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Disco Stu's CBA (long)

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10-28-2003, 11:34 AM
  #1
discostu
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Disco Stu's CBA (long)

I was taken to task, sort of speak, by West to provide what my proposal for a CBA would look like, so here it is. It's pretty long though.

It's a basic luxury tax system, with some other small adjustments to the current CBA.

Changes to base CBA:
-Rookies are capped by a maximum salary of $1,000,000 base salary and $500,000 in performance bonuses for the first 3 years.
-Players that re-enter the draft after not signing with their original teams are subject to a cap of $1,000,000 total (base salary and performance bonuses)
-Players are eligible for arbitration coming off their rookie contract
-Teams can qualify players by offer a contract of 90% of their previous contract
-Players can become UFA at the age of 29
-The NHL will shut down for two weeks for the Olympics every 4 years to allow its players to compete for their countries during the main bracket portion of the competition. Players who wish to compete during the qualifying bracket for their country may take time off from their NHL team do so and receive 50% of the salary for the NHL games that they miss.
-Contracts can get bought out for 75% of their value. Teams who do this can elect to take the buyout as a one time hit or amortize it over the course of the contract for luxury tax purposes.


Luxury Tax:
The luxury tax will be a progressive tax. Every payroll dollar spent up to $32 million will be tax free. After that point, the following tax brackets apply.

32-40 million: 25% Tax
40-48 million: 50% tax
48-56 million: 75% tax
56+ million: 100% tax
65 million: loss of 3rd round pick
75 million: loss of 2nd round pick
90 million: loss of 1st round pick

Expected results:

Based on this system, this is how I foresee teams spending habits being after implementation.

5 teams less than 32 million
15 teams around $36 million, result, $15 million in tax proceeds
7 teams around $46 million, $35 million in tax proceeds
2 teams around $54 million, $25 million in tax proceeds
1 team around $64 million, $22 million

To qualify for tax proceeds:
-Must have a payroll less than $40 million
-Must have made the playoffs at least once in the past 3 years
-Must have won a playoff series at least once in the past 5 years
-Must have season ticket sales of greater than 6000 seats per year
-Must have a regular season winning percentage greater than .350 during the past year


Important qualifying notes:
All payments made from team to player are included, including salary, signing bonuses and performance bonuses. Any other payment made to a player by a related corporate entity from the team must be authorized by the NHL (i.e. endorsement contract) and may be classified as salary.
Signing bonuses will be amortised over the life of the contract (to avoid teams putting in huge signing bonuses for the year that they have cap room)
Players that have played for the same team for 7 or more years only have 60% of their salary count against the luxury tax system (Larry Bird rule)

Length of CBA

The CBA will last for 6 years. All tax brackets will remain static over the life of the CBA. If revenues increase by 25% over the course of the CBA, the players have the right to open up the CBA for renegotiations.

Net results:

Tax:
-Assuming all qualifying teams meet performance criteria, it will result in a payment of $4.85 million to each qualifying team (total of $97 million), which is a significant boost to many team's bottom line.
-The higher luxury tax rates near the top will prevent higher spending teams from poaching a lot of higher end talent.
-The performance bonuses ensures that each team will be putting a competitive team on the ice. Any team that tries to ice a low quality team will eventually start missing out on their share of the proceeds.
-The loss of picks near the top of the tax system are there in case any team tries to take a run at buying a cup. I wouldn't expect anything more than a third rounder would ever be revoked
-Some teams will miss out on the performance bonuses, which may incur a debt spiral. I think each team should be able to sustain a few years without qualifying for the tax proceeds, and if they can't, the league needs to address their financial situation, and determine if they are worth continuing pumping money into and saving.
-All qualifying criteria will start the year that the CBA goes into affect. Therefore, if a team hasn't won a playoff series for a few years leading up to the CBA, it won't matter, and they will still receive the tax proceeds.
-The static tax brackets are crucial. I think that revenues have levelled off for the NHL. They will still increase, but at a slower rate, closer to inflation. This will provide a chance for revenues to stay flat or decline while revenues slowly catch-up. If this isn't the case, then once the revenues do increase, the players can open up the CBA and renegotiate the rates if they feel it's necessary.


Rookies:
-The rookie cap with bonuses will prevent the large contracts given to players out of the draft.
-The restriction on entering the draft year is designed to motivate the young players getting into the league right away. There's little use of playing hardball, as it will only restrict their earning later on.

Free Agency:
-The lower UFA age is necessary. The players need some concession. Since there will be other factors that prevent the big team from poaching players, it shouldn't be too much of an issue.
-The arbitration at an earlier age is designed to prevent as many hold-outs
-The lower qualifying amount is designed to account for players whose value declines, yet the team still wishes to retain. Since players will have arbitration rights, they will still receive fair offers.

