Minnesota Timberwolves Leandro Bolmaro creates $4.4 M TPE, what’s that?

Okay, so now that we’ve had a 24-hour grace period to ponder the magnitude of the Minnesota Timberwolves massive NBA-headlining trade package to acquire NBA All-Star center Rudy Gobert from the Utah Jazz, how is everyone feeling? Are you still reeling? Are you on the fence? Do you think that the NBA is about to face a new entrant into that small circle of championship teams, namely the Minnesota Timberwolves?

However you may feel about ‘The Gobert Trade,’ I can assure you that there are components to the deal that we have all missed in terms of their significance. How do I know that? The intricacies of this deal are so overwhelmingly massive that even NBA experts are only now beginning to realize their importance. Like the small detail of the Minnesota Timberwolves‘ decision to include Leandro Bolmaro in the package of players:

Okay, so getting a $4.4 million TPE sounds good. But what the heck is a TPE?

Timberwolves News: TPE – Traded Player Exception

The NBA is an accountant and financial professional’s nightmare because the sport is loaded with stifling regulations. But for all of those regulations, there are twice as many carve-outs, or exceptions, that negate the general rule if certain conditions are met.

The NBA TPE, or Traded Player Exception, is one such exception. The TPE is created when a team moves a player to another team without absorbing any salary in the process. Traded Player Exceptions are exactly like the name suggests, created in NBA trades. Since trades are never perfectly balanced in terms of teams trading players, the one team sending out more salary, under the collective bargaining agreement, receives a TPE that is equivalent to the difference between the salary difference. Teams can then absorb future player salaries from future trades into the exception, bypassing any constraints from the salary cap boundaries.

Let’s apply this to the Jazz and Timberwolves.  In the exchange between all those players for Gobert, the Jazz had sufficient salary space to take on an additional $4.4 million. That salary difference now allows the Timberwolves to add a player to the roster, and exclude up to $4.4 million of that salary this year.

If not for the TPE, the Minnesota Timberwolves may have difficulty replacing so many traded players with what remained of their remaining salary cap. Let me know if you have any questions about TPE in the comments section below.