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***Official*** NHL Lockout news thread ***Confirmed***

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Economist: NHL, NHLPA playing with fire

Canadian Press
2/12/2005

PITTSBURGH (AP) - The NHL would further alienate its diminishing fan base by trying to salvage a season that's ruined beyond repair, and is better off cancelling the 2004-05 campaign as it tries to solve its labour mess, according to some well-known sports economists.

Negotiations between the league and its locked-out players union ended Thursday with no progress reported, creating speculation NHL commissioner Gary Bettman will cancel the 2004-05 season early next week. Bettman said a labour deal was needed by this weekend so each team could play a 28-game schedule - about one-third as long as normal - before the playoffs.

The league will find it difficult enough to win back fans that have seemed disinterested at best during the five-month lockout, the economists said, so asking them to support a shortened season played mostly in the springtime would be a huge mistake.

"They (NHL franchises) are going to be hurting when they come back - they were hurting before the lockout, with a fan base that is thinning out," said Andrew Zimbalist, an economics professor at Smith College who studies economic trends in American sports. "They're alienating a large part of the small fan base they already have."

Neither side has budged from the positions they've long held, with team owners insisting they must have "cost certainty" - a cap on player salaries - and players strongly opposing it.

"They're playing with fire, which isn't a good idea for a sport that skates on ice," Zimbalist said.

Even if the NHL emerges from what would be the first full-season shutdown of a major North American pro sports league with a more favourable owner-friendly labour agreement, the analysts warn hockey will need years to repair the damage.

Franchise values, already the lowest of the four major pro team sports, will be appreciably diminished, they warn, and revenues likely will be lower because ticket prices may have to be lowered to win fans back. Last fall, Forbes Magazine valued six franchises - the Anaheim Mighty Ducks, Atlanta Thrashers, Edmonton Oilers, Buffalo Sabres, Pittsburgh Penguins and Carolina Hurricanes - at barely one-tenth as much as the NFL's Washington Redskins, which are worth an estimated $1.1 billion.

"When you have labour strife like this, certainly that impacts value," said Jackie Dal Santo, a Chicago-based executive who evaluates franchises for Willamette Management Associates. "It's difficult to say it's a certain percentage, but it does have an overall impact on the whole league. A lot of NHL teams already filed for or were close to filing for bankruptcy."

The Pittsburgh Penguins, Buffalo Sabres and Ottawa Senators have declared bankruptcy since 1999, although all were later acquired by new owners who kept the clubs operating.

Roger Noll, an economics professor at Stanford University who studies sports business issues, questions if some small-market and Sun Belt franchises will survive longterm. Within 10 years, he envisions a North American super league stripped of perhaps a dozen current franchises, which would fold or become minor-league clubs.

"The notion that the NHL can solve its problems with a salary cap is ludicrous," Noll said. "It will increase profits for the best teams, but it doesn't make the small-market teams viable. The disparity of revenues across the league is greater than in any other sport and there's no salary solution to that problem. Some teams have 25 times (the local TV revenue) of other teams. The only solution is to get rid of the small-market teams or subsidize them.

"Even if salaries were zero dollars per year, I question if some small-market teams would have enough revenue to cover costs. Blowing up the league is the likely outcome because the big-market teams don't see revenue sharing as being in their best interest," Noll said.

Noll said the NHL's business model doesn't work because it was designed in the mid-1990s around increasing national TV rights and licencing fees. Instead, the league's latest network TV deal with NBC guarantees no money.

"They're basically giving away their games," Noll said. "The NHL hasn't built a sufficient market outside of the northeast quadrant of the United States and southeast Canada. They're stuck with expansion franchises that aren't viable and there is no solution to it. It's just crazy. You can't operate a league the way they're currently operating."

Neal Pilson, the former CBS Sports president who now runs a consulting firm, disagrees with Noll that the league must contract to survive but warns it will take time and considerable effort to win back fans.

"Eventually the league will play hockey again, and the spectators and the viewers will come back," Pilson said. "It (attendance) might not be as strong as before, and there will be a dropoff in viewership - it took baseball 5-6 years to get back the levels it had before the 1994-95 strike. To the NHL, whatever damage they're sustaining now is less than the longterm damage done if they don't restructure their labour agreement."

Pilson thinks NHL players are making "one of the most dramatic miscalculations in labour management history" by refusing to consider a cap.

"The sad thing is the players don't seem to understand that if the season is cancelled, their deal is going to be diminished. They're not going to get a better deal a year from now," Pilson said. "The league is going to be in a weaker position, so it's a huge miscalculation on their part that they can increase their bargaining position by refusing any discussion on a hard salary cap."

Cheers,
Aquaman
 
Hicks: Players turned down best offer

Canadian Press
2/12/2005

There was no contact between the NHL and the NHL Players' Association on Saturday as a weekend deadline to put a deal on paper was quickly approaching.

