Salary cap?

[johnnychemo]

What are the salary cap implications for all the players called up from Rachacha? I know the Sabres were bumping up against the cap prior to the season, and with all the callups, esp this early in the season, they gotta be getting close to the cap again.

What happens if they go over the cap - is there some sort of fine, does it cost them draft picks, do they have to cut players loose to get back down?

 

Thanks!

[spndnchz]

Ennis, Weber, Myers, and Boyes are all on Long term IR. You are allowed to go over the cap by their cap hit while they are out. The Sabres are actually under the cap more with having them out and entry level contracts being paid.

[inkman]

Ennis, Weber, Myers, and Boyes are all on Long term IR. You are allowed to go over the cap by their cap hit while they are out. The Sabres are actually under the cap more with having them out and entry level contracts being paid.

Have the Sabres announced any of them as LTIR? All we ever hear is "lower body", "upper body" "gonna be out a while".

[spndnchz]

Have the Sabres announced any of them as LTIR? All we ever hear is "lower body", "upper body" "gonna be out a while".

 

Yes.

[tom webster]

Yes.

 

Do you know why Hecht was never put on? At least I can't find any sight that shows that he was on and that they get credit for it.

[spndnchz]

Do you know why Hecht was never put on? At least I can't find any sight that shows that he was on and that they get credit for it.

 

He went on LTIR November 3rd. Came off Nov 23rd.

[LabattBlue]

Do you know why Hecht was never put on? At least I can't find any sight that shows that he was on and that they get credit for it.

I'm not sure what you mean by "they get credit for"? It is my understanding that when you put a player on LTIR, you can fill his roster spot with a contract of equivalent value. If you choose not to, you don't bank those dollars for future use, correct?

[spndnchz]

I'm not sure what you mean by "they get credit for"? It is my understanding that when you put a player on LTIR, you can fill his roster spot with a contract of equivalent value. If you choose not to, you don't bank those dollars for future use, correct?

 

It's fairly complicated and hard for me to explain. My example is a very simple one:

 

All teams have $347,567 per day to spend on players. If they don't spend it, it is considered "banked" to possibly spend later.

 

When a player goes on LTIR the cap hit of that player is not taken away from the $347,567 each day the player is out.

 

Boyes gives you about $21,000 per day while Ennis only about $5,000. Let's say these are the only players out. You have now "banked" $26,000 each day. This bank is available as long as the player is out to spend on other players.

[LabattBlue]

It's fairly complicated and hard for me to explain. My example is a very simple one:

 

All teams have $347,567 per day to spend on players. If they don't spend it, it is considered "banked" to possibly spend later.

 

When a player goes on LTIR the cap hit of that player is not taken away from the $347,567 each day the player is out.

 

Boyes gives you about $21,000 per day while Ennis only about $5,000. Let's say these are the only players out. You have now "banked" $26,000 each day. This bank is available as long as the player is out to spend on other players.

Thanks. The bolded was the part I was not sure on.

[shrader]

It's also worth noting that in order for these guys to be on LTIR, they are ruled out for a minimum of 24 days or 10 games. That time table is pretty obvious for Ennis and Myers, but it gives you a little glimpse into the status of Weber and Boyes (busy weekend, so if their status has been updated already, I missed it).

[tom webster]

It's fairly complicated and hard for me to explain. My example is a very simple one:

 

All teams have $347,567 per day to spend on players. If they don't spend it, it is considered "banked" to possibly spend later.

 

When a player goes on LTIR the cap hit of that player is not taken away from the $347,567 each day the player is out.

 

Boyes gives you about $21,000 per day while Ennis only about $5,000. Let's say these are the only players out. You have now "banked" $26,000 each day. This bank is available as long as the player is out to spend on other players.

 

 

I'm not sure its as complicated as the lawyers try to make it. While your cap doesn't go up, you are allowed to spend what you earn in LTIR credits over the cap. So the net effect is the same. According to capgeek, their LTIR projected credits are $3,271,547. So unless I'm missing something, assuming all players are out as projected, the team can now spend $64.3 million + $3,271,547 or roughly $67.5 million for the year.

