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Pros and Cons of the Maximum Extension for Andrew Wiggins

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A maximum contract extension for Andrew Wiggins locks up the Wolves 22-year-old, but could lead to future financial burden through his hefty price tag.

NBA: Minnesota Timberwolves at Indiana Pacers Trevor Ruszkowski-USA TODAY Sports

“We’re working on it right now,” said Tom Thibodeau, in regards to a contract extension with Andrew Wiggins during a Wednesday news conference to introduce Jamal Crawford. For Wiggins, his maximum contract extension is five years and nearly $148 million.

Andrew Wiggins Max Contract Extension

Year Max Contract Extension w/ Wolves
Year Max Contract Extension w/ Wolves
2017-18 $7,574,323
Contract extension kicks in 2018-19
2018-19 $25,500,000
2019-20 $27,540,000
2020-21 $29,580,000
2021-22 $31,260,000
2022-23 $33,660,000
Five-Year Extension Total $147,900,000

The starting figure of this maximum deal, in year one, is found by taking 25 percent of next season’s projected $102 million salary cap. Thus: $25.5 million in 2018-19. But, as you can see, the deal’s price increases exponentially. This comes from the set of rules that rewards players for extending with their current team by offering eight percent annual raises over five years (sign elsewhere and receive five percent raises over four years).

While this extension would not kick in until 2018-19 when the cap again bumps up slightly, the deal would still render an average annual salary of $29.58 million. For some context on that dollar value, these are the four highest paid players 2017-18 salaries.

Largest Salaries in NBA for 2017-18

Player Team 2017-18 Salary
Player Team 2017-18 Salary
Stephen Curry Golden State Warriors $34,682,550
LeBron James Cleveland Cavaliers $33,285,709
Gordon Hayward Boston Celtics $29,727,900
Russell Westbrook Oklahoma City Thunder $28,530,608
Wiggins avg. annual salary on max extension beginning in 2018-19
Andrew Wiggins Minnesota Timberwolves $29,580,000

While framing Wiggins as the fourth highest paid player is doing a bit of painting around the numbers, I believe the context is still fair. The message being, the players signing this type of deal have high levels of productivity that are expected. Wiggins is more so the player with hypothetical projections. His on-court productivity does not suggest he is in this class.

With that said, here are the “pros” of signing Wiggins to a maximum contract.

The Pros of an Andrew Wiggins Maximum Contract Extension

Wiggins is locked up through 2022-23. The Wolves will have effectively retained the rights to an extremely talented athlete who has shown a progression on offense in quantity and efficiency over each of his three seasons. They are protecting an asset and hoping he grows into the deal. This shows Wiggins they are committed to him.

Andrew Wiggins’ Increasing Offensive Efficiency

Andrew Wiggins PTS per 36 mins eFG% 3P% AST% TOV% USG%
Andrew Wiggins PTS per 36 mins eFG% 3P% AST% TOV% USG%
2014-15 16.8 45.40% 31.00% 9.80% 11.70% 22.60%
2015-16 21.2 48.10% 30.00% 10.10% 10.60% 27.20%
2016-17 22.8 48.40% 35.60% 10.60% 9.40% 29.00%

The Wolves will still be eligible to offer Karl-Anthony Towns a five-year maximum extension. Through the adjustment in the NBA’s most recent Collective Bargaining Agreement, teams can now offer not one but two five-year extensions. The singular max deal previously, in duration and dollars, would pinch teams to essentially pick favorites between their two best prospects. Infamously, this happened to the Wolves with Kevin Love as they opted to “save” their five-year extension for either Ricky Rubio or Derrick Williams.

Assuming Towns, one year Wiggins’ junior, signs his five-year extension twelve months from now, the Wolves will also have Towns locked up through 2023-24. Towns’ five-year maximum extension will cost $158 million over five years. If he makes an All-NBA team this season, which is fairly likely, that contract will swell to $190 million over five. That number juxtaposed against Wiggins’ $148 million figure is a fair segue to the cons.

The Cons of an Andrew Wiggins Maximum Contract Extension

The price tag is daunting. While it would be great, from a talent accumulation standpoint, to have two former first-overall picks locked up into the 2020’s, there becomes a cost even beyond the $300-plus million.

As we’ve talked about here before, a players rookie contract (first four years) is the best value contract there is. While players are in their developmental stages those first years, even mediocre progression allows a player’s productivity to exceed their cost. For example, Andrew Wiggins will have earned a relatively small total of $24.85 million over the course of his four-year rookie deal. Towns slightly more at $25.72 million.

Just a hair over $6 million annually for those players is a coup. The relatively cheap contracts of Wiggins and Towns have value through the cap space it frees around the two players. This space afforded the Wolves the ability to dole out a 4-year $64 million contract to Gorgui Dieng, a 3-year $57 million deal to Jeff Teague, 2-years and $28 million to Taj Gibson, and to inherit the final three years and $60 million left on Jimmy Butler’s deal.

However, there can be a winner’s curse for these rookie deals. Curse being, the eventual need to pony up big dollars to retain those rookies on their second deal. A reality Wolves management is currently wrestling with. The second contract signals the time to pay star caliber dollars before a player has reached their prime. Theoretically, the player reaches star caliber and exceeds the value of the contract but the inherent risk of the player just being “good” is a reason for concern when the price tag is this high.

