[News] Bouma, Byron, and Jooris and 20 other players file for Salary Arbitration

[Finger Cookin]

Originally Posted by Fire

The more I think about it, the riskier it is signing Bouma to a long term contract for much more than $1.5 million/yr right now. The Cap staying most likely flat next season is worrying. Bouma is still a RFA after this season, the Flames can accept the 1 year arbitration and re-evaluate next off-season. Most likely his production drops next season with the emergence of Ferland, Bennett and Frolik.

The Canadian dollar lost almost 20% of its value from July 2014 to July 2015, but the cap still went up almost 3.5% because of the new money from the Rogers TV deal. Why would the cap go flat now?

[getbak]

Over the next three seasons, three teams will be moving into new buildings (Islanders, Oilers, Red Wings). Each of those buildings should allow the team to generate additional revenue.

If the Coyotes relocate, it should be somewhere that their revenue improves.

If the league expands to Vegas and/or Quebec City, both teams should have revenue higher than the current league average.


All of those factors (plus normal inflation) should see league-wide revenue continue to rise over the next few years, which should also lead to a steady increase in the salary cap.

[Vulcan]

Originally Posted by GreenLantern2814

The core is all that matters - Monahan, Gaudreau, Bennett, Brodie, Gio, Hamiton. Assuming an 8M deal for Gio, we have $31.375M tied up in six players. The oldest non-Gio player in that group is 24 years old.

Our cap situation is going to be fine.

I'm not saying our cap situation is not going to be fine but I'm putting in perspective what we are looking at in a year from now.

We also have contract obligations to other players such as Backlund, Raymond, Smid, Engelland, Wideman and Stajan that aren't going to disappear by snapping your fingers.

The core is all that matters eh? Unless we have players ready to step in and replace the other parts we'll be in a constant state of rebuild.

[Weitz]

Originally Posted by Finger Cookin

The Canadian dollar lost almost 20% of its value from July 2014 to July 2015, but the cap still went up almost 3.5% because of the new money from the Rogers TV deal. Why would the cap go flat now?

Didn't it only go up because of the player elected artificial inflator? Or something like that?

[GreenLantern2814]

Originally Posted by Vulcan

I'm not saying our cap situation is not going to be fine but I'm putting in perspective what we are looking at in a year from now.

We also have contract obligations to other players such as Backlund, Raymond, Smid, Engelland, Wideman and Stajan that aren't going to disappear by snapping your fingers.

The core is all that matters eh? Unless we have players ready to step in and replace the other parts we'll be in a constant state of rebuild.

Smid is either going to retire or he's going to be traded - there's no room for both him and Engelland, and I'd rather have Deryk.

There isn't ever going to be a shortage of teams in need of veteran players who are as good as Wideman and Stajan. On this team, they exist to be replaced by younger players.

Raymond's still a serviceable NHL player, and I'm sure Treliving can get something done where we don't retain salary.

Include Backlund in the core too if you want, I won't disagree. But anyone who isn't in that group should be on a shorter term higher dollar value deal ie Engelland in order to maintain flexibility.

Being close to the cap doesn't concern me as long as the contracts that put us there are reasonably easy to get rid of.

[getbak]

Originally Posted by Weitz

Didn't it only go up because of the player elected artificial inflator? Or something like that?

It's not really an artificial inflator. It's an assumption that basic revenue will increase year-to-year due to inflation (which it almost always does).

People really misunderstand the way the 5% inflator works, especially the media people who cover the game. There's no witchcraft or made-up numbers. Every projection for the upcoming season is based on actual revenue from the previous season.

They take the actual league-wide HRR for the previous season and apply a 5% growth factor to that (to account for normal inflation) when calculating the expected revenue for the following season. They can also account for known significant increases in revenue that will be occurring in the upcoming season (such as a new tv contract).

They don't just willy-nilly increase the cap year after year because they want to increase the cap.


Here is what the CBA says on calculating the salary range midpoint (which is used to calculate the cap and floor) for the next season...

(Preliminary HRR for the prior League Year multiplied by fifty (50) percent (the Applicable Percentage), minus [-] Projected Benefits), divided [/] by the number of Clubs then playing in the NHL (e.g., 30), shall equal [=] the Midpoint of the Payroll Range (which figure shall be considered the Midpoint only for purposes of calculating the Adjusted Midpoint; all references to the "Midpoint" thereafter shall mean the "Adjusted Midpoint"), which shall be adjusted upward by a factor of five (5) percent in each League Year (yielding the Adjusted Midpoint, which shall then become the Midpoint of the Payroll Range) unless or until either party to this Agreement proposes a different growth factor based on actual revenue experience and/or projections, in which case the parties shall discuss and agree upon a new factor. If a significant (i.e., $20 million or more) onetime increase or decrease to League-wide revenues (e.g., by reason of the addition or loss of a national television contract or the scheduled opening of one or more new arenas which is expected to result in a significant increase in League-wide revenues) is anticipated in the next League Year, the parties will endeavor to estimate the expected increase or decrease and incorporate that estimate into the above-stated formula for calculating the Adjusted Midpoint.

