GirardIsStupid
Registered User
Anyone know how the cap is to be determined on an annual basis? I figure that its largely determined by a figure midway between the cap floor/max that closely relates to the fixed percentage of a specified amount of revenue (based on previous year's revenues generated in the seasons following this year). For instance, the NHL is projecting 1.7 B in revenues for the upcoming season. 54% of this would result in 918 M going towards player compensation. That averages to 30.6 M in alotted monies per team. But with a payroll gap being allowed and not exceeding 17.5 M, the cap max would be 17.5 M/2 above the 30.6 M figure (39.35 M). Conversely, the floor would be 17.5 M/2 below (21.85 M).
If this is the formula that is used, it would seem to me that should revenues fall to 1.5 B (as many suspect it will), the cap would become 35.75 M (with a floor of 18.25 M). Yet, if revenues recover and the NHL pots 2.2 B (at levels of what the league was making prior to the lockout, 55% of which would go to the players), the cap could become 49.08 M (while the floor would be 31.58 M). The player cap max would be 9.82 M.
This increase in the cap is significant for a couple reasons. Many small market clubs are continuing to operate on a budget (close to 35 M) despite the cap being as low as it is. With revenue sharing being minimal (though clubs that restrict their budget at lower levels are rewarded with more revenue being shared with them), it may be possible that small market teams find themselves financially handicapped within 5 years. Even more important is that a 50 M cap allows big market clubs to bid much more competitively for UFAs. In fact, when the Avs won the cup in 2001, their payroll was 51.7 M despite featuring a star-studded roster containing Roy (7.5 M), Blake (5.3 M), Forsberg (10 M), Sakic (7.9 M), Hejduk (1.2 M), Tanguay (1.0 M), Bourque (5.5 M), Drury (1.3 M) and Foote (3.2 M).
If this is the formula that is used, it would seem to me that should revenues fall to 1.5 B (as many suspect it will), the cap would become 35.75 M (with a floor of 18.25 M). Yet, if revenues recover and the NHL pots 2.2 B (at levels of what the league was making prior to the lockout, 55% of which would go to the players), the cap could become 49.08 M (while the floor would be 31.58 M). The player cap max would be 9.82 M.
This increase in the cap is significant for a couple reasons. Many small market clubs are continuing to operate on a budget (close to 35 M) despite the cap being as low as it is. With revenue sharing being minimal (though clubs that restrict their budget at lower levels are rewarded with more revenue being shared with them), it may be possible that small market teams find themselves financially handicapped within 5 years. Even more important is that a 50 M cap allows big market clubs to bid much more competitively for UFAs. In fact, when the Avs won the cup in 2001, their payroll was 51.7 M despite featuring a star-studded roster containing Roy (7.5 M), Blake (5.3 M), Forsberg (10 M), Sakic (7.9 M), Hejduk (1.2 M), Tanguay (1.0 M), Bourque (5.5 M), Drury (1.3 M) and Foote (3.2 M).
