Speculation: Odd ramifications of a rising cap combined with multiple rebuilds occurring at the same time

[MHO]

Montreal may be coming around but they would be the exception considering their cap situation but the other four recent major rebuilds taking place in Anaheim, Chicago, Columbus, and San Jose may face an interesting challenge going into next year. This is going to sound odd but: They might have trouble reaching the floor.

I know anything can happen between now and the beginning of next season but assuming the cap goes up to $95M next season, the floor would be at about ~$71M. Then look at the contracts each of the 4 teams ALREADY have allocated for next year with available roster spots.

Seems like a good problem to have right?

But then consider the ELC's these teams may want to add or players due for raises. I made assumptions on who the teams would like to add for next year.

Now if you add those contracts to what is already in place, this would be the cap situation going into next season for these four teams.

So if nothing changes, Anaheim would have to spend $13.4M between 2 players just to reach the floor!

None of these teams would likely attract top free agents and probably wouldn't want to give players term as they're going to have to give their own players raises in the years to come. Plus with a stacked draft in 26, more teams may be joining the rebuild club leading to an interesting offseason ahead. You might be seeing teams delaying prospects on ELCs or even competing to acquire bad contracts just to reach the floor. I think it will be a great summer to be a free agent or to unload a bad contract.

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[Andy]

They won’t have to sign players. They are gonna trade for pure cap dumps

 

[MHO]

They won’t have to sign players. They are gonna trade for pure cap dumps

But what cap dumps either don't have NMCs or would waive them to go to a rebuilding team?

 

[Mrfenn92]

Raid the LTIR market

 

[Andy]

But what cap dumps either don't have NMCs or would waive them to go to a rebuilding team?

Someone can take Price’s 10.5 cap hit for example.

I venture you’ll see a lot of this type of shit to reach the floor

 

[29Potvin]

But what cap dumps either don't have NMCs or would waive them to go to a rebuilding team?

Im sure we will see teams waiving players that have ntc knowing teams will need to reach the cap floor.
You may also see the price of retention as a third-party go down from what it has been in the past.

 

[The Crypto Guy]

Can't reach the floor, then you lose your 1st round pick. That simple.

 

[Dr Jan Itor]

Great opportunity to grab some assets.

 

[Gaylord Q Tinkledink]

Great opportunity to grab some assets.

Maybe. If there is indeed a few teams looking it might be a seller's paradise.

 

[Irie]

It may well likely be a "get out of jail free card" for the GMs that have handed out many ill-advised contracts recently, which is unfortunate, but reaching the floor should still be a relatively easy thing to do. (some of these teams may just have to overspend a little in the UFA market or take on a contract with some term they dont really want, but there should be plenty of options.)

 

[HuGort]

Going to be a lot of big contracts handed out this summer by sounds. To average players

 

[The Nuge]

As others have said, there’s definitely some cap dumps that teams will pick up (such as we just saw with Trouba and Goodrow), but also, Columbus is the only team of those 4 that would have trouble attracting free agents. Most players want to play in California/Florida for the weather, and Chicago has been able to attract players even after they started to fall off. I have a hard time believing those 3 couldn’t land a Marner/Rantanen/Ehlers/Boeser/Ekblad/etc if they went to free agency. Especially because their cap situation means they could likely make the biggest offers

 

[ToDavid]

Where are those player counts from? For next season Puckpedia has:

Chicago	16	$58.2m
Anaheim	14	$51.4m
Columbus	12	$47.7m
San Jose	16	$54.1m

I also think you're being a tad generous with some of those assumed ELC players. Several of them are still probably AHLers next year.

 

[Pierce Hawthorne]

Nope... But the price to dump bad contracts will likely come down, quite significantly in some cases.


IE in the flat cap world $6M was roughly the equivalent of a 1st round pick, I'd venture to guess with a $95M cap and no future concerns of a flat cap returning, that $6M for a dump likely becomes more like $9-10M.

 

[MHO]

Where are those player counts from? For next season Puckpedia has:

Chicago	16	$58.2m
Anaheim	14	$51.4m
Columbus	12	$47.7m
San Jose	16	$54.1m

I also think you're being a tad generous with some of those assumed ELC players. Several of them are still probably AHLers next year.

Maybe a tad generous. The numbers were from Spotrac.

 

[madmike77]

I know the Flames aren’t listed here but they’re also a cap floor team. They’ve been more competitive than the teams listed here, but from a roster construction standpoint I think they’re in a similar position. They do have to give Wolf a new deal and Andersson if he’s willing to stay. Bahl will also get a large raise based on his play this season. But I think they could struggle to stay at the floor as they bring more young players in.

