There are three forms of the mid-level exception: the room exception, the full/non-taxpayer MLE, and the taxpayer MLE. All three have different values and can be used to sign players to contracts of different lengths.
Our focus today is specifically on the non-taxpayer version of the mid-level exception, which is a bit of a misnomer. Though its name suggests otherwise, using the non-taxpayer MLE doesn’t mean a team can’t or won’t be above the tax line ($165,294,000) at seasons end; it simply means the team’s total salary can’t surpass the first tax “apron” ($172,346,000).
As our Luke Adams previously detailed, the non-taxpayer MLE is the primary tool for over-the-cap teams to sign free agents. It runs for up to four years with 5% annual raises and a starting salary worth up to $12,405,000.
Interestingly, while many teams have used a portion of the non-taxpayer MLE, only the Raptors have gone through the entire $12,405,000 this summer — they used it to sign veteran guard Dennis Schröder to a two-year deal in free agency. Schröder is currently competing at the 2023 World Cup, leading Germany to an unblemished 5-0 record and a berth in the quarterfinals.
The Knicks (Donte DiVincenzo), Lakers (Gabe Vincent), Timberwolves (Shake Milton and Nickeil Alexander-Walker) and Cavaliers (Georges Niang) have all used a major portion of the MLE. They’re all unlikely to use the remaining amount they control due to the relatively modest amounts they have available, as well as their luxury tax situations.
The same is true of the Bulls, who are right at the tax line and used $6.2MM of their MLE to sign Jevon Carter. The Pelicans only used $1.8MM of their MLE (on E.J. Liddell), but they’re projected to be over the tax at the moment, so they’re unlikely to use more of the MLE unless they make a major salary-shedding trade.
The Mavericks (Dante Exum and Seth Curry) have used $7MM of their MLE, and they technically have enough breathing room below the tax to use more of it. However, their roster is nearly full, so it’s unclear if they actually will.
The Hawks, Nets, Hornets, Grizzlies, Trail Blazers and Wizards haven’t used any of their non-taxpayer MLEs. Some are more likely to use it than others, but it’s technically still available.