Around the NHL 2023-24 - offseason part II

[ZachaFlockaFlame]

Losing is problematic for Nico with regard to paying him but health isn't a concern for Jack?

No I'm not using it against Nico, I'm saying it's a reason for why he'd walk in anger. He looked like death last year in regards to the Lindy stuff/late game pressers in March lol

I think Nico takes a lot of pride in being the Devils captain and that he will genuinely want to stay for anything reasonable. His roots seem to be planted deep.

I worry more about the losing affecting Jack - he seems more likely to lose his temper and make an emotional decision. I can definitely see a world where we lose too long and he becomes a malcontent like Eichel did in Buffalo (especially if his health goes sideways). But we have Luke, hopefully locked up long term, and Jack won't need a contract for some time.

I don't think Jack does that with Luke here, the only way we lose either of them or both is if a Scott/Rob Nieds situation happens again where we win a Cup and Quinn is cupless in Vancouver

 

[Devils731]

The Canes just did a deferral contract that saves them half a million a year on the cap. Maybe that isn't 'meaningful' to you but it's definitely something cap celling teams will try to exploit and that envelope will be pushed more and more until the loophole is closed.

What he means, I believe, is that a rational player will force you to either pay them $1 million in year 2 or the equivalent value of $1 million in year 10, making no net savings against the cap.

For me, I don't believe all players will be rational and/or really grasp the time value of money. Also, the financial world won't be the same so the time value discount will be different during different free agency periods.

The agent will understand time value but their goal is to keep the player's business, keep the player happy, and get their commission. If the player is content ignoring or underestimating the time value then a cap savings will be realized by the team, which may or may not be a reasonable outcome, but will give that team a competitive advantage.

 

[MasterofGrond]

The Canes just did a deferral contract that saves them half a million a year on the cap. Maybe that isn't 'meaningful' to you but it's definitely something cap celling teams will try to exploit and that envelope will be pushed more and more until the loophole is closed.

It's not a loophole. The player took a deal for objectively less compensation.

Unless you're going to say every team friendly deal is a loophole, you can't say this one is. The only thing novel about it is the mechanism of the "discount" Jarvis gave.

I'm not expecting every person to understand finance concepts like discount rate, but just because someone doesn't understand them, that doesn't make a completely unremarkable compensation scheme something a loophole or an advantage.

 

[Goptor]

My friend, you do not understand the mechanics of the deferral contracts. There is no meaningful discount in this rate environment.

It's just a different way of paying out money that gives a different total contract dollar amount. It is not an AAV hack, it is not a secret, and there are millions of good reasons most contracts don't include them, for both team and player friendly reasons.

The deferral "discount" has more to do without accounting than it does cap management.

The accounting manipulation will also mean he very likely 'earns' millions more in tax savings depending on when and where he is when the money is given to him.

The accounting manipulation also means he makes a lot less money on the books, which is where the cap value comes from.

EDIT: above is wrong, he makes the same on the books, but NHL cap does not take into account any money made outside the contracted year length. Its a cap manipulation because the league forgot to include situations that pays players beyond the contract length.

 

[MasterofGrond]

The accounting manipulation will also mean he very likely 'earns' millions more in tax savings depending on when and where he is when the money is given to him.

The accounting manipulation also means he makes a lot less money on the books, which is where the cap value comes from.

it's not accounting manipulation. It's basic finance.

I would argue that, unlike deferrals, frontloading a contract is actually a loophole because it INCREASES the value of payments made to a player without increasing the cap hit. This, of cours,e is why they have limited it.

The only thing Jarvis is "making less money on the books" compared to is an imaginary non-existent contract for the same dollar value spread out differently. That contract is not what this should be compared to, because the team would not have agreed to it. You're comparing this deal to a fundamentally different one and saying LOOK AT THOSE CAP SAVINGS, mostly because servalli is a f***ing moron and got everybody hyped up about the most boring, non-angle shooting deal I've ever seen.