[shrader]

I'm not sure its as complicated as the lawyers try to make it. While your cap doesn't go up, you are allowed to spend what you earn in LTIR credits over the cap. So the net effect is the same. According to capgeek, their LTIR projected credits are $3,271,547. So unless I'm missing something, assuming all players are out as projected, the team can now spend $64.3 million + $3,271,547 or roughly $67.5 million for the year.

 

Those credits disappear the second a player comes off of LTIR though. You will see them appear at on a site like that at the end of the season though because whatever amount they actually did spend will have to be listed so that the numbers balance out.

[tom webster]

Those credits disappear the second a player comes off of LTIR though. You will see them appear at on a site like that at the end of the season though because whatever amount they actually did spend will have to be listed so that the numbers balance out.

 

 

But the unused credits are banked so the net effect is the same. If they can spend $347K per day, but for 10 days they only spend $247K, at the end of the year you have $1 million to spend. To me its really semantics so they can say they hace a hard cap when in fact there is some flexibility built in.

[Taro T]

It's fairly complicated and hard for me to explain. My example is a very simple one:

 

All teams have $347,567 per day to spend on players. If they don't spend it, it is considered "banked" to possibly spend later.

 

When a player goes on LTIR the cap hit of that player is not taken away from the $347,567 each day the player is out.

 

Boyes gives you about $21,000 per day while Ennis only about $5,000. Let's say these are the only players out. You have now "banked" $26,000 each day. This bank is available as long as the player is out to spend on other players.

Unless they changed the way the BF-LTIR works when they adjusted the salary cap rules with the Kovy rules, that's not the way it works. (Well, technically it is the way it works, but it's missing a very important component - the team's effective cap not counting those players is reduced to what the team was spending on the day the player went on BF-LTIR.)

 

It is complicated, but more so on how much you can exceed the cap while a player is on BF-LTIR (essentially, a team's salary cap not counting the player(s) on BF-LTIR is set at what the team's salary was prior to placing the player(s) on BF-LTIR) rather than on what a team is banking in cap space.

 

So, with a salary cap of $64.3MM, if a team with a current cap hit of $63.3MM (and no banked salary) puts a player with a cap hit of $2MM on BF-LTIR, they can replace him with $2MM worth of salary cap salary, they can't replace him with a $3MM player because that would put them over where they were at when the player went on BF-LTIR.

 

If they have banked salary, they could exceed that $63.3MM until the bank is exceeded, but the bank can go away very quickly because all NHL salaries (non-BF-LTIR & BF-LTIR) and dead cap money count against the leaguewide salary cap for banking purposes. In the example where the team was $1MM below the salary cap and replaced a $2MM BF-LTIR'd player with another $2MM BF-LTIR'd player they are burning $1MM/186 (total they are over the leaguewide cap divided by the # of days in the season) each day. They'd be able to bring in more than $2MM worth of cap hit but only until their bank was emptied. So assuming the team was 60 days into the season, and they'd been banking at a $1MM/day rate, they could bring in $3MM worth of salary for 30 days. (The overage of $1MM against the real cap getting eaten up on a day by day basis, plus the $1MM overage against the team's effective cap getting eaten up on a day by day basis.) After that, they could only replace the BF-LTIR'd player's $2MM in salary as their bank is now gone.

 

But if they had 2 - $2MM players replaced on BF-LTIR with equivalent salary they'd be burning banked cap space at a rate of $3MM/186 each day. (Total salary of $67.3MM minus cap of $64.3MM divided by 186 days in season.) So, they'd only be able to bring in $5MM worth of salary for 15 days (the overage of the $3MM against the real cap getting eaten up on a day by day basis plus the $1MM overage against the team's effective cap getting eaten up on a day by day basis.)

 

But putting a guy on BF-LTIR in and of itself doesn't cause a team's cap bank to ever go negative. Once that player getting placed on BF-LTIR has burned up all the bank the bank stays at $0.

 

Which is why the Sabres couldn't go above the salary cap at the trade deadline the year that Timmy missed all but 1 day of the season because he'd effectively burned all their banked cap space.

[Sabres Fan in NS]

Unless they changed the way the BF-LTIR works when they adjusted the salary cap rules with the Kovy rules, that's not the way it works. (Well, technically it is the way it works, but it's missing a very important component - the team's effective cap not counting those players is reduced to what the team was spending on the day the player went on BF-LTIR.)

