The upcoming contract negotiations involving Hedo Turkoglu and Marcin Gortat
The Sentinel has learned that the Magic most certainly will have to make some salary-cutting moves after the season in order to keep small forward Hedo Turkoglu and center Marcin Gortat and avoid paying the NBA's punitive luxury tax next season.
Their payroll is projected at roughly $70 million for 2009-10 and the league's tax threshold is expected to drop from $71 million to about $68 million, meaning the Magic would have do to something they vowed never to do.
Smith said he doesn't believe the Magic will have to go into the tax to contend for a championship — and doesn't expect ownership will have to pay it next season.
"I don't see that changing," Smith said. "We have a great owner [ Rich DeVos]. I have not gone to ownership and said we need to be in the tax. I don't think it's necessary. You have to be creative."
Being creative means trading players and reducing payroll, crucial in a smaller market such as Orlando.
To keep both Gortat and Turkoglu and avoid the dollar-for-dollar tax, the Magic would have to move some salary.
Trading players this offseason with expiring contracts to teams under the salary cap is one way. Forward Tony Battie and point guard Rafer Alston will be in the final years of their deals next season that pay them $6.2 million and $5.2 million, respectively. Point guard A.J. Johnson has one year left at $2.1 million.
Turk signed a six-year deal for $39 million with Orlando in 2004. His camp believes he is worth what Golden State paid small forward Corey Maggette (five years, $50 million). Not surprisingly, there are indications that the Magic and Turk are far apart if that's his sticker price.
At 30, Turkoglu faces a dilemma. He can try to find the best deal this offseason or stay with Orlando and explore free agency in the summer of 2010.
Gortat is a restricted NBA free agent and the Magic can match any offer, but Gortat can sign with a foreign team if he chooses to return overseas. The Magic would retain his NBA rights.
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