Length of the CBA:
-The term length was set so to a shorter term as the last one. The idea being that it's better to make sure this system works. If there's a problem with it, there will be a better idea on how to fix it 6 years out.

So there it is. Criticism will be grudgingly accepted.

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10-28-2003, 12:25 PM
  #2
Dr Love
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Quote:
Originally Posted by discostu
To qualify for tax proceeds:
-Must have a payroll less than $40 million
-Must have made the playoffs at least once in the past 3 years
-Must have won a playoff series at least once in the past 5 years
-Must have season ticket sales of greater than 6000 seats per year
-Must have a regular season winning percentage greater than .350 during the past year
I thought Disco Stu didn't advertise, yet his name is clearly in the thread title. Hypocrite.

I think that the qualifications you have set forth would eliminate a majority of the teams that tax proceeds would be intended for, assuming that all of the above criteria need be met. Namely Calgary and Edmonton who wouldn't qualify since they haven't won a playoff round in the past 5 years, nor would Phoenix, Florida, Columbus, Nashville, Atlanta, or Chicago. Only Minnesota, Vancouver (although their payroll might now be over 40, I'm not sure), Pittsburgh, Ottawa, Tampa, Buffalo, Boston, and Carolina would be helped. Now, if it is a 3/4 out of five criteria, then they would qualify, but I'm assuming it's not. Perhaps your criteria should be alterated, because the way it stands now some of the teams that really need the help aren't getting it.

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10-28-2003, 01:21 PM
  #3
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Quote:
Originally Posted by Dr Love
I think that the qualifications you have set forth would eliminate a majority of the teams that tax proceeds would be intended for, assuming that all of the above criteria need be met. Namely Calgary and Edmonton who wouldn't qualify since they haven't won a playoff round in the past 5 years, nor would Phoenix, Florida, Columbus, Nashville, Atlanta, or Chicago. Only Minnesota, Vancouver (although their payroll might now be over 40, I'm not sure), Pittsburgh, Ottawa, Tampa, Buffalo, Boston, and Carolina would be helped. Now, if it is a 3/4 out of five criteria, then they would qualify, but I'm assuming it's not. Perhaps your criteria should be alterated, because the way it stands now some of the teams that really need the help aren't getting it.
Well, as stated, all criteria would take effect as the new CBA starts. This was a little unclear, but essentially, everything before the CBA wouldn't matter. Thus, it would take 3 years before any team will be affected by the "making the playoffs" criteria, and 5 years before any team will be affected by the "winning a round" criteria. By the time these criteria took affect, these teams should hopefully have met the objective.

The winning a playoff round is the hardest one to achieve I think, and is the one that I would consider altering; perhaps bumping up the timeframe to 6 or 7 years, but I think 5 years is still attainable. The reason that it's there is that I wouldn't want to see an owner build a team that can barely makes the playoffs every other year with a smaller payroll, and takes the luxury tax proceeds from the rest of the teams and pockets it. You want to give the owner an incentive to build a team that has a bit more potential, and that can make a playoff run eventually.

Quote:
Originally Posted by Dr Love
I thought Disco Stu didn't advertise, yet his name is clearly in the thread title. Hypocrite.
I lied. :p

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10-28-2003, 02:17 PM
  #4
Dr Love
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Quote:
Originally Posted by discostu
Well, as stated, all criteria would take effect as the new CBA starts. This was a little unclear, but essentially, everything before the CBA wouldn't matter. Thus, it would take 3 years before any team will be affected by the "making the playoffs" criteria, and 5 years before any team will be affected by the "winning a round" criteria. By the time these criteria took affect, these teams should hopefully have met the objective.

The winning a playoff round is the hardest one to achieve I think, and is the one that I would consider altering; perhaps bumping up the timeframe to 6 or 7 years, but I think 5 years is still attainable. The reason that it's there is that I wouldn't want to see an owner build a team that can barely makes the playoffs every other year with a smaller payroll, and takes the luxury tax proceeds from the rest of the teams and pockets it. You want to give the owner an incentive to build a team that has a bit more potential, and that can make a playoff run eventually.
Ah, I missed that part, I guess I read too fast. Taking that into consideration then I don't have as much of a problem with it.



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I lied. :p

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10-28-2003, 03:36 PM
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Disco Stu is starting what I think will be a new trend around here.

Mock CBA's. Let's see who will be the closest to being the actual one.

There will be more points than what is here. Someone on these boards (it might be the almighty God Buffaloed) has an actual copy of the CBA. The best way is to look at that and see what you would change.