Huberdeau, Kadri and Weegar’s deals are the only thing keeping them from serious cap issues.

 

[Chainshot]

But what cap dumps either don't have NMCs or would waive them to go to a rebuilding team?

The LTIRetired guys who used to all wind up in the league dumping ground known as Arizona. Now that Utah is trying to be competitive and no other team is willing to take those guys one, that'll be how they get to the floor.

 

[5cotland]

There is always multiple rebuilds happening at the same time.

However, clubs will always have awareness of what they will need to do to hit the cap floor.

Sometimes you will get a few players who will strike lucky and get a very high cap hit on a 1 year deal to see them to the floor and potentially use them as a decent trade chip at the deadline.

 

[Jumptheshark]

Poorly titled thread for a question with an obvious answer. Some of the teams in question have an internal cap and will have no trouble getting to the floor. With the cap going up? So will player demands

 

[NyQuil]

Can't reach the floor, then Ottawa loses its 1st round pick. That simple.

True.

 

[seanlinden]

There are going to be 3 implications:

1. You're going to continue to see contracts like Foligno, Gudas, etc. signed where veteran players, who are certainly on the back half of their careers, are getting money that would have previously been considered ridiculous.

2. If a team needs to shed a $4-6m player on a short term deal, and that player is at all useful, it's not going to cost all that much.

3. You'll likely continue to see LTIR contracts bounce around at reduced prices, especially if the contracts are insured.

 

[Ledge And Dairy]

Reaching the cap floor is probably the easiest thing to do as a GM. Rebuilding teams are always looking for vets to lead their kids and contending teams are always trying to offload inflated contracts. The cap is not going to jump like the NBA did in 2016 where the floor went up 21.7M, the league will raise it at a much more moderate pace to ensure an already capped out team can't just add a star player in free agency (like Golden State did with Durant).

 

[PullHard]

Justin Holl to the highest bidder

 

[Drake1588]

Reaching the floor is not difficult, and it is not negotiable.

If you are not compliant with the cap provisions in the CBA, you don't get to play. You forfeit games until such time as the team submits a roster that is compliant (over the cap floor, under the cap ceiling.) Then the league would likely impose fines and take away draft picks. So teams will make sure they are under the cap and over the floor. Occasional dispensations like the CBJ this season after their superstar's passing have happened, but this is a different scenario.

How do they get there? The usual ways. First of all, the steep cap bump is not going to take place in a vacuum. Agents are going to be arguing for percentages of the cap, not finite dollars compared with recent years' wages. Salaries are going up. A middle-six guy who used to make $4M-$6.5M? That guy is probably now going to start making $6M-$8.5M. And so on.

Do players necessarily choose to play for you as a rebuilding club in maybe not the most exciting of markets? Probably not, and likely not at a market-competitive offer. Yet once you start offering wages that are over market value, and then substantially over market value if that's not enough, players will adjust their calculus quickly. Every market is a fine place to play, and for 15-20 percent higher wages, most people would go anywhere during their finite peak years of playing time.

And yes, there are potential implications for trades involving cap dumps and LTIR contracts, but this is always overblown by fans of teams that desperately want to see their bad contracts off the books and engage in a little wishful thinking. It's more likely that teams in these situations make their own dumb UFA signings, and probably for less term than the contracts you hope they take off your own team's hands.

As to roster spots that are "taken up" by a team's desire to bring in kids? Tough. You need to be compliant, and if that means an overpaid veteran takes up a spot instead of a promising kid on his ELC, then you lump it. Management will adjust fast to the new cap floor and ceiling, though. It'll be a temporary bump in the road.

 

[StlBigFly]

I think the majority of commenters here so far have perhaps failed to grasp the severity of the problem.

There are not infinite nhlers. Every team does not have a giant Ltir contract to move, let alone a contract without move protection. The splintering of contracts due to low tax states amplifies the problem, complicates solutions, and is a major source of movement clauses, the final headwind.

The league is in the middle of an expansionary phase however the talent pool recently experienced a pandemic and likely will cause a predictable lull in nhl talent.

We have left a phase of one extreme: where a stagnant cap forced every contending team to employ acuaries to be cap compliant highlighted by Edmonton ending exactly at 0 last year iirc.

And now we have rapidly entered another. A short squeeze of sorts. On player contracts. There is no bad contract. There are only ones that can be moved. Trouba shows that bidding wars will occur for these contracts and that the market is hungry for more. Somebody(ies) will be left without a chair when the music stops.