News: Salary Cap staying at 81.5M

[Junohockeyfan]

bergevin won't spend much cap anyways...

It until 2021/2022

 

[BLONG7]

It until 2021/2022

Hopefully, MB will be gone by then...

 

[ole ole]

Flat cap works perfectly for the Habs.

Could you imagine a flat cap and a lucky draw to move up to at least the 3rd OA pick. Boys this site would be flooded.

 

[rent free]

It until 2021/2022

so 2 years that the habs won't spend much; not sure what all the hoopla is about

 

[BLONG7]

How can the cap stay at 81.5M when they did not meet their revenue projections? Makes more sense for it to go down...? At this point, the regular season for next year may not even start on time...this is ugly folks, especially for pro sports.

 

[Junohockeyfan]

How can the cap stay at 81.5M when they did not meet their revenue projections? Makes more sense for it to go down...? At this point, the regular season for next year may not even start on time...this is ugly folks, especially for pro sports.

they can artificially set it.

 

[danielpalfredsson]

This is a HUGE advantage for teams like Montreal who have a lot of high profile players to sign in the next two years; UFA (Danault, Tatar, Gallagher, Petry, Armia) and RFA (Domi, Kotkaniemi, Poehling, Suzuki, Lehkonen).

This is also a huge advantage for teams who currently have a lot of cap space. It’s time for those teams to take advantage of the situation.

The cap being frozen won't really be an advantage in terms of signing players. It will be an advantage to teams who happen to have cap space right now, because they can use that cap space as an asset by either acquiring bad contracts, or acquiring star players who other teams cannot spare cap for in what might be a buyers market.

It really depends on how it plays out. I could see players who otherwise might have signed max term off of their ELC, instead insisting on bridge deals, with the intention of waiting out the ramifications of the COVID-19 on the salary cap.

If the cap is frozen, it defeats the purpose of going long term with a lot of players, because the cap hit doesn't get deflated by the cap going up. It really throws a wrench into that kind of planning.

 

[flying v 604]

How can the cap stay at 81.5M when they did not meet their revenue projections? Makes more sense for it to go down...? At this point, the regular season for next year may not even start on time...this is ugly folks, especially for pro sports.

Travis Greene said that in the last 5 days the mood around the league has been different and seems to be optimistic about salvaging the season. Trump has also met with him among others and wants to work to get sports back sooner than later. Worst case its without fans but personally by the end of May middle of June I think this hysteria will have died down. By then majority of infected will be recovered or in isolation. The demographic that would go to a game are the the same people who have been isolating. I cant see in 6 weeks from now there will be a large amount of people who would be infected without knowing. People are overreacting imo, 50.000 alone die in the USA from the flu every year, the world still turns.
If theres any issues, they could have the rinks at a lower capicity in a way to keep people at a distance.

 

[danielpalfredsson]

How can the cap stay at 81.5M when they did not meet their revenue projections? Makes more sense for it to go down...? At this point, the regular season for next year may not even start on time...this is ugly folks, especially for pro sports.

The cap is a mechanism for dividing half of all hockey related revenue among the players. A player's cap hit isn't their actual take home salary. It represents what percentage of HRR they get relative to the cap. If HRR falls short by 20 percent, and the cap should have been 20 percent lower, a player making 10 million only takes home 8 million.

It creates a balancing act where the NHLPA has to decide between doing benefits players who are already signed, vs doing what benefits players who are free agents, or will sign in the future. The cap not going down is bad for players who already signed, because it increases the likelihood that hockey related revenue is not in line with the cap, and they will not make their total cap hit. The cap going down is bad for players who haven't signed because it lowers the amount of available cap to be distributed to free agents. So while it increases the odds of a player already signing not taking a pay cut, it means a free agent signing on "July 1st" will take a pay cut because there will be less cap to drive up the price of their contracts.

 

[Xoggz22]

If the Cap stays flat I hope there also is no compliance buyout. Should be no bailout for teams with those awful contracts. If it's irresponsible spending, suffer the consequences. Teams with Cap space can choose to bail them out for a price.

 

[Number1RedWingsFan52]

If the Cap stays flat I hope there also is no compliance buyout. Should be no bailout for teams with those awful contracts. If it's irresponsible spending, suffer the consequences. Teams with Cap space can choose to bail them out for a price.

Totally agree with this, Why should GMs be rewarded for bad cap management?

 

[rent free]

If the Cap stays flat I hope there also is no compliance buyout. Should be no bailout for teams with those awful contracts. If it's irresponsible spending, suffer the consequences. Teams with Cap space can choose to bail them out for a price.

Totally agree with this, Why should GMs be rewarded for bad cap management?

bad way of thinking what it's for.

the compliance buyout is supposed to help teams comply with a lower than expected salary cap through no fault of their own. it's not right that they have to be punished because of covid

 

[Xoggz22]

bad way of thinking what it's for.

the compliance buyout is supposed to help teams comply with a lower than expected salary cap through no fault of their own. it's not right that they have to be punished because of covid

We'll just have to disagree on this one. Every team needs to be compliant with the Cap when it's set. I work in compliance in another industry so the concept isn't lost on me. However, when you run up against a limit and the limit changes you need to find ways to adjust and it isn't shouldn't impact those that remain compliant. That's just my way of thinking. I don't begrudge teams for wanting to spend to the Cap but in most cases this is a result of the Free Agent system and the players right to get what the owner is willing to pay. If the Cap is indeed flat, there are already rules in place to get compliant. They have regular buyout options or you work with your fellow GMs to move the salary - in this case it's at a cost to the team not in compliance. Again, just my opinion.

