Wednesday, July 28, 2010

Money and something I was wrong about

OK, for lack of anything else to go off of, let's make some assumptions and see where we are. The point of this, as mentioned yesterday, is to determine that Redden must go, using the maths. But before we get into that, we need to cover something I was wrong about.

It turns out that "all bonuses, even if they go unpaid, count against the cap," as I have previously claimed, is an oversimplification. Signing bonuses always count against the cap, but performance-based bonuses (like "if you score 20 goals by January, you make an extra $500,000") only sort of always do. All potential bonuses (ones that have neither been paid out nor become impossible to achieve) are counted against the team's cap, yes. But: a team is allowed to exceed the cap by 7.5% (of the cap) in potential performance bonuses. If a bonus ends up not being achieved, it stops counting against the cap (whether or not it was up in that "bonus cushion," exceeding the cap). If it is achieved, however, it counts. If the bonus still kept the team under the real cap, that's fine (the bonus gets paid out, everyone is happy). However, if the bonus was only legal because of