Cap Questions

Discussion in 'Fugu's Business of Hockey Forum' started by CarolinaCapsFan, Aug 7, 2005.

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  1. CarolinaCapsFan

    CarolinaCapsFan Registered User

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    How do bonuses affect the Salary Cap?

    In the case of a rookie at the rookie max salary (about 1 million and an additional 2 million in bonuses). Does this player take up one million or three million in cap space? The bonus thresholds won't be met til season's end so would logic dictate that the layer would only take up 1 million in capo space?

    Also, does the cap equate to total team payroll or total amount of money actually paid out? For example, a team is two million shy of the cap and trades for a player on the last year of his contract at the trade deadline. The yearly salary of the player is 5 million but he will only be paid 1 million in actual dollars by his new club (the first club has already paid 4 million out through the season). Is this club over the cap or no?
     
  2. kdb209

    kdb209 Registered User

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    Someone else here (gscarpenter?) stated, based on an interveiw with an agent familiar with the CBA, that for ELS contracts all potential bonuses (except those ones paid by the league) count against the cap in the current year. For veteran or IR players on 1 yr deals (like Allison), the bonuses only count against the cap as they are earned - ie Allison gets goal #30, the Leafs may have to trade/cut a player. So in your case of a rookie, there would be a $3M hit against the cap. That probably goes a long way towards explaining why Bobby Clarke did not offer Richards or Carter any bonuses in their max salary rookie deals.

    The cap is based on total team payroll at any point in time, not the total actually paid out, so in your example the new team has a cap liability of all $5M, not just the $1M remaining. Thre was some speculation before the deal (including from the respected Bob McKenzie here) that the cap would be based on total paid, but from everything I've seen after the agreement, that is not the case - and the CBA FAQ seems pretty clear on that point.
     
  3. GSC2k2*

    GSC2k2* Guest

    Yep, that was me.

    Mind you, both Ken Campbell and Strachan have bandied around the notion that the team can spend up to 10% over the cap on such bonuses. However, since most sports writers have a brain the size of a pea, I will wait for confirmation from a sentient life form.
     
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