News Article: Auston Matthews - August 1st., Contract Crickets

[Niagara Bill]

Unless he agrees to a sign-and-trade, Leafs aren't getting enough value for him with or without a NMC

Right now we are getting nothing gfor AM in July 24.
Pay him 500,000 per for a trade window, but a no trade clause is unacceptable. We have our own Kyrie Irving.
So far in his career he has proven to be a scorer but not a winner.
He is no Trottier, Bossey, Orr, Esposito, not even a Stamkos, or McKinnon. His speed in the playoffs certainly was not fast enough to back any dman into a panic, the cute drop passes and spins to the outside of the ice were noteworthy.
He says he wants to be a Leaf, then play like the crest matters not stats.

 

[keonsbitterness]

Right now we are getting nothing gfor AM in July 24.
Pay him 500,000 per for a trade window, but a no trade clause is unacceptable. We have our own Kyrie Irving.
So far in his career he has proven to be a scorer but not a winner.
He is no Trottier, Bossey, Orr, Esposito, not even a Stamkos, or McKinnon. His speed in the playoffs certainly was not fast enough to back any dman into a panic, the cute drop passes and spins to the outside of the ice were noteworthy.
He says he wants to be a Leaf, then play like the crest matters not stats.

I agree, trade him for Esposito.

 

[Dekes For Days]

I don't Matthews agent will see 27,28, 29 year old seasons as less valuable than his 32, 32, 33.

Yeah, adding on years in your mid 30s has always historically brought down cap hit, though it is possible that Matthews just refuses to sign for 8 years because the usual equation of the earning potential in those years has now shifted so dramatically with it being open knowledge that the cap is about to skyrocket.

 

[Divine]

MLSE invests funds, but they do not invest all of their funds, They are a multi-billion dollar company with 9-figure yearly expenses, and they have cash on hand at any given time. They have constant expenses that they need to cover, and we're talking pretty small differences in time. You are exaggerating the impact it has for a company like MLSE.

Also, nobody is arguing that it is a financial benefit for the Leafs in the first place. It is a financial benefit for the player, that is mitigating a financial disadvantage that Toronto brings in taxes. It is trading financial benefits for hockey benefits. That is the price of doing business with high caliber players in a very high tax location.

As for other teams, they would happily pay salaries on July 1st if it means they're paying less overall, which they would if MLSE was picking up a portion of the tab in the form of the signing bonus for that year. It's again MLSE using their financial might to provide hockey-related benefit.

You're severely misunderstanding how a business operates. Usually, the business makes money, they use that money to pay expenses (salaries). With a signing bonus upfront, the business now has to pay a significant amount of it's expenses before it has the ability to make profit. That now either has to come from a bank (with interest) or their cash reserves (which must be stockpiled simply for this).

Normally, a profitable business can run with no cash reserve for salaries. It makes the profit, and uses those profits to pay off the salaries. No one wants to pay the salaries at the beginning of the year, and then start making money at a later date. Ask any wealthy employer to pay your salary on Jan 1st (or any fixed date) every year, and then you'll work the remainder of the year for free. Let's see how many agree to it. It is a benefit for the employee, not the business.

Do you realize if you trade a player before their last season - the new team has to pay their signing bonus for the remainder of the contract?

Teams are not lining up to pay a signing bonus. Like you said, it's a Toronto advantage - it is a negative for other teams. That offsets any benefits you think you're getting on the trade market.

Toronto is not getting a lower AAV with these signing bonuses either, so there is no benefit to doing them. It limits their trade partners. Give them a signing bonus for the last year and call it a day unless the player agrees to a lower AAV for the signing bonus like they do in low tax states.

 

[Dekes For Days]

You're severely misunderstanding how a business operates. Usually, the business makes money, they use that money to pay expenses (salaries). With a signing bonus upfront, the business now has to pay a significant amount of it's expenses before it has the ability to make profit.

No, I understand perfectly how a business operates. This is a long-running organization with many moving parts and sources of revenue and expenses. The business already has profit coming in from the previous season, that they can use to pay these bonuses. It's not like they're some mom and pop shop having to make a big expenditure before they've opened up. All it's really doing is slightly shifting the timeline for a portion of the salaries. And then during the season when they're raking in piles of cash because they're spending less on salaries in-season, they can invest it.

