NBA commissioner Adam Silver confirmed Wednesday that the league has finalized a draft lottery reform proposal to present to team owners at the end of May, designed to eliminate the competitive incentive to lose games deliberately. The proposal centers on a flat-odds system that would reduce the advantage of finishing with the league's worst record.

"We've essentially done, and we have a proposal that we're going to be bringing to our team owners at the end of May, and that is to create essentially a system of flat odds, so that you have no particular incentive to be bad," Silver said on Stephen A. Smith's radio show.

The proposal matches what ESPN first reported as the "3-2-1" system. Under the structure, the three worst teams in the league would actually receive lower lottery odds than clubs finishing fourth through tenth, a deliberate reversal of the current incentive structure. Silver described the concept as "draft relegation."

"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," Silver said. "We're still playing a little bit with the system there."

The reform would also expand the league's disciplinary authority over teams deemed to be deliberately losing. The NBA fined the Utah Jazz $500,000 for conduct detrimental to the league earlier this season, but Silver indicated future penalties could go further.

"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," Silver said. "We can actually take away draft lottery balls, we can change the order of the draft."

All four teams that jumped up in this season's lottery, the Washington Wizards, Utah Jazz, Memphis Grizzlies and Chicago Bulls, made moves in the final weeks of the regular season aimed at improving their draft positioning. League officials told ESPN the expectation is the proposal will pass this month.

The system is designed as a three-year measure set to expire in 2029 when the new collective bargaining agreement takes effect, at which point tanking rules could be renegotiated.

"The teams are incredibly innovative and creative at coming up with ways to work the system," Silver said. "This will give us time for additional study to see whether there are other creative ways to better distribute players."

There is an expectation amongst NBA front offices that teams will be less willing to trade future picks under the new system due to the increased probability of a higher draft pick regardless of record.