The recent decisions by the Milwaukee Bucks and Phoenix Suns to waive and stretch the contracts of highly paid players represent a landmark moment in NBA roster construction. Both teams, facing significant financial constraints and a desire to remain competitive, utilized the “stretch provision” to create immediate salary cap relief. However, this maneuver comes at a steep price: an unprecedented amount of “dead money” on their books for years to come. This article explores the details of these transactions, the mechanics of the stretch provision, and the long-term implications for the Bucks, Suns, and the league as a whole.
The Mechanics of “Dead Money” and the “Stretch Provision”
In the NBA, dead money is the portion of a player’s guaranteed salary that still counts against a team’s salary cap after they have been waived. It’s a financial obligation for the team even though the player is no longer on the roster. The concept is a fundamental aspect of the league’s collective bargaining agreement (CBA), which guarantees player contracts.
The “stretch provision” is a tool that allows teams to mitigate the immediate impact of dead money on their cap sheet.1 When a team waives a player and opts to use the stretch provision, the remaining guaranteed salary is not paid out over the original contract’s term. Instead, it is spread out over a longer period, specifically, twice the number of years remaining on the contract, plus one.2 This has the effect of reducing the annual cap hit of the waived player, providing a team with more financial flexibility in the short term.3
For instance, if a player has two years remaining on their contract, stretching their salary would result in the money being paid out over five years (2 x 2 + 1 = 5).4 While the team still owes the player the same total amount of money, the annual cap hit is significantly lower.5 This is a powerful tool for teams looking to sign a free agent or make a trade that they otherwise couldn’t afford.
The Milwaukee Bucks: Damian Lillard’s Stretched Contract
The Milwaukee Bucks’ decision to waive and stretch Damian Lillard’s contract was a seismic event in the NBA. Lillard, who had two years and more than $112 million remaining on his deal, was waived following a season-ending Achilles injury.6 This move, a direct result of the Bucks’ need to create cap space, allowed them to sign free-agent center Myles Turner.7
Without the stretch provision, the Bucks would have been on the hook for Lillard’s entire salary over the next two seasons, leaving them with virtually no room to make a significant roster addition. By stretching his contract, they will now pay Lillard approximately $22.5 million per season for the next five years.8 This is the largest waive-and-stretch transaction in NBA history, and it demonstrates the extreme measures teams are willing to take to win in the short term.
The decision was not without controversy. While it allowed the Bucks to acquire Turner, a younger and more durable player, it also saddles them with a substantial annual cap hit until the 2029-2030 season.9 This long-term financial commitment could severely limit their ability to make future moves and build a championship contender around Giannis Antetokounmpo. The move has also led to speculation about Antetokounmpo’s satisfaction with the team’s direction, with some reports suggesting he was not pleased with the decision to waive Lillard.
The Phoenix Suns: The Bradley Beal Buyout and Stretch
The Phoenix Suns, a team that has aggressively pursued a championship with a high-priced roster, also faced a difficult financial situation.10 With Bradley Beal having two years and over $110 million remaining on his contract, the Suns sought to move on from his deal.11 Due to Beal’s no-trade clause, a simple trade was not possible. This led them to a buyout and stretch provision scenario.
The Suns already had about $3.8 million in stretched money on their books from previous transactions, which created a unique challenge.12 Under the CBA, a team cannot have a total of stretched money that exceeds 15% of the current salary cap.13 To make the stretch provision work for Beal’s contract, he had to agree to give up a portion of his remaining salary. Beal and the Suns reportedly agreed to a buyout where he surrendered around $13.9 million, allowing the team to stretch the remaining roughly $96.9 million over five years.14
This maneuver will result in the Suns carrying a cap hit of approximately $19.4 million for Beal through the 2029-2030 season.15 For Phoenix, this move was about more than just adding a player; it was about creating short-term financial flexibility to duck back under the luxury tax and avoid the punitive penalties of the second apron. It was a strategic decision to reset their financial clock and maintain long-term flexibility, even if it meant taking on a massive amount of dead money.
The Long-Term Consequences and a New Precedent
The actions of the Bucks and Suns have set a new precedent for how teams manage expensive, long-term contracts. While the stretch provision has been used before, these transactions involve a scale and dollar amount that are truly unprecedented. The creation of such a significant amount of dead money raises serious questions about the long-term viability of these teams and their ability to remain competitive.
For both Milwaukee and Phoenix, the dead money will be a lingering burden that will impact their cap sheets for the next five years. This will limit their ability to sign free agents, re-sign their own players, and make trades. The gamble for both teams is that the short-term benefits of these moves—acquiring Myles Turner for the Bucks and gaining financial flexibility for the Suns—will outweigh the long-term consequences.
The league will be watching closely to see how these situations play out. If either team finds sustained success, it could open the door for other teams to take a similar approach to managing their finances. However, if the dead money proves to be a crippling constraint that prevents them from winning, it could serve as a cautionary tale for the rest of the NBA. The era of the mega-stretch provision has arrived, and its ultimate impact on the league is yet to be determined.
For a deeper dive into the Bucks’ stunning moves, you can watch this breakdown of the Bucks waiving Damian Lillard and signing Myles Turner.