Also I think the teams falling under that 75% and 100% tax would anti up their payroll to lose the 3rd round pick as opposed to the hell load of money they'd lose.

It's a great effort on your part. I like a lot of the things you put in, but I'm not sure it would work. Qualifying for tax help is an issue. Most of the teams needing it, need the money in order to reach the points where you have teams qualifying for it.

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10-28-2003, 10:38 PM
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Quote:
Originally Posted by go kim johnsson
Also I think the teams falling under that 75% and 100% tax would anti up their payroll to lose the 3rd round pick as opposed to the hell load of money they'd lose.
Don't you think they take the 100% + lose the pick? That's what I assumed and I can't see him not meaning that.

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10-29-2003, 02:50 AM
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Quote:
Originally Posted by rob_paxon
Don't you think they take the 100% + lose the pick? That's what I assumed and I can't see him not meaning that.
Yup, that's what I meant. The penalties are cumulative. Once you lose the third round pick, you're already paying $23 million in taxes, and will continue to pay a dollar for every dollar you continue to spend. When you get to $75 mil, you'll lose the second rounder and the third rounder, in addition to the $33 million in taxes.

As for the qualifying criteria, the teams will have access to the money to start out. After the 3 year mark, those who haven't made the playoffs will lose access to it, which will provide them with additional motivation (and reward) to getting to the playoffs.

The qualifying criteria is a replacement for a salary floor. I don't like salary floors, since it's easy for a team to just reach the salary floor level, ice a mediocre team, and collect the luxury tax proceeds. This forces them to have a plan to not only make the playoffs, but be able to win at least one round sometime within the future.

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10-29-2003, 02:50 AM
  #8
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Great job Stu. There is only one thing i would add. I would like to see a salary floor of 22 million. If teams are below that number, they shouldn't recieve any revenue sharing money. The NBA has a salary floor and it actually worked this year. The Clipper had to bring back a couple of RFA just to stay above that floor number. The Clippers owner has zero interest in winning. Making a profit is the 1st and only order of business for the Clippers. But they did have to shell out big bucks to Elton Brand to keep the teams payroll over the salary floor number.

Teams can still keep a payroll below 22 million if they want. But they wont see any revenue sharing money.

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10-29-2003, 03:53 AM
  #9
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Quote:
Originally Posted by discostu
...The reason that it's there is that I wouldn't want to see an owner build a team that can barely makes the playoffs every other year with a smaller payroll, and takes the luxury tax proceeds from the rest of the teams and pockets it...
But that never happens...
<(-:**
Good plan DiscoStu...I bet it would probably work great.
That's why neither side would ratify it, unfortunately.
Though you never know...you should print it and send one copy to Bettman and one copy to Goodenow. It should at least get them to the table.

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10-29-2003, 04:47 AM
  #10
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Quote:
Originally Posted by JasonMacIsaac
You taxes are too harsh on the 30 million payroles.
It's only 25% on the amount between $32 and $40 million, which maxes out at $2 million. Given that these same teams also receive the luxury tax proceeds, I think it's manageable.



Quote:
Originally Posted by JasonMacIsaac
The teams in the 90 million range....do they also pay a 100% tax, lose a 1st, 2nd and 3rd?
Yes, the penalties are cumulative.

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10-29-2003, 04:51 AM
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Quote:
Originally Posted by JasonMacIsaac
25% of 30 is around 7.25 million thats too harsh for Calgary and Edmonton.
The first $32 million in payroll is tax free. Only the portion of the salary greater than $32 mil would be taxed.

If a team had a payroll olf $36 million, they would pay $1 million in taxes.

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10-29-2003, 04:53 AM
  #12
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Quote:
Originally Posted by JWI19
Great job Stu. There is only one thing i would add. I would like to see a salary floor of 22 million. If teams are below that number, they shouldn't recieve any revenue sharing money. The NBA has a salary floor and it actually worked this year. The Clipper had to bring back a couple of RFA just to stay above that floor number. The Clippers owner has zero interest in winning. Making a profit is the 1st and only order of business for the Clippers. But they did have to shell out big bucks to Elton Brand to keep the teams payroll over the salary floor number.

Teams can still keep a payroll below 22 million if they want. But they wont see any revenue sharing money.
My preference is to the performance criteria versus a payroll floor. If a team can make the playoffs and win a playoff round at least once every five years, does it really matter what their payroll is? If they can achieve that, they obviously care about winning.


BTW, thanks for all the feedback guys. I do appreciate it. Keep it coming.