 

It is complicated, but more so on how much you can exceed the cap while a player is on BF-LTIR (essentially, a team's salary cap not counting the player(s) on BF-LTIR is set at what the team's salary was prior to placing the player(s) on BF-LTIR) rather than on what a team is banking in cap space.

 

So, with a salary cap of $64.3MM, if a team with a current cap hit of $63.3MM (and no banked salary) puts a player with a cap hit of $2MM on BF-LTIR, they can replace him with $2MM worth of salary cap salary, they can't replace him with a $3MM player because that would put them over where they were at when the player went on BF-LTIR.

 

If they have banked salary, they could exceed that $63.3MM until the bank is exceeded, but the bank can go away very quickly because all NHL salaries (non-BF-LTIR & BF-LTIR) and dead cap money count against the leaguewide salary cap for banking purposes. In the example where the team was $1MM below the salary cap and replaced a $2MM BF-LTIR'd player with another $2MM BF-LTIR'd player they are burning $1MM/186 (total they are over the leaguewide cap divided by the # of days in the season) each day. They'd be able to bring in more than $2MM worth of cap hit but only until their bank was emptied. So assuming the team was 60 days into the season, and they'd been banking at a $1MM/day rate, they could bring in $3MM worth of salary for 30 days. (The overage of $1MM against the real cap getting eaten up on a day by day basis, plus the $1MM overage against the team's effective cap getting eaten up on a day by day basis.) After that, they could only replace the BF-LTIR'd player's $2MM in salary as their bank is now gone.

 

But if they had 2 - $2MM players replaced on BF-LTIR with equivalent salary they'd be burning banked cap space at a rate of $3MM/186 each day. (Total salary of $67.3MM minus cap of $64.3MM divided by 186 days in season.) So, they'd only be able to bring in $5MM worth of salary for 15 days (the overage of the $3MM against the real cap getting eaten up on a day by day basis plus the $1MM overage against the team's effective cap getting eaten up on a day by day basis.)

 

But putting a guy on BF-LTIR in and of itself doesn't cause a team's cap to ever go negative. Once that player has burned up all the bank the bank stays at $0.

 

Which is why the Sabres couldn't go above the salary cap at the trade deadline the year that Timmy missed all but 1 day of the season because he'd effectively burned all their banked cap space.

 

Wholly crap!!

[inkman]

Unless they changed the way the BF-LTIR works when they adjusted the salary cap rules with the Kovy rules, that's not the way it works. (Well, technically it is the way it works, but it's missing a very important component - the team's effective cap not counting those players is reduced to what the team was spending on the day the player went on BF-LTIR.)

It is complicated, but more so on how much you can

exceed the cap while a player is on BF-LTIR (essentially, a team's salary cap not counting the player(s) on BF-LTIR is set at what the team's salary was prior to placing the player(s) on BF-LTIR) rather than on what a team is

banking in cap space.

 

So, with a salary cap of $64.3MM, if a team with a current

cap hit of $63.3MM (and no banked salary) puts a player with a cap hit of $2MM on BF-LTIR, they can replace him with $2MM worth of salary cap salary, they can't replace

him with a $3MM player because that would put them over

where they were at when the player went on BF-LTIR.

If they have banked salary, they could exceed that

$63.3MM until the bank is exceeded, but the bank can go

away very quickly because all NHL salaries (non-BF-LTIR

& BF-LTIR) and dead cap money count against the

leaguewide salary cap for banking purposes. In the

example where the team was $1MM below the salary cap

and replaced a $2MM BF-LTIR'd player with another

$2MM BF-LTIR'd player they are burning $1MM/186 (total

they are over the leaguewide cap divided by the # of days

in the season) each day. They'd be able to bring in more

than $2MM worth of cap hit but only until their bank was

emptied. So assuming the team was 60 days into the

season, and they'd been banking at a $1MM/day rate, they

could bring in $3MM worth of salary for 30 days. (The

overage of $1MM against the real cap getting eaten up on

a day by day basis, plus the $1MM overage against the

team's effective cap getting eaten up on a day by day

basis.) After that, they could only replace the BF-LTIR'd player's $2MM in salary as their bank is now gone.