What if Andrew Wiggins is Rudy Gay 2.0? While the optimistic outlook is that Wiggins continues his progression as a scorer and begins to realize his defensive potential, there is also the pessimistic outlook that suggests Wiggins progression stagnates. That is what happened to Rudy Gay.

Rudy Gay entered the league in 2006 and by his second season was already averaging 20 points per game. The expectation was that Gay would be a transcendent player as he continued to progress. Very similar to Andrew Wiggins.

Andrew Wiggins and Rudy Gay Third Year in NBA

Player Age MPG PTS REB AST STL BLK FGA 3PA 3P% eFG% FT%
Player Age MPG PTS REB AST STL BLK FGA 3PA 3P% eFG% FT%
Rudy Gay (08-09) 22 37.3 18.9 5.5 1.7 1.2 0.7 16 3.1 35.10% 48.70% 76.70%
Andrew Wiggins (16-17) 21 37.2 23.6 4 2.3 1 0.4 19.1 3.5 35.60% 48.40% 76.00%

In 2010, Rudy Gay signed a five-year $80 million contract with the Memphis Grizzlies, after his rookie deal ended. The salary cap, then, was $58 million. Today, the cap is $99 million making that Gay deal almost identical in relative cost to Wiggins’ potential extension.

The reality for Memphis, with Gay, was that they saw their franchise cornerstone’s progression plateau after his rookie deal ended. He never became the All-Star his initial progression and skill set indicated. Gay simply remained a volume shooter who continued to score around twenty points per game but his efficiency did not improve nor did his defense.

As his new $80 million deal wore on, the question of, “Does Rudy Gay help or hurt your team?” began to gather steam. So much so that Memphis management decided to dump him to Toronto before the deal ended.

While this Gay scenario is a worst-case of sorts for the Wolves, it goes to show how committing that amount of money to the wrong player can throw a franchise off course.

Max Andrew Wiggins and salary cap hell inevitably looms. Again, Wiggins deal would start at $25.5 million in annual salary and by year five of the deal that number will have climbed to $33.5 million. Towns will almost certainly receive his max extension next summer starting at $27 million annually and by year four of that deal—when Wiggins is making $33.5 million—Towns’ cost will be $34 million. That $67.5 million will be more than half of the salary cap—estimated $125 million in 2022—between just two players.

And what about Jimmy Butler? Two years from now, Butler will be a 29-year-old free agent—assuming he opts out of his final year—looking for his own max contract. For Butler, his next contract will start at $34 million and could touch nearly $200 million over five years. By 2022, with max deals to Wiggins, Towns, and Butler, the Wolves will be paying $111.5 million—89 percent of the salary cap—to three players.

Wolves Cap Sheet Going Forward

Player Salary '17-18 Extension? Salary '18-19 Extension? Salary '19-20 Salary '20-21 Salary '21-22 Salary '22-23 Salary '23-24
Player Salary '17-18 Extension? Salary '18-19 Extension? Salary '19-20 Salary '20-21 Salary '21-22 Salary '22-23 Salary '23-24
Jimmy Butler $19,301,070 $20,445,779 if max extension $34,020,000 $36,741,600 $39,680,928 $42,855,402 $46,283,834
Jeff Teague $19,000,000 $19,000,000 $19,000,000
Gorgui Dieng $14,112,360 $15,170,787 $16,229,213 $17,287,640
Taj Gibson $14,000,000 $14,000,000
Andrew Wiggins $7,574,323 if max extension $25,500,000 $27,540,000 $29,743,200 $32,122,656 $34,692,468
Cole Aldrich $7,300,000 $6,956,021
Karl-Anthony Towns $6,216,840 $7,839,435 if max extension $27,000,000 $29,160,000 $31,492,800 $34,012,224 $36,733,202
Jamal Crawford $4,328,000 $4,544,400
Nemanja Bjelica $3,949,999
Justin Patton $2,247,480 $2,667,600 $3,117,240 $4,781,846
Tyus Jones $1,471,382 $2,444,503
Kevin Martin (waived) $1,360,305
---------
Sum of Salaries $100,861,759 $118,568,525 $126,906,453 $117,714,286 $103,296,384 $111,560,094 $83,017,036
Estimated Salary Cap $99,093,000 $102,000,000 $108,000,000 $113,400,000 $119,070,000 $125,024,000 $131,275,000
Luxury Tax Line $119,266,000 $123,000,000 $131,000,000 $137,550,000 $144,428,000 $151,649,000 $159,231,000

While going that far into the future is a bit presumptive, it is a reality the Wolves are considering as they navigate a future with Andrew Wiggins. Of the team’s three best players, Wiggins is the least likely to be “worth” his maximum price tag through his not yet recognized potential.

But Wiggins rookie deal ending after this season makes him the first domino. Making for an awkward situation in the Wolves exciting and expensive future. If he is to receive a maximum extension, that deal must be agreed upon the day before the season starts, October 14th.

Since Tom Thibodeau’s comments at the Jamal Crawford news conference, a new detail in the Wiggins saga has come to fruition: Kyrie Irving’s trade request. A theoretical trade for Irving would almost certainly include Wiggins, throwing a wrench in these negotiations. A wrench that maybe leads Wolves management to consider different contract options with the 22-year-old, detailed here.

Regardless the Wolves are in the midst of their most interesting offseason in recent memory. And as it turns out, becoming a contender is a tricky journey to navigate. A journey that Andrew Wiggins remains at the fulcrum of. Where do you stand on a Wiggins extension?