After adjustment for the revenue growth factor, the Payroll Range shall be constructed by adding to the Adjusted Midpoint an amount equal to fifteen (15) percent of the Adjusted Midpoint (i.e., multiplying the Adjusted Midpoint by one-hundred fifteen (115) percent) to establish the Upper Limit, and subtracting from the Adjusted Midpoint an amount equal to fifteen (15) percent of the Adjusted Midpoint (i.e., multiplying the Adjusted Midpoint by eighty five (85) percent) to establish the Lower Limit. Notwithstanding the foregoing, (i) the magnitude of the Team Payroll Range shall never be less than $16 million (i.e., +/- $8 million of the Adjusted Midpoint) or greater than $28 million (i.e., +/- $14 million of the Adjusted Midpoint) and (ii) the Upper Limit shall never be less than $64.3 million (notwithstanding Preliminary HRR for the prior League Year), provided, however, that should the calculations described above produce an Upper Limit below $64.3 million, the Midpoint and the Lower Limit for that League Year shall be set in accordance with those calculations (without regard to the resulting magnitude of the Payroll Range).

The 5% growth factor is applied every year (unless either the league or PA ask for it to not be applied) because it reflects the normal and expected inflation of revenue from one season to the next.

[codynw]

Originally Posted by GreenLantern2814

Smid is either going to retire or he's going to be traded - there's no room for both him and Engelland, and I'd rather have Deryk.

Why would Smid retire? He's still owed millions of dollars, he's not just going to give that up. If he's healthy, he'll play somewhere. If he's not, he'll go on LTIR.

[Parallex]

Originally Posted by getbak

The 5% growth factor is applied every year (unless either the league or PA ask for it to not be applied) because it reflects the normal and expected inflation of revenue from one season to the next.

so if we assume the 5% increase every year over year then we're looking at a cap ceiling of...

71.40 (This Upcoming Year)
74.97
78.71
82.64
86.77

For the next 5 seasons.

[Vulcan]

Originally Posted by codynw

Why would Smid retire? He's still owed millions of dollars, he's not just going to give that up. If he's healthy, he'll play somewhere. If he's not, he'll go on LTIR.

Yeah, he's owed $7.75M to be exact.

[GreenLantern2814]

Originally Posted by Vulcan

Yeah, he's owed $7.75M to be exact.

Doesn't insurance pay for that if he retires due to injury? From what I recall, Savard was on LTIR because he'd already had concussion history and his deal wasn't insured, and Pronger was a 35+ contract.

Those are the only players I can recall taking up LTIR space every year.

[Coach]

Originally Posted by GreenLantern2814

Doesn't insurance pay for that if he retires due to injury? From what I recall, Savard was on LTIR because he'd already had concussion history and his deal wasn't insured, and Pronger was a 35+ contract.

Those are the only players I can recall taking up LTIR space every year.

My understanding is the vast majority of contracts are NOT insured, because the cost of insuring them vs the risk a player might get hurt is only worth for top-tier players.

[shotinthebacklund]

Originally Posted by codynw

Why would Smid retire? He's still owed millions of dollars, he's not just going to give that up. If he's healthy, he'll play somewhere. If he's not, he'll go on LTIR.

While yes this is true, who wants to walk away from 7.5 mil. There becomes a balance between money and long term life functionality. As I understand the situation this injury borders on long term health and his retirement may be the path he takes for himself and his family.

If he is healthy enough to play but chooses not to, retirement is the only choice.

[bax]

Originally Posted by shotinthebacklund

While yes this is true, who wants to walk away from 7.5 mil. There becomes a balance between money and long term life functionality. As I understand the situation this injury borders on long term health and his retirement may be the path he takes for himself and his family.

If he is healthy enough to play but chooses not to, retirement is the only choice.

Didn't Treliving say he would be good to go for training camp?

[Vulcan]

Originally Posted by MattyC

My understanding is the vast majority of contracts are NOT insured, because the cost of insuring them vs the risk a player might get hurt is only worth for top-tier players.

I don't remember the players name but in the late 90s a defenceman we acquired suffered a career ending injury and his contract wasn't insured. I think it was only for about $2M per but at the time it was a big deal to our internal cap.

[GioforPM]

Originally Posted by Vulcan

I don't remember the players name but in the late 90s a defenceman we acquired suffered a career ending injury and his contract wasn't insured. I think it was only for about $2M per but at the time it was a big deal to our internal cap.

Nathan Horton's contract wasn't insured.

[Robbob]

Originally Posted by Vulcan

I don't remember the players name but in the late 90s a defenceman we acquired suffered a career ending injury and his contract wasn't insured. I think it was only for about $2M per but at the time it was a big deal to our internal cap.

Brad Werenka

[sureLoss]

When a player retires, the club or insurance no longer makes payments on a contract.

The cap hit may persist if the player is 35+ though.

[Street Pharmacist]

Originally Posted by shotinthebacklund

While yes this is true, who wants to walk away from 7.5 mil. There becomes a balance between money and long term life functionality. As I understand the situation this injury borders on long term health and his retirement may be the path he takes for himself and his family.

If he is healthy enough to play but chooses not to, retirement is the only choice.

He can stay on long term IR as long as there's risk of further injury or functional limitation. He doesn't need to retire

[Fire]

Originally Posted by Finger Cookin

The Canadian dollar lost almost 20% of its value from July 2014 to July 2015, but the cap still went up almost 3.5% because of the new money from the Rogers TV deal. Why would the cap go flat now?

For most of the season the CDN dollar was still in the mid-80s. Now it's in the 70s and still most likely going down before it goes up. The NHL hasn't felt the full impact of the decline in the CDN dollar yet. The TV deal will help a bit because I believe Roger's yearly payment to the NHL increases every year, but my guess would be for a 2016-17 cap that is within $1.5 million of this season's cap.

[Finger Cookin]

Fair enough. I guess we'll see how it plays out.