After becoming a fan favorite in his four seasons in Los Angeles, Alex Caruso’s departure in free agency on Monday was a bitter pill to swallow. Not just a cult hero, Caruso had become one of the most valuable Lakers on the roster. He had established himself as one of LeBron James’ best teammates ever, was the x-factor in a title-clinching NBA Finals win and earned All-Defensive team votes this past season.
All of that led to Monday, when the Bulls signed Caruso to a four-year, $37 million deal, one that came in under his expected value of the mid-level exception this summer. Sam Amick of The Athletic reported the Lakers even turned down the chance to match the offer, a decision that made Caruso’s departure even more frustrating.
On Wednesday’s episode of the “Brian Windhorst & The Hoop Collective” podcast, however, the news got even worse. Ramona Shelburne had more details on how little the Lakers valued Caruso in free agency, as she reported they turned down the chance to sign him to an even smaller deal than the Chicago offer, as well as where the Lakers drew the line with him in terms of salary:
“I think the Lakers looked at Alex Caruso and said ‘we’re happy for you, we really appreciate everything you’ve done, we wish we could keep you, but, you know’... He was willing to go back there at three years and $30 million Brian, he actually gave them that option, even at the end — it’s less than what he signed for in Chicago — but even that was more than they were willing to pay... That was as far as they were willing to go. They looked at Caruso and said ‘we can go to $7 million a year, but above that it gets too cost-prohibitive.’”
The luxury tax was certainly a driving factor in the Lakers’ decision, as no rules prohibited them from matching or even exceeding Caruso’s deal with the Bulls, let alone paying him an even lower salary. Zach Lowe of ESPN said as much in his latest episode of “The Lowe Post” podcast on Wednesday:
“Well look, the Caruso decision was a tax decision. Even the Russ trade, the tax was not not a consideration. Because Schröder, plus Hield, plus KCP, plus other role players was probably going to end up being more expensive than Russ, even though Russ makes a massive amount of money.
“And look, you can sit here and quibble and say ‘how can you worry about the tax when you have LeBron James approaching 37, like you should be all-in to win now?’ But they worried about it, and that’s their prerogative.”
There isn’t a scenario in which Caruso leaving looks like a good decision. On one hand, the Lakers balked at paying a hefty luxury tax bill despite being valued at $4.6 billion in February by Forbes and being valued at $5.5 billion given the recent ownership stake sold to Mark Walter and Todd Boehly. When putting it in the context of the franchise being worth over $5 billion, a bigger luxury tax payment to compete feels like a small drop in a big bucket.
Their perceived importance on potentially saving money on the luxury tax stands out even more when their biggest competitors aren’t playing within those same self-imposed boundaries. The Brooklyn Nets landed Patty Mills on Tuesday for the taxpayer mid-level exception, a deal that will come in at 2 years, $12 million. As a result, their luxury tax bill took a spike, but it was a sacrifice they were willing to make to field the best team possible.
Brooklyn tax bill— Bobby Marks (@BobbyMarks42) August 3, 2021
Before Patty Mills: $92.6M
The Lakers could have retained Caruso — which would have cost them an extra $30 million or so in tax payments — and still been barely paying more in taxes than the Clippers, who are basically punting a year due to Kawhi Leonard’s injury, and still far less than the Nets and Warriors:
Luxury tax penalty (Day 3 of FA):— Bobby Marks (@BobbyMarks42) August 4, 2021
LAC- $54M (w/KL)
$9.5M distribution to the 24 teams below
Highest tax penalty: BKN- 2013-14 ($90.6M)
Happy to pass the torch to Golden St.
But even if this wasn’t a luxury tax decision — which all signs and reports indicate it was — then the Lakers didn’t value Caruso properly as a player on the court, which is an equally frustrating conclusion to come to. In so many ways, Caruso was a perfect player to pair with James. This season, no one had a higher net rating alongside James than Caruso at +17.1. His effectiveness alongside LeBron has been one of the major themes of their tenure together.
There isn’t a way to come out of this situation without being incredibly frustrated by the Lakers. The team had the chance to retain not just a fan favorite, but an impactful, winning basketball player who excels alongside other stars and has been a fixture in closing lineups, and turned down the opportunity, even when he was willing to take a pay cut to stay. They’ve still filled out the roster nicely, and the summer may well end up being a net positive. The Lakers could very well still have success next season, even if no cap mechanism was stopping them from retaining Caruso and signing everyone they brought in this summer so far.
But seeing positive results does not mean the process getting there was good. They still might win a title, but it’s clear that saving money may have been just as important to this ownership group. We’ll see if that prioritization comes back to bite them.