The Pacers have been granted a disabled player exception worth $14,104,000, general manager Chad Buchanan stated during an appearance on the Setting The Pace podcast (YouTube link).
Indiana was eligible for that exception as a result of Tyrese Haliburton‘s Achilles tear, which will sideline him for the entire 2025/26 season.
“We’ve applied for that and been granted that exception, so I don’t know if I’m breaking news there for you guys,” Buchanan said when asked by co-host Alex Golden about the possibility of the team applying for a DPE. “Whether we use it or not depends. Using the full exception would put us into the luxury tax, which we’re not opposed to if it’s the right player.”
A disabled player exception gives an over-the-cap team some extra spending power – but not an additional 15-man roster spot – when it loses a player to an injury deemed likely to sideline him through at least June 15. As we explain in our glossary entry, the exception can be used to sign a free agent, to claim a player off waivers, or to acquire a player in a trade.
The disabled player exception can only be used on a single player and can only accommodate a player on a one-year deal. A free agent signee can’t get a multiyear contract, and any trade or waiver target must be in the final year of his contract.
The exception is worth either half the injured player’s salary or the value of the mid-level exception, whichever is lesser. Since Haliburton is earning over $45MM this season, the Pacers’ DPE is worth the amount of the non-taxpayer MLE.
Buchanan, who was asked about the possibility of adding more backcourt depth with Haliburton out for the year, acknowledged that if the front office were to target a specific position, it would likely be a point guard. However, he added that the Pacers haven’t pursued that possibility “super hard” and mentioned RayJ Dennis, Kam Jones, and Quenton Jackson as young guards the team likes and will continue to develop behind Andrew Nembhard and T.J. McConnell.
Indiana is currently operating about $6MM below the luxury tax line. If the club doesn’t use its disabled player exception on a free agent before or during the season, it also could come in handy at the trade deadline. For example, if the Pacers were to trade Obi Toppin and his $14MM salary for a player on an expiring $14MM contract, they could use the DPE to take on that player, creating a new trade exception worth Toppin’s outgoing salary.
It’s worth noting that the Pacers also still have their full $14.1MM mid-level exception available — it can be used to sign free agents and/or acquire players via trade too, and it can be split among multiple players, unlike the DPE.
The deadline to use a disabled player exception is March 10. The mid-level exception can be used until the final day of the regular season.