Do you realize if you trade a player before their last season - the new team has to pay their signing bonus for the remainder of the contract?
Teams are not lining up to pay a signing bonus. Like you said, it's a Toronto advantage - it is a negative for other teams. That offsets any savings you think you're getting.

Yes, I realize that the new team would have to pay the signing bonuses in the other years. Do you realize that they still have a net financial benefit from this arrangement, because they're getting the first year for almost free?

Take Matthews' current contract. If we traded him July 2nd, 2022, the new team would get him for 3 years.
They would have this 11.6m player and fill 11.6m of their cap in each of those 3 years, and if they signed that player or the player had their contract equally distributed across years in salary instead of signing bonuses, they would pay them 34.8m overall. Because of the front-loading and the signing bonuses, the team would instead pay a combined 16.7m over those 3 years. That's a massive savings of over 18m for this new team. This increases the trade value of the asset and opens up trade possibilities with more teams.

Toronto is not getting a lower AAV with these signing bonuses either, so there is no benefit to doing them.

The benefit is mitigating the tax disadvantage that we have in Toronto, so that we don't have higher AAVs.

 

[ALine]

I've never heard the theory that he would take a lower AAV on an 8 year deal than on a 5 year deal or that he wants an 8 year deal at all.

Of all the reports I've recalled seeing, it's the shorter the contract, the lower the cap, the higher you go the more prohibitively expensive it gets.

I’m not going by any speculation or rumours about Matthews specifically, more so just conventional approach to these kinds of deals.

 

[Divine]

Yes, I realize that the new team would have to pay the signing bonuses in the other years. Do you realize that they still have a net financial benefit from this arrangement, because they're getting the first year for almost free?

Take Matthews' current contract. If we traded him July 2nd, 2022, the new team would get him for 3 years.
They would have this 11.6m player and fill 11.6m of their cap in each of those 3 years, and if they signed that player or the player had their contract equally distributed in salary instead of signing bonuses, they would pay them 34.8m overall. Because of the front-loading and the signing bonuses, the team would instead pay a combined 16.7m over those 3 years. That's a massive savings of over 18m for this new team. This increases the trade value of the asset and options up trade possibilities with more teams.

The benefit is mitigating the tax disadvantage that we have in Toronto, so that we don't have higher AAVs.

You're making two contradicting points. You're saying many teams cannot afford to do this, yet those teams are also more incentivized to trade for said player. It does not matter if the player gets paid less over the term of the contract if the team cannot afford to pay the signing bonus every July 1st. It automatically lowers your trading partners. Not every team in the NHL wants to pay the signing bonus for future years, even if avoiding it for one year.

Secondly, we don't have to mitigate the tax advantages of Toronto. There's lots of teams in the NHL with the same tax situation - where they do not hand out these contracts and get the player at a lower cost than Toronto. See: Boston, Chicago, New York, Montreal, LA, SJ, Ana, etc.

Why did Adam Fox not get a bonus structure from NYR to 'mitigate the tax disadvantage' of NYC? Panarin did. Teams (other than Toronto) simply do not want to do this unless there's a benefit. Toronto has run rogue and bent over backwards for their players for no benefit. It's a classic example of the inmates are running the asylum.

 

[pcruz]

Its kind of ironic in a Salary Cap World now where a player now entering his 3rd contract is looking for term and long-term security of a guaranteed contract trying to leverage his most productive years of the next 4-5 against the later years of his career when his play falls off. For the team the throw away final years at cheap cost $$ should lower that AAV over the term of the deal factoring for decline.

If Matthews hypnotically said "I want $15 mil for the next 5 years upfront most in signing bonus with full NMC" and then I'll give you steep discount for the final 3 with a limited NTC.

ie. $15 mil + 15 mil + 15 mil + 15 mil + $15 + $7.5 mil + $3.5 mil + $2.0 mil = $88 mil over 8 years = $11.0 Mil AAV X 8 years for Toronto with CH% lower than current on a $92 mil. ceiling.

Auston would be getting paid at a rate of $15 mil ($75 total) for the next 5 years of service cashing in HUGE, and then Leafs team gets the benefit of averaging over term to come in at $11.0 mil annually and actually slashing $600k mil AAV off his current amount and able to move on in the later years if they want to. With each passing year the cap increases the C.H% goes down and better surrounding depth.

That is a team friendly and player friendly contract that benefits both sides and why I can see Treliving pushing for more term to lower the AAV based on this concept.

