OT: CBA Discussion (All tax discussion goes here).

[patnyrnyg]

I agree that it is not as big of a deal as many make it out to be. If it was, why wouldn't players like Crosby and Ovechkin have fled to Florida, Tampa, or the Stars once they became UFA?

 

[patnyrnyg]

That's only true to an extent. I can tell you for a fact that numerous teams would spend above it if allowed. Our team included. The luxury tax would limit the amount spent over it, but teams would absolutely do it.

Yeah, spending out the wazoo was really good for this team. The BEST thing to ever happen to the Rangers was the cap. This will only be the 3rd year since the '04-05 lockout they have missed the play-offs and one of those years came down to a shootout in the last game of the season.

 

[Hunter Gathers]

Yeah, spending out the wazoo was really good for this team. The BEST thing to ever happen to the Rangers was the cap. This will only be the 3rd year since the '04-05 lockout they have missed the play-offs.

This is so misleading it's not even funny.

Spending without a plan is what the team did prior. You can spend a lot of money with a plan. Don't you recall Sather's entire MO prior to joining the team? He suggested simply spending would enable the team to win a Cup. He was wrong.

The idea that the cap somehow helps the team is . . . absurd. What would help the team is a luxury tax system as well as properly analyzing talent. The luxury tax system would still mean some frugality but give much more flexibility.

 

[Gardner McKay]

this won't be addressed. the nhl can't control taxes.

and everything that you don't like isn't a loop hole

Right. And while I am hesitant to make this next statement because I am worried it will inevitably be taken out of context and turned into a political discussion, I'm going to give it a try...

The NHL can't control the policy decisions of each state. What people fail to realize is that quite often the reach of a policy decision (such as raising taxes) goes well beyond their immediate view. When it begins to impact areas they don't expect, they don't like it. While I do feel the advantage is massively blown out of proportion, there are consequences to each decision.

I believe it is unlikely for the NHL to go to a luxury tax system (one I would be 100% for) and I believe it is unlikely they close this "tax loophole".

 

[FireGerardGallant]

It's bull**** but what can they do about it, give the teams that are located in states with no income tax a penalty? I'm not sure theres a way the nhl can do anything

 

[patnyrnyg]

Secondly, the only place I hear this idea mentioned is on message boards, especially HF boards. I have never heard this was an issue the players or BOG wanted to address in any CBA negotiation, from anyone on tsn, sportsnet, nbcs. We hear the issues now are escrow, contract limits, and the Olympics. Last time, it was about lowering the % of HRR to the players. Have never heard this was an issue for anyone that is actually involved with the negotiations.

 

[Shesterkybomb]

Also you will never hear about a luxury tax system outside of the big market teams.

 

[JimmyG89]

Where are the results? Where are the cups? Tampa is the powerhouse this year. Next year things aren't going to be so great for them.

Cities like LA and Chicago have how many cups in the last decade? They aren't exactly located in tax friendly states (especially LA).

Not all cities in Canada are as bad as Montreal (tax wise).

This is because they actually used contracts that would be now illegal to build stacked rosters. Richards and Carter were a part of the team that went to the finals on their own. They got ADDED to Kopitar, Doughty, Brown and Quick. That allowed them to trade for Gaborik and keep Williams. Hawks were the same way. Hossa and Keith contacts allowed them to pay others and stay under the cap.

The players got big money up front, likely what they would have gotten as a free agent, but tacked on years at the end of their deal to lessen the cap hit. So, even with heavy taxes, their salaries were high and they had a shot at winning a cup. Sounds good for the player.

The only thing you could correlate that every team has is that they both had players on an ELC that killed it and produced as middle 6 players (Toffoli/Voynov and Saad) allowing the big contracts to not strap them to the mid tier of the league.

 

[Leetch3]

I have a bridge to sell you in Brooklyn. The purpose of the cap is to make sure the owners get their share of the revenues.

the problem though is that the cap is 50% of league revenue not each team and there is really no revenue sharing...so the rangers with $253 mil in revenue (according to forbes) have the same cap as arizona with $96 mil in revenue....a cap at $74 mil is only 29% of dolan's revenue but 78% of phoenix's revenue. so doesn't really guarantee the yotes making a profit.

 

[NYRFAN218]

I don’t see the solution behind fixing the state tax issue. The owners want a hard cap to control salaries and keep money in their pockets. And as others have alluded to, bigger markets have their own attractions that non income tax states may not have. I feel bad for the Edmonton’s of the world because there’s just nothing redeeming for a lot of guys to go to a place like that.

I’ve long argued though that the floor should be lowered and the ceiling raised of the cap. Keep the midpoint the same and keep it at a 50/50 split. This will give those bigger markets who want to spend more flexibility and it allows the Arizona’s and Ottawa’s of the world not to spend money they don’t have which kills them every year when they’re reporting losses.

 

[Gardner McKay]

This is because they actually used contracts that would be now illegal to build stacked rosters. Richards and Carter were a part of the team that went to the finals on their own. They got ADDED to Kopitar, Doughty, Brown and Quick. That allowed them to trade for Gaborik and keep Williams. Hawks were the same way. Hossa and Keith contacts allowed them to pay others and stay under the cap.

