The Cap Should Be Over $100 Million Right Now. How Is The NHL going to handle the inevitable post-COVID cap rise?

[RabbleMasterBlaster]

100 mil cap, 50 spent on scrubs. It's better for the fringe nhlers though. Guys who could barely crack the AHL will now have guaranteed million dollar contracts just so teams can meet the floor.

Last McJesus contract will be 25m/year

 

[GirardSpinorama]

There's a good thread on Reddit posted by a user named tkecanuck341 that discusses the fact that at 6.43 billion in NHL revenue for 22-23, the NHL is millions behind what the cap actually should be based on a 50-50 HRR split:



He goes into big detail on it, but more or less I believe he is correct. 6.43 billion in HRR is 32% higher than the 4.86 billion it was in 18-19, the last year before COVID hit, when the cap used to be 79.5 million. An increase of 32% over 79.5 mill cap (as it was in 18-19) would be 105 million almost. Now granted there's an extra team in Seattle (32 teams instead of 31), but still the cap should probably be over $100 million based on revenue already.

This has been held back because the players had to pay back the owners for losses during COVID, but that was fully paid off last season already I believe, two years ahead of schedule.

Now I believe the NHL has a mechanism where the cap can only rise so much the next two years (6%?) because of COVID conditions, but after that, that stipulation goes away.

I wonder how the NHL will handle this? Maybe they allow the cap to hit 100 mill for the 25-26 season to prevent a massive spike the following year? Revenue is headed towards 7 billion in 2 years, on a 7 billion HRR 50-50 split between owners and players, the cap should be a whopping $110+ million approximately.

How much longer do we think the players/PA will accept far less than 50% of HRR that they're entitled to now that the COVID debt is paid off?

Is the split based on revenue or revenue net expenses? We need to know the real numbers before saying the current lag formula is not reflecting the 50/50 split.

 

[Lunatik]

That essentially only applies for next season, where it will increase by around 5% (although this year was also supposed to be 5%, which should have meant a 87.7 mill cap but instead it increased to 88 million, so I'm not sure if even this is rock solid or just a starting point).

Based on last season, the cap should be a minimum of about 92.5 million for next year.

However the 5%-ish rule is basically over after that as the CBA expires after 25-26 season and all COVID era stipulations are basically over.

So that means for the 26-27 season the cap could skyrocket well past $100 million even just based on today's revenue, let alone increasing revenue.

If the players asks for the normal 50-50 HRR split, as is their right, the cap could balloon to like $110+ million, lol, that's why I'm asking how the NHL is going to handle this. Maybe the PA can be talked into taking less due to escrow, but I have a hard time seeing them taking way below 50% HRR for years on end.

The cap is way lower than what it should be based on HRR, that can't stay that way much longer now that the COVID debt is paid off.

Just FYI, just because the cap is lower than 50%, doesn't mean they aren't getting 50%. All the lower cap means is that instead of escrow, they are going to receive equalization payments. They still get their 50% of HRR.

 

[Bruins4Lifer]

Just FYI, just because the cap is lower than 50%, doesn't mean they aren't getting 50%. All the lower cap means is that instead of escrow, they are going to receive equalization payments. They still get their 50% of HRR.

You're about the 7th person to explain it now, and I'm not sure if it's gotten through yet.

 

[GirardSpinorama]

Just FYI, just because the cap is lower than 50%, doesn't mean they aren't getting 50%. All the lower cap means is that instead of escrow, they are going to receive equalization payments. They still get their 50% of HRR.

Ya that's what im not getting. The players will get their money regardless of the cap increase. Its really more of a question of whether or not the revenue projections are still valid. A recession can easily turn it sour in a gate driven league.

 

[Ciao]

Just FYI, just because the cap is lower than 50%, doesn't mean they aren't getting 50%. All the lower cap means is that instead of escrow, they are going to receive equalization payments. They still get their 50% of HRR.

I don't think he gets this.

 

[Lunatik]

You're about the 7th person to explain it now, and I'm not sure if it's gotten through yet.

I didn't read 7 pages lol.

 

[FriendlyGhost92]

The NHLPA would have to be the biggest suckers of a PA in pro sports to get scared by that.

10.6% increase in cap versus a 32+% rise in salary cap is hilariously bad to begin with, I don't think that would fly in any of the other major pro sports.

No one in the NHLPA believes the NHL is going to risk a lock out over that. They have no ground to stand on whatsoever, it's a complete paper threat.

If business in the NHL was terrible and revenue was down pre-COVID and COVID somehow devastated the league, OK, but we are MILES away from that, the reality is the complete opposite actually, I think the NHL has higher revenue increase than both the NBA and MLB.

The players deserve a (big) bone being thrown their way, even the owners and Bettman know that.

Gonna bet the owners believe the NHLPA isn't gonna risk a lockout over the cap going up a few years sooner either, considering only a fraction of the players benefit.

It's sad that you've made this many long posts arguing just to argue, and not realizing that they're getting skimmed at best.

Stop doubling down on ignorance.

 

[FriendlyGhost92]

I know it's not a 1:1 comparison, but it's f***ing hilarious that a bench player on an NBA team like Riu Hachimura (for non-basketball purists, this is the equivalent of like a 3rd/4th line player), a guy who is not even in the top 100 NBA salaries makes more than any NHL player, lol.

For next season

Hachimura - $17 million
Matthews - $16.7 mill actual salary (13.25 mill cap hit)
MacKinnon - $15.7 mill actual salary
McDavid - $10 mill actual salary

I mean that's just laughable. I know the NBA is a higher revenue league but it's not *that* much higher revenue.

The top paid NHL player shouldn't be below the 100th paid NBA player. NBA players should definitely get more but that is ridiculous.

Yeah bro, it's truly remarkable that players make more in a league that generated $4B+ more revenue than the NHL in 22-23, with team rosters that are 2/3rds the size of NHL rosters.

I am befuddled by this revelation.