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10-29-2003, 08:07 AM
  #13
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Quote:
Originally Posted by discostu
Changes to base CBA:
-Rookies are capped by a maximum salary of $1,000,000 base salary and $500,000 in performance bonuses for the first 3 years.
-Players that re-enter the draft after not signing with their original teams are subject to a cap of $1,000,000 total (base salary and performance bonuses)
I like this and think it's pretty good. I think that I'd change it to something closer to...
- Teams Get to retain a players rights if they make an offer of the maximum rookie base salary and raise the maximum allowable in bonus to the 1 to 2 million dollar range.

This would not cap the level of earning to much of players like Pitkanen, Kovalchuk and any other players that excell early but let's the team drafting them enough leverage to make sure that they have to earn the bonus.

I'm assuming that your using the same later draft picks get less money scale as currently in place.

Quote:
Originally Posted by discostu
-Players are eligible for arbitration coming off their rookie contract
-Teams can qualify players by offer a contract of 90% of their previous contract
-Players can become UFA at the age of 29
-The NHL will shut down for two weeks for the Olympics every 4 years to allow its players to compete for their countries during the main bracket portion of the competition. Players who wish to compete during the qualifying bracket for their country may take time off from their NHL team do so and receive 50% of the salary for the NHL games that they miss.
-Contracts can get bought out for 75% of their value. Teams who do this can elect to take the buyout as a one time hit or amortize it over the course of the contract for luxury tax purposes.
I'm ok with most of this with the exception of 90% is to high if I'd go for 80% because this deal is looking (owners view anyway) to be deflationary so 90% is what everyone should be offered if the player has a bad couple of years he should get even less I'd say 80%. Also if the deal is to be deflationary arbitration needs to be looked at since it is based on current contracts. Lastly I believe that contract can be bought out at 2/3 right now did you meen for this number to be higher than the current value (if not I'd change it to 50%)?

Quote:
Originally Posted by discostu
Luxury Tax:
The luxury tax will be a progressive tax. Every payroll dollar spent up to $32 million will be tax free. After that point, the following tax brackets apply.

32-40 million: 25% Tax
40-48 million: 50% tax
48-56 million: 75% tax
56+ million: 100% tax
65 million: loss of 3rd round pick
75 million: loss of 2nd round pick
90 million: loss of 1st round pick

Expected results:

Based on this system, this is how I foresee teams spending habits being after implementation.

5 teams less than 32 million
15 teams around $36 million, result, $15 million in tax proceeds
7 teams around $46 million, $35 million in tax proceeds
2 teams around $54 million, $25 million in tax proceeds
1 team around $64 million, $22 million
I'd like to run some very rudimentary numbers on this (I'll give my assumptions when I do) but I suspect that this will end up being to little money spread to many ways. I'll post again on this and realize that this may be completely wrong.

Quote:
Originally Posted by discostu
To qualify for tax proceeds:
-Must have a payroll less than $40 million
-Must have made the playoffs at least once in the past 3 years
-Must have won a playoff series at least once in the past 5 years
-Must have season ticket sales of greater than 6000 seats per year
-Must have a regular season winning percentage greater than .350 during the past year
Right now I'd say that teams that make the play-offs and/or win round probably don't need the money as bad as teams that don't. So your giving money to teams that don't really need it like MIN, BUF, CAR in years that they made a ton of money. I can see the point of wanting to only giving the tax benifits to teams that are trying to do well and not to teams that are hoarding the cash but if that's what your trying to do let's talk about cash and not just on ice performance. Also by definition 20% of the leagues management is going to suck at any time. This is the nature of a competive league somebody wins and someone losses. If you set up any sort of survival of the fittest senario don't be surprized if only the fittest survive.

Quote:
Originally Posted by discostu
Important qualifying notes:
All payments made from team to player are included, including salary, signing bonuses and performance bonuses. Any other payment made to a player by a related corporate entity from the team must be authorized by the NHL (i.e. endorsement contract) and may be classified as salary.
Signing bonuses will be amortised over the life of the contract (to avoid teams putting in huge signing bonuses for the year that they have cap room)
Players that have played for the same team for 7 or more years only have 60% of their salary count against the luxury tax system (Larry Bird rule)

Length of CBA

The CBA will last for 6 years. All tax brackets will remain static over the life of the CBA. If revenues increase by 25% over the course of the CBA, the players have the right to open up the CBA for renegotiations.
All of the above sounds good except the Larry Bird part dosn't help your mid to small salary teams keep their star players.


For an overall review I don't think that it's going to do enough for the deflationary point of view. The owners are talking about a hard cap at $31 million or an almost garunteed 25% drop in payroll costs. Assuming that the owners are full of it and they'd settle for about half of this I don't think your tax would do it (like I said I'll run some very basic assumption through a calculator later and see what happens). Also it is still basically the same system that got everyone to this sitituation in the first place there is no real reason to think that teams would but this money against their bottom line where they need it they it would just as likely just cycle back into payroll for different teams. So if there is a real problem I don't see this as a solution.

