Announcement of All-NBA teams brings bad news to Indiana Pacers and Utah Jazz

Both teams will have less leverage in retaining Paul George, Gordon Hayward

Thursday’s announcement of the 2016-17 All-NBA teams brought bad news for the Indiana Pacers and Utah Jazz in regard to their ability to retain their star small forwards.

Neither Paul George (40 points) nor Gordon Hayward (27 points) were selected to any of the All-NBA teams. They finished seventh and eighth among forwards, but were well short of the vote totals of Third Team forwards Draymond Green (134) and Jimmy Butler (102). That means that neither George nor Hayward is eligible for the new “designated player veteran extension” and their teams have less leverage in trying to retain them in free agency.

George is under contract for next season at about $19.5 million and he has a $20.7 million player option for the 2018-19 season. In July, the Pacers can offer him a contract extension that starts in 2018-19 (eliminating the player option year). But because George didn’t make an All-NBA team, that extension can only be for four years and can’t be nearly as lucrative as it would have been if he had got one of those Third Team spots.

The designated player veteran extension was added under the new collective bargaining agreement, which goes into effect on July 1. It allows teams to give a player a starting salary of up to 35 percent of the salary cap, instead of the standard 30 percent max for players with 7-9 years of experience. According to Yahoo’s Bobby Marks, a DPVE extension could have paid George about $207 million over five years (through the ’22-23 season).

But to be eligible for the DPVE, a player would need to have be named Defensive Player of the Year or to the All-NBA (first, second or third) teams in the previous season or in two of the last three seasons. He’d also be eligible if he was named MVP in any of the last three seasons.

George has been previously named third team All-NBA in 2012-13, ’13-14 and ’15-16. But because he fell short this year, he isn’t eligible for the DPVE, with only one All-NBA honor in the last three seasons. George missed all but six games of the ’14-15 season after breaking his leg in a USA Basketball scrimmage in the summer of 2014.

Because he didn’t make All-NBA this year (or in ’14-15), the Pacers can, right now, only offer George a four-year extension (that goes through the ’21-22 season) worth about $137 million. So it’s possible that the voting had a $70-million impact on the size of his next contract, though some of that would presumably be recouped in the first year of his next deal (the last year of what would have been a five-year extension).

George still has a chance to become DPVE-eligible, though. If he makes All-NBA next season, he’d be eligible for the DPVE in July of 2018.

The question is whether or not the Pacers want to take that risk. If George doesn’t make All-NBA and declines his ’18-19 player option, he could become a free agent next summer. Indiana would still be able to pay him more money than any other team, but they wouldn’t have nearly the same advantage they’d have with the DPVE.

Either way, the time is now for general manager Kevin Pritchard to have a conversation with his team’s star and determine if the Pacers have a chance of retaining George beyond next season. If George indicates that he’s leaning toward leaving Indiana, Pritchard may decide that it’s time to start talking with other teams about a trade.

It has been rumored that George wants to play for the Los Angeles Lakers, who have the No. 2 pick in this year’s Draft, as well as other young players that could help the Pacers build a young core that already includes 21 year old Myles Turner.

Hayward is in a similar situation as George, except that he has a player option for next season (which he’ll need to exercise or decline before July 1). If he choose to decline that option, he’ll be a free agent on July 1, but not DPVE-eligible. Of course, he could bet on himself, exercise that option and choose to push free agency until next summer. Then if he makes All-NBA next season, he’d be eligible for the DPVE and able to get a lot more money from the Jazz.

Only a player’s original team (or a team that acquired him in his first four seasons) is eligible to give him the DPVE. So if the Pacers were to trade George this summer, he’d no longer be eligible, even if he were selected to an All-NBA team in a new uniform next season.

The contract implications of All-NBA voting and the need to prepare for free agency is why the NBA announced the All-NBA teams on Thursday. All other NBA awards will be awarded at the first-ever NBA Awards Show on June 26 in New York.

John Schuhmann is a staff writer for NBA.com. You can e-mail him here, find his archive here and follow him on Twitter.

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