News Article: Three reasons why the NHL salary cap could get tighter

[deeshamrock]

Pretty interesting read by Elliotte Friedman on the Trouba deal and why they opted for it, possibly with a tight CAP situation on the horizon.

Three reasons why the NHL salary cap could get tighter - Sportsnet.ca

Some merit to his point that young players want their share, not settling for a bridge deal.

That the current CBA could be reopened in Sept but neither side wants it, but the players are tired for losing $$ due to the escrow. So if they get their way, the CAP won't rise as much.

The players don’t want a stoppage, but they want escrow to be eased. Last season’s number was 11.6 per cent, and if I had that much of my paycheque being withheld every two weeks, I’d be annoyed, too.

ON NBC's contract being up 20/21 and what that new USA tv deal might mean for the CAP, that it might be the CAP goes up 2 to 2.5 M per yr for the next two years.


Then, if everything works out with the American television deal, there’s a consistent rise for 2021-22 and beyond. It means a tight two seasons, but is the best hope for labour peace.

So maybe other GM's will be eyeing that theory as well, as making moves accordingly.

Click to read more...

 

[fsanford]

Pretty interesting read by Elliotte Friedman on the Trouba deal and why they opted for it, possibly with a tight CAP situation on the horizon.

Three reasons why the NHL salary cap could get tighter - Sportsnet.ca

Some merit to his point that young players want their share, not settling for a bridge deal.

That the current CBA could be reopened in Sept but neither side wants it, but the players are tired for losing $$ due to the escrow. So if they get their way, the CAP won't rise as much.

The players don’t want a stoppage, but they want escrow to be eased. Last season’s number was 11.6 per cent, and if I had that much of my paycheque being withheld every two weeks, I’d be annoyed, too.

ON NBC's contract being up 20/21 and what that new USA tv deal might mean for the CAP, that it might be the CAP goes up 2 to 2.5 M per yr for the next two years.


Then, if everything works out with the American television deal, there’s a consistent rise for 2021-22 and beyond. It means a tight two seasons, but is the best hope for labour peace.

So maybe other GM's will be eyeing that theory as well, as making moves accordingly.

I think there is a lockout, and part of me is actually hoping it happens, maybe we get some buyouts that will not impact the cap situation.

 

[Sol]

I like how the PA keeps asking for the moon and when they get it, it's never enough. These contracts are awful. They really need to come down on years of max contracts so teams can have more flexibility.

 

[jfont]

I like how the PA keeps asking for the moon and when they get it, it's never enough. These contracts are awful. They really need to come down on years of max contracts so teams can have more flexibility.

i really disagree with a lot of your post in this forum but respect that you have your own opinion.

again, I disagree with the statement that its all PA's fault. a large portion of the blame should go to the owners who let their GMs hand out these contracts.

 

[KINGS17]

Pretty interesting read by Elliotte Friedman on the Trouba deal and why they opted for it, possibly with a tight CAP situation on the horizon.

Three reasons why the NHL salary cap could get tighter - Sportsnet.ca

Some merit to his point that young players want their share, not settling for a bridge deal.

That the current CBA could be reopened in Sept but neither side wants it, but the players are tired for losing $$ due to the escrow. So if they get their way, the CAP won't rise as much.

The players don’t want a stoppage, but they want escrow to be eased. Last season’s number was 11.6 per cent, and if I had that much of my paycheque being withheld every two weeks, I’d be annoyed, too.

ON NBC's contract being up 20/21 and what that new USA tv deal might mean for the CAP, that it might be the CAP goes up 2 to 2.5 M per yr for the next two years.


Then, if everything works out with the American television deal, there’s a consistent rise for 2021-22 and beyond. It means a tight two seasons, but is the best hope for labour peace.

So maybe other GM's will be eyeing that theory as well, as making moves accordingly.

Essentially what the NHLPA is advocating when they say "they want escrow to be eased", is they want a larger piece of the revenue pie. The total salaries paid out to players are a 50% of hockey related revenue every single season. The players have for years foolishly voted for the escalator to artificially raise the cap every summer.

The owners didn't care about the cap going up due to the escalator. They are going to pay 50%. I fail to see why the owners would ease the escrow payments just because the players can't do basic math. To illustrate here is a over-simplified example with round numbers. Suppose you have a salary cap of $100M due to the players invoking a super escalator clause (if there was such a thing), but the hockey related revenue the NHL takes in is only $180M. That means the total in salaries the owners are going to pay is $90M. That's a 10% escrow payment, and at the end of the season that 10% goes to the owners.