Lastly I don't see what's in this for the big market teams they foot alot of the bill and don't seem to get anything in return?

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10-29-2003, 08:29 AM
  #14
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Quote:
Originally Posted by West
For an overall review I don't think that it's going to do enough for the deflationary point of view. The owners are talking about a hard cap at $31 million or an almost garunteed 25% drop in payroll costs. Assuming that the owners are full of it and they'd settle for about half of this I don't think your tax would do it (like I said I'll run some very basic assumption through a calculator later and see what happens). Also it is still basically the same system that got everyone to this sitituation in the first place there is no real reason to think that teams would but this money against their bottom line where they need it they it would just as likely just cycle back into payroll for different teams. So if there is a real problem I don't see this as a solution.

Lastly I don't see what's in this for the big market teams they foot alot of the bill and don't seem to get anything in return?
I don't think the owners are entitled to an immediate 25% drop in payroll, and they won't get anything close to that. Salaries may be too high, but it will take time for them to come down. The brackets will remain static, so assuming that revenues grow at the same rate as national inflation, it will help bring the relative payroll costs coming down. I see this knocking payroll down by about 10% within a short time, and keeping them at that rate as revenues hopefully grow.

As for the dollar amounts, the net result is about 4 to 5 million per team, which I think is substantial. As for the big market teams, I agree, they do not get too much out of it, however, it offers them more than a hard cap (i.e. big teams can still spend a little more, which is what they want). Other than that, I don't think the big market teams should expect to get out of this mess without footing a large portion of the bill. They all agreed to expansion, and now, they are going to have to go along with the rest of the league who now need their support. All teams have equal say in the final decision.

Another quick note, where did you hear that contracts can be bought out for 2/3rds. I thought it was 90% currently, but I'm not certain. Perhaps someone else knows this a bit more. If it is 2/3rds, then yeah, I'd keep it at that level.

I appreciate the feedback though,

Thanks

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10-29-2003, 10:41 AM
  #15
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Quote:
Originally Posted by discostu
I don't think the owners are entitled to an immediate 25% drop in payroll, and they won't get anything close to that. Salaries may be too high, but it will take time for them to come down. The brackets will remain static, so assuming that revenues grow at the same rate as national inflation, it will help bring the relative payroll costs coming down. I see this knocking payroll down by about 10% within a short time, and keeping them at that rate as revenues hopefully grow.

As for the dollar amounts, the net result is about 4 to 5 million per team, which I think is substantial. As for the big market teams, I agree, they do not get too much out of it, however, it offers them more than a hard cap (i.e. big teams can still spend a little more, which is what they want).
I Agree that 25% is not likely to happen. Like I said I'd want to run a few calculations but I don't think that you'll get your 10% (which I agree is about right) salary drop by implementing this tax system.

My major area for concern is was that I don't think that this system makes any fundemental change from the previous CBA that's seen salary's escalate so rapidly.

So there is a very real question of what happens if the teams that got the money were to just dump it back into player salary so that they could compete for the money again. The amount of salaries go down would be minimal although league competivness would be improved but that doesn't help most teams bottom line.

I'll guestimate up some numbers and give my assumptions later right now this part has the makings of an is not is so senario.

Quote:
Originally Posted by discostu
Other than that, I don't think the big market teams should expect to get out of this mess without footing a large portion of the bill. They all agreed to expansion, and now, they are going to have to go along with the rest of the league who now need their support. All teams have equal say in the final decision.
Why is it big markets fault more than say small markets or the players? I don't think that giving their money away is any fairer than saying the top 150 paid players in the league taking a 25% pay cut across the board.

Quote:
Originally Posted by discostu
Another quick note, where did you hear that contracts can be bought out for 2/3rds. I thought it was 90% currently, but I'm not certain. Perhaps someone else knows this a bit more. If it is 2/3rds, then yeah, I'd keep it at that level.
I believe that was the number being thrown about this summer when Dallas fans were talking about cutting Turgeon lose for more money to sign Hatcher. I don't know where they got it from.

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10-29-2003, 11:22 AM
  #16
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The current CBA dictates a 2/3 buyout if a player is willing to accept it. I think that is the bare minimum a contract can be bought out for.

LetGoPens.com has a copy of the current CBA.

I'd say the 2/3 buyout is fair, because keep in mind that if they owners want to sign these deals, they should be responsible for them. It's not the players fault for taking the deals, and they should be honored for the most part.

