PALM BEACH, Florida -- This is the time of year when the cap projections usually are optimistic. It’s the time when the commissioner emerges from the NHL's Board of Governors meeting and gives a number for next season that ends up being just a little too high.
So when Bettman’s initial projection for the 2017-18 salary cap on Thursday was somewhere between its current spot and a $2 million increase, you couldn’t help but hear only the part where he suggests it could be a bit flat. There was a pessimism that usually isn’t present this time of year.
“There’s always a range, but it’s something we’re going to have to look at very carefully in terms of how best to approach it,” Bettman said. “The cap could range from where it is now to a couple or so million up. We’re going to all have to focus on what makes most sense going forward.”
That was enough of an indication that the NHL isn’t going to see a big jump in the salary cap. But Bettman dropped a couple other hints.
There’s been a lot of talk from the players about their hatred of escrow, and understandably so. It’s no fun to see a chunk of money you think you’re going to get disappear. What the players’ contracts really represent is a percentage of the revenue pie, not necessarily a hard salary. That’s not an easy concept to grasp though, when you sign your name to a contract and then anticipate getting paid exactly what’s on it.
Bettman came up with a very practical solution for those who want to eliminate escrow.
“If you lowered the cap, you’d have less escrow. It’s that simple,” Bettman said. “The players in the last round of collective bargaining ... wanted to change the formula to raise the cap, which raises the escrow.”
Bettman doesn’t typically say things by accident, and my good friend Chris Johnston seemed to pick up on that when he asked Bettman if his preference was for the cap to stay the same or to decline just to address the escrow issue.
“The answer to that is one I would prefer to discuss with the players association first,” Bettman answered.
There are a lot of factors at play between now and when a cap number ultimately is determined for next season, something the owners and general managers in the room with Bettman this week understand.
“You kind of speculate what’s going to happen,” said Winnipeg Jets GM Kevin Cheveldayoff when we chatted in the lobby of The Breakers resort after the meeting. “There’s different forces at play. The Canadian dollar is such a big factor in it. You always take it with a grain of salt at this point in time. I don’t know if you can take it to the bank to make your final determinations.”
Reading the tea leaves, teams better start preparing for a salary cap that looks awfully close to the current one, at $73 million.
Since the last lockout, the increase in the cap on a year-to-year basis is trending down. Here are annual salary-cap increases from the previous season:
2013-14: up $4.3 million
2014-15: up $4.7 million
2015-16: up $2.4 million
2016-17: up $1.6 million
That number is getting smaller and smaller. There’s no major revenue generator coming either, which suggests a flat salary cap for the first time since 2009-10 is on the way.
Who does that impact most, and how would a flat cap impact NHL rosters? Here’s a look:
Artemi Panarin, LW, Chicago Blackhawks
On Monday, we examined what the next Panarin contract might look like -- and it’s going to be a big one. This is a team that’s already tight against the salary cap on an annual basis, a team that negotiated deals with its superstars under the assumption that the cap would go up every year.
If Panarin’s contract jumps from $812,000(!) to the $7.5 million Vladimir Tarasenko is earning per year, that’s a healthy, healthy increase. It means someone has to go, either Panarin or Brent Seabrook or another one of the Blackhawks' core players.
GM Stan Bowman showed he’s not afraid to move a young forward in making the Brandon Saad deal, but that has to be less appealing as the other Blackhawks get older.
“A young kid like that, on a team that is aging, I don’t think you let him go,” said one NHL source.
Nobody did a better job of using salary-cap space as an asset than Coyotes GM John Chayka did this past season. By taking on the contracts of Dave Bolland and Pavel Datsyuk, the Coyotes were able to land high-end prospects Jakob Chychrun and Lawson Crouse.
The Coyotes, on paper, are a cap team right now, but according to capfriendly.com, they have just $44.5 million committed to next year’s cap. That gives Chayka a lot of flexibility to be creative again next season as he collects young players.
“We were able to use it this year. That’s not going to be the case in a couple years,” said Coyotes CEO and co-owner Anthony LeBlanc. “As everyone knows, we have a youth-oriented team. Some of those players are coming off their entry-level contracts.”
Signing young players can get expensive, but the Coyotes still have time to figure that out.
“We don’t envision any short-term period where we will be a cap team from a cash perspective, but our payroll is going up every year,” LeBlanc said. “It’s going to quickly get to that point where we won’t have that tool.”
Steve Yzerman, GM, Tampa Bay Lightning
Somehow Yzerman got the puzzle pieces to fit in Tampa this offseason. He got Steven Stamkos and Victor Hedman to take a discount and sign long-term deals under market value. He signed Nikita Kucherov to one of the best bridge deals in the league. He worked a lot of magic.
With a flat cap, it doesn’t get any easier. After this season, Tyler Johnson, Ondrej Palat and Jonathan Drouin all are going to need new contracts as restricted free agents.
It’s going to take real shuffling to make it happen. Whether that’s moving Ryan Callahan or one of the other players needing a raise, Yzerman has his work cut out. A flat cap doesn’t help the cause one bit.
Kevin Shattenkirk, D, St. Louis Blues
Shattenkirk is our representative for all the big-name unrestricted free agents expected to hit the market this offseason. He’s due a big raise. He’s going to be the most sought after defenseman on the market. The Blues can’t afford to give him what he can earn on the open market.
But a flat cap might limit the market for Shattenkirk and the other unrestricted free agents. If the players are so upset about escrow, it’s possible they don’t enact the escalator clause that bumps up the cap. That would be awful timing for Shattenkirk, Alexander Radulov, Ben Bishop and some of the other big-name free agents.