Sources on both sides confirmed Saturday that there was absolutely no communication of any form between the two sides.

The league, however, sent out a memo to its 30 teams on Friday releasing the gag order on owners, GMs and team executives, not only allowing them to talk about the lockout to the media but also giving them the green light to reach out to players if they wanted. This would appear to be a move to circumvent the union leaders, hoping GMs could start a groundswell among their players to put pressure on NHLPA executive director Bob Goodenow.

Dallas Stars owner Tom Hicks didn't waste any time.

"The players have turned down the best offer they're ever going to get. I can say that with certainty," Hicks told the Dallas Morning News, adding that the NHLPA wasn't "serious about entertaining the system we need to go forward."

Another league source insisted commissioner Gary Bettman would not call Goodenow on Sunday, leaving it to the union to make the last move. There were reports of the union head office receiving phone calls from concerned players on Saturday, asking Goodenow to make a move Sunday, but an NHLPA source said that was not the case.

"I think something could happen Sunday," said a source.

Goodenow pulled a rabbit out of the hat 10 years ago in helping to end the lockout and some wonder whether he will do the same again Sunday, either call Bettman and tell him he's got a new offer or ask to meet on Monday morning.

Bettman said Wednesday that if a deal wasn't put to paper by the end of the weekend, he would go ahead and cancel the season sometime this week since it would be too late to salvage a shortened season.

Sunday should have seen this year's all-star game played in Atlanta. Instead, it's gone by the wayside as well as 824 of the 1,230 regular-season games. If a miracle agreement is reached, the league has a shortened schedule ready to go that would see teams play 28 regular-season games, playing only within their conference. The playoffs would stay the same.

Cheers,
Aquaman
 
Originally posted by: Schmitty
aquaman no wonder your a "lifer" you post junk that no one cares about. we can read it our damn self!! ur just copy/pasting those into the post.

Thanks for crapping our NHL thread. Bye now.
 
Originally posted by: Schmitty
aquaman no wonder your a "lifer" you post junk that no one cares about. we can read it our damn self!! ur just copy/pasting those into the post.

Well......... it you don't like it .......... you don't have to come in here. But that's your choice. I am still going to be doing this as long as the strike is on.

The reason I cut and paste is because links die over time.

Cheers,
Aquaman
 
Last-ditch effort to save the season

Canadian Press
2/13/2005

Gary Bettman's deadline is about to pass. A last-ditch meeting with mediators failed.

Is it finally time to pull the plug on the 2004-05 season?

That question should be answered Monday when the NHL decides how to proceed after failing to reach a miracle agreement by the end of the weekend, the NHL commissioner's self-imposed deadline to put pen to paper on a deal.

The NHL and NHL Players' Association secretly met for more than five hours with U.S. federal mediators in Washington on Sunday but still could not make any progress.

The two sides met from 1:45 p.m. to 7 p.m. EST with the U.S. Federal Mediation and Conciliation Service.

NHL commissioner Gary Bettman and NHLPA executive director Bob Goodenow were not in the meeting. Bill Daly, the NHL's executive vice-president and chief legal officer, and league outside counsel Bob Batterman were there with NHLPA senior director Ted Saskin and union outside counsel John McCambridge.

According to a statement from the NHLPA, Scot B. Beckenbaugh, acting director of the U.S. Federal Mediation and Conciliation Service, requested the meeting. The two sides had met two more times with the FMCS over the course of the last year.

"Today, the parties met for the third time with FMCS officials," Saskin said in a statement. "There was no progress to report as a result of this meeting, and in fairness to the process it would serve no purpose to comment further."

Daly also released a statement, which read: "No progress in the collective bargaining process resulted from the meeting. We have no further comment."

The session definitely flew under the radar, with both sides telling media this weekend that no meetings were in the works.

The league is expected to cancel the season either Tuesday or Wednesday in New York unless something drastic happens Monday that would change Bettman's mind _ such as a phone call from Goodenow saying he's got one last offer.

There was a lot of talk among agents, GMs and players this weekend but the buzz did not translate into any substance.

There has been more talk ever since the league sent out a memo to its 30 teams Friday releasing the gag order on owners, GMs and team executives, not only allowing them to talk about the lockout to the media but also giving them the green light to reach out to players if they wanted. This would appear to be a move to circumvent the union leaders, hoping GMs could start a groundswell among their players to put pressure on Goodenow to accept a salary cap.

If there is no miracle deal, the NHL would become the first major professional league in North America to ever cancel an entire season from beginning to finish.

