Kyle Lowry or Gabe Vincent? Inside the Miami Heat’s impending decision

One of the reasons running it back isn’t an option for the Miami Heat is because free agency and stricter tax penalties under the new CBA will prohibit the Heat from returning the same group next season.

Three days before the start of free agency, the Heat are looking at tough decisions regarding three guards on the roster: Kyle Lowry, Gabe Vincent and Victor Oladipo.

It’s highly unlikely that both Lowry and Vincent return next season, with Lowry due $29.7 million next season and Vincent set to sign a new contract that could pay in the range of $10 million annually. Miami doesn’t want to spend nearly $40 million next season for something short of elite at the point guard position, especially with the impending luxury taxes multiplying that payment.

If the Heat can’t find a trade partner for Lowry, sources tell Barry Jackson of the Miami Herald that they are considering using the waive-and-stretch provision on the 37-year-old point guard to create some immediate cap relief.

Using the provision would shrink Miami’s 2023-24 payroll from $178.5 million to $158.5 million (below the $165 million tax line and the $182.5 million second tax apron), but would result in cap hits of $9.8 million in each of the next three seasons. The Heat have until Sept. 1 to waive and stretch Lowry’s contract but hope to find a trade partner before then.

Teams like the Spurs and Pacers have enough cap space to absorb Lowry’s deal while sending a smaller salary back — a scenario that would still create substantial savings for the Heat. It’s unclear what the Spurs, for instance, would be willing to send back or what their appetite for Lowry would be. (They’re reportedly in the market for a veteran point guard, but Lowry’s salary could be too rich.)

It’s more likely that teams with room will wait and see what happens in free agency, which begins Friday (6 pm ET) before making their remaining cap space available for a salary dump.

This is where timing becomes a factor. Vincent and his agent Bill Neff expect to be fielding offers within the opening moments of free agency. If an opportunity for a substantial raise on a competitive team emerges, it will be hard for Vincent to wait on Miami’s decision on Lowry.

“I’d love to go somewhere and impact winning and continue to have deep runs in the playoffs,” Vincent told Jim Rome this week. “I definitely want to be at a place where I have an opportunity to be me and an opportunity to have an impact and a role on the team. I’m looking forward to that, wherever it may be.”

Given the choice, the Heat would prefer to bring back Vincent, who replaced Lowry as the team’s starting point guard and averaged 12.7 points and 3.5 assists while shooting 37.8% on 3s in the playoffs. He is also 10 years younger than Lowry and, even with a new contract, will be much cheaper. Jackson reported Tuesday that Pat Riley plans to meet with Vincent ahead of free agency.

The Heat have Vincent’s Bird rights and are capable of matching or exceeding any outside offer. Miami can feasibly bring Vincent back early in free agency before finding a trade destination for Lowry, then continue to shop the veteran point guard. If nothing materializes, they can waive and stretch Lowry before Sept. 1. Other than incurring the dead cap hits over the next three years, there’s little risk in this approach. It allows the Heat to bring back Vincent regardless and continue to stay in the mix for Lillard.

But if Lillard isn’t available, the preference would be to find a taker for Lowry. Over the last few months, there have been a few examples of players on hefty expiring contracts getting traded. The Lakers sent the final $47 million of Russell Westbrook’s contract to Utah for a package of role players at February’s trade deadline, and Chris Paul’s $30.8 million salary was used by Phoenix to acquire Bradley Beal, and then by Washington to acquire Jordan Poole. The Heat do not want to attach a pick to Lowry in order to unload his contract, and would go the waive-and-stretch route before losing valuable draft capital.

The Heat will also consider using the waive-and-stretch option on Victor Oladipo, who has until Thursday to decide on his $9.5 million option for next season. After sustaining a knee injury in the playoffs that will sideline him well into the coming season, it’s expected that Oladipo will pick up the option for the final season of his contract. Once Oladipo does opt in, the Heat will have until Sept. 1 to waive and stretch his salary into $3.1 million cap hits over the next three seasons.

Waiving and stretching both Lowry and Oladipo would cost the Heat nearly $13 million in dead cap in each of the next three seasons. Obviously, this wouldn’t be ideal. The best-case scenario is that Lowry and/or Oladipo could be used as salary ballast in a deal to acquire Damian Lillard or another high-priced star. But short of a helpful trade or big swing, the waive-and-stretch provision is on the table.