Last offseason, the Cleveland Cavaliers were the only franchise daring enough to enter and remain in the second apron of the luxury tax. This year, Cleveland has dropped below the first and second aprons and appear to plan to stay below.
If the Cavaliers hope to pull of a sign-and-trade for Peyton Watson or Jonathan Kuminga, they will target a hard cap at the first apron. Currently, Cleveland sits $22.8 million below the first apron, but one core member of the franchise is still on the free agent market.
Former MVP James Harden is an unrestricted free agent after declining his $42.3 million player option for the 2026-27 season. Joining the Cavs at the 2025-26 trade deadline, Harden helped lead Cleveland to their first Eastern Conference Finals appearance since 2018 after just over two months with the organization.
Harden is assumed to be staying with Cleveland, but he has taken a pragmatic and modest approach to free agency. Roman Shelburne reported that Harden is giving the Cavaliers time to explore the market for a starting-caliber wing, noting Watson as a current target.
Ramona Shelburne on James Harden and the Cavs:
— Oh No He Didn't (@ohnohedidnt24) July 30, 2026
"I think that could happen relatively soon. The question is gonna be is it a two year deal, a three year deal, what the structure looks like is gonna determine what the money looks like. But the Cavs are still poking around with… pic.twitter.com/jG9ZQ9v3jm
Had Harden accepted his player option, the Cavs would be over $20 millon above the first apron with no room to dip below and make substantial change. Harden's next contract will almost certainly garner him more overall money than what his one-year player option would have done, but stretching that salary across two or three seasons could be the difference between a new-look, competitive forward depth chart and a year of painful, inefficient rotations.
Cleveland would not have this flexibility without Harden
James Harden was the only member of Cleveland's star core to enter free agency this summer. Without dumping Evan Mobley, Donovan Mitchell or Jarrett Allen for salary relief, the Cavs would be creeping towards the second apron again before free agency began.
All dissatisfaction and reservations for Harden aside, trading Darius Garland was the only way the Cavaliers could navigate the aprons and maintain competitiveness. Harden's patience this summer is enough reason to find the trade a success, unless the Cavaliers do nothing with the flexibility.
Losing Garland for a player ten years his senior is not an easy decision to accept, but the Cavaliers managed to find financial relief and retain star power at the point guard position. If Cleveland capitalizes on this cap relief with finally landing a true 3-and-D starting small forward, the trade is immediately a win for the short and long term.
The Cavs' future relies heavily on navigating the luxury tax enough to stay competitive now and build towards a Mobley-centric future. Missing out on LeBron stings, but Harden is still giving the Cavaliers room to accomplish that future with the possibilities of Watson or Kuminga.
The Cavaliers are not far from being the best in the East
Despite being swept in the ECF, the Cavs proved to be a legitimate playoff threat, albeit an imperfect one. That imperfection showed most clearly on the wing. While Dean Wade's defense and size made him the go-to starter at the three spot, his timid offense and low volume gave defenses an easy player to ignore. Max Strus, a streaky shooter and solid defender, lacked the size and rebounding Wade provided. Sophomore Jaylon Tyson lacked the emotional maturity to manage his behavior in the postseason, garnering unnecessary fouls and missing easy opportunities.
This offseason had a clear mission to add talent on the wing. Cleveland, like every team, targeted LeBron James and paused all other negotiations until eventually the King chose the Philadelphia 76ers. After the missed chance, the Cavaliers pivoted to Kuminga and Watson. Both wings are 23 years old with defensive upside. Kuminga presents a more impressive defensive option, but Watson's mix of offense and defense have made him the apparent top choice for the Cavs.
Triggering a hard cap will mean Harden takes significantly less on his next contract's first year, but if the Cavaliers can land Watson or Kuminga, that sacrifice would be well worth it. At 37 years old, Harden's NBA career is winding down, but he still has yet to accomplish an NBA Finals victory. While the road to the Finals will be tumultuous with LeBron and Giannis Antetokounmpo joining contenders in the same conference, adding young, emerging wing talent could be enough to give the Cavs a real chance.
James Harden is not making this choice as an act of charity to the Cavaliers. He will be compensated with a longer, higher-paying deal at the end. He is, however, granting Cleveland necessary room to negotiate and construct the right roster rather than chasing immediate pay days. That is a leadership quality the Cavaliers desperately need in the new apron era.
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