Of Cap Considerations and Compensations

While the news of the morning is Anaheim punching their ticket to the finals, my fellow Buffalo Sabres blogger Kevin at Bfloblog had a great introductory post for the off-season yesterday, which followed a wondrous recap of the Sabres season from a fan perspective the day previous. In his off-season primer he lays out some details which are going to play a large role in how teams position themselves for next season.

The NHL's revenue is going to exceed $2.2Billion US, which will push the salary cap to around $48 million dollars. There had been rumors about this move previously, but now it looks like this can be considered fact.
With revenue moving that high that means the players are in line for a raise from 54% of revenues to 55-56% thereof.
As has been reported on widely, and favorably, by the hockey blogosphere, it was the NHL's decision to leverage digital media and the internet which helped to grow revenues by that much, as paid attendance was nearly flat and it was only a rise in ticket prices which allowed for a rise in league revenue.

It behooves us, as well, to reiterate the Restricted Free Agent Compensation Rules under this CBA at this time. With 28 teams not playing and a slew of RFA's to consider signing a few high profile ones may be in line for the-dreaded-poaching via Offer Sheet Signing that fill message boards and even some dead-tree media column inches with dread. Can anyone say Thomas Vanek?

GROUP 2 COMPENSATION CHART

OFFER SHEET /COMPENSATION

$660,000 or below / None
Over $660,000 to $1 million / Third Round Pick
Over $1 million to $2.0 million / Second Round Pick
Over $2.0 million to $3.0 million / First Round and Third Round Pick
Over $3.0 million to $4.0 million / First Round, Second Round, and Third Round
Over $4.0 million to $5.0 million / Two First Rounds, Second Round, and Third Round
Over $5 million / Four First Rounds

In a doomsday scenario, if Darth Regier were to low-ball Vanek, say in the $3 million range, how fast would you think a rvial GM would try and sign him to a long-term $3.99 or $4.99 million contract which Regier would have to match or risk losing his only proven goal-scoring winger, especially a GM with extra picks in next year's draft, which were thrown around this past February judiciously.

The unwritten rule of ignoring the mechanism of offer sheet signings was broken by the now-departed Bobby Clarke last summer when he forced Dave Nonis to overpay Ryan Kesler. With the Compensation Levels for mid-level RFA's being as low as they are, is there nowenough incentive to use this system to it's fullest? A player like Kesler is a perfect example of someone worth much more than a 2nd round pick and as the salary cap increases, contracts signed today become cheaper, as a percentage of the cap, through time.

Amatuer GM's, like myself, are already sharpening their swords and pencils.

Ta,