NHLPA: 11-12 cap ~$62M; late May Daly: ~$63.5M cap;

[Brent Burns Beard]

Simple

We no longer have NYR/Det having a payroll 4 times the size of small market teams who they used as basically minor league restock stealing all there up and coming young talent they couldn't afford

Also the league is much stronger financially and competitively

The league has cost certainty

id be interested in even one single example where NYR or DET stole a young and upcoming talent?

shouldnt it be of epidemic proporations for it to be worth shutting the whole thing down? yet, you wont find one example.

the biggest spenders were NYR, PHI and TOR and with 1 cup in 30 years between them, I am not going out on a limb by saying that spending on UFA did not equal winning the cup. DET had a big payroll because GASP, they drafted and developed world class players. who knew that good players would cost alot?

the owners lockout was because teams like NYR, TOR and PHI could make MORE money and finally be able to compete with teams like ANA, TBY, CRL, COL and NJD. All with more cup appearances individually then the big spenders in PHI, TOR and NYR could manage collectivly.

Yup, damn those big markets and their buying cups! worked pretty much never!

 

[Fugu]

Call me crazy - but the way I understand it league revenues have increased by more than 50% since the lockout ($39+M cap limit first year under new CBA to projected $62M next year). The players get more as the league wide revenues increase.

No, HRR has gone up from a starting point of $2.1-2.2 billion, depending on what was counted pre-lockout to the current $2.8ish billion-- inclusive of the improvement in the CAD over prelockout figures.

The cap ceiling of course has gone up far more than that, thanks in part to the sliding formula of player share ranging from 54% at the $2.1 billion mark, to 57% for anything over $2.7 billion.

The cap midpoint has risen 75% from $31MM for Yr 1 post lockout to the new [potentially] $56MM if this new figure holds up.

The real problem with the salary cap is the HUGE discrepency between the individual teams revenue streams. That has nothing to do with the salary cap, and has everything to do with revenue sharing.

Well, no, you're mixing the causes of the problem with what you believe to be the solution. The cause of this problem has always been the revenue disparity. The NHL's brilliant solution was to lump in everyone's HRR into one big pot and base a cap range off of that figure. I guess they never considered mathematical weighing, and/or what would happen if the stronger teams outgrew the weaker ones in real dollars.

This also highlights that the NHL still has the majority of its revenue coming from the local teams. In order to fix this particular problem with even greater revenue transfer directly from the have's to the have not's, one must consider what effect that would have on franchise values. If your team is "taxed" of say 30% of its revenue for the noblesse oblige, does that not erode your franchise value? The only way that it does not is if the ultimate ROI will be far greater. Well, since no one knows if the league will ever gain a $3 billion TV contract, and owners turn over about every decade for many teams... what's the possible motivation here?

 

[Fourier]

I was hoping you'd show up since you have the ratios handy. Otherwise I might actually have to calculate things for myself again.


So roughly 3.3-3.5%-ish of real growth. Your earlier entry on this topic, for reference:



Here's last year's thread:
http://hfboards.com/showthread.php?t=691083

I was trying to find the discussion by Daly about total growth, and portion attributable to the CAD for last season.

I am going to suggest that the 1 cent increase in the $CDN now means somewhere in the $9-9.5M in additional revenues. My guess is that Canadian organic growth has outstripped the growth in the US on a per team basis so the relative size of the revenue pool in $CDN has likley risen somewhat.

By the way I have been predictiing a $62.4M cap for a while so maybe it is time to go out and buy a lottery ticket. My luck can't last that long.

 

[Fugu]

I am going to suggest that the 1 cent increase in the $CDN now means somewhere in the $9-9.5M in additional revenues. My guess is that Canadian organic growth has outstripped the growth in the US on a per team basis so the relative size of the revenue pool in $CDN has likley risen somewhat.

By the way I have been predictiing a $62.4M cap for a while so maybe it is time to go out and buy a lottery ticket. My luck can't last that long.

You would get no argument from me. Buy a ticket for me while you're at it.

 

[Hamilton Tigers]

It's the avg annual rate from 1st Jul to 30 jun. Too lazy to look it up but I think last year was roughly .9 or .94-ish.

Good memory. About .949

This year ( 9 1/3 months so far) .992

http://www.x-rates.com/d/USD/CAD/hist2010.html

Canadian dollar appreciated 4% over last year's average.

 

[Hawkscap]

http://puckthemedia.wordpress.com/2011/04/19/live-updates-on-the-nhl-nbc-call/

The League for the 2010-11 season is on pace to once again set a record for total revenue despite the challenging economy, surpassing $2.9 billion overall.

Does this number ($2.9 bil rev) fall in line with a $62 mil cap? My back of the envelope calculation say $63 mil.

 

[BigFatCat999]

http://puckthemedia.wordpress.com/2011/04/19/live-updates-on-the-nhl-nbc-call/



Does this number ($2.9 bil rev) fall in line with a $62 mil cap? My back of the envelope calculation say $63 mil.

Also does this include the new TV deal?

 

[Hawkscap]

The new TV deal will affect the 12-13 cap. I am waiting to hear from some of the cap gurus here if the escalator could go up above 5% due to the clause of a significant jump in revenues. I posted the exact CBA clause in the beginning of the New TV deal thread.

 

[Fugu]

The new TV deal will affect the 12-13 cap. I am waiting to hear from some of the cap gurus here if the escalator could go up above 5% due to the clause of a significant jump in revenues. I posted the exact CBA clause in the beginning of the New TV deal thread.

