo! Sports.

As part of the deal, the Rockets will send guard Troy Daniels along with a 2015 second round pick from Sacramento (via the Jason Terry trade), Houston’s 2016 second round pick (protected for picks 31-45) and cash. The Rockets also send their 2015 second round pick and the rights to Sergei Lishouk to Philly for absorbing Ronny Turiaf’s $1.5 million expiring deal. Houston uses part of the trade exception they created in the Jeremy Lin trade last summer to absorb Brewer’s contract.

To make room for Shved, the Rockets have released Francisco Garcia.

“A great situation, it’s going to be great,” Brewer told the Minnesota Star Tribune. “Playing with guys like Dwight Howard and James Harden, they’re in a playoff race. They have a good team. I think I can come in and help that. That they wanted to trade for me and think I can help, that means a lot.”

“I’ve got lots of room for more rings,” said Brewer, who won an NBA title with the Dallas Mavericks in 2011. “Last time I went to Texas, it worked out. Make it 2-for-2 in Texas, the Texas Two-Step.”

At 6-foot-9, Brewer is a good defensive player that can cover both guards and small forwards. Despite playing only 28 minutes a game, Brewer is currently the league leader in steals at 2.3 a night. He can agitate and plays with a lot of energy, often gambling to steal passes in the lane.

So in Brewer, Houston adds a rotation piece at the wing spot. The Rockets (and their #2-ranked defense) needed to add some depth there as they have relied heavily on Trevor Ariza, who is playing a career-high 38.4 minutes a night — the second-most minutes of any player in the NBA this season, trailing only Jimmy Butler’s 39.8.

How Brewer will fit offensively, where his skills are a little more limited, is the better question. The ideal defensive role player for Houston would also have the ability to knock down the open three-point shot, but Brewer has no three-point range — he’s shooting 19% from distance this season and has hit just 29.1% from beyond the arc over his eight-year career. But he’s active on the offensive end. He is more of a slasher and often takes off in transition for easy layups. He is capable of a random big game, as we all remember his 51-point night against the Rockets last season.

The Rockets wanted to make a deal by December 19 so they could also be in a position to make a bigger deal down the line. By acquiring Brewer and Shved now, they will be eligible to be combined with other players in a trade in exactly 60 days — in other words, just before the NBA trade deadline in February.

Shved is not much of an offensive player, hitting just 36% from the field and 29% from three-point range for his career, but his $3.3 million expiring salary could later give the Rockets the flexibility to possibly keep a Jason Terry or Kostas Papanikolaou if a deal for a bigger contract does present itself at the deadline.

Updated: November 24, 2014

Much has been made recently about the NBA’s new national television contracts and their massive impact on the NBA’s salary cap in future years.

This season’s maximum team salary cap is $63.065 million. Several months ago (before the new TV deal was signed), the league released a projected $66.5 million salary cap for the 2015-16 season. The new deal, which does not kick in until the 2016-17 season, could increase the salary cap that year to as high as $85-90 million!

In order to address what could be a problematic one-year spike in the salary cap, the league has proposed one or more proposals to the player’s union in order to “smooth” the salary cap increase over several seasons. This issue must be collectively bargained with the player’s union, so any failure to agree by those two sides would likely result in that one-year spike.

Changing Cap Projections

For several months (both before and after the size of the TV deals was known), many league executives have been preparing as if the 2015-16 salary cap would be artificially increased in order to reduce the year-to-year increase caused by the new TV revenues.

However, whether based on perceived resistance from the player’s union on the league’s “smoothing” proposals (one or more of which allegedly call for the salary cap to only increase at around the rate at which Basketball Related Income (BRI) has increased over the past several seasons) or on an inability for the league to come up with a “smoothing” proposal that objectively makes sense for all parties, things don’t seem to be looking very good for teams (like the Houston Rockets) hoping for a big jump in the salary cap for the 2015-16 season.

Zach Lowe, Grantland’s lead NBA writer (and, in my opinion, the best national NBA writer in the business), wrote in a November 5 article about the increasing likelihood that the new TV deal would not lead to an increase in the salary cap for next season:

“No one knows what will happen to the cap in 2015-16 and 2016-17, the first year of the league’s mammoth new national TV contract, but the league’s most recent projections for 2015-16 remain in the range of $66 million to $68 million, per several league sources. It appears unlikely the league bakes any of the anticipated TV money into the cap figure a year early, meaning the 2015-16 cap will sit right around where the NBA had projected it.”

In a subsequent piece from November 17, Lowe reiterated this assumption:

“There is some opportunity cost in forfeited cap space this summer, assuming that the 2015-16 cap sticks around the projected $66 million–to–$68 million range. That is what almost all team executives anticipate now.”

Potential Impact on Rockets’ Plans

The Rockets currently have about $55.9 million in guaranteed salary committed for next season (not including cap holds, incomplete roster charges and other cap considerations). However, with a beefed-up 2015-16 salary cap that includes some early incorporation of new TV money, Houston would be in position–with only a couple of minor trades–to create enough cap space to either offer a max (or at least near-max) contract to a major free agent or be able to trade for almost any player under contract (perhaps dangling that New Orleans pick on or after draft night as bait).

Unfortunately, if the cap stays at the currently-projected $66.5 million, things do not look nearly as rosy for the Rockets in 2015 free agency.

Assuming that the Rockets waive all non-guaranteed salary for next season (namely, Kostas Papanikolaou and Tarik Black), renounce their rights to Jason Terry and Francisco Garcia, keep Patrick Beverley‘s cap hold on the books (which cap hold assumes that Beverley meets the “starter criteria” enabling him to get a higher qualifying offer from Houston) and otherwise do not make any trades (I know, unlikely, but still), Houston would be in line to have less than $7.2 million in cap room next summer.

That’s a nice amount of cap room, but it’s not enough to add that third star that Rockets GM Daryl Morey has been after since landing Dwight Howard in July 2013. The Rockets would need to clear out Trevor Ariza‘s salary (taking little to no salary back) to even approach the type of room they could create if a “smoothing” proposal were adopted. While Ariza is by no means completely “off-limits” in trade, he is an integral part of the team Houston is trying to build and is an ideal fit starting next to James Harden.

This relatively recent shift in perspective by many league executives on the projected 2015-16 salary cap may be a large factor in the Rockets’ apparent willingness to trade for Corey Brewer, whose contract includes a $4.9 million player option for next season. It could also be a reason why Houston might be trying to exert additional pressure on other teams to cough up a star (or near-star) player sooner rather than later (see Dragic, Goran).

Conclusion

Whether Morey is among those league executives starting to lose hope that a “smoothing” proposal can be swept through league and player’s union approval in time for next summer’s free agency/trade season is anyone’s guess. But if he is, then this shift could ultimately be the deciding factor in whether the Rockets choose to bite the bullet and make potentially cap-clogging moves in the next few months.