The meeting Sunday came on the very day the NHL had been originally slated have this year's all-star game in Atlanta. Instead, it's gone by the wayside as well as 824 of the 1,230 regular-season games. If an agreement is reached, the league has a shortened schedule ready to go that would see teams play 28 regular-season games, playing only within their conference. The playoffs would stay the same.

Cheers,
Aquaman
 
Melnyk: Let the players vote

TSN.ca Staff
2/14/2005

Ottawa Senators owner Eugene Melnyk thinks he has a solution for the NHL lockout: Let the players vote.

According to a report in the Globe and Mail, Melnyk thinks that the majority of NHL players would agree to play under a salary cap, saying, "I think the best solution would be to get these 700 guys in a rink somewhere and get them to vote on this, individually and confidentially. I think you'd be absolutely shocked at what comes back."

Melnyk's statements come on the heels of Dallas Stars owner Tom Hicks stating that the players have already seen the best offer they are going to get from ownership. Not coincidentally, NHL Commissioner Gary Bettman lifted his gag order on NHL owners late in the week, when it finally appeared that negotiations between the NHL and NHLPA had broken down.

Melnyk is so confident in his position that he issued a challenge to the NHLPA. "I dare them to go out and do a confidential vote of the 700 players. I've got a very good sense of where a lot of these players are.

"The more vocal ones have a view that I think is inconsistent with the view of the whole membership," Melnyk continued. "I think that would be their worst nightmare, to actually put it to a vote."

According to a report in USA Today, NHL officials and team executives heard from some players on Friday and Saturday who were willing to accept a salary cap in the range of $47 million, without any linkage to league revenues. While it doesn't fit the league's ideal, it's also a departure from the NHLPA's staunch refusal to consider a cap.

For their part, the players doing the public speaking are standing firm. Scott Walker, the Nashville Predators player representative, told the Globe and Mail, "We've already counted this season out. We were told this could last for one year or even two years."

Those statements that were echoed by veteran Detroit Red Wings forward Brendan Shanahan in an interview with ESPN, with a despondent Shanahan talking about this process even taking as long as three years.

Melnyk, who rescued the Senators from bankruptcy in April of 2003, has been supportive of the league's position throughout the process, telling the Ottawa Sun in December that, "The most important thing is to fix the system. What we don't want to do is end up back in the same situation three, four or five years from now."

Cheers,
Aquaman
 
Bettman calls Wednesday news conference

TSN.ca Staff/CP files
2/14/2005

The National Hockey League will conduct a news conference with Commissioner Gary Bettman on Wednesday at 1pm et from New York where it is expected he will officially cancel the 2004-05 regular season and playoffs.

Individual NHL clubs are said to be planning their own local news conferences immediately following Bettman's announcement.

TSN has learned that NHL executive vice-president Bill Daly and NHLPA senior director Ted Saskin met Monday at an undisclosed location in a last-ditch attempt to save the season. As of 6:45pm et, the two sides are still behind closed doors. As in some previous meetings, Bettman and union chief Bob Goodenow are not in the room.

Players who spoke with Goodenow were told Monday that representatives of the two sides were getting together.

The NHL and NHL Players' Association met with U.S. federal mediators in Washington on Sunday but still could not make any progress, despite five hours of talks.

According to a statement from the NHLPA, Scot B. Beckenbaugh, acting director of the U.S. Federal Mediation and Conciliation Service, requested the meeting.

Bettman and Goodenow were not in these meetings either. Daly and league outside counsel Bob Batterman represented the NHL with Saskin and union outside counsel John McCambridge representing the Players' Association.

Saskin later released a statement saying that no progress was made as a result of the meeting.

Daly also released a statement, which echoed Saskin's.

If the season is canceled on Wednesday, the NHL would become the first major professional league in North America to ever cancel an entire season from beginning to finish.

Cheers,
Aquaman
 
NHLPA offers cap, NHL rejects it

Canadian Press
2/15/2005

NEW YORK (CP) - The No. 1 issue that has plagued the NHL lockout went out the window Monday night when the NHL Players' Association offered a deal that included a $52-million US salary cap.

But the deal was rejected by the NHL.

The surprising move was made by NHLPA senior director Ted Saskin during his secret meeting with NHL executive vice-president Bill Daly in Niagara Falls, N.Y.

According to an NHLPA statement, Daly began the process Monday by offering a $40-million salary cap without ''linkage'' - a fixed link between player costs and league revenues, which has long been the centrepiece of the NHL's bid for cost certainty.

The union counter-offered with the $52-million team-by-team salary cap. The players' proposal also featured more aggressive payroll tax thresholds and tax rates on team payrolls.

''It is indeed unfortunate that with the major steps taken by both sides today we were unable to build enough momentum to reach an agreement,'' Saskin said in a statement released early Tuesday morning.

The union's offer also included the 24 per cent salary rollback on all existing contracts.