I personally would love to see all deals with a cap of 1-2 years though. You'd get paid more on your recent performances and you wouldn't see so many floaters out there as every year is a contract year. Maybe 1 year deals under UFA age, 2 year deals over of UFA age.

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10-29-2003, 12:11 PM
  #17
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Quote:
Originally Posted by West
I Agree that 25% is not likely to happen. Like I said I'd want to run a few calculations but I don't think that you'll get your 10% (which I agree is about right) salary drop by implementing this tax system.

My major area for concern is was that I don't think that this system makes any fundemental change from the previous CBA that's seen salary's escalate so rapidly.

So there is a very real question of what happens if the teams that got the money were to just dump it back into player salary so that they could compete for the money again. The amount of salaries go down would be minimal although league competivness would be improved but that doesn't help most teams bottom line.
Taxing payroll for the larger teams by 75-100% is a VERY powerful deflationary tool. Currently, the highest salaries in the league are in the $10 million range, meaning that those teams feel that they are getting an incremental benefit of about $10 million from that player at least. Once a tax goes into place at 75%, a team now must get at least $17.5 M in benefit in order to offer a $10 million contract. This will bring down the contracts offered to UFA in a hurry, IMO.

As for the smaller spending teams, keep in mind the $40 million hurdle prevents them from doing anything too stupid. As soon as you pass that threshold, you lose out on the proceeds.

Smaller market teams will be putting some of this money back into payroll. That's one of the big objectives, decreasing disparity among club spending. The spending decrease at the top end will outweigh it though, IMO. The net result is slightly lower player compensation (10% reduction), with decreased payroll disparity.

Quote:
Originally Posted by West
Why is it big markets fault more than say small markets or the players? I don't think that giving their money away is any fairer than saying the top 150 paid players in the league taking a 25% pay cut across the board.
It isn't necesarily the fault of the bigger market teams (although, their spending habits do influence the smaller markets), but the onus is on them because they can afford to. A level playing field is needed in the NHL. Right now, some clubs have a lot more money than others. To get a leveler playing field, one of two things is needed:
-Take money from rich clubs, and give them to the poor (through a tax or revenue sharing)
-Cap the payroll system to make it accessible to the weakest clubs.

The latter option involves setting the payroll really low, and comes to great expense to the players. I don't think that it's a feasible option, which is why the former alternative is the best bet, IMO.

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10-30-2003, 09:34 AM
  #18
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Had some unexcepted free time last night and ran some numbers.

assumptions:
-used the 02-03 numbers you estimated.
-taxed teams reduce their payrolls to the point where the tax and payroll will add up to current payroll outlay.
-Every team qualifies for the bonus.
-Option one was did the calculation assuming that teams that get the money put half into payroll and put half against their bottom line (forgot to tax the tax money but it made the second option way quicker to calculate).
-Option two was did the calculation assuming that teams that get the money put it all against their bottom line.

Today In 3-5 years
____ Payroll __ Tax ___ Payroll __Tax __ Total
DET___68.0___24.0_____56.0___12.0___68.0
PHI___56.0___12.0_____49.2___ 6.9___56.1
TOR___54.3___10.7_____48.2___ 6.2___54.4
MIN___20.5____0.0_____20.5___
LAK___43.3____3.7_____40.9___ 2.5___43.4
NJD___52.4____4.4_____47.0___ 5.5___52.5
NYR___69.2___25.2_____56.6___12.6___69.2
STL___63.1___19.1_____53.2___ 9.9___63.1
CLM___28.2____0.0_____33.6
BOS___37.3____1.3_____36.2___ 1.1___37.3
MTL___48.6____6.5_____44.4___ 4.2___48.6
COL___60.7___16.7_____51.8___ 8.9___60.7
VAN___31.8____0.0_____31.8___
DAL___61.7___17.7_____52.4___ 9.3___61.7
CHI___44.5____4.3_____41.7___ 2.9___44.5
PIT___31.2____0.0_____31.2
OTT___30.3____0.0_____30.3
SJS___47.8____5.9_____43.9___ 3.9___47.8
WAS___50.7____8.0_____45.8___ 4.9___50.7
NYI___41.7____2.9_____39.5___ 1.9___41.4
NAS___25.2____0.0_____25.2
ATL___25.9____0.0_____25.9
BUF___31.1____0.0_____31.1
ANA___39.0____1.8_____37.6___ 1.4___39.0
FLA___32.7____0.2_____32.6___ 0.2___32.8
CAR___39.2____1.8_____37.8___ 1.5___39.2
CAL___33.2____0.3_____33.0___ 0.3___33.3
TBL___28.9____0.0_____28.9
EDM___30.9____0.0_____30.9
PHX___44.3____4.2_____41.6___ 2.8___44.4

Option 1: Total taxs are 98.9 million. This is divided 16 ways for each team getting 6.2 million. The average team payroll is 41 million down a little over 3% from today.
Option 2: is the same expect the deflation is about 7% instead of 3%.

