Again I think the RFA term is too long and could be reduced in exchange for better buyout provisions for teams stuck with players who cannot/do not live up to their salaries.
Potential CBA negotiation issues (was: Is a lockout actually inevitable?)
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I would imagine that would be something the players would accept. It likely impacts those guys in their 30’s, so they should have made good money by that time. Right now it’s 2/3 of the salary if over 26 and 1/3 for those under. Could see that claw back to include signing bonus as well as a reduction to 50% or lower of the value of the contract.
For the owners, it’s likely about money issues that impact the quality of their team.
Buyout helps them have a better team as they aren’t wasting cap space on someone who is not performing.
Does shorter contracts help them in that regard as well? IMO, more it’s more on the GMs to not sign guys into their mid to late 30’s at big money. How quickly that Little doesn’t seem worth his contract? It was in effect for 1 year and jets fans want an upgrade.
Do teams want a limit on SB as a percentage of contract?
The have teams like being able to front load contracts as they are able to unload them later to the cap floor teams.
The pie is only so large for the players. Like a lion pride, who gets to eat the most?
Ernie
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Tom ServoMST3K
In search of a Steinbach Hero
I'd like to see RFA years go down a bit, or at the very least expand arbitration rights to more players.
But that should be an issue not worth opting out of a CBA for.
I have not seen any buzz from players about that though. Only about escrow.
But that should be an issue not worth opting out of a CBA for.
I have not seen any buzz from players about that though. Only about escrow.
BattleBorn
50% to winning as many division titles as Toronto
Which is crazy to me since the players control escrow.
Want to get rid of it for the most part? Stop voting to use the escalator out of some loyalty to your fellow player. Run it like a business.
This is what I totally don't understand, either. The escrow 'penalty' to the players exists for one reason: The cap is too high.
What we know about this is:
The players are at least partly responsible for that.
The players don't have all the information, because Toews et all are accusing the owners of not doing enough to 'grow revenues to make up for the higher cap.' That, of course, doesn't make sense, since the owners would do all they could, since 50% of it ends up in their own pockets.
And, finally, Fehr has made noise on various occasions that MLB is the most well-founded league (no labor strife, etc...) and it has no Cap.
Which may indicate to me that Fehr wants to somehow eliminate the cap, and escrow is the issue he wants to use to open that discussion.
As we have seen, however, that has ZERO chance of happening because it would do two things:
Make the haves much less profitable.
Kill the have nots.
So, idk where this goes...
Unless the HAVE owners value winning more than profits, I don't see the owners getting off the Cap.
So, from their POV, as long as the split is fair to them, they shouldn't be considered about which players get paid the most.
Whether teams opt to pay their 24 year olds like McKinnon, Scheiffle, Gaudreau, etc. the most or they opt to 30 somethings the most should not matter to the owners.
Main issue for the owners would be to get the most bang for their buck. So, if I was an owner, so long as the cap system is in place, I'd be looking to reduce buyout rates and possibly cut down on term on contracts (mainly eyeing contracts to 30 year olds that take them to 36/37). If I make a mistake, I want to fix it and spend that money on someone else who can perform to the contract.
Tom ServoMST3K
In search of a Steinbach Hero
My assumption at thos point is players have no idea what escrow is or how it works.
Crede777
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The one problem I can see with this is that the NHLPA is disproportionately run by older players.
LadyStanley
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Ted Hoffman
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That's not the problem. The escalator needs to be there to account for future growth in some way; otherwise if everything else were set correctly then the players would be getting underpaid for the next year's revenues. They don't want to wait to get their money, and the owners don't want to be cutting a check to the players at the end of each league year. (How to estimate that escalator is an open question, and beyond the scope of my post and your point - which I'm reading as "controlling escrow.")
If the players want to be paid "full dollar" for their contracts, they have to minimize escrow. The easiest way to do that is to lower the midpoint in the calculations of the cap such that once teams inevitably overpay for player salaries (which they always do, and will always do), that payment in aggregate is the specified percentage of league revenues (which I'll presume will remain at 50%). By continually setting the midpoint at 50% of league revenues (after all adjustments), you guarantee the owners will overpay that point and you guarantee the players will always have to pay into escrow unless growth in league revenues outpaces the escalator by at least a few percentage points.
Where is that point? My guess is that it needs to be more like 45% of league revenues, but it depends on how you're spreading the Upper Limit and Lower Limit and how teams are overspending with respect to the midpoint (and how that would look with an adjusted midpoint and any adjustments to spread between Upper/Lower Limit).
The NHLPA won't want to hear "move the midpoint lower" because it will get this stupid idea that it's taking money out of the pockets of the players in aggregate, but math is math.
Effectively, Irish, you are saying the cap must be lower. Correct?
If so, it doesn't matter how you do it. My understanding of the escalator is that BEFORE any escalator is considered, the league already does an estimate of next year's HRR. Then, the escalator is used according to PA's preference. Effectively, the escalator raises things TOO MUCH. This is the same concept as lowering the cap midpoint.