These latest developments came as the NHL announced a news conference for Wednesday at 1 p.m. EST in New York when commissioner Gary Bettman is expected to announce the cancellation of the 2004-2005 season.

While no talks were planned for Tuesday, the fact that both sides made dramatic moves from their longstanding positions Monday night could spur on more last-ditch efforts to save the season.

As it stands, the players have finally accepted a salary cap for the first time in their history while the league gave up on linkage. Now the two sides are separated by $12 million on their cap figures. And with the rollback, two-thirds of the league's teams would be under $40 million.

But is it too late?

Earlier on Monday night, the league sent out a statement saying talks between Daly and Saskin produced ''no progress.''

Bettman's news conference was originally slated for Tuesday, according to a source, but pushed back a day as Daly and Saskin met late into the night.

It all made for a roller-coaster day.

''I've said all along, until someone tells me it's over, it's not,'' Devils GM and CEO Lou Lamoriello said from his New Jersey office Monday. ''It's too easy to be negative.

''There's no question we have something scheduled at this point for Wednesday. It's looking very bleak right now but it's not over.''

The Devils boss also offered some advice.

''To me, let's get rid of all these buzz words (salary cap, luxury tax) and get something done that works for everybody,'' he said.

Should the worst happen Wednesday, the NHL will become the first major professional league in North America to cancel an entire season from start to finish. But Bettman says the damage the NHL will suffer as a result is worth it in order to get ''cost certainty'' for his owners.

''I'm extremely concerned,'' Flyers captain Keith Primeau told The Canadian Press from Philadelphia. ''The biggest thing that disturbs me is everyone's true misunderstanding of the fan base. You hear how certain people believe that the hard-core fan will definitely return, that the damage isn't irreparable.

''I think that's a huge miscalculation or judgment in error of who and what your fan base is. That, I think, is going to alarm a lot of people when the doors are re-opened.''

The NHL and the union met for more than five hours with U.S. federal mediators in Washington on Sunday but still could not make any progress. Bettman and NHLPA executive director Bob Goodenow were not at the meeting. Daly, the NHL's executive vice-president and chief legal officer, and outside counsel Bob Batterman represented the league while Saskin, the NHLPA's senior director, and outside counsel John McCambridge were there for the union.

So much of the season has already been scrapped. Through Monday, 824 of the 1,230 regular-season games have gone by the wayside.

If an agreement can still be reached, the league has a shortened schedule ready to go that would see teams play 28 regular-season games, playing only within their conference. The playoffs would stay the same and consist of four rounds.

Cheers,
Aquaman
 
Can NHL, NHLPA bridge the gap?

TSN.ca Staff
2/15/2005

Now that the NHL Players' Association has gotten over the ideological hump of living with a "salary cap," players are mulling over the rival concepts presented yesterday by the league and the union.

Details of both proposals have been posted on The Source, the NHLPA's secure website for players.

Sources say the NHLPA proposal is as follows:

- A cap of $52 million but with provisions for teams to spend as much as 10 per cent more than that on three occasions in a six-year period, with a luxury tax incorporated. The luxury tax rates would be 25 per cent on $40-44 million; 50 per cent on $44-48 million; 75 per cent on $48-52 million and 150 per cent on $52-$57.2 million.

Sources say the NHL proposal is as follows:

- A hard cap of $40 million, with a 50 per cent luxury tax on $34-40 million.

As for the possibility of negotiations, sources on the NHLPA side are suggesting the union will only negotiate off the $52 million figure if the NHL presents a detailed, meaningful revenue sharing plan.

On the NHL side of the equation, sources are suggesting the league isn't prepared to go much higher than the $40 million cap figure.

So it's a matter of trying to bridge a $12 million (per team) gap with the clock running towards the league's scheduled 1 p.m. (EST) announcement to cancel the season.

Cheers,
Aquaman
 
Two sides closer, but is there time?

Canadian Press
2/15/2005

NEW YORK (CP) - The two sides in the NHL labour dispute have abandoned longstanding philosophical positions and edged closer together, but the question is whether there is time to bridge the remaining gap.

While more talks were expected Tuesday, time is running out with commissioner Gary Bettman expected to cancel the season at a 1 p.m. EST news conference in New York barring an agreement.

Still, it appeared Tuesday like there was the momentum to secure a deal following Monday night's revelation that the NHL Players' Association had changed direction at the final turn and offered to play under a $52-million US salary cap.

The league, meanwhile, turned heads by proposing a $40-million salary cap with no ''linkage'' to revenue.

''I'm sure not everybody is happy out there. I'm sure there's some players not happy with a hard cap and some owners not happy at not having linkage,'' Flyers player representative Robert Esche told The Canadian Press from Philadelphia.

''But hey, it's a give-and-take world. Now it seems we're just down to numbers. It's exciting.''

