The NHL defrosts the ceiling – Newspaper Kommersant No. 195 (7396) of 10/20/2022

The improvement in the financial situation of the NHL, which lost at least $1 billion during the coronavirus pandemic, will apparently allow the league to finally meet the needs of the leaders of its clubs and not just symbolically, but quite significantly – in the amount of $4 million to $4.5 million – to raise the salary cap. For several years, he kept about the same level. This circumstance seriously complicated the recruitment of teams, the best of which were constantly forced to suffer personnel losses.

That the NHL salary cap could see a ‘substantial lift’ next season declared at a meeting of the league’s club owners’ council in New York, its head, Gary Bettman. He even named the range of his increase – from $4 million to $4.5 million. True, in order for it to take place, according to Gary Bettman, one condition must be met. It consists in compensating the losses to the owners of the clubs that they suffered during the coronavirus pandemic. It significantly reduced the calendar of two consecutive championships, and also led to significant losses for other reasons, for example, due to restrictions on the admission of spectators to the stands.

In the official terminology of the NHL, the losses are called the “duty” of the players to the club owners, who, despite the difficulties, were forced to fulfill their contractual obligations.

Gary Bettman estimated the size of the debt at $1 billion and made it clear that, in his opinion, the chances that it will be paid off in the near future are extremely high. This is evidenced by the data on the income of the league for the season that preceded the current one, which started in early October. The previous championship was the first full-fledged in terms of the calendar since the announcement of the pandemic. In the course of it in December last year, the NHL experienced a powerful outbreak of the coronavirus, but it managed to avoid a radical reshaping of the championship format by abandoning the Beijing Olympics and filling the February Olympic window with rescheduled matches.

The league announced a few months ago that thanks to this, it expects revenues directly related to the hockey business to return to pre-pandemic levels, that is, by the $5 billion mark. But in the end, as Gary Bettman clarified, they turned out to be even more solid – $5.4 billion. And this circumstance can provide the league with freedom of maneuver with the salary cap.

Why Mr. Bettmen’s statement regarding him has become almost the main hockey news of the week for America is understandable. The salary cap, which roughly corresponds to the total value of the annual contracts of all the club’s hockey players, is one of the NHL’s key financial instruments. With it, it maintains competition in the championship, and also reduces the risk of clubs’ commercial failures, the threats of which have already led to lockouts twice this century, in 2004 and 2012. In the NHL, unlike, for example, the National Basketball Association, the ceiling is rigid, and the possibility of exceeding it, even for paying a luxury tax, is not provided. At the same time, the last significant increase in the ceiling took place a very long time ago – when in 2014 it jumped from $64.3 million to $69 million. by $1 million a season, which did not fundamentally change the situation.

The fact is that raising the salary cap has long been one of the most relevant topics for NHL club leaders, since in a frozen state it makes it much more difficult for them to complete squads against the backdrop of ever-growing requests from players.

Limits do not allow them to be satisfied, which is why staff turnover in the league has become commonplace. Moreover, almost in the first place, the ceiling hits the leading clubs, whose success is actually impossible without the utmost, “to the eyeballs” filling out the payroll, which, when the best players begin to insist on re-signing contracts on more favorable conditions, taking into account their achievements, have to urgently unload. So, this summer, both Stanley Cup finalists, the Colorado Avalanche and the Tampa Bay Lightning, which lost to him, were forced to part with a whole group of major hockey players. And even the tricks the clubs have come up with to get around the rules, like placing players on the so-called long-term injured list, LTIR (in which case their contracts are not counted in the regular season), do not help solve the problem.

Its sharpness can be judged by looking at the data of the resource. CapFriendlyconstantly monitoring payrolls. At the moment, 13 of the 32 NHL clubs have zero clearance under the ceiling. Another five have it symbolic – less than a million. And boldly looking into the future, knowing that they will have the opportunity to enter into expensive contracts without radically shaking up the foundation, perhaps only three teams with a backlash of more than $10 million – the Anaheim Ducks, the Arizona Coyotes and the Buffalo Sabers.

Alexey Dospekhov