Also possible would be something like this:
Use a 5-year running average to guess the amount that league wide HRR will increase.
Use a 5-yr running average to guess the amount of cap space that goes unused.
With those 2 numbers, set your CAP CEILING.
This is will be very close, so increase by, say, 2%.
Voila.....Very much less escrow.
Point being....
The bottom line problem is the cap ceiling is too high.
Want another way? Do everything as now, but make the ceiling be midpoint +10% rather than 15%.
Many answers. But the PA is unlikely to like any of them, because they all do the same thing: Lower the cap ceiling. That means lower contracts for new FAs. PA won't like that.
And players are trying to get off from being properly punished. Sorry but i have no respect for players that won't take personal responsibility for their decisions that let them to being suspended in the first place.
And always i am 100% against the sports unions for that very reason. They only care for those that get suspended not those that get hurt caused by another player.
I agree with a tweet response saying the NHLPA should been sued instead of the NHL.
LeHab
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Base cap midpoint is set based on previous season HRR and not projections. Players can then elect to implement the escalator.
While I believe you are right, LeHab, can you reference the appropriate part of the CBA?
Thanks.
If you are correct, then they need to implement my idea of a 5- year running average of HRR growth as an estimate of next year's HRR. It would be a better starting point.
In any case, the end conclusion still applies:
The Cap ceiling being too high is the ONLY reason for escrow being high. But, while the players dislike escrow, they would also dislike a lower ceiling....
LadyStanley
Registered User
As the "final" HRR for a season isn't known/finalized until at least October, they are using projections based on the just completed season to set the cap in June.
mouser
Business of Hockey
It's in CBA 50.5(b)
They use Preliminary HRR from the prior season to set the cap in June. Which should ideally be close to the Actual HRR numbers typically finalized in October, after audits have been done and the PA has the opportunity to challenge certain components. The CBA does include a mechanism where if the Preliminary and Actual HRR numbers are so far off that it would result in an increase or decrease of $5m+ to the cap midpoint then the cap would be changed mid-season to reflect the Actual HRR figures.
LeHab
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Here is the formula:
LadyStanley precision is right that it is not a final number but preliminary HRR however still concerns projections of last season. There is potential for exception as stated above if a one-time large swing in revenues is expected (exception to growth factor % which I assume is the escalator?).
Last edited:
Ted Hoffman
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Correct.
Yes, and no. If teams in aggregate are spending 10% above the midpoint after applying a 5% escalator, removing the escalator factor still means teams in aggregate will be overspending the lower midpoint. [It won't be a 5% reduction, it might be a point or two.] It won't be as much as with the escalator in place, but the players will still have to pay escrow.
That's why I go back to how the midpoint is set. You want that set so that you apply the escalator and teams overspend the midpoint, in aggregate they're spending about 50% of revenues on player salaries. [Same stipulations on "50%" as my earlier post.] That piece is the easiest to work with to get escrow neutral. If the escalator is off, it's likely to be off by only a point or two [unless someone uses unrealistic assumptions; more on that some other time]. If the midpoint is set so that everyone is just going to overspend it by 10%, then a 10% escrow is already baked into the cake and the escalator aggravates things a little more; at that point, the players are hoping the escalator is way too low and revenues grow by even more than projected. [Which might happen, but it's unlikely to be wildly off to the point it offsets teams having already overspent the midpoint.]
If I have the time, I might mock up an example for this. That might help illustrate things better. [Might even dig out the old workbook I threw out years ago to illustrate the fallacy of teams "being above average in league revenues" and how that leads to instability in the absence of revenue sharing.]
Irish,
I think I am following you well.
Say, as a nice, neat example, that last year's preliminary HRR league wide was 4B (minus 5%). Now, the new year cap ceiling (apparently, I haven't taken time to wade all way through the CBA) is set by 4 calculations:
1- Add 5% (which brings to exactly 4B) - and this number is chosen by the CBA as a sort of 'guess' or 'average' of how much HRR increases each year - so this is good.
2- Take 50% of that for players' salaries and divide by the number of teams (I assume when adding an expansion team that the first year they simply calculate off of the prior year's numbers and assume the lower number of teams - but that's just a fine point - we're dealing generally here).
3- The number from "2" is the midpoint.
4 - Cap and floor are 15% up and down from there.
Clearly this technique suffers from the following potential problems:
1- the 5% number may not be accurate.
2- More teams are going to spend close to the cap than close to the floor.
So, if escrow losses for players are 'too high' (and, what % is too high is a matter of choice, of course), then that is a result of BOTH of the 2 factors listed. And, Massaging the escalator may not be sufficient to rectify the situation.
I'd like to suggest a couple of things here:
First: The way the system is designed is clearly in error. That's surprising on the surface because everyone in the room when the CBA was negotiated SHOULD HAVE realized that more teams would spend to the cap than the floor. So, the first thing we need to address is "How did we get this system?" And, I believe that the answer would be: The players were already seeing their salaries reduced because the %age of HRR going to the players was going from 57 to 50. In order to massage that, I believe that no one in the room had the courage to point out that salaries would actually decrease MORE than they thought, because of the effects we are discussing. Owners would keep quiet about that. Players, if they knew it, might have wanted a higher number on their salary, etc.....
