NHL Free Agency Starts Today

[Kntx]

I don't see how a responsible GM can write a contract for 17 years for a 27 yo player. I know Kovy is a badass, but there's a good chance that the Devils could have a 6 mil cap hit for 5-7 years for a useless old player.

 

[Blackjack200]

I don't see how a responsible GM can write a contract for 17 years for a 27 yo player. I know Kovy is a badass, but there's a good chance that the Devils could have a 6 mil cap hit for 5-7 years for a useless old player.

Kovalchuk will not play for $500,000 a year, he will retire. Even if he doesn't we can trade him to a team that needs to get over the cap floor. Lots of teams would do this because they'd get credit for a $6 million cap charge, but would only have to pay him $500k.

Essentially, it's just circumvention of the salary cap. Same with Johan Franzen, Marion Hossa, Chris Pronger and a few others.

 

[Kntx]

Are there cap implications for the team if he retires before the end of his contract, or does the contract drop off the books?

 

[Blackjack200]

Are there cap implications for the team if he retires before the end of his contract, or does the contract drop off the books?

Drops off the books.

 

[mugs]

Drops off the books.

As long as he's under 35 when he signs the contract.

 

[Blackjack200]

As long as he's under 35 when he signs the contract.

Good point. They are thinking of getting rid of that provision as it has made many teams hesitent to sign players over 35.

 

[BassBomb]

can someone explain very thoroughly how this extra year thing works?

 

[FallenHero]

can someone explain very thoroughly how this extra year thing works?

As in why they sign for all these extra years?

NHL contracts and their cap hits are an average over the lifespan of the contract, not the actual amount paid in any one year. So this 102 million dollar 17 year contract is extremely front loaded, but only costs roughly 6 million a year in cap space. I think the NHL is the only league to do it like this, and I expect it to be changed during the next negotiation as it basically makes teams able to rid themselves of the cap by signing crazy long contracts.

 

[Blackjack200]

As in why they sign for all these extra years?

NHL contracts and their cap hits are an average over the lifespan of the contract, not the actual amount paid in any one year. So this 102 million dollar 17 year contract is extremely front loaded, but only costs roughly 6 million a year in cap space. I think the NHL is the only league to do it like this, and I expect it to be changed during the next negotiation as it basically makes teams able to rid themselves of the cap by signing crazy long contracts.

I think the NFL might structure it simliarly with the guaranteed (bonus) portion of their contracts.

 

[FallenHero]

I doubt it Seabrook is still young. For this to work the end of the contract (when it tails down to 1/2 million per year) has to coincide with the player reaching retirement age. The idea is that the player will just retire when the salary gets that low. Seabrook will be 35 years old when he hits the tenth year, and won't want to be making $500,000. If the Hawks want to take advantage (like they've already done with Hossa) they would likely need to sign him to a 17ish year deal. More likely you'll see Seabrook sign one more short term 3-5 year deal (I think he'll still be an RFA so it shouldn't be too much) and then sign a cap-bending contract when that's up.

We will see. The Keith/Seabrook combo is something they want to keep together, so a crazy long contract like Keith got isn't out of the question.

 

[BassBomb]

As in why they sign for all these extra years?

NHL contracts and their cap hits are an average over the lifespan of the contract, not the actual amount paid in any one year. So this 102 million dollar 17 year contract is extremely front loaded, but only costs roughly 6 million a year in cap space. I think the NHL is the only league to do it like this, and I expect it to be changed during the next negotiation as it basically makes teams able to rid themselves of the cap by signing crazy long contracts.

So in awhile, Kovalchuk will be getting almost nothing but the team will take 6 mill cap hit?

 

[mugs]

So in awhile, Kovalchuk will be getting almost nothing but the team will take 6 mill cap hit?

No, because he'll retire when he's sitting on a pile of money and making $750k a year (after years of inflation).

As I said before, I don't like it when teams play these games. But when other teams are doing it - and winning the Stanley Cup - it's hard to blame the Devils for gaming the system in the same way (though they pushed it a bit farther).

Hey, Gordie Howe played until he was 52. He played in the NHL in 5 different decades.

 

[Kntx]

So in awhile, Kovalchuk will be getting almost nothing but the team will take 6 mill cap hit?

Yes, but the idea is that he'll probably retire around 40 with 5 years left on his contract. At that point the team doesn't owe him any more money and his cap hit goes away. So for the years he actually played his salary was much higher than his cap hit.

 

[SP33Demon]

So what's stopping a team from signing someone for 25 years to lower their average $$ hit on the cap? Is there a limit to this madness?

 

[FallenHero]

So what's stopping a team from signing someone for 25 years to lower their average $$ hit on the cap? Is there a limit to this madness?

No limit really. I think the Blackhawks started the gravy train with the Hossa signing and the NHL investigated trying to find a way they broke the rules. It just so happens there is a massive massive loophole allowing signings like it so teams are jumping on and the players are more then happy to join them. Everybody wins...well, except the teams with no money.