Now the question is whether the two sides can bridge the gap. A source said the league sees $52 million as too high but might be willing to go in the low 40s to get a deal done.

''It shouldn't be that hard, they're agreeing on principles,'' Esche said.

Ottawa Senators owner Eugene Melnyk wasn't quite as positive.

''It's a lot to try to do in a very, very short time,'' he told The Fan, a Toronto all-sports radio station. ''I'm just not optimistic.''

The change in strategy represents a quantum leap for both sides. The players have insisted a salary cap was a non-starter while the league has built its case around so-called cost certainty - linking player costs to revenue.

A source close to the talks indicated Tuesday morning that he expected both sides would get together later in the day. But as of 1 p.m. EST NHL executive vice-president Bill Daly was still in New York while NHLPA senior director Ted Saskin was still in Toronto.

The surprising developments came during a secret meeting Monday in Niagara Falls, N.Y., between Saskin and Daly.

Daly began the process by offering his cap figure without a fixed link between player costs and league revenues. The union countered with the $52-million salary cap per team and its 24 per cent rollback on existing salaries, which was rejected by the NHL.

''It is indeed unfortunate that with the major steps taken by both sides today we were unable to build enough momentum to reach an agreement,'' Saskin said in the early hours of Tuesday morning.

It appears a select group of players spearheaded the NHLPA change in strategy.

The Philadelphia Inquirer and others reported Tuesday that Flyers centre Jeremy Roenick, along with Calgary's Jarome Iginla, St. Louis's Chris Pronger and others, urged the union leaders to put a cap with no linkage on the table in a bid to save the season.

''I was involved with a group of NHL players who were trying to get to as many people as possible to come on board with a resolution that works for both sides,'' Roenick told the Inquirer. ''The proposal has to have a number that is not tied to revenues.''

A call to Iginla was not immediately returned Tuesday.

Other reports said the group of players actually had a proposal for the league, but Esche said that was pushing it too far.

''That needs to be clarified,'' Esche told CP. ''I talked to Pronger a few hours ago, I spoke with JR a few hours ago, that is the further thing from the truth. They didn't give a proposal to the league, they didn't go behind the union's back. They would never undermine our union.''

Still, Buffalo Sabres player rep Jay McKee was surprised Tuesday when he heard the union would accept a cap.

''If that's where we were going, I wonder why now,'' he said.

According to a source, the union's offer breaks down like this:

A cap of $52 million but with provisions for teams to spend as much as 10 per cent more than that on three occasions in a six-year period, with a luxury tax incorporated. The luxury tax rates would be 25 per cent on $40-$44 million; 50 per cent on $44-$48 million; 75 per cent on $48-$52 million and 150 per cent on $52-$57.2 million.

The league's deal features a $40-million cap, with a 50 per cent luxury tax on payrolls from $34 million to $40 million.

Using last season's payrolls and adding the 24 per cent rollback on existing contracts, the average team payroll was $33.95 million. There were 16 teams over the $40-million figure last season, but that's without the contact rollback.

Monday's development could also have a major impact on the league's ability to declare legal impasse down the road if there's no deal and the season is cancelled. The union could perhaps argue to the U.S. National Labor Relations Board that there is no impasse in talks because the philosophical issue of a salary cap is no longer the deal-breaker.

The NHL is hoping to avoid becoming the first major professional league in North America to cancel an entire season from beginning to finish.

''I'm extremely concerned,'' Flyers captain Keith Primeau said from Philadelphia. ''The biggest thing that disturbs me is everyone's true misunderstanding of the fan base. You hear how certain people believe that the hardcore fan will definitely return, that the damage isn't irreparable.

''I think that's a huge miscalculation or judgment in error of who and what your fan base is. That, I think, is going to alarm a lot of people when the doors are re-opened.''

Through Tuesday, 834 of the 1,230 regular-season games have gone by the wayside.

If an agreement can still be reached, the league has a shortened schedule ready to go that would see teams play 28 regular-season games, playing only within their conference. The playoffs would stay the same.

''We probably could've gotten this thing done in the summertime,'' Chicago forward Matthew Barnaby said. ''Am I mad, no? I want to get back to work. But at the same time, I'm just a little disappointed that it went this far to play poker and to have someone call your bluff.''

Cheers,
Aquaman
 
Players surprised at salary cap move

Canadian Press
2/15/2005

NHL players were taken by surprise Tuesday by news that their Players' Association had turned face and put a salary cap on the bargaining table.

But some also expressed faith in the leadership, saying they were behind union officials if they believed it's the right thing to do.

''Giving up the salary cap is obviously really frustrating as a player,'' Oilers forward Ryan Smyth said in Edmonton.

''The union, through this proposal, has caught us by surprise. But the fact they felt it was the thing to do to get it done, then I'm behind them,'' he added.