Matthews wanting only 4-5 years at his +$14 mil only hurts the team with an AAV at that rate.

Same concept applies to Willy ... You want $10.5 mil per (front loaded) for the next 4 years fine, then Leafs get the next 2 extra years at $5.5 mil = 6 years at $53 mil total = $8.83 AAV.. (which is the AAV BT is rumoured to be offering),

When both player and team are pulling in the same direction its a WIN -WIN for both sides of the equation. But Leaf players seem to want to Win, but they also want the Leafs team too Lose.

View attachment 727227

Dubas handed out Zero-Sum contracts, and I'm hoping that Treliving an experienced GM will be looking for Non-Zero-Sum deals this time around, and convincing the players to buy-in.

That is how a SMART GM does a Doover or Reset to buck current trending on past mistakes.

That's not a CBA compliant contract.

I'm pretty sure there is a clause that the salary can't differ by 50% of the highest value....

 

[Dekes For Days]

You're making two contradicting points. You're saying many teams cannot afford to do this, yet those teams are also more incentivized to trade for said player. It does not matter if the player gets paid less over the term of the contract if the team cannot afford to pay the signing bonus every July 1st.

Nothing I said is contradictory. I didn't say that teams can't afford to pay a signing bonus. Of course teams can pay a signing bonus. And teams would always prefer to find a way to pay a signing bonus on July 1st if it's saving them tens of millions of dollars overall. Heck, just use that money you saved by not paying them anything the first year.

Secondly, we don't have to mitigate the tax advantages of Toronto. There's lots of teams in the NHL with the same tax situation - where they do not hand out these contracts and get the player at a lower cost than Toronto. See: Boston, Chicago, New York, Montreal, LA, SJ, Ana, etc.

Yes, we do need to mitigate the tax disadvantages of Toronto. We have some of the highest taxes in the league, and high-tier players in other high tax locations also often get signing bonuses.

Why did Adam Fox not get a bonus structure from NYR to 'mitigate the tax disadvantage' of NYC? Panarin did.

I don't know. He got some. He re-signed at a really uncertain time for the league when we were mid-pandemic and the owners had over a billion dollars needing to be repaid, so maybe that impacted it. Don't really see why it matters. Panarin got mostly signing bonuses... Zibenejad got mostly signing bonuses... High tax locations do it quite a bit for top end players. Two of the best young players in the cap era and one of the best UFAs in the cap era in one of the highest tax locations in the league are obviously going to get it.

 

[Divine]

Yes, we do need to mitigate the tax disadvantages of Toronto. We have some of the highest taxes in the league, and high-tier players in other high tax locations also often get signing bonuses.

Name them.

Players with full signing bonuses signing without a discount:

Matthews
Marner
Tavares
Panarin

I'm okay with signing bonuses if the player lowers their AAV. Want a signing bonus for tax advantages? Okay lower your AAV like players in low-income tax states.

Why would we pay you more AND give you a signing bonus?

 

[Dekes For Days]

Name them.

I already named some in the post above. Panarin. Zibenejad. Price. McDavid. Heck, even top end players in low tax locations like Mackinnon sometimes get it.

I'm okay with signing bonuses if the player lowers their AAV.

They're not going to lower their AAV for signing bonuses. Signing bonuses just get our players closer to neutral relative to most other teams, and opens up pathways for the team to transfer their financial power to team benefit. You're putting way too much emphasis on something like this. We should be thrilled that MLSE is willing to flex their financial power to benefit the team. There's literally no downside for a fan. Only upside.

 

[usernamezrhardtodo]

Name them.

Players with full signing bonuses signing without a discount:

Matthews
Marner
Tavares
Panarin

I'm okay with signing bonuses if the player lowers their AAV. Want a signing bonus for tax advantages? Okay lower your AAV like players in low-income tax states.

Why would we pay you more AND give you a signing bonus?

Matthews has his off season home in Arizona and gets paid his bonus WHILST in Arizona and therefore would pay Arizona tax rate...not Toronto tax rate...which means this bullshit of the american players getting gouged up here is totally false. Agents just use the tax thing to get more money. I have seen Alan Walsh say that playing in T.O. does not really make that much of a difference for players from the USA as long as they get bonuses paid out while they are in the off season state.

The players should be giving something...anything back to us but they don't. That is the problem.

