The NBA has distributed its updated Draft Lottery reform proposal to team owners ahead of a May 28 vote, with new details clarifying how consecutive-draft restrictions will work, sources tell Yahoo's Kevin O'Connor.

The "3-2-1" framework allocates 37 lottery balls across 16 teams. The three lowest-ranked teams receive two balls each (5.4% odds), teams four through eight receive three (8.1%), play-in seeds nine and 10 receive two (5.4%), and the seven-versus-eight play-in loser receives one (2.7%). All 16 lottery picks would be drawn, with the three worst-record teams unable to fall below 12th.

Commissioner Adam Silver would gain expanded authority to penalize tanking by adjusting lottery odds or pick placement.

A key clarification concerns the anti-consecutive-draft rule where no team can land the first pick in back-to-back drafts, or finish in the top five in three straight drafts. Sources confirm the streak attaches to the original team, not the pick's current holder.

"In the event a team's pick is drawn in the lottery in a position where it is not permitted to be, then such team's pick would be moved down to the first permissible position," the league wrote in its proposal.

The rules are also applied retroactively. The Washington Wizards, who won the 2026 lottery, cannot land first again in 2027. The Utah Jazz, which selected fifth in 2025 and second in 2026, cannot finish in the top five in 2027. Utah traded that pick to the Memphis Grizzlies for Jaren Jackson Jr., meaning the Grizzlies would be barred from receiving a top-five selection under the streak clause.

The retroactive clock also creates complications for existing trades. The Houston Rockets hold swap rights to the Phoenix Suns' unprotected first via the Kevin Durant deal. If Phoenix lands fifth in 2027 and third in 2028, Houston's acquired pick could not finish in the top five in 2029, retroactively reducing the value of a trade completed in July 2025.