Our source for all things NHL salary cap is CapFriendly, so let’s take a look at what the cap situation is at this point in time.
Gary Bettman has been asked about the cap for the next couple of seasons and he has publicly said that the cap could go up by as much as $4,000,000 next season.
You see this all goes back to the pandemic when the NHL was forced to shut down operations midseason in one case and then start much later on in the calendar year the next – and even then there were no fans in the building and all the playoffs were played in a bubble in either Edmonton or Toronto, with Tampa Bay winning their second Stanley in 2021 here in Edmonton. As restrictions were eased by health authorities and vaccination numbers increased (the pandemic was declared over three weeks ago in case you missed it) some fans were allowed in the building and then all seats were opened.
So you may ask what happened to players’ salaries during this time that the NHL was shut down? Well, the owners secured bridge financing to pay player salaries while the season wasn’t being played. In return, the NHLPA used all of their escrow money (~ 20% of a player’s gross income that gets paid back at the end of the season if the owners are not suffering financially) to pay back the owners the salaries they were paid while they weren’t playing, and the cap only went up by $1,000,000 a year since the NHL re-opened for business.
Well, ever since then according to Gary Bettman the NHL has recovered its pandemic costs at a faster rate than anticipated, and while it was originally projected to take at least one more season for the players to pay back the owners for the salaries they collected while two seasons ended prematurely and started late, depending upon playoff revenues those costs might be recovered by the end of the playoffs this season, which means the cap will now go back to being calculated according to NHL revenues instead of debt the players owe the owners.
Bettman has stated we’ll know more in June after total playoff revenue is included in the NHL’s revenue figures. For now, though, the cap is only going up by $1,000,000 to $83.5 million. The extra three million would certainly help but the Oilers are at $77.53 million in spending for next season right now – and they have seven players whose contracts are up that need to be re-upped. This means that unless the cap goes up more the Oilers will have $5.97 million in cap space to re-sign said players and one of the guys who needs a new contract is Evan Bouchard, who’s bound to actually take up at least 67% of said cap space (that’s a minimal cap hit of $4,000,000, it could be larger).
It’s also worth noting that the LTIR space of Mike Smith ($2.2 million) and Oscar Klefbom ($4.167 million) is no longer available as those contracts have expired. That’s over $6,000,000 in cap space that has just evaporated overnight.
Unless Holland wants to dismantle the roster in unpalatable ways, the easiest way to get around this is to acquire another LTIR contract. Tampa Bay and Vegas have been doing this for years, so why can’t we? Personally, I vote for trading for Shea Weber’s contract from Arizona, that would be $7.857143 million in LTIR cap space for the next three seasons, and hopefully, by that time the cap will have gone up enough that the Oilers won’t need LTIR cap space anymore. Hopefully, they’ll be able to shave some cap space at the bottom of the roster. For example, want to re-up Mattias Janmark? Why not offer him $2,000,000 over two seasons? That decreases his cap hit from last season by $250k. How about Nick Bjugstad at $850K per season for two years? That’s another $50K off his cap hit from last year. Derek Ryan? How about $900K for one season? $350K off his cap hit from last season.
There, in just three examples I’ve already shaved $650K of cap space off the cap without giving up any assets – and that will at least give Holland some wiggle room that he can apply to players that will get a raise like Bouchard, Ryan Mcleod, or Klim Kostin.
Of course, if the cap increase quadruples in size that will change the game a bit as the Oilers would have almost $9,000,000 in cap space instead of almost $6,000,000. They might or might not get everyone signed for that money – or at the very least wouldn’t need as much LTIR cap space.
I’d probably still trade for it just in case we needed it and it would certainly help us at the next trade deadline with a great rental.
The Oilers also get the buyouts of Andrej Sekera and the retained salary of Milan Lucic off the books, saving us $2.25 million off the cap, but considering that Stuart Skinner’s extension will give him $1,815,834 in extra cap hit per season that pretty much wipes that out. Still, we have another $434,166 in cap space than we would’ve had – I guess that’s better than nothing. Gives the Oilers a little more cap room – maybe one more callup from the farm team or trade deadline acquisition.
However he does it, this will be a question Ken Holland will have to answer sooner rather than later.