 

[nbwingsfan]

Doesn’t matter if the qualifying offer for Meier is 10m, 9.9m for Tkachuk, 8.25m for McCavoy, 7.7m for Werenski etc...

Teams are going to have to overpay to keep those guys or let them walk for nothing in a cap that will stay flat with high escrow % for a couple of years



Yeah, missed him. Wow that is going to f*** San Jose big time.

Those numbers aren’t THAT bad for Weresnki or McAvoy but yeah those Tkachuck and especially Meier are awful numbers

 

[Horse McHindu]

Surprised it's not going down

That in itself is the major victory here in my opinion.

 

[mouser]

If there are escrow debt paybacks how does that work for someone who’s contract changes this season? For example if there’s 25% escrow this year but the players only paid 15% from their cheque’s they owe 10%. Would a player who was paid say 1 million but resigned for 5 million be paying the 100k he owes(10% of 1 million, his prior contract to make up his share) or does the NHLPA as a whole pay 10% this year, meaning the guy who is suddenly making 5 million is paying 500k now. I would assume the former, players individually make up their share based on prior years and not as a whole based on next year

If an escrow overage carries over to next season then it's the latter. e.g. If final escrow was 35% this season and players only had 25% in the escrow account, then next season in 2020-21 every player will have 10% deducted from their paychecks to make up the difference.**

Doesn't matter what a player's paycheck was in 2019-20.

**Note: this deduction would happen before assessing escrow for the 2020-21 season.

 

[mouser]

bad way of thinking what it's for.

the compliance buyout is supposed to help teams comply with a lower than expected salary cap through no fault of their own. it's not right that they have to be punished because of covid

I would disagree with that view. The two times in the past there have been compliance buyouts were due to intentional changes taken by the NHL in CBA negotiations, not unforeseen lower caps. The most significant unforeseen cap situation happened in 2009-10 when the CAD exchange rate tanked and no new compliance buyouts were granted.

The CBA already contains the mechanisms to deal with unexpected shortfalls like this.

 

[4thline]

I recognize this is self serving as fan of a large budget team, but if we're looking at emergency CBA adjustments I wonder about temporarily allowing teams to retain dollars while moving cap hit.

Does it offer large market teams short term advantage? Yes. But more importantly it allows the financially healthy teams to essentially provide bridge financing to keep the league payroll as close to 100% of cap as possible. While that doesn't fix the overall HRR split problems, it does allow for free-er, more regular player movement and distribution.

A flat cap is one thing, a flat cap where half of the league is wanting to cut payroll to cap min to operate viably is another entirely more disastrous thing.

 

[mouser]

How can the cap stay at 81.5M when they did not meet their revenue projections? Makes more sense for it to go down...? At this point, the regular season for next year may not even start on time...this is ugly folks, especially for pro sports.

The intention of the cap is to constrain spending on players so total player compensation doesn't vary too far from the 50% share of NHL revenue the players are due. The formula to base the next season's cap on the previous season revenue is essentially a default guideline, not a set in stone rule to be applied. If the NHL and PA are aware of details that would cause that default guideline to create an inaccurate projection for the next season then they can adjust the upcoming cap in any way they see fit. e.g. Yes, the NHL is likely to lose a lot of revenue in 2019-20 due to the epidemic, but if they think the league will bounce back to regular revenue in 2020-21 then there's no reason to set the 2020-21 cap based on actual 2019-20 revenue.

 

[Jumptheshark]

Shocking

 

[BLONG7]

Flat cap works perfectly for the Habs.

Habs cap management is bizzarre to say the least. Marc Bargainbin is a clown...doesn't matter what the cap is.

 

[Richard88]

A flat cap would benefit Colorado a lot.

1. Burakovsky, Jost, Zadorov, and Graves (all RFA's in summer 2020) should sign for more reasonable deals than if cap rose. A flat cap in 2020-21 probably also improves the likelihood of extensions in 2021 for Makar/Landeskog/Grubauer next summer being reasonable too.

2. Colorado will have plenty of capspace available to acquire players by trade from cap-strung teams in what should be a buyers market.

3. Due to cap constraints there will probably be less teams able to challenge for the best free agents, so again, Avs could sign free agents at reasonable deals.

4. Having numerous good prospects ready to step in on ELC's (eg. Newhook, Byram, Timmins, Bowers, Kaut, etc) will further exacerbate the advantage Colorado has over other clubs with less cap flexibility.

 

[canuckking1]

Makes sense given we've seen a few signings in the recent days

 

[OrrNumber4]

Travis Greene said that in the last 5 days the mood around the league has been different and seems to be optimistic about salvaging the season. Trump has also met with him among others and wants to work to get sports back sooner than later. Worst case its without fans but personally by the end of May middle of June I think this hysteria will have died down. By then majority of infected will be recovered or in isolation. The demographic that would go to a game are the the same people who have been isolating. I cant see in 6 weeks from now there will be a large amount of people who would be infected without knowing. People are overreacting imo, 50.000 alone die in the USA from the flu every year, the world still turns.
If theres any issues, they could have the rinks at a lower capicity in a way to keep people at a distance.

Sounds good, but hockey is primarily a gate-driven league. Lower or no-capacity would barely make a dent with the issue of revenues.

What I am curious about is how the cap, old salaries, and new salaries will jibe. Ultimately, players get 50% of revenues so players on current contracts can expect a big cut. What about players on new contracts? Would they be signing nominal numbers knowing they would be getting nowhere close to that? Are there workarounds?

 

[LeHab]

Shocking

Not really, this was the most likely scenario rumored for a while even if remaining of season is cancelled.