 

[Dekes For Days]

Matthews has his off season home in Arizona and gets paid his bonus WHILST in Arizona and therefore would pay Arizona tax rate...not Toronto tax rate...which means this bullshit of the american players getting gouged up here is totally false. Agents just use the tax thing to get more money. I have seen Alan Walsh say that playing in T.O. does not really make that much of a difference for players from the USA as long as they get bonuses paid out while they are in the off season state.
The players should be giving something...anything back to us but they don't.

Why should players be giving something to get the lower tax rates on a portion of their contract that players signing in other places get on their whole contract automatically?

 

[usernamezrhardtodo]

Why should players be giving something to get the lower tax rates on a portion of their contract that players signing in other places get on their whole contract automatically?

Because the other players on those teams like TB happen to give something back because of the tax rate in FLA....They take less from the team because they also get taxed less....really straight forward.

 

[andora]

Because the other players on those teams like TB happen to give something back because of the tax rate in FLA....They take less from the team because they also get taxed less....really straight forward.

Yeah i see this side - when over 90 % of his contract is taxed in arizona

If it was 50 50 yeah ok.. but his salary is like 775000 i think.. and that alone is taxed in toronto only half the season..

 

[Dekes For Days]

Because the other players on those teams like TB happen to give something back because of the tax rate in FLA...

Players giving meaningful discounts on AAV is rarer than people think - even more so just for tax purposes. Florida is also lower taxes than even somewhere like Arizona, and they wouldn't have to buy additional property (which they're going to pay additional taxes on), and live somewhere specific outside of their team's location.

 

[Mess]

Because the other players on those teams like TB happen to give something back because of the tax rate in FLA....They take less from the team because they also get taxed less....really straight forward.

No better example then TB's Brayden Point..

In 2018-19 coming out of his ELC contract Point put up 41 goals 51 assists 92 points

To help TB be Cup competitive he takes a 3 year bridge deal @ $6.750 mil AAV & After Marner signed his deal.

& Tampa Bay wins 2 X Stanley Cups in 2021 & 2022 and Point Leads the playoffs in goals both times with 14 playoff goals. Even after 2 Cups he still makes only $9.5 mil and less than Marner.

Meanwhile Mitch Marner took those same year stats of 94 points and said I'm going to need $10.9 mil per and be the 7th highest player in the league and pay me my $11 mil like Matthews and Tavares.

 

[TheDoldrums]

why would any fan care about signing bonuses. Complain about the AAV or something that actually impacts the teams ability to improve.

 

[Nineteen67]

Yeah i see this side - when over 90 % of his contract is taxed in arizona

If it was 50 50 yeah ok.. but his salary is like 775000 i think.. and that alone is taxed in toronto only half the season..

Does the drama teacher let all that salary go untaxed in Canada?

 

[andora]

Does the drama teacher let all that salary go untaxed in Canada?

I am not following the reference.. but i am pretty sure i would smile if i did

 

[13pacheco31]

I am not following the reference.. but i am pretty sure i would smile if i did

Justin Trudeau use to be a high school drama teacher

 

[Nineteen67]

Justin Trudeau use to be a high school drama teacher

Part-time drama teacher?

 

[andora]

Justin Trudeau use to be a high school drama teacher

Oh for Christ's sake yes I should have made that connection. Spending too much time on these boards when you think things are referencing other posters

 

[kb]

Ya thats where I'm driving this thing lol.. hard balling our superstars out of town hasn't gone well round these parts. We've done it lots and lots. 1967.

You nailed it brother....

 

[TMLBlueandWhite]

Remember when Treliving was made GM?

His number one priority was getting Matthews extended.

First order of business was flying to Arizona. It's now July 10th and Matthews still hasn't extended. In light of that fact alone I'd say Treliving's tenure hasn't been successful so far.

That won't change until Matthews re-signs.

When they drafted him, the Leafs saw Matthews as an instant win button. That didn't happen. What happened was, they burned years of contention off the prime of the best Leafs player in a lifetime, in repeated failed attempt to win it all now.

Now they're gonna have to pay this guy the moon and the stars and the sun itself.

Just to keep him on a team that hasn't even come close to contending. If Matthews doesn't extend, it's over. Oh well, it was fun while it lasted.

Look on the bright side.

They broke a few regular season records, and Matthews won a few individual trophies, during his time here.

The fans will always have those memories of the greatest Leafs player in a lifetime to cling to.