Oilers defenceman Cory Cross echoed the sentiment: ''We have faith in the committee. They are doing what's right for everybody.''

The union move showed what the players are willing to do to get a deal, Smyth said.

''We are throwing every bone we can to make this work.''

Added Senators defenceman Wade Redden: ''It takes a little pressure on each side to budge. Both sides are at a pressure point and want to get things going.''

But Todd Marchant, the Blue Jackets player rep, says he isn't so sure the two sides are any closer.

''We've proposed a ceiling on salaries, we've given a salary rollback, and it's still not enough,'' he said. ''Honestly I believe we've made the compromise. It's time for them to step up now.''

Sabres player representative Jay McKee admitted he was surprised when he heard the union would accept a cap.

''If that's where we were going, I wonder why now,'' he said.

Even Redden, also in Edmonton, wondered about the timing.

''If it could have been done two years ago it could have been a lot more convenient for everyone,'' he said.

Chicago forward Matthew Barnaby was of the same mind.

''We probably could've gotten this thing done in the summertime,'' he said. ''Am I mad? No. I want to get back to work. But at the same time, I'm just a little disappointed that it went this far to play poker and to have someone call your bluff.''

Cheers,
Aquaman
 
28 games... I can live with that.

Better than 0 games + no talk activity during the next few months before the next season is supposed to start...

Bottom line, get something done, ASAP... don't care about a season anymore.
 
Originally posted by: cliftonite
God please let the Rangers win the draft lottery.
No way dude, it'd be entirely fair for the Caps to get another #1 pick. Totally fair !

Hell I'd give my left nut to get that kid on my team.
 
It feels like a big subterfuge! Making us think they are getting closer to a deal only to snatch it away in the 11th hour! By the way. The owners are proposing a $42.5 million cap with no linkage to revenue. It is their final offer and will have to be accepted by the Players Union before 11am tomorrow (Wednesday) morning.
 
Bettman letter to Goodenow

TSN.ca Staff
2/15/2005

The following is a letter NHL commissioner Gary Bettman sent to NHLPA Executive Director Bob Goodenow on Tuesday.

Dear Bob:

We attempted to reach out to you with yesterday's offer of a team maximum cap of $42.2MM ($40MM in salary and $2.2MM in benefits) which was not linked to League-wide revenues. As Bill told Ted, "de-linking" a maximum team salary cap from League revenues and total League-wide player compensation has always been problematic for us, especially since we cannot now quantify the damage to the League from the lockout. This presents the risk we will pay out more than we can afford. As you know, if all 30 teams were to spend to the maximum we proposed, and if the damage to our business is as we discussed at our meetings in New York, then the League would continue to lose money.

I know, as do you, that the "deal" we can make will only get worse for the players if we cancel the season - whatever damage we have suffered to date will pale in comparison to the damage from a cancelled season and we will certainly not be able to afford what is presently on the table. Accordingly, I am making one final effort to reach out to make a deal that will let us play this season.

We are increasing our offer of yesterday by increasing the maximum individual team cap to $44.7MM ($42.5MM in salary and $2.2MM in benefits). This offer is not an invitation to begin negotiations - it's too late for that. This is our last effort to make a deal that's fair to the players and one that the Clubs (hopefully) can afford. We have no more flexibility and there is no time for further negotiation.

If this offer is acceptable, please let me know by 11:00 A.M. tomorrow, in advance of my scheduled press conference. Hopefully, the press conference will not be necessary.

Sincerely,
Gary B. Bettman
Commissioner

Cheers,
Aquaman
 
NHL gives union final offer

Canadian Press
2/15/2005

NEW YORK (CP) - The NHL delivered a take-it-or-leave-it offer to the Players' Association on Tuesday, upping its salary cap offer to $42.5 million US from $40 million and imposing an 11 a.m. EST deadline Wednesday.

''This offer is not an invitation to begin negotiations - it's too late for that,'' commissioner Gary Bettman wrote in a letter to NHLPA executive director Bob Goodenow. ''This is our last effort to make a deal that's fair to the players and one that the clubs (hopefully) can afford.

''We have no more flexibility and there is no time for further negotiation.''

That put the ball in the union's court, with the clocking ticking down to 1 p.m. EST Wednesday when Bettman is expected to cancel the season barring an agreement.

''Hopefully, the press conference will not be necessary,'' Bettman wrote.

The NHLPA's last offer involved a $52-million cap.

''I know, as do you, that the `deal' we can make will only get worse for the players if we cancel the season - whatever damage we have suffered to date will pale in comparison to the damage from a cancelled season and we will certainly not be able to afford what is presently on the table,'' Bettman wrote.

''Accordingly, I am making one final effort to reach out to make a deal that will let us play this season.''