I figure that this is the deflation that you could realistic expect using your CBA although these are very rough calculations and admitedly could be way off.

just as an add on.
Option 3: Uses twice the amount teams reduce their payroll by in option 1 (I see it as the best possible senario for ownership, that teams that spent the money look at the tax and decide to avoid a heavy tax at all costs. I'd rate this option as very unlikely but possible).

Today In 3-5 years
____ Payroll __Tax ___ Payroll__ Tax __ Total
DET___68.0___24.0_____44.0___4.0___48.0
PHI___56.0___12.0_____43.4___3.7___47.1
TOR___54.3___10.7_____42.1___3.1___45.2
MIN___20.5____0.0_____20.5___
LAK___43.3____3.7_____38.5___1.6___40.1
NJD___52.4____4.4_____41.6___2.8___52.5
NYR___69.2___25.2_____44.0___4.0___48.0
STL___63.1___19.1_____43.3___3.7___47.0
CLM___28.2____0.0_____28.2
BOS___37.3____1.3_____35.1___0.8___35.9
MTL___48.6____6.5_____40.2___2.1___40.3
COL___60.7___16.7_____42.9___3.5___46.4
VAN___31.8____0.0_____31.8___
DAL___61.7___17.7_____43.1___3.6___46.7
CHI___44.5____4.3_____38.9___1.7___40.6
PIT___31.2____0.0_____31.2
OTT___30.3____0.0_____30.3
SJS___47.8____5.9_____40.0___2.0___42.0
WAS___50.7____8.0_____40.9___2.5___43.4
NYI___41.7____2.9_____37.3___1.3___38.6
NAS___25.2____0.0_____25.2
ATL___25.9____0.0_____25.9
BUF___31.1____0.0_____31.1
ANA___39.0____1.8_____36.2___1.1___37.3
FLA___32.7____0.2_____32.5___0.1___32.6
CAR___39.2____1.8_____36.4___1.1___37.5
CAL___33.2____0.3_____32.8___0.2___33.0
TBL___28.9____0.0_____28.9
EDM___30.9____0.0_____30.9
PHX___44.3____4.2_____38.9___1.7___40.6

Option 3: Total taxs are 44.6 million. This is divided 18 ways for each team getting 2.5 million. The average team payroll is 36.6 million down 14% from today.

I'd say option 3 is as likely as the weak teams spending all their tax benifit money on payroll meaning 0% deflation.

So with this CBA I'd expect 6-7% deflation after making moderately reasonable assumption of what teams would do. So I think I'll stand by the idea that this would not be deflationary enough for me as an owner and call it a minor victory for the PA.

Again just my opinion.

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Old
10-30-2003, 03:56 PM
  #19
Emule Richard
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Quote:
Originally Posted by GoCoyotes
The current CBA dictates a 2/3 buyout if a player is willing to accept it. I think that is the bare minimum a contract can be bought out for.

LetGoPens.com has a copy of the current CBA.

I'd say the 2/3 buyout is fair, because keep in mind that if they owners want to sign these deals, they should be responsible for them. It's not the players fault for taking the deals, and they should be honored for the most part.
Yea, the minimum buyout is 2/3, and I think it's fair. That's a major reason I don't want to see a hard cap; it would be extremely difficult for the teams to maintain a hard cap without being able to release players outright (and thus have a buyout of 0). I don't think you'd be very happy if you signed a 3 year contract and planned your future financially based on that, and then you were let go a year later because in your first year you broke your leg and couldn't walk into work as well as you could when you signed the contract. That said, player contract certainty for the NHLPA is equally, if not more important than cost certainty is for the owners. We're comparing individuals' lives to teams' expenses, and I think that a player, if he signs a contract, should be certain that he'll get at least a majority of the compensation from that contract, regardless of other circumstances.

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10-30-2003, 09:32 PM
  #20
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I am just a little curious, are you going to try to put in a change in the RFA signing compensation levels, as I have seen no mention of it (maybe it is slightly out of the scope as it is less about financials), I think they may lower the compensation, as it is rare for a player to be signed to an offer sheet, but what do you guys think?

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10-31-2003, 03:33 AM
  #21
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Quote:
Originally Posted by steveburfoot
I am just a little curious, are you going to try to put in a change in the RFA signing compensation levels, as I have seen no mention of it (maybe it is slightly out of the scope as it is less about financials), I think they may lower the compensation, as it is rare for a player to be signed to an offer sheet, but what do you guys think?
Personally, the biggest reason why we haven't seen RFA signings is the matching rights, not the compensation (although it is a very heavy price to pay).

