NBA Unveils “3-2-1” Draft Lottery to Deter Tanking

The NBA’s recent drafts have exposed teams deliberately losing to improve draft position. Under the Player Participation Policy introduced before the 2023-24 season, the Utah Jazz and Indiana Pacers were fined for withholding star players in February, marking the league’s first financial penalties for tanking.

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Commissioner Adam Silver said the league will present a “3-2-1” lottery proposal to owners at the end of May. The plan replaces weighted odds with flat odds for all 16 lottery teams, eliminating any incentive to finish last. Under “draft relegation,” the three worst-record teams receive two lottery balls each (no lower than the 12th pick), while the other 13 non-playoff teams get three balls each. In the play-in, the No. 9 and No. 10 seeds get two balls and the losers of the 7-8 games get one ball. The system also blocks a team from securing a top-five pick in three straight years or the No. 1 pick in consecutive drafts, and removes pick protection for picks No. 12-15.

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The NBA will gain authority to alter a team’s lottery odds or remove lottery balls if it deems a club is tanking. Silver noted this exceeds existing fines, citing the $500,000 penalty on the Jazz for “conduct detrimental to the league.” The league can thus directly affect a team’s draft position.

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Silver said the proposal aims to “remove any particular incentive to be bad” and noted the flat-odds system will run for three years before the collective bargaining agreement is renegotiated. He added the league will monitor team responses and explore other talent-distribution methods.

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Some observers doubt the need for a new lottery, noting teams have historically found ways to work the system. Yet there is near-universal expectation the league will adopt a reform after recent drafts.

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• “We're still playing a little bit with the system there.” — Adam Silver

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• “The system that we're going to be putting in front of our teams will be in effect for three years,” — Adam Silver

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• “There's even something we're calling draft relegation, that if you're one of the bottom three teams in the league, you'll actually have worse odds than teams that sort of are four through up until teams make the playoffs.” — Adam Silver

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• “Teams have to know it's not just about paying a financial fine, which they may think is worth it in order to get a top pick, but that it'll directly impact their ability to get a top draft pick.” — Adam Silver

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The proposal will go to the board of governors later this month. If approved, it will govern the 2024-2026 drafts and “sunset” after the 2029 season, when a new collective bargaining agreement can address further changes.

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