The escalator is something that the two parties can agree to set wherever they like. The default is 5%, but the parties can agree to lower it or exclude it completely... or go over 5%.

Thus the current year's revenues (this season) are used as the basis for next year's cap. If the current revenues are $2.9 billion then the cap for next year will be that figure +/- the escalator. NEXT season's actual HRR will include the $200MM as actual revenues. The two sides can choose to account for that in the escalator if they agree-- needs to be mutual.

Edit: Here's the relevant section, Art 50.5 (b)

(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 scheduled 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.

 

[Fourier]

The new TV deal will affect the 12-13 cap. I am waiting to hear from some of the cap gurus here if the escalator could go up above 5% due to the clause of a significant jump in revenues. I posted the exact CBA clause in the beginning of the New TV deal thread.

Are you talking about for this coming year or for next? For this year there shpould be no effect becauseas you say the new revenue stream does not come on until the following year.

However, if the current CBA is still in place I could see a cap of $68M+ in 2012-2013 given the new money and the higer dollar.

 

[MountainHawk]

The NHL and NHLPA can opt to raise the escalator to say 8%, and push the cap up more to account for the new revenue.

 

[MaskedSonja]

Are you talking about for this coming year or for next? For this year there shpould be no effect becauseas you say the new revenue stream does not come on until the following year.

However, if the current CBA is still in place I could see a cap of $68M+ in 2012-2013 given the new money and the higer dollar.

So that would a cap floor of....52 Million? (16 mil dif between floor and ceiling)

High Spending teams are like "High Five!"

Floor teams are like "Excuse me?"

In all seriousness, I would have to think that in the next CBA we see SOME change in the formula for Ceiling/Floor-what I have no idea, but again, I really see this as being a big issue in the next CBA between "have" and "have not" markets.

So, at this continued rate of growth (HYPOTHETICALLY of course), how long until we hit 100M Cap Ceiling with 84 M cap floor? Within the next decade?

 

[Fourier]

The NHL and NHLPA can opt to raise the escalator to say 8%, and push the cap up more to account for the new revenue.

Why do this now if the revenue stream does not come in next year. You are just making things more lucrative for this years FA class at the expense of additional escrow for the masses.

 

[MaskedSonja]

Why do this now if the revenue stream does not come in next year. You are just making things more lucrative for this years FA class at the expense of additional escrow for the masses.

Call the NBA effect

Well, your point would certainly test how unified the NHLPA is, do the players now say "give me what I can get, nuts to the next ones?" or do they take that point into consideration?

I think it depends on whether the NHLPA thinks the gravy train is going to keep going, and ride on the idea "the cap is never going to go down".

Unfortunately, I do a "getting while getting is good" mentality, though I HOPE I am wrong...

 

[MountainHawk]

Why do this now if the revenue stream does not come in next year. You are just making things more lucrative for this years FA class at the expense of additional escrow for the masses.

There is no reason for the NHLPA to do it necessarily, since the escrow will ensure they get 57% of the revenue next year anyway. [Question: If by some miracle the players with 0% escrow came up short, do the owners issue "bonus checks"?]

However, they may want to do so to push everyone's cap up an additional $2M or so, and therefore keep free agent salaries increasing.

 

[Fourier]

There is no reason for the NHLPA to do it necessarily, since the escrow will ensure they get 57% of the revenue next year anyway. [Question: If by some miracle the players with 0% escrow came up short, do the owners issue "bonus checks"?]

However, they may want to do so to push everyone's cap up an additional $2M or so, and therefore keep free agent salaries increasing.

The problem though is that the only players who benifit from this decision would be this FA class. Their windfall would come on the backs of all other players in the league.

And the answer to your question is yes, the owners would have to issue bonus cheques.

 

[Fourier]

Call the NBA effect

Well, your point would certainly test how unified the NHLPA is, do the players now say "give me what I can get, nuts to the next ones?" or do they take that point into consideration?

I think it depends on whether the NHLPA thinks the gravy train is going to keep going, and ride on the idea "the cap is never going to go down".

Unfortunately, I do a "getting while getting is good" mentality, though I HOPE I am wrong...

The NHLPA already voted to have the masses take the hit for the unfortunate when they kept the 5% escalator in place in the face of potentially falling revenues. This was the exact opposite scenario from what we are talking about here. Becuase without this action one FA class would have taken a huge potential hit.

The NHLPA can not force revenue growth to be linear. But I see no reason why they should act to exaggerate any difference that might exist across FA classes.

 

[Hawkscap]

Daly: 2011-12 Cap Range $60.5M to $63.5M

SBJLizMullen Liz Mullen
#NHL Dep Commish Bill Daly: "It appears our salary cap will be going up." Projects new cap will be $60.5M to $63.5M, up from $59.4M this yr.

Range due to escalator being used or not?

 

[LadyStanley]

So up from NHLPA estimate of $62.2m max.

And yes, I'm guessing that's with the escalator. With no bonus cushion next year, I'd guess the NHLPA won't even consider NOT putting in escalator.


Will be interesting to see if something greater that 5% is used due to the increased $$ from US TV contract.

 

[C77]

This is interesting.

Which teams are capable/willing to spend to $62-63 million?

 

[Hawkscap]

Blackhawks, Flyers Caps ...

 

[Goalie_Bob]

Pens

 

[jkrdevil]

Blackhawks, Flyers Caps ...

Devils...

 

[C77]

Yea I think those teams....also Toronto, Montreal and Boston if necessary.

 

[Fugu]

Detroit. Come on...