Campbell's Cuts: Holy CBA, Batman!
Well it took a little more than a year, but it looks as though the players and owners have found a creative new way around the collective bargaining agreement.
And because of that, a CBA that was supposed to be a slam-dunk trounce for the owners is beginning to tilt more in the players' direction.
To be sure, few players are suffering financially because of the new agreement and many of them are making off with untold millions and long-term job security.
Ticket prices are going up and with a salary floor of $34.3 million next season, about a third of the league will be forced to spend more on players than it did before the lockout.
Kind of makes you wonder why we missed a full season of hockey, doesn't it?
One way both sides are getting around the salary cap is with the long-term, front-loaded contract. Free agent jackpot winners such as Daniel Briere, Scott Gomez, Chris Drury, Ryan Smyth and Kimmo Timonen - technically, he was not a free agent, but he still cashed in because of his pending unrestricted status Â– all took long-terms deals with big money up front.
A reader wrote to THN asking why, if the salary cap hit comprises the average salary over the course of the deal, players are signing for front-loaded contracts. It's a good question, with a multi-pronged answer.
The first one is obvious. Money is lot more valuable when you get it now rather than later. Briere is getting $10 million for the 2007-08 season, $3.5 more million than the average of his contact, an amount he can invest and watch grow over the course of his contract.
Secondly, the player does better by front-loading if he either retires or is bought out at the end of his contract because the vast majority of the money will have already been paid out.
Let's take Briere for example. He is scheduled to make $52 million over the next eight seasons for a per-season salary cap hit of $6.5 million. But he will make $50 million of that amount in the first seven years of the contract, with just a $2 million salary in the final year of the deal. The eight-year breakdown is as follows: $10 million in 2007-08, $8 million in each of 1008-09 and '09-10, $7 million in 2010-11, '11-12 and '12-13, $3 million in 2013-14 and $2 million in 2014-15.
Briere will be 30 years old by the time next season starts, so let's say, for argument's sake, that in seven years it becomes clear that he can no longer play at the NHL level as a 37-year-old player.
Should he decide to retire, he'll have collected $50 million, as opposed to just $45.5 million if he took a straight $6.5 million per season. If he were bought out Â– at two-thirds of his salary for the final year of the deal Â– he'd make a total of $51.3 million over the course of the deal, instead of $49.9 million under the $6.5 million per season scenario.
For the teams, it allows them to get around the salary cap by, in effect, permitting them to spend over the cap in any given season. The Flyers, by my calculations, will be spending at least $51.7 million in real money next season, which is higher than the salary cap of $50.3 million, but will still be under the cap because of their average salaries to each player.
When observers are choosing their unrestricted free agency winners and losers over the next little while, it would be safe to say the Buffalo Sabres will be firmly planted in the losers' column.
At first blush, one might be tempted to feel sorry for the Sabres after losing Briere, Drury and Danius Zubrus to free agency. You might even feel more sorry for them if you believe team management's claim that there's no way they could have brought Drury and Briere back for the combined $84.5 million for which they signed elsewhere.
But if reports are to be believed, the Sabres could have had the two for a combined $46.5 million over a shorter term if they had only acted sooner.
Bucky Gleason, the terrific sports columnist for the Buffalo News
, claims the Sabres could have signed Drury to a four-year extension worth $21.5 million last summer and could have locked Briere up for five years at $25 million in January. According to Gleason, they dithered on both of them and both players realized they could get more as the Sabres continued to put together an excellent season.
If that's the case, the Sabres obviously gambled big-time and lost big-time.
DEVILS LOST, TOO:
Several New Jersey observers were impressed with how classy Brian Rafalski was upon leaving the New Jersey Devils to sign a five-year, $30 million deal with the Detroit Red Wings. Apparently, Rafalski was supposed to be outraged that Devils GM Lou Lamoriello low-balled him in recent negotiations.
There's a good reason why Rafalski had nothing but good things to say about the Devils because if not for their eye for talent, Rafalski might still be playing in Finland today for a fraction of what he has made as an NHL player.
In 1999, Devils scouting director David Conte Â– why this guy hasn't had a chance to be a GM yet, I have no clue Â– told the team's European scout Dan Labraaten to identify the best player in Europe that season, regardless of age, size or position. Labraaten's response was Rafalski, a small, undrafted defenseman for IFK Helsinki playing his fourth season in Europe. Despite the fact nobody was clamoring to sign Rafalski, the Devils thought it was worth the risk and gave him the chance to become the NHL player he is today.
Ken Campbell's Cuts appears regularly only on The Hockey News.com. Want to get the inside edge from Ken himself? You can reach him at firstname.lastname@example.org.
One of THN's senior writers, Ken Campbell gives you insight and opinion on the world of hockey like no one else. Subscribe to The Hockey News to get Ken's expertise delivered to you every issue.