Operating in the Era of a Falling Salary Cap
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06-21-2009, 08:03 PM
DIEHARD the King fan
Join Date: Apr 2008
Location: blueline to slot
I posted this in the Breakfast with the GM thread, But it seems more appropriate here.
Originally Posted by piston
Excellent questions, let me try and answer.
We don't 'know' where the cap is going. We do know a) the economy sucks and the massive appreciation of the Canadian dollar are over (this was the main driver of the previous increases) 2) Jeff Solomon said yesterday there are no serious negotiations going on until teams know where the cap is and 3) Solomon, who gets paid to track this, thinks it will be flat to slightly down this season and down significantly next season. This is not a negotiating tactic as some have suggested as very few contracts are going to be signed before both the teams and the players know what the cap is going to be giving neither an edge.
As to your next question, look at Dany Heatley and Rick Nash. At today's cap, Heatley eats up 13.2% of Ottawa's cap. Now, say Nash wants the same deal (he may want more) but the cap drops to Solomon's worst case projection of $48 mm. Now, Nash will be eating up 15.6% of Columbus's space making it more difficult for the Blue Jackets to surround him with talent. Now Nash is probably worth it and will still get paid. But is Chris Drury worth 14.7% of the reduced cap? Are the Sedins worth 22.1%? Spending big bucks on the wrong players can really hurt you, and with these long term deals, it will hurt for a long time. Thus, the very top players will likely be paid, but that level just below elite will see significant downward pressure on salary levels as you just can't afford to make a mistake here. There is not too much the NHLPA can do about this.
Far more interesting, however, is how teams will likely react. Philadelphia, Boston and NYR all have to clear space very soon or be over next year's cap (if it goes down like we are assuming for the sake of this discussion). But who is going to take on these salaries. Just as Philly made a mistake overpaying Briere and the Rangers did with Drury and Gomez why would another team take on that mistake? As i said above, if you have one or more of these contracts that suck up a high percentage of your cap without a commensurate return in performance, you will really be handicapped. In addition, the teams that are hemorrhaging cash are going to spend even LESS on salaries as the floor goes down as well. So, there will only be a small handful of teams with both cap space AND the ability to spend up to the cap, the Kings presumably among them. The GMs in Philly, NYR and Boston all know this and will be making some very interesting offers. For example, I would not offer more than a 7th for Briere and insist on a first coming my way as well (assuming Briere fits). If Philly says F/U, I say good luck getting under the cap bro and walk.
Hope that answers your questions.
Thanks piston. I understand your answers but still have questions. I guess someone could, a la Jeff Solomon/Dean Lombardi figure out exactly what each team has committed for each of the next two years, and then calculate the total league wide commitments on salary and see if it is possible for the league to fit that amount of existing salary commitment within the league wide total of allowed cap expenditure. I assume that as of right now, with several teams well below the cap, (Montreal being the most obvious) there is enough cap space league wide to satisfy the existing contracts for 2010-2011, but by the time this year's crop of UFA's and RFA's are signed, and assuming a worst case scenario of a 48MM cap in 2010-2011, there might not be.
If not, then what happens? A team's star players have to be sent to the AHL (where I understand a player's cap hit no longer counts against the team)? Someone suggested that in the breakfast. What if Philly and New York have NO TAKERS in their attempts to unload salary and literally can not fill their roster without going over the cap? Then what? I have trouble believing the league will nullify their games or not provide them some relief if they cant ice a team without going over the cap.
Beyond that, it seems logical and possible that at some not too distant point salaries, existing and those to come, will necessarily exceed a cap that continues to drop and that, as a result, some mid level players will be forced out of the NHL because teams simply will not be allowed to pay them close to what they are worth, and then those players may seek employment in other leagues. I think there are going to be adjustments made in practice by the NHL when the presumed cap hell materializes.
Bringing this full circle, it is assuming alot to pin your team's hopes of acquiring key pieces of the puzzle on the presumed ability of stealing players away from other teams who have cap problems. Reading that part of the DL interview reminded me of DL's "make my day"sound bite" last year about teams offering offer sheets to our RFA's. If the league offers respite to cap plagued teams because of a precipitous drop in the cap, we will have been waiting for nothing.
Originally Posted by Stupid Sexy Flanders
I predict that, if the cap falls sharply, teams like PIT will raise holy hell and Bettman will devise some weaselly hardship clause or some other amendment to the CBA.
Originally Posted by Ziggy Stardust
Similar to what the MLS has, I could see the NHL implementing a "franchise player" exemption rule where one player on the roster would be deemed exempt from the cap, but there are certain rules as to how long a "franchise" labeled player must remain with the team and the minimum/maximum length and wage of the franchise players' contract.
At this point, any adjustment by the league will significantly impact the stated strategy of DL and Co in using cap space limitations of other teams to poach a valuable player for minimal amounts. I am concerned that this strategy might not bear the fruit anticipated, and then the waiting and planning for next year will only result in one more year of suck with no significant improvement, unless you consider moving down a few spots in the draft an improvement.
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