Puckpedia agent poll. CBA changes wanted, tough GM negotiations, etc.

[LadyStanley]

Off to do some reading...

Click to read more...

 

[Fourier]

In response to the question: If you could change one aspect of the CBA (other than the 50% share) what would it be...

14% No escrow.

Does anyone else see the irony in this response???

 

[Kranix]

Boy Genius got 29% of the vote on who to get a great deal from, haha

 

[Ernie]

I actually can understand the escrow thing. After taxes and escrow, players take home about a 1/3rd of their salary. That $10m/year contract is actually more like $3.5m.

 

[Jumptheshark]

curious how the GMS feel about this and what agent (my guess his first name is Alan) is the hardest to deal with

 

[WeaponOfChoice]

In response to the question: If you could change one aspect of the CBA (other than the 50% share) what would it be...

14% No escrow.

Does anyone else see the irony in this response???

Just make the cap 50% of HRR and there's no escrow.

 

[Fourier]

Just make the cap 50% of HRR and there's no escrow.

Unless you have a crystal ball that is not so easy to do since the cap has to be set a year before you know what HHR is going to be.

 

[royals119]

Just make the cap 50% of HRR and there's no escrow.

How would that work? The reason for escrow is to allow the cap to be 50% of HRR for the current season. Of course no one knows exactly what the HRR will be for the season until it is over, so they hold a little money aside and adjust and the end to make it 50%.

Are you proposing to set the cap for the season based on the previous season's HRR and not allow any changes if revenue is up or dows? Or are you proposing the players get paid their full contract and then they have to give back money at the end of the season if they got more than 50% (and their contracts almost always add up to more than 50% of HRR, so that would always happen) - or every contract is for a percentage of the cap with paychecks at the end of the year, pro-rated for games played?
There has to be some method to account for the fact that you don't know what HRR will be until the season is over.

 

[WeaponOfChoice]

How would that work? The reason for escrow is to allow the cap to be 50% of HRR for the current season. Of course no one knows exactly what the HRR will be for the season until it is over, so they hold a little money aside and adjust and the end to make it 50%.

Are you proposing to set the cap for the season based on the previous season's HRR and not allow any changes if revenue is up or dows? Or are you proposing the players get paid their full contract and then they have to give back money at the end of the season if they got more than 50% (and their contracts almost always add up to more than 50% of HRR, so that would always happen) - or every contract is for a percentage of the cap with paychecks at the end of the year, pro-rated for games played?
There has to be some method to account for the fact that you don't know what HRR will be until the season is over.

Base the cap on 50% of last season's HRR. If revenue is up, give the players more money. Make players' cap number a percentage instead of an actual number.

 

[Noldo]

How would that work? The reason for escrow is to allow the cap to be 50% of HRR for the current season. Of course no one knows exactly what the HRR will be for the season until it is over, so they hold a little money aside and adjust and the end to make it 50%.

Just setting the cap, i.e. the upper limit, based on 50% of HRR would eliminate most of the escrow and the remaining difference would be small enough that it could be managed.

We have to remember that in the current system HRR defines the midpoint and cap, as it is in practice seen, exceeds the midpoint by some 12%. And someone is still surprised if the escrow exceeds 10% each year since the teams are by design giving out much more than the players share in contracts.

However, if the cap would be redefined that way, you would have to cut contracts by that same 12% in order to fit them within the new framework. Net money would be same as currently with escrow.

 

[Fourier]

Just setting the cap, i.e. the upper limit, based on 50% of HRR would eliminate most of the escrow and the remaining difference would be small enough that it could be managed.

We have to remember that in the current system HRR defines the midpoint and cap, as it is in practice seen, exceeds the midpoint by some 12%. And someone is still surprised if the escrow exceeds 10% each year since the teams are by design giving out much more than the players share in contracts.

However, if the cap would be redefined that way, you would have to cut contracts by that same 12% in order to fit them within the new framework. Net money would be same as currently with escrow.

