I see. Well, that is clearly a different take, and it is contrary to what I see and intend. I saw just a few candidates last season (addressed above), just a few this, so I don't see chaos, which is one of your concerns. Where we differ significantly is the idea of penalizing someone. This would only be for most playoff teams and only lottery teams would bid on the free agents. Only certain contracts would be eligible and only in years 2 and 3. It rewards trying to win despite having bad contracts, gives teams looking to compete more chances to do so.
I think my formal proposal will not include your changes, but I will try to address your fears more directly. You'll, of course, be able to vote against it in it's final form, regardless.