Capologists rejoice: your long, national nightmare is almost over! The keyword there is almost, although we can add “maybe” in there as well. Commissioner Gary Bettman announced the NHL salary cap could go up significantly for the 2022-2023 season if certain conditions are met.
The financial conditions might sound a little complicated, so we’re going to do our best to explain them. Consider this “NHL salary cap details for dummies”.
Long story short, the players are basically in debt to the league. Under the current CBA, players are allotted a certain amount of hockey-related revenue to be paid with. During the COVID shutdowns, players were paid even though the league wasn’t taking in any hockey-related revenue.
Because of this, the players ended up throwing off that balance of how hockey-related revenue would be shared between them and the league.
For the first time in years, the NHL salary cap might not remain flat.
That led to the “flat cap” the league has experienced over the past few years. “Flat cap” is a weird term, because the NHL’s salary cap actually did raise $1 million last season.
The league arranged the debt, which is formally known as “escrow,” to be paid off over the next few seasons in sort of a playoff plan tied directly to raising the cap.
Over the past few years, hockey-related revenues rose, but the cap did not (except for that pesky little $1 million everyone pretends doesn’t exist). The league was making more, but players did not.
That threw the “hockey-related revenue” balance back in the league’s favor to even out the discrepancy from during the COVID shutdown.
The cap will go up by $4 million next season if things finally even out. Commissioner Gary Bettman sounded cautiously optimistic, saying that it would be “close” and not committing to anything just yet. Remember, the salary cap is something usually calculated in the offseason anyway.
Escrow has long been a point of contention between the league and its players. Players in the past have said it’s an issue they see causing a future lockout.
Of course, those comments were made pre-COVID and pre-new CBA. Those concerns were in reference to how escrow is dealt with in normal (non-COVID) seasons.
While $4 million extra might not have been enough to help the Tampa Bay Lightning when they famously had to wait until the playoffs for Nikita Kucherov and his cap hit, it could have helped other cap-strapped teams.
The Vegas Golden Knights have been dealing with cap issues from even before they traded for Jack Eichel. Remember, back in 2020-2021 they had to play with fewer than 18 skaters in some games because of salary cap constraints. That decision likely cost them that season’s Presidents’ Trophy.
If they had that extra $4 million, they might have found a way to keep Max Pacioretty this offseason instead of trading him away for nothing, or had some extra money to address their goaltending dilemma with Robin Lehner out all season.
After years of making every penny count, teams will be thrilled if the cap corrects itself. $4 million is a lot of flexibility. Too bad for the teams, Bettman left the door open that they might have to wait yet another year.