This is an excellent post which is really at the heart of the matter. I have argued many times that players and perhaps some of their agents don't seem to get the way the system works. Their nominal salary is not their actual salary but rather a measure of a player's relative piece of the pie. They won't end up with any more money in their pockets in the end nor will they will feel better about it. It's kind of like giving someone a title instead of a raise.

 

[TheWhiskeyThief]

I actually can understand the escrow thing. After taxes and escrow, players take home about a 1/3rd of their salary. That $10m/year contract is actually more like $3.5m.

That’s not even close to being correct, even if they’re getting straight salary playing in Toronto.

Cap Friendly has a widget that shows you how much take home is. The actual numbers are close to double what you guessed.

 

[LeHab]

This is an excellent post which is really at the heart of the matter. I have argued many times that players and perhaps some of their agents don't seem to get the way the system works. Their nominal salary is not their actual salary but rather a measure of a player's relative piece of the pie. They won't end up with any more money in their pockets in the end nor will they will feel better about it. It's kind of like giving someone a title instead of a raise.

Players seem to value the perception of a full paycheck. Owners could redesign cap ceiling (likely over time) where ultimately a player signing under current system 10 millions instead of leaving a million in escrow would sign for 8 millions and receive a million from escrow. In the end the net is the same but if perception matters, I'm sure something can be worked out.

 

[LadyStanley]

Part the third

 

[Tawnos]

Just setting the cap, i.e. the upper limit, based on 50% of HRR would eliminate most of the escrow and the remaining difference would be small enough that it could be managed.

We have to remember that in the current system HRR defines the midpoint and cap, as it is in practice seen, exceeds the midpoint by some 12%. And someone is still surprised if the escrow exceeds 10% each year since the teams are by design giving out much more than the players share in contracts.

However, if the cap would be redefined that way, you would have to cut contracts by that same 12% in order to fit them within the new framework. Net money would be same as currently with escrow.

It's a function of having a symmetrical relationship between the cap and floor with the midpoint, given the reality that the cap acts as a magnet. Just as an example, throwing out numbers, if you made the cap 10% over the midpoint and the floor 15% below the midpoint, you'd reduce the amount of escrow. You can't guarantee revenue split by completely eliminating escrow, but you could reduce it to the point of practical non-existence. 1 or 2 percent. You could even make the percentage dynamic, and tie it to how much over the midpoint the teams spend from one season to the next, though that would be complex and I'm sure would cause a lot of confusion.

Setting the cap where the current midpoint is calculated would result in the owners owing the players money after the fact, rather than the reverse situation we have now. That's not a solution you'll ever see.

 

[MNNumbers]

As to the cap and escrow....

Mud the Acas really helped me understand the problems in a way I didn't before. One of the big problems is that there are 2 completely different calculations going on. One has to do with the cap and floor, and the other has to do with what exactly is HRR, and what counts as player costs against the 50% rule. There are player costs such as LTIR (and a couple of others as well), which count against the 50%, but don't count against the cap. That's a problem.

My best attempt at creating a system with no escrow would go like this:

Empirically, every year, the amount which is actually spent on player costs amounts to about 97% of the total cap for all the teams. This is completely an empirical number. It is not because of any great calculation about how much cap space is used (although that enters into it). It's just what the number has turned out to be for the last several years before this one.

So, to make a cap, what you do is......
First, get your best economists, and consider all the inputs, and.....looking at last year's numbers, you make your very best estimate as to what the HRR will be for the coming year. This is a very important step. There is no way to rectify mistakes here, so both the PA and the BOG will need to have their guys on the board which does the estimating.

That's HRR (estimate)

Then, second, take 50% of that (for the players' share).
Then, divide that by the number of teams.
Then, take the resultant number and multiply by 103% (this is the inverse of the 97% above)

That's the cap.

Then, make the floor 25 or 30% less.

You don't actually need a midpoint. You only need ceiling and floor.

This would get you within 1% IF....your estimate is good.