If you think Drai should have been signed to a deferral deal in order to game the system, please suggest one that saves money on the cap while providing similar value to him. If you can't, you're just suggesting "Bowman should have just gotten Drai to take a discount" which is, of course, the dream for a team, but also not a f***ing revelation.

 

[Oneiro]

I am glad they got it done with Drai. Otherwise that had classic NYR UFA signing all over it.

 

[Devils731]

EDIT: above is wrong, he makes the same on the books, but NHL cap does not take into account any money made outside the contracted year length. Its a cap manipulation because the league forgot to include situations that pays players beyond the contract length.

It does take into account that money in 1 of 2 ways.

1) If a player is getting deferred money without interest then the league adjusts that money for the time value the player gave up and include that against the cap the year the money is earned, not the year paid. That is the Cane's situation

2) If a player is getting deferred money with interest then then entire dollar amount counts against the cap the year it is earned, not the year paid.

 

[Goptor]

it's not accounting manipulation. It's basic finance.

I would argue that, unlike deferrals, frontloading a contract is actually a loophole because it INCREASES the value of payments made to a player without increasing the cap hit. This, of cours,e is why they have limited it.

The only thing Jarvis is "making less money on the books" compared to is an imaginary non-existent contract for the same dollar value spread out differently. That contract is not what this should be compared to, because the team would not have agreed to it. You're comparing this deal to a fundamentally different one and saying LOOK AT THOSE CAP SAVINGS, mostly because servalli is a f***ing moron and got everybody hyped up about the most boring, non-angle shooting deal I've ever seen.

If you think Drai should have been signed to a deferral deal in order to game the system, please suggest one that saves money on the cap while providing similar value to him. If you can't, you're just suggesting "Bowman should have just gotten Drai to take a discount" which is, of course, the dream for a team, but also not a f***ing revelation.

Contract ends when he's age 38. Defer the money (4?) years after that to a point where he's retired. Move out of Canada's just under 50% income tax rate to somewhere that is more generous. Adjust the rate of return listed in the contract to include tax savings and its very likely over the current interest rate. Beneficial to the player

All money deferred past year 8 will be excluded from cap calculations. Essentially free spending that the league doesn't care about for competitive purposes. Beneficial to the team.

 

[Devils731]

To add, what should be a standard ask from teams once contracts get very close to agreed but aren't done is that the team will agree to the players money ask but they want to pay out the contract the first day of the year following the contract year.

I think most players won't emotionally feel like that is giving a lot and may close the deal without realizing he is giving up a lot of value.

If you did that for every contract on your team right now you'd get an extra $4.8 million to play with, not bad business if your players are comfortable doing it.

 

[MasterofGrond]

Contract ends when he's age 38. Defer the money (4?) years after that to a point where he's retired. Move out of Canada's just under 50% income tax rate to somewhere that is more generous. Adjust the rate of return listed in the contract to include tax savings and its very likely over the current interest rate. Beneficial to the player

All money deferred past year 8 will be excluded from cap calculations. Essentially free spending that the league doesn't care about for competitive purposes. Beneficial to the team.

Money deferred past year 8 isn't excluded from cap calculations. The CBA spells out exactly how it's accounted for because the league does care about it. I've explained the mechanism in this thread and on the main board.

And the tax implications, while potentially beneficial, don't make up for the massive discounting that should be done to properly account for the time value of money. If you (on average) push every year back one, maybe you make up for it in tax advantages, more than 1.5, and I really doubt it.

 

[Goptor]

It does take into account that money in 1 of 2 ways.

1) If a player is getting deferred money without interest then the league adjusts that money for the time value the player gave up and include that against the cap the year the money is earned, not the year paid. That is the Cane's situation

2) If a player is getting deferred money with interest then then entire dollar amount counts against the cap the year it is earned, not the year paid.

#2 is wrong and thats why there is such a huge uproar. Its a loophole because the league does not charge the cap hit to the year earned if its past the contract length. Nobody would care if Carolina got a $3.2mil cap hit on year 9.