Second: The real solution to this is to choose the cap ceiling, rather the midpoint, with math. Like so:
Choose your estimate of HRR as above (or in some other way...my favorite is a 5-year average of %age growth, rather than a fixed number. Of course, you operate on a per team basis to account for expansion).
Then, you take a 5-year average of how much %age of cap ceiling money was actually spent on players' salaries. This will be 90% or some such number.
Then, you take the HRR/team (times 50%, or course), and divide by the 90% (thus raising the number). That number is the CAP CEILING for the new year. If teams spend as much that year as they do ON AVERAGE in the years prior, you hit exactly on the forecast. Perfect. No escrow losses at all.
Then, you put your floor lower by the proper %age to make the range exactly what it is now.
Done.
I think I am following you well.
Say, as a nice, neat example, that last year's preliminary HRR league wide was 4B (minus 5%). Now, the new year cap ceiling (apparently, I haven't taken time to wade all way through the CBA) is set by 4 calculations:
1- Add 5% (which brings to exactly 4B) - and this number is chosen by the CBA as a sort of 'guess' or 'average' of how much HRR increases each year - so this is good.
2- Take 50% of that for players' salaries and divide by the number of teams (I assume when adding an expansion team that the first year they simply calculate off of the prior year's numbers and assume the lower number of teams - but that's just a fine point - we're dealing generally here).
3- The number from "2" is the midpoint.
4 - Cap and floor are 15% up and down from there.
Clearly this technique suffers from the following potential problems:
1- the 5% number may not be accurate.
2- More teams are going to spend close to the cap than close to the floor.
So, if escrow losses for players are 'too high' (and, what % is too high is a matter of choice, of course), then that is a result of BOTH of the 2 factors listed. And, Massaging the escalator may not be sufficient to rectify the situation.
I'd like to suggest a couple of things here:
First: The way the system is designed is clearly in error. That's surprising on the surface because everyone in the room when the CBA was negotiated SHOULD HAVE realized that more teams would spend to the cap than the floor. So, the first thing we need to address is "How did we get this system?" And, I believe that the answer would be: The players were already seeing their salaries reduced because the %age of HRR going to the players was going from 57 to 50. In order to massage that, I believe that no one in the room had the courage to point out that salaries would actually decrease MORE than they thought, because of the effects we are discussing. Owners would keep quiet about that. Players, if they knew it, might have wanted a higher number on their salary, etc.....
Second: The real solution to this is to choose the cap ceiling, rather the midpoint, with math. Like so:
Choose your estimate of HRR as above (or in some other way...my favorite is a 5-year average of %age growth, rather than a fixed number. Of course, you operate on a per team basis to account for expansion).
Then, you take a 5-year average of how much %age of cap ceiling money was actually spent on players' salaries. This will be 90% or some such number.
Then, you take the HRR/team (times 50%, or course), and divide by the 90% (thus raising the number). That number is the CAP CEILING for the new year. If teams spend as much that year as they do ON AVERAGE in the years prior, you hit exactly on the forecast. Perfect. No escrow losses at all.
Then, you put your floor lower by the proper %age to make the range exactly what it is now.
Done.
I'm a little unclear on this. It seems to me that, in the absence of Rev Sharing, the following will happen:
More teams will be under the average revenue than above it, simply because some markets allow TWICE the average to be brought in while NO markets will bring in ZERO. Another way to say this is that: there is far more room ABOVE the average than below it.
Then, in the present arrangement, where each team has to spend a %age of league-wide HRR on players (the %age is found by: HRR*50%/#ofteams), then, in order to lose the same amount of $$ next year, those teams whose revenue was below average last year have to increase their own revenues dollar-for-dollar with the high revenue clubs.
Since they are probably not able to do so, the lower revenue clubs will be more behind the next year. And, so on....
LadyStanley
Registered User
31 Thoughts: Bettman has ‘no interest’ in NHL playoff expansion - Sportsnet.ca
Friedman with words from Bettman on potential lockout
World Cup 2020 and new expansion team Seattle could start playing in 2020. Labor peace (and "on time" arena renovations) required for those to happen.
Friedman with words from Bettman on potential lockout
World Cup 2020 and new expansion team Seattle could start playing in 2020. Labor peace (and "on time" arena renovations) required for those to happen.
Ted Hoffman
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Exactly. This came up in terms of relocation [which is way off-topic for this thread] and revenue sharing ("there shouldn't be any") the "simple" solution of "just move teams to [highly desired location]." If it ever comes up again (and I'm sure eventually it will), then I'll get into it.
LadyStanley
Registered User
Dreger on NHL Overtime (NBCSN) mentioned that players may be pushing to change arbitration (remove commissioner from procedure entirely). And the league isn't happy that the last three suspensions have all been reduced by arbitrator.
Ted Hoffman
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That's why independent arbitrator Shyam Das shouldn't be surprised when the NHL moves to dismiss him the first chance they get.
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