You be Patrick Kane, sign a 200 million 30 year contract but retire after 15 years and it would be perfectly legal. The risk for the team is the player getting hurt/becomes shitty/stops trying/dies, you are out a shitload of cash and the player is untradable. No one will touch kovalchuk with that contract. Ever. He will retire a NJ devil for sure.

Check out the massive boost in pay. Wow.

http://www.nhlnumbers.com/overview.php?team=NJD&season=1011&expand=y

 

[mugs]

No limit really. I think the Blackhawks started the gravy train with the Hossa signing and the NHL investigated trying to find a way they broke the rules. It just so happens there is a massive massive loophole allowing signings like it so teams are jumping on and the players are more then happy to join them. Everybody wins...well, except the teams with no money.

It could potentially hurt players a bit too, because their percentage of league revenues is fixed. If players with big front-loaded contracts push the total players' salaries over the fixed percentage, all of the players lose a portion of their income.

 

[Elganja]

So what's stopping a team from signing someone for 25 years to lower their average $$ hit on the cap? Is there a limit to this madness?

IIRC the NHL still has the right to refuse any contract within reason. I bet the NJ GM and Bettman (or whoever is in charge of this stuff) went back and forth on the amount of years and agreed on 17

I, like many others, think it's complete bullshit that this loophole exists. But it will be fixed in the next CBA for sure...

 

[FallenHero]

It could potentially hurt players a bit too, because their percentage of league revenues is fixed. If players with big front-loaded contracts push the total players' salaries over the fixed percentage, all of the players lose a portion of their income.

I'm not familiar with the details of the revenue sharing and the entire CBA. If thats true, I would expect the Union to step in at some point and try to add a clause to the contract limiting the "lifelong" contracts that are being signed.

You got a link explaining the CBA or a copy of it online anyplace with explanation I can take a look at? It's actually interesting finding this out.

 

[oogabooga]

I think Pronger was over 35 or at least the rule applied to him when Philly signed his contract no? They're on the hook the full cap hit for his contract.

The devils haven't been shy about working the system in their favor in the past to deal with cap issues. They did trade that one guy to the Sharks so the sharks would eat his cap hit (when they had cap space right after the lockout) and in return got a first round draft pick in exchange for a much cheaper player.

So what's stopping a team from signing someone for 25 years to lower their average $$ hit on the cap? Is there a limit to this madness?

Nothing.

I think the NHL can reject a contract - they even threatened the league stating Hossa's contract was pushing it last year. Then.. they let this one through. Kovy is good, but this is pretty dumb. Why have a salary cap?

People are bringing up that Lou Lamoriello is 67. He'll be an old old man when this thing is done - not that it matters to him.

 

[mugs]

I'm not familiar with the details of the revenue sharing and the entire CBA. If thats true, I would expect the Union to step in at some point and try to add a clause to the contract limiting the "lifelong" contracts that are being signed.

You got a link explaining the CBA or a copy of it online anyplace with explanation I can take a look at? It's actually interesting finding this out.

I'd love to find something like that myself. For now, there's wikipedia: http://en.wikipedia.org/wiki/NHL_Salary_Cap

Notwithstanding the cap and the nominal value of the players' contracts, the CBA stipulates that a fixed percentage of total league revenues (currently 57%) is to be paid to the players each season. To ensure compliance with this provision a percentage of each player's salary is witheld in escrow until the season is over, at which time the funds are divided between the players and owners so as to balance the aggregate league payrolls to the agreed percentage. In the first season of the current CBA, revenues exceeded expectations to such a margin that players received the entire escrow back plus additional funds from the owners, however in subsequent seasons this has not been the case.

I'm sure this kind of stuff will factor into negotiating a new CBA when the current one expires.

 

[Blackjack200]

Damn, I'm reading some of the web articles about the Kovy signing and am getting irritated.

#1 - He did not fizzle in the playoffs last year. He was our best player and scored 6 points in 5 games. This going up against one of the best defensemen in the league in Chris Pronger.

#2 - He is not selfish. Hockey writers seem to have a fascination with calling Russian goal-scorers 'selfish'. Kovy was the slickest passer I've ever seen play for the Devils, including Scott Gomez. He had a chance at an ENG during the regular season last year but slid the puck to Brian Rolston so Rolston could collect his 700th point.

#3 - He is not a defensive liability. Don't get me wrong, he is no Mike Richards out there, but his competitiveness is evident at both ends of the ice.

I don't think I'm alone in these opinions because I don't think the Devils would have signed a selfish, defensively challenged hockey player that doesn't perform in the playoffs to this kind of contract.

 

[BassBomb]

I think in this years playoffs his shifts were too long and he tried on his own a little too much... but he is an exceptional player

 

[Blackjack200]

I think in this years playoffs his shifts were too long and he tried on his own a little too much... but he is an exceptional player

He did take long shifts, in the regular season as well as the playoffs. That was my only real criticism, although I do give him a slight pass since that's how he played in Atlanta and no one else on the Devils was doing anything with their ice time anyway.

But I agree, he'll have to shorten them up this year.

 

[Firsttime]

So who are the Devils going to dump to clear the cap space?

 

[jman19]

Not to be a dick, but I hope this deal ends up being a disaster for the Devils. These CBA circumventing deals need to stop...