The players already under contract lose money every time they vote for the escalator. Are their financial advisors and agents giving them poor advice when it comes to voting for the escalator? Sure seems that way to me.

 

[lumbergh]

Essentially what the NHLPA is advocating when they say "they want escrow to be eased", is they want a larger piece of the revenue pie. The total salaries paid out to players are a 50% of hockey related revenue every single season. The players have for years foolishly voted for the escalator to artificially raise the cap every summer.

The owners didn't care about the cap going up due to the escalator. They are going to pay 50%. I fail to see why the owners would ease the escrow payments just because the players can't do basic math. To illustrate here is a over-simplified example with round numbers. Suppose you have a salary cap of $100M due to the players invoking a super escalator clause (if there was such a thing), but the hockey related revenue the NHL takes in is only $180M. That means the total in salaries the owners are going to pay is $90M. That's a 10% escrow payment, and at the end of the season that 10% goes to the owners.

The players already under contract lose money every time they vote for the escalator. Are their financial advisors and agents giving them poor advice when it comes to voting for the escalator? Sure seems that way to me.

The players are going to get the same half of the pie due to escrow. Using the max escalator just dilutes all the existing contracts. Kopitar’s $10 million becomes $9 million instead. The increase in the cap benefits free agents because they can sign for more. This becomes a player vs player situation. Every player wants the cap to go up, but players with good long contracts want escrow to go away.

 

[KINGS17]

The players are going to get the same half of the pie due to escrow. Using the max escalator just dilutes all the existing contracts. Kopitar’s $10 million becomes $9 million instead. The increase in the cap benefits free agents because they can sign for more. This becomes a player vs player situation. Every player wants the cap to go up, but players with good long contracts want escrow to go away.

We are in not so violent agreement here. It is a player vs player situation, and it doesn't make sense to me for the guys who vote for the escalator every year to come back and complain about the amount of escrow being taken out of their paycheck increasing. Stop voting for the escalator, and stop artificially inflating the salary cap. There are far more players under contract any given summer than there are UFAs.

 

[Chazz Reinhold]

We are in not so violent agreement here. It is a player vs player situation, and it doesn't make sense to me for the guys who vote for the escalator every year to come back and complain about the amount of escrow being taken out of their paycheck increasing. Stop voting for the escalator, and stop artificially inflating the salary cap. There are far more players under contract any given summer than there are UFAs.

Didn’t they only use 1.25% of it last offseason?

 

[KINGS17]

Didn’t they only use 1.25% of it last offseason?

To be honest I don't know how much the players bumped it up last season with the escalator. I think the cumulative effect of doing it every year for quite some time has taken its toll on the escrow payments of players who have been under contract for over three years. If you are one of these players in that situation, why keep voting for the escalator?

 

[Ziggy Stardust]

I like how the PA keeps asking for the moon and when they get it, it's never enough. These contracts are awful. They really need to come down on years of max contracts so teams can have more flexibility.

Didn't realize those poor owners were being forced by the greedy players to overspend on player salaries. Kevin Hayes must've held the Flyers at gunpoint.

Maybe those who overpay these contracts are at fault?

 

[kingsholygrail]

I wonder how irritated owners get with each other when there's ridiculous contracts handed out.

 

[Kings man 4 life]

Why don't they just give contracts that say player X will get % of the total cap. If it shrinks or goes up they are still getting that percentage. Solves long term complaints of screwy contracts, and players still get paid. Also signing bonuses should only effect the first year of a contract, every year is stupid.

That's just my thoughts I'm sure some lawyer will come and say why this is illegal.

 

[KINGS17]

Didn't realize those poor owners were being forced by the greedy players to overspend on player salaries. Kevin Hayes must've held the Flyers at gunpoint.

Maybe those who overpay these contracts are at fault?

From a purely financial standpoint the owners don't care. It has been and always will be going forward a 50/50 split on the hockey related revenue. Now, revenue may decrease in key markets if enough of the teams in those markets don't put a contending team on the ice. If that happens the player's escrow payments will go up.

 

[KINGS17]

I wonder how irritated owners get with each other when there's ridiculous contracts handed out.

I don't think the smart owners care. They recognize it is going to be a cycle of contending for 3-5 years, then some lean years, then building toward contention again. As a fan of the Kings, I would like to see them be smart enough to recognize when a run is over and minimize the lean years.