 

But if they had 2 - $2MM players replaced on BF-LTIR with

equivalent salary they'd be burning banked cap space at a

rate of $3MM/186 each day. (Total salary of $67.3MM minus cap of $64.3MM divided by 186 days in season.)

So, they'd only be able to bring in $5MM worth of salary for 15 days (the overage of the $3MM against the real cap

getting eaten up on a day by day basis plus the $1MM

overage against the team's effective cap getting eaten up

on a day by day basis.)

But putting a guy on BF-LTIR in and of itself doesn't cause a team's cap bank to ever go negative. Once

that player getting placed on BF-LTIR has burned up

all the bank the bank stays at $0.

 

Which is why the Sabres couldn't go above the salary cap

at the trade deadline the year that Timmy missed all but 1

day of the season because he'd effectively burned all their

banked cap space.

(in my best butthead voice)

 

Uh...what? You said eaten.

[carpandean]

Thanks Taro. I had been meaning to look into exactly how that works for a while now, but your explanation makes sense.

 

I'm not sure why they didn't set it up as players don't count against the cap while on LTIR. Basically, it would be treated the same way as a player being demoted to the minors during that time. There is a minimum time and it's in the rules that the league can and will investigate any misuse of the bona fide long-term injured reserve, so why make a rule that seems like it's aimed at discouraging teams from placing players on LTIR? Seems to me that it punishes teams with a lot of injuries.

[shrader]

But the unused credits are banked so the net effect is the same. If they can spend $347K per day, but for 10 days they only spend $247K, at the end of the year you have $1 million to spend. To me its really semantics so they can say they hace a hard cap when in fact there is some flexibility built in.

 

There's a miscommunication here and I'm not quite sure where it is. They're not banking a thing when they put a guy on LTIR. He still counts against the cap. For those who can read it, Taro's post covers most everything.

 

Thanks Taro. I had been meaning to look into exactly how that works for a while now, but your explanation makes sense.

 

I'm not sure why they didn't set it up as players don't count against the cap while on LTIR. Basically, it would be treated the same way as a player being demoted to the minors during that time. There is a minimum time and it's in the rules that the league can and will investigate any misuse of the bona fide long-term injured reserve, so why make a rule that seems like it's aimed at discouraging teams from placing players on LTIR? Seems to me that it punishes teams with a lot of injuries.

 

I think they want to avoid the potential legal battles that would be involved in those investigations. That's one giant can of worms.

[tom webster]

There's a miscommunication here and I'm not quite sure where it is. They're not banking a thing when they put a guy on LTIR. He still counts against the cap. For those who can read it, Taro's post covers most everything.

 

 

 

I think they want to avoid the potential legal battles that would be involved in those investigations. That's one giant can of worms.

 

 

I think you will find that if you go through Taro's detailed explanation and my overly simplified version, the math will come out the same but I will have to do a little research to prove, or disprove my point. Frankly, I'm not sure I'm right, I'm just pretty sure I am.

[Taro T]

...

 

I'm not sure why they didn't set it up as players don't count against the cap while on LTIR. Basically, it would be treated the same way as a player being demoted to the minors during that time. There is a minimum time and it's in the rules that the league can and will investigate any misuse of the bona fide long-term injured reserve, so why make a rule that seems like it's aimed at discouraging teams from placing players on LTIR? Seems to me that it punishes teams with a lot of injuries.

My best guess would be to keep from driving down individual player salaries. The players will get X $'s at the end of the year (currently 57% of agreed upon revenues). If total player salary on paper ends up less than X, the players get more $'s on a prorated basis (a guy making $2MM on paper gets twice the escrow payment at the end of the year that a guy making $1MM gets); if the total player salary on paper ends up greater than X, the players give more money back from escrow.

 

I know it would never happen to this extent, but as an example, if a team had $64.3MM worth of BF-LTIR payments, every player in the league on the other teams would lose ~3.3% of their salary as the total player pool was now effectively split between 31 teams' worth of players rather than 30 teams' worths.

 

Whereas, when a player is sent to the minors on a 1 way contract, his salary doesn't count against the players' 57%.

 

If that's not the reason for it, I'm stumped.