The NBA is currently negotiating new TV contracts with ESPN and Turner Broadcasting. With current deals set to expire in 2016, the two sides appear eager to extend their deals to lock in a safe future of broadcasting in NBA games. Per Dan Feldman of NBC Sports, that could have a massive impact on the league's revenue, and therefore, the salary cap:
NBA’s new TV contracts could increase salary cap by about $16 million http://t.co/2IsHHW2ytq— Kurt Helin (@basketballtalk) September 8, 2014
The report states that the new deals with ESPN and Turner could be in excess of $1 billion per year each, more than doubling the income the NBA receives from their current deals with the broadcasting companies. This means that per the design of how the NBA uses Basketball-related income, the salary cap could jump by roughly $16 million in 2016, when the new deals kick in. Obviously this is mostly guesswork until the deals kick in, but a doubling in revenue from TV deals would certainly cause a substantial bump in the salary cap.
The current salary cap for the 2014-2015 NBA season is set at $63.1 million, with the luxury tax line set at $76.8 million. The cap is projected to jump to about $66.3 million in 2015-2016, and with this news, explode to near $80 million in 2016-2017. This news is very good for every NBA team, because per the current version of the collective-bargaining agreement, it would give every team the ability to add a max-level contract to its cap sheet. However, this news is especially good for teams that are going to be running up against the salary cap and luxury tax for the forseeable future: Teams like the Nets, Thunder, and of course, the Cavs.
The Cavs' cap figure is currently $68.4 million, slightly over the cap, but well below the tax line. After that, it gets a little murky due to the Kyrie Irving and Kevin Love extensions, a possible extension for LeBron James, and several expiring contracts and potential re-signings among the supporting cast. However, it's almost certain that the Cavs' cap figure will go up; Kyrie might get a Rose Rule extension, Love's extension will certainly be a max, and new deals for Tristan Thompson and Anderson Varejao could be for significant money. Under the current cap, that means the Cavs would almost certainly be dealing with the luxury tax for the forseeable future.
However, projecting into 2016-2017, the Cavs would get some relief from the potential cap bump. The Cavs would have three max contracts on their cap sheet, worth probably around $60 million total. New deals for Varejao, Thompson, and potentially Dion Waiters would probably take up another $10-$12 million, assuming Varejao takes a pay cut and no one massively overpays for Waiters. Six to nine more contracts (probably a combination of low-1st round rookie deals and veteran's minimum contracts) would then be necessary. In 2015-2016, that would probably put the Cavs over the tax line by at least about $5 million. However, if the cap figure is then bumped to near $80 million in 2016-2017, the Cavs then would have about $8-10 million to work with for those final spots before they even went over the salary cap.
Of course, this is all assuming the massive jump occurs in one year; it's been reported that the NBA wants to avoid this, if possible. If it's smoothed out over multiple years, or countered through some sort of increase in max deals that could be offered, the Cavs could still have some struggles with fielding a team with three max contracts. However, based on the current data, it looks like a massive increase is coming, and the Cavs stand to take advantage.