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12-11-2008, 07:52 AM
  #66
Noldo
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Quote:
Originally Posted by Ozymandias View Post
The cap doesn't go down, ever. Unless there is an extreme condition and an agreement is done between the two parties (NHL and NHLPA). In this case, player's salaries will be cut in a percentage equal to the difference that would put the total of player's salaries to 56% of total revenues at the end of year, cut equally with the appropriate corresponding % among players.

It's all there in the CBA, article 49. Long read.

http://www.nhl.com/cba/2005-CBA.pdf
Unfortunately Article 49 of the CBA does not determine the Cap, Article 50 does.

Quote:
Originally Posted by CBA Article 50.5 (b)
"Lower Limit" and "Upper Limit."

For each League Year there shall be a "Lower Limit" and an "Upper Limit" at or between which each Club must have an Averaged Club Salary. The range between the Lower Limit and Upper Limit shall be known as the "Team Payroll Range" (the "Payroll Range" or "Range"). (i) The Upper and Lower Limits of the Team Payroll Range shall be determined in accordance with the following formula:

Preliminary HRR for the prior League Year multiplied by [x] the Applicable Percentage (as defined in Section 50.4(b) of this Agreement), minus [-] Preliminary Benefits, divided [/] by the number of Clubs then playing in the NHL (e.g., 30), shall equal [=] the Midpoint of the Payroll Range, which shall be adjusted upward by a factor of five (5) percent in each League Year (yielding the
Adjusted Midpoint) until League-wide Actual HRR equals or exceeds $2.1 billion, at which point the five (5) percent growth factor shall continue unless or until either party to this Agreement proposes a different growth factor based on actual revenue experience and/or projections, in which case the parties shall discuss and agree upon a new factor. If a significant (i.e., $20 million or more) one-time increase or decrease to League-wide revenues (e.g., by reason of the addition or loss of a national television contract or the cheduled opening of one or more new arenas which is expected to result in a significant increase in League-wide revenues) is anticipated in the next League Year, the parties will endeavor to estimate the expected increase or decrease and incorporate that estimate into the above-stated formula for calculating the Adjusted Midpoint.
If the Leaguewide Hockey Related Revenues (HRR) drop significantly (actually, more than 5 %), the cap will decrease as desribed above. If the cap would decrease, there would quite likely be escrow payment from players to the owners (as desrcibed in Article 49), but it would not prevent the cap being lower for the following season.

The one thing that can not change under the current CBA is the existing contracts. Even is Cap would decrease, the current contracts would remain, even if they would be more than 10 % of the new cap.

Now, back to the topic....

Since quite nice amount of NHL's revenues are generated already before the season begins (arena sponsors, season ticket holders etc.), they have not been affected by the economy. For this season. The effects would be felt next season with less season tickets sold and difficulties to renew expiring sponsorships (arena's named after car companies are extremely vulnerable). For this season it is reasonable to assume that excitement in certain strong markets (Boston and Chigago especially) could outfight the decrease in actual value of canadian revenues (due the falling loonie) and as Bettman suggested, the cap could well stay at current level for the next season, give or take one or two millions.

The next season is currently totally in the dark. If things are looking grim still next summer, one would expect that season ticket and similar revenues for the season 2009-2010 would be smaller, leading to lower cap for 2010-2011 season.

Still, I really doubt Vinny would be moved. but with Tampa's current ownership, anything isn't really out of question.


Last edited by Noldo: 12-11-2008 at 09:42 AM.
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