There was no immediate public response from the union.

The league counter-offer came around supper time on a tense day where facts were few but opinions were plentiful.

It appeared the door leading to a possible solution had finally started to open following Monday night's revelation that the NHLPA had changed direction at the final turn and offered to play under a $52-million salary cap.

The league, meanwhile, moved by proposing a $40-million salary cap with no ''linkage'' to revenue.

Each side rejected the other's offer.

Both include the union's original proposal to slash existing contracts by 24 per cent.

''The buzzwords are off the table now, it's a business discussion now not a philosophical argument and that's good,'' Devils GM Lou Lamoriello said from New Jersey. ''But there's work to be done.''

Said Sabres player representative Jay McKee: ''We're at the point now where it's got to get done, and it's got to get done quick. But I think it can get done.''

Flyers player rep Robert Esche applauded the compromise.

''I'm sure not everybody is happy out there. I'm sure there's some players not happy with a hard cap and some owners not happy at not having linkage,'' he said.

''But hey, it's a give-and-take world. Now it seems we're just down to numbers.''

Ottawa Senators owner Eugene Melnyk wasn't quite as positive.

''It's a lot to try to do in a very, very short time,'' he told The Fan, a Toronto all-sports radio station. ''I'm just not optimistic.''

Using last season's payrolls and incorporating the 24 per cent rollback on existing contracts, the average team payroll was $33.95 million.

Looking at the numbers without the proposed rollback, the Red Wings topped the list last season at $82.9 million, with Pittsburgh at the other end of the spectrum at $21.65 million.

Toronto led all Canadian franchises at $72.8 million, followed by Ottawa ($48.55 million), Montreal ($47 million), Vancouver ($46.8 million), Calgary ($40 million) and Edmonton ($35.7 million).

In all, there were 16 teams over the $40-million figure last season - without the contract rollback factored in.

Melnyk declined a later request for an interview. Many teams deflected similar requests for comments from owners, noting club officials were scheduled to speak in their own markets immediately following Bettman's news conference Wednesday.

Richard Peddie, president and CEO of Maple Leafs Sports and Entertainment, deflected a question about what the owners had given up by taking the linkage issue off the table.

''All I can tell you is that we've been kept apprised and we'd really like to play hockey this year,'' he said. ''But it has to be the right deal, even for the Toronto Maple Leafs. Even our revenues are drying up, believe it or not. We want a deal that's also good for the Leafs.''

The last-minute change in negotiating strategy represents a quantum leap for both sides. The players have insisted a salary cap was a non-starter while the league has built its case around so-called cost certainty - linking player costs to revenue.

Monday's unexpected development probably surprised and unsettled many on each side. But the fact that both felt the pinch may also signify the two sides have finally found an area of compromise.

''Am I excited about a salary cap? No. But it's about trying to get a deal done,'' said Calgary star Jarome Iginla.

McKee, however, was concerned about how much harm a five-month-long lockout has had on the sport and its fan base.

''It's not so much that I'm angry that they offered a cap. I'm angry that why now?'' McKee said. ''Why not last June, last July?''

Even if it is too late to save the season, the change in positions may still set the stage for a settlement that could pave the way for the entry draft and a more normal off-season.

The surprising developments came during a secret meeting Monday in Niagara Falls, N.Y., between NHL executive vice-president Bill Daly and NHLPA senior director Ted Saskin

Daly began the process by offering his cap figure without a fixed link between player costs and league revenues. The union countered with the $52-million salary cap per team and its 24 per cent rollback on existing salaries.

''It is indeed unfortunate that with the major steps taken by both sides today we were unable to build enough momentum to reach an agreement,'' Saskin said in the early hours of Tuesday morning.

The Philadelphia Inquirer and others reported Tuesday that Flyers centre Jeremy Roenick, along with Iginla, St. Louis's Chris Pronger and others, urged the union leaders to put a cap with no linkage on the table in a bid to save the season.

''I was involved with a group of NHL players who were trying to get to as many people as possible to come on board with a resolution that works for both sides,'' Roenick told the Inquirer. ''The proposal has to have a number that is not tied to revenues.''

But Iginla played down any role he may have had.

''I have talked to Pronger and Roenick but also to many guys around the league, because we're interested in what's going down. But ultimately, it's the committee that's doing all this, not me. If people ask me my opinion, I'll give it, and I have.''

Iginla and Esche both shot down other reports saying the group of players actually had a proposal for the league.

According to a source, the union's offer breaks down like this:

A cap of $52 million but with provisions for teams to spend as much as 10 per cent more than that on three occasions in a six-year period, with a luxury tax incorporated. The luxury tax rates would be 25 per cent on $40-$44 million; 50 per cent on $44-$48 million; 75 per cent on $48-$52 million and 150 per cent on $52-$57.2 million.