 

[Devils731]

#2 is wrong and thats why there is such a huge uproar. Its a loophole because the league does not charge the cap hit to the year earned if its past the contract length. Nobody would care if Carolina got a $3.2mil cap hit on year 9.

How is #2 incorrect? In both scenarios the CBA says the cap hit is given in the year the money is earned, not paid.

If the money is earned during the SPC the money is not considered deferred. You can, by definition, only have deferred money after the contract ends. This part of the CBA tells us how to treat it and it does not disappear.

Money never disappears, even if it was deferred 20 years.

The Cane's cap savings was because he delayed some payment into year 9 and they adjust that money back into years 1-8. We don't know how much or when he took the deferred money or else I could show you exactly how the math works on a spreadsheet.

Current rate adjustment is 5.507%.

Edit: Also, the Canes are doing #1, not #2, but neither of allow money to disappear and not count against the cap because it was deferred.

 

[None Shall Pass]

PuckPedia made a deferred calculator, just FYI to all of you: https://puckpedia.com/deferred

 

[ZachaFlockaFlame]

I am glad they got it done with Drai. Otherwise that had classic NYR UFA signing all over it.

There was a dude on the main board who had Drai penciled for the Rags roster in 25-26 after the Panthers game 6 loss, bad day for that person

 

[JK3]

I'm glad he settled on only 14 mil, what a team friendly deal LMAO.

 

[njdevils1982]

I'm glad he settled on only 14 mil, what a team friendly deal LMAO.

i cant fathom having 14M let alone times 8 years

it's an absurd amount of money

 

[MadDevil]

I'm glad he settled on only 14 mil, what a team friendly deal LMAO.

Good on him. More superstars should go for huge paydays in this league.

And yes I know I'm saying that as a fan of a team whose superstar is on a ridiculous value contract lol

 

[ZachaFlockaFlame]

Good on him. More superstars should go for huge paydays in this league.

And yes I know I'm saying that as a fan of a team whose superstar is on a ridiculous value contract lol

Yeah, exactly. These guys have a finite amount of time to do what they do and if you're good, you should be compensated for it, lol. It's not Drai and McDavid's fault that Holland overpaid Nurse

 

[Triumph]

I was on vacation when Jarvis signed his deal, glad that the idea of deferred money being a cap workaround was debunked - there was deferred money in deals pre-2005, both Stevens and Brodeur had it in their contracts that they signed in 2002. The idea that everyone just plum forgot about it for 20 years wasn't sitting right with me.

 

[Oneiro]

Love seeing Caulfield change his number to 13.

We’re on a hockey forum so people here get how hard it is to have longevity as a small player but for the greater public, still a class move.

 

[Devs3cups]

I think Nico takes a lot of pride in being the Devils captain and that he will genuinely want to stay for anything reasonable. His roots seem to be planted deep.

I worry more about the losing affecting Jack - he seems more likely to lose his temper and make an emotional decision. I can definitely see a world where we lose too long and he becomes a malcontent like Eichel did in Buffalo (especially if his health goes sideways). But we have Luke, hopefully locked up long term, and Jack won't need a contract for some time.

Jack is signed for 6 more years still and the foundation is there to potentially win now and even more in the future. I don't think we have to worry about that doomsday scenario yet at all, and that's without talking about Luke as you mentioned. We're set up quite nicely here.

As for Nico, I 100% agree. He feels like a lifer to me.

 

[Goptor]

I'm glad he settled on only 14 mil, what a team friendly deal LMAO.

He's making 16.5 for the first several years. Max is $17.6 i believe. So he took $1.1m less than he could based of the CBA.

 

[Its Always Sundstrom]

https://x.com/i/web/status/1831139213485429100

 

[JrFischer54]

nothing like reading about contract defer and cba....riveting conversation and people think this place is boring end of summer.

 

[sabremike]

https://x.com/i/web/status/1831079888339734747