NHL teams may need to start preparing for the league’s salary cap to stay flat for the 2017-18 season, reports ESPN’s Craig Custance. The news, which comes out of the NHL’s recent Board of Governors meeting, could have a huge impact on the upcoming offseason, especially for the Blackhawks.
The current upper limit to the salary cap, which determines how much each team can spend in a given season, is set at $73 million. That number has risen significantly over the past decade, but with league revenues stagnating in recent years, the changes have become increasingly small.
From the 2015-16 season to the 2016-17 season, the NHL saw a cap increase of just $1.6 million, down from $2.4 million the year before and $4.7 million entering the 2014-15 season. It’s a worrisome trend, and based on what commissioner Gary Bettman reportedly told owners recently, it may only get worse.
Bettman projected a 2017-18 salary cap increase between zero and $2 million, opening the possibility for a flat cap next season. That would affect many big-budget teams around the league that are already struggling to retain key players.
As Custance notes, part of the trouble here is the league’s escrow system, which puts a chunk of the money earned by players each season into escrow. “What the players’ contracts really represent is a percentage of the revenue pie, not necessarily a hard salary,” he writes. It’s a little difficult to grasp, but the simple reality is that in the last round of CBA talks, players preferred having an increasing cap, even if it meant some money went into 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.”
Add up everything from the report, and it signals that the Blackhawks should be ready for a salary cap around $73 million again next season. That’s a HUGE deal, especially with the upcoming restricted free agency of Artemi Panarin. The team won’t be able to fit his multi-million dollar pay raise with all the money currently on the books, so a stagnant cap increases the odds of trading Panarin or another core player (like Brent Seabrook) prior to the 2017-18 season.
Back in 2014, the Blackhawks had gambled that the NHL’s revenues would keep increasing when they signed Jonathan Toews and Patrick Kane to huge extensions. Now they’re starting to pay for it a bit as those guys come at a premium in a league with flat revenues, which has happened for a lot of reasons.
The summer of 2017 was always going to be a challenging one for GM Stan Bowman. Based on reports like this one, it might get even harder.