The players got big money up front, likely what they would have gotten as a free agent, but tacked on years at the end of their deal to lessen the cap hit. So, even with heavy taxes, their salaries were high and they had a shot at winning a cup. Sounds good for the player.

The only thing you could correlate that every team has is that they both had players on an ELC that killed it and produced as middle 6 players (Toffoli/Voynov and Saad) allowing the big contracts to not strap them to the mid tier of the league.

That is actually a really good point.

 

[Kane One]

This needs to be addressed in the cba. Canadian teams getting killed on this loophole they’ll cry about it the most.

This isn’t a loophole. This shit happens with every single industry. Why is it only a big deal in hockey?

 

[SA16]

They need to adjust the language on conditional picks. The players should not permit conditions based on whether or not they re-sign. It artificially reduces their market.

 

[RangerBlues]

Never underestimate the lunacy of NHL ownership.

 

[patnyrnyg]

the problem though is that the cap is 50% of league revenue not each team and there is really no revenue sharing...so the rangers with $253 mil in revenue (according to forbes) have the same cap as arizona with $96 mil in revenue....a cap at $74 mil is only 29% of dolan's revenue but 78% of phoenix's revenue. so doesn't really guarantee the yotes making a profit.

I agree, but that is an issue for the owners to work out on their own. The NFL revenue sharing works because they centralize all their revenues. The television rights are national deals. If they ever went to teams negotiating their own tv deals, several teams would fall apart. They also share the gate with the road team. They would never do a salary cap based on % of individual team's revenues. Could you imagine if the the Rangers could spend $126.5MM and the Coyotes on $48MM?

 

[duhmetreE]

This needs to be addressed in the cba. Canadian teams getting killed on this loophole they’ll cry about it the most.

There's ways to circumvent it. Matthews being the latest example. He lives in Arizona and is getting paid predominately in signing-bonuses. Those will get taxed in Arizona. His 750k salary will get taxed where his games are played.

This might be addressed in the new CBA but I don't see why.

 

[duhmetreE]

I'm all for a 'cap' defined by a luxury tax.

The MLB has a solid foundation with the luxury tax. Numbers would have to be adjusted somewhat because we're talking about a fraction of team payroll.

You can be taxed at a high rate (100+% ) whatever you're overage is and if you're overage occurs for years, you start forfeiting draft picks.

hypothetical system:
1st year - 100% and 3rd rounder forfeit
2nd year - 125% and 2nd rounder forfeit
3rd year - 150% and 1st rounder forfeit
4th year 200% and 1st rounder forfeit
5th year 250% 1st and 2nd rounder forfeit

 

[sbjnyc]

MLB luxury tax system can forfeit draft picks because you can't trade them. How do you forfeit a draft pick that Slats traded away?

 

[duhmetreE]

MLB luxury tax system can forfeit draft picks because you can't trade them. How do you forfeit a draft pick that Slats traded away?

Future picks and/or add a provision where you cant trade picks if you're over the threshold

It needs to be severly penalized to prohibit the abuse of it

 

[sbjnyc]

You might see a lot of RFA offer sheets to supplement your roster instead of the draft. Can't forfeit what you don't have.

 

[duhmetreE]

You might see a lot of RFA offer sheets to supplement your roster instead of the draft. Can't forfeit what you don't have.

It's applied to some degree already with conditional picks. If you're over the threshold you cannot trade picks that would be forfeited, this season or the future.

Nothing will change. Offer-sheets will never be mainstream in the NHL

 

[sbjnyc]

Are you saying the new CBA should allow the NHL to restrict the movement of draft picks (trades, offer sheets, etc) because a team might exceed the cap?

 

[duhmetreE]

Are you saying the new CBA should allow the NHL to restrict the movement of draft picks (trades, offer sheets, etc) because a team might exceed the cap?

If your team exceeds the cap you can't offer sheet because those picks might be forfeited.

You're attempting to dissect a loosely constructed hypothetical.

 

[Tawnos]

I don’t see the solution behind fixing the state tax issue. The owners want a hard cap to control salaries and keep money in their pockets. And as others have alluded to, bigger markets have their own attractions that non income tax states may not have. I feel bad for the Edmonton’s of the world because there’s just nothing redeeming for a lot of guys to go to a place like that.

I’ve long argued though that the floor should be lowered and the ceiling raised of the cap. Keep the midpoint the same and keep it at a 50/50 split. This will give those bigger markets who want to spend more flexibility and it allows the Arizona’s and Ottawa’s of the world not to spend money they don’t have which kills them every year when they’re reporting losses.

I don't know about spreading the ceiling and the floor further apart... but I will say that one of the solutions to the escrow issue is to make the cap/floor asymmetrical. That is... the cap is not as far over the midpoint as the floor is below it. The cap acts as a magnet. The reason players are losing so much to escrow is that only something like 5 teams are below the midpoint at any given time. Everyone else is above it and that skews team payrolls to be above 50% of revenue.

 

[sbjnyc]

If your team exceeds the cap you can't offer sheet because those picks might be forfeited.

You're attempting to dissect a loosely constructed hypothetical.

You can offer sheet or trade picks for a player without exceeding the cap. Then you resign those players resulting in going over the cap. You no longer have the picks to forfeit. I'm not saying the NHL can't establish some rules around this but you simply can't compare to the MLB system where draft picks don't get moved, other than compensatory picks.