If I was trying to increase the number of RFA signings, I would make it so that teams can only match contracts that are less 125% of their most recent offer. Therefore, if the Sens offer Hossa $6 million a season on his contract, and someone else comes in and offers $7.6 million a season, then the Sens would not have the right to match. They would still be entitled to the draft pick compensation though.

However, I'm not looking to change this portion of the CBA, as I think it's fine as it is. I've proposed lowering the UFA rate age down, so that's sufficient, IMO.

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Old
11-01-2003, 07:19 PM
  #22
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Looks pretty ok. There are things I don't agree with though.

For the requirements I would like to see a sum attatched to each. Hit one and you get 1/5 of the money, hit 2 and get 2/5 of the money. An all-or-nothing approch won't fly. The owners would never go for that. They want cost certainty, and the other side of the coin is that they want income certainty. Having the whole bonus rest on a single game 7 is not something they would like very much.

I would probably make the Bird-clause more appealing. how about 60% 5-8 years, 50% 9+ years. It would make more sense since I suspect older players will have higher contracts overall.

Remove the qualifying for Olympics thingy. These guys are NHL players. If there is a game for their team in the NHL they shouldn't be off doing something else.

Buying out. I would have it at 90% for contracts under 1 million/year, 75% for contracts under 2 million/year, 70% for contracts under 3 million, 65% for contracts under 4 million, 60% for contracts 4 million or higher.

Things that need to be adressed.

Minimum wage
Two-way contracts
Offers for RFA

All of these can of course be unchanged. But at least for the latter it is clear that the current system is broken. I want to have rules that encourage offers for RFAs, making it a valid thing to do as a GM. And the current penalty of up to 5 first round picks is way too steep. A maximum of two first rounders seems more reasonable to me.

As for the actual taxrates it is possible that it has to have some adjustments. You would definately have to have some adjustment for inflation in there if this is supposed to be a long run CBA. It is also possible that there has to be some rules for canadian teams since we have two different currencies at play here.

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Old
11-03-2003, 06:32 AM
  #23
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Here's my input:

1) Keep the UFA age where it is or as close as possible to where it is. I can live with a much softer cap and a higher max. (For some teams, a cap and lower UFA age is a win-win situation; so where is the pain? Find something else to trade off for a cap. Salary arbitration is doing a wonderful job of increasing salaries, the players don't need to rush off everywhere across North America as free agents like they do in baseball. If the UFA age is lowered, then some teams who lose players should get compensation at the draft.)

2) The Sinden rule: start paying salaries on the first day of training camp instead of the first day of the regular season.

3) No contracts over 3 years in duration.

4) System allowing player salary to be lowered without losing the player if that player has not performed at the proper level. System must also be fair to the player....(only for bargaining on NEW contracts) (perhaps only for players with less than 5 years seniority)

4) Creation of a new health and safety committee with teeth.

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11-05-2003, 06:21 PM
  #24
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I'd like to add something: the players wouldn't like it much. So, here's what you do to help the players accept a salary cap:

-Increase the minimum salary at least 25%: This may seem like your giving them too much, but actually it works to the owners advantage. This will either pusht he bottom feeders out of the league faster (i.e., Carolina's Jeff Daniels) and it will cause owners not to spend so much money on higher end players. Don't want to go over the cap.
-Two-way contracts for all players with less than 240 games played in the NHL: This will cause players with no business in the NHL easily moved out of the NHL. This definitely helps with my next idea...
-Players with two-way contracts and above the age of 23 can refuse assignments, but their contracts will become non-guaranteed: Therefore, they will be waived and become restricted free-agents. It's a way for a player to get out of a contract and gamble for a new contract. Emphasis on gamble.
-UFA's for players with at least 600 games of NHL service but their salary isn't within 25% of the league average: Only players who qualify for this will be a bunch of checkers and busts. Helps some teams get rid of these guys easier.
-All players eligible for UFA after 800 games of NHL service:With this suggestion, the 31 year old age crap has to go. Players would definitely like this one better. Correction, if a player is 31 years old and has less than 800 games of NHL service, then he should be eligible for UFA. Course, this sort of player probably doesn't deserve to be in the NHL if he gets past the "600/25%" proposal above. Then again, some players like Carolina's Nic Wallin (entered the NHL at age 24) will probably not even have 600 games of NHL experience by this point.

Some of these proposals will definitely keep some GM's from rushing players to the NHL, too.

It's sounds dumb, but I did this just for fun

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