On July 13, 2005 Gary Bettman stood in front of the hockey world a conquering hero in the eyes of his bosses, the NHL owners.
He had effectively slew the NHLPA and had put in a system that was thought to bring financial stability and parity to the league.
Since then more holes have been punched in his landmark collectively bargained agreement than the plot of a Transformers movie, the Phoenix Coyotes went into bankruptcy where the league bought them and still owns them, the Atlanta Thrashers have moved while other seem perilously close to the edge of packing up and that economic stability that was supposed to be forced upon the league has turned into a fallacy.
I remember the day vividly as Kevin Lowe quickly swung deals for Chris Pronger and Mike Peca and swore up and down that they had made their last trade ever due to financial constraints.
That of course was after emerging from the lockout with a cap of $39 million and a floor of $21 million.
Pre-lockout, the Edmonton Oilers were part of the have-nots with a limited market, limited dollars and a budget of less than $30 million. Meanwhile the big market teams were spending like drunken sailors with the New York Rangers, Detroit Red Wings, Toronto Maple Leafs, Colorado Avalanche and the Philadelphia Flyers all spending more than $60 million, some times pushing much higher.
There was no realistic way for the small markets to compete.
The lockout was their Hail Mary pass to save their, um, back side.
There was no way they could have imagined that six years later teams would be entering an off season where the floor alone would be jumping to $48 million. The cap will be $64 million.
While the cap is based on the NHL’s revenue streams, the floor is forcing teams to spend irresponsibly.
With the current floor teams, regardless of how well they are run, will be forced to spend beyond their means and for the cycle their franchise is in.
Case in point are the Florida Panthers who are in the middle of a rebuild are sitting $22.2 million below the cap, this after taking on Brian Campbell’s $7 million a year hit at the draft and signing Tomas Kopecky to a four year $12-million on Wednesday.
Now one could say that it’s just the Panthers being cheap as they always have been, that they are mismanaged, etc.
But when you look at who is now building the team, Dave Tallon who was the architect of the Chicago Blackhawks Stanley Cup championship team, the picture gets a little fuzzier.
“The focus is not the floor, the focus is to become a really good team as quickly as possible without jeopardizing our future,” he said at the draft, when asked if he made the Campbell trade just to pick up salary to get closer to the floor. “The floor is going to accidentally get in the way. That’s the way I’m looking at it — I’m not doing this (Campbell trade) to get to the floor, I’m doing this to become a good team. Period.”
In other words the Panthers face a huge problem when it comes to staying on their rebuilding plan and meeting the lower limits of the cap.
They will also become a target for every team in the league looking to dump a bad contract. If it’s a bad contract for one team, there is no reason it will be a good contract for them.
The other risk teams are facing with an extremely weak pool of free agents opening up today is the temptation to over pay for mediocre players just to get to the floor.
The Buffalo Sabres on Thursday, for example, handed defenceman Christian Erhoff a 10-year deal worth $40 million.
The hard truth for the league is it is right back where it was before the lockout — except the gap between the haves and have-nots is growing.
Heading into the lost season teams like the Columbus Blue Jackets, the Atlanta Thrashers and Phoenix Coyotes with plummeting levels of income were hovering around break even propositions — according to a story in the The Globe and Mail on Thursday. In the new revenue sharing world of the NHL, in 2009 the Blue Jackets lost $10 million and $7 million last year, the Predators have lost $11 million the last two years and the Coyotes, well the City of Glendale is paying the league $25 million a season to help cover their losses. This is after league revenue sharing. Basically they are being forced to spend more just to get a little bit of it back.
Teams like the Toronto Maple Leafs, Montreal Canadiens and Vancouver Canucks are benefitting from rising operating incomes, buoyed by a strong Canadian dollar.
At this point it’s not all about how well a franchise is run that will determine if it makes a buck.
Since Year 1 of the CBA the minimum cost of operating a team in the NHL has more than doubled. How teams in limited markets are expected to keep pace is beyond me.
The system that was supposed to be a blue print for leagues like the NBA to follow has proven to be a sham.
With the CBA expiring at the end of the 2011-2012 season, Bettman has one year to fix it.
jaldrich@www.reddeeradvocate.com
Twitter.com/Ridingthepine03