The league's deal features a $40-million cap, with a 50 per cent luxury tax on payrolls from $34 million to $40 million.

Monday's development could also have a major impact on the league's ability to declare legal impasse down the road if there's no deal and the season is cancelled. The union could perhaps argue to the U.S. National Labor Relations Board that there is no impasse in talks because the philosophical issue of a salary cap is no longer the deal-breaker.

The NHL is hoping to avoid becoming the first major professional league in North America to cancel an entire season from beginning to end.

''I'm extremely concerned,'' Flyers captain Keith Primeau said from Philadelphia. ''The biggest thing that disturbs me is everyone's true misunderstanding of the fan base. You hear how certain people believe that the hardcore fan will definitely return, that the damage isn't irreparable.

''I think that's a huge miscalculation or judgment in error of who and what your fan base is. That, I think, is going to alarm a lot of people when the doors are re-opened.''

Through Tuesday, 834 of the 1,230 regular-season games have gone by the wayside.

If an agreement can still be reached, the league has a shortened schedule ready to go that would see teams play 28 regular-season games, playing only within their conference. The playoffs would stay the same.

''We probably could've gotten this thing done in the summertime,'' Chicago forward Matthew Barnaby said. ''Am I mad, no? I want to get back to work. But at the same time, I'm just a little disappointed that it went this far to play poker and to have someone call your bluff.''

Cheers,
Aquaman
 
Goodenow letter to Bettman

TSN.ca Staff
2/15/2005

The following is a letter NHLPA Executive Director Bob Goodenow sent to NHL commissioner Gary Bettman in response to Bettman's letter sent on Tuesday.

Dear Gary,

Yesterday afternoon, Bill Daly presented us with an offer from the League that, for the first time, was not linked to League-wide revenues. We appreciated your willingness to adjust your position and we worked to respond in kind. By evening, we had fashioned and reached out to you with an offer from the PA that included, for the first time, a team maximum cap. This offer built upon the 24% rollback and other changes in favour of clubs, which were presented by the Players on December 9, 2004.

As you know, and as Ted told Bill, our offer of a team cap represented a radical step for the PA. We took this step because we too believe that our sport will be damaged greatly by the cancellation of this season and the continuation of the lockout through next season.

We wish that the NHL had offered a no linkage proposal before yesterday so that negotiations in that arena could have commenced sooner. However, we recognize that they did not and we agree that time is short.

In that spirit, and in a final attempt to reach an agreement, we are adjusting our offer of yesterday in two respects. First, we are reducing the maximum individual team cap to $49 million in salary, which does not include the $2.2 million per team in benefits due.

Second, we will adjust our exception provision so that it is available to teams only twice during the six year term and for up to only 10% over the limit of $49 million (to $53.9 million), at the tax rate of 150%. The exception provision is important so that a successful team does not have to arbitrarily dismantle its roster after it has achieved particular success or is in a unique phase of its player roster cycle.

I have attached a short summary of the main deal points discussed by Bill and Ted yesterday, as modified above.

I can be reached at the usual phone numbers.

Regards,

Robert W. Goodenow
Executive Director & General Counsel

NEW CBA DEAL POINTS

1. Term - 6 full seasons (through 9-15-11).

2. CBA System Incorporation of NHLPA December 9, 2004 proposal into the recently expired CBA, with indexing of financial provisions (per diems, etc.) at 2% per year, with the following additional changes requested by the NHL yesterday:

(a) Increased salary arbitration rights for Clubs -- to be agreed upon. Salary arbitration available after Player leaves Entry Level System.

(b) Cap on Exhibit 5 Individual B Performance Bonuses -- to be agreed upon.

(c) Replace NHLPA Revenue Sharing Plan with NHL Revenue Sharing Plan to share at least $88M in each year of the Agreement. Clubs may credit any payroll taxes paid against their revenue sharing contribution.

3. Team Payroll Limit - $49M in salary and bonuses

4. Minimum Team Payroll - $25M (each team can fall no more than 10% below only twice during term).

5. Minimum Player Salary - $300K (as per NHL Proposal)

6. Payroll Taxes - $40M - $43M (25%)
$43M - $46M (50%)
$46M - $49M (75%)
$49M - $53.9M (150%) only twice per team during 6 year term

7. Indexing of Tax Rates and Payroll Minimums & Maximums All dollar amounts would be in place for 2004-05 (pro-rated) and 2005-06. Dollar levels for tax rates, payroll minimums & maximums for subsequent years either constant or increased by % change in greater of either hockey related revenues or only the gate receipts and broadcasting segments of hockey related revenues from the 2005-06 base year.

8. 2005 Playoffs 55% of playoff revenues to be paid to Players for the 2005 playoffs.

Cheers,
Aquaman
 
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