If you've ever studied economics, you've probably heard the term "sunk cost." It refers to a cost or investment that's already been incurred and cannot be recovered, so the business simply needs to swallow it and re-calibrate how to distribute its resources. You spent the cash, and you're not getting it back even if you're dissatisfied.
The Chicago Blackhawks should probably know a thing or two about sunk costs entering the 2016-17 season. While the upper limit of the salary cap is the true boundary by which the team must operate, the reality is that some sunk costs will significantly lower the amount of money the Hawks actually have to work with. Depending on how you ultimately evaluate Bryan Bickell, we're potentially talking enough dead weight to cover the entirety of Brent Seabrook's cap hit.
As part of GM Stan Bowman's ongoing efforts to keep the Blackhawks contenders over the past few years, he's constantly been forced to rearrange the pieces to keep the team's finances from overflowing. The result has been various compromises, from eating salary in trades to including a substantial array of lucrative bonuses in the contract of a certain Russian star. And now, in 2016-17, those tough choices will come home to roost as Chicago stares at millions in sunk costs.
Let's start with the dead money that simply cannot be moved, the sunk costs in the truest sense.
Rob Scuderi's retained salary
Hey, remember him? Well guess what!! Despite generally sucking during his brief time with the team before being traded for another veteran who didn't help much, Scuderi will continue eating away as Chicago's books. Bowman retained $1.125 million of Scuderi's salary for the 2016-17 season, and unless the 37-year-old decides he'd no longer like to be paid millions to play hockey, there's no way the Hawks can get out of it. So right there, let's chip away over $1 million from what the Hawks have to play with.
And here's the other big one. We can't stress enough that the Hawks were in the right by giving Artemi Panarin some big-time bonuses in order to sign him, but now that the 24-year-old Russian has proven to be a legitimate NHL star, he's no longer quite the incredible bargain he was with a six-figure salary. By finishing among the top 10 NHL forwards in points in 2015-16 with 77, Panarin earned $1.725 million to give him a bonus total of $2.575 million. Add in another $212,500 for Teuvo Teravainen for finishing among the team's top six forwards in average ice time and $100,000 for Michal Rozsival's game bonus.
That's a combined bonus payout of $2,887,500 left for the Hawks at the end of the 2015-16 season. Teams use their remaining cap space to pay out bonuses, but when there's no available cap space left, the difference is applied to the team's books next season. For the Blackhawks, who finished the season with just $143,538 in cap space, per General Fanager, that means a massive overage hits the books.
For those not interested in doing the math themselves, it's an approximate cap overage of $2,743,962.
Already, you can see there's a ton of money that's not available to the Blackhawks just from Scuderi's retained salary and the overage charge. And guys, we haven't even gotten to Bryan Bickell.
Bickell when buried
And here's the final potential source of dead weight, although it's important to differentiate Bickell from the other costs because there's some flexibility remaining here. Unlike with the retained salary and cap overage, which are set in stone, the Hawks still have some options with Bickell, as we outlined in detail last month.
The problem, of course, is that Bickell appears to be a sunk cost of some sort no matter how you swing it. If you leave him on the roster and bury him in Rockford, you have a $3,050,000 cap hit stuck on the books for 2016-17. If you trade him, unless you're including another great asset -- possibly, Hossa forbid, Teuvo Teravainen? --- you're probably retaining millions. And if you buy him out, you decrease his 2016-17 cap hit to $1 million, but you'd add another $1.5 million to the books in 2017-18 when crucial players like Panarin and Teravainen will be RFAs.
So no matter how you twist things, Bickell will eat up at least $1 million, and assuming the team would like to move on from this albatross next offseason, it'll be much more than that.
The final tally is going to make Blackhawks fans sweat a bit. The team already had trouble filling out the roster with a salary cap of $71.4 million in 2015-16, and that was with just a $750,000 bonus overage from Kimmo Timonen. Realistically, combined with the raises to Brent Seabrook and Artem Anisimov, the Blackhawks are going to have one of the most obvious "stars and scrubs" rosters we've ever seen. There's simply no other way the books will work unless the team tries to clear some of those big salaries.
Because right now, the Hawks don't have anywhere close to $71.4 million to work with even if the cap stays stagnant. If the NHLPA declines the escalator clause and the cap goes down, as has been rumored to be possible, then we'll have to get ready for an utterly chaotic offseason. No matter what, Chicago has millions on the books that need to be qualified as sunk costs.
If the Hawks don't buyout Bickell, they're looking at approximately $7,018,962 in dead weight on the books for next season. If they do buy him out, they're looking at approximately $4,968,962. Either way, it's a ton of money -- right now with Bickell around, nearly 10 percent of the Hawks' cap space for the 2016-17 season is dead weight.
So while we continue talking about where the salary cap will ultimately land, the number for the Hawks will be even lower. When it comes to why the team probably won't be able to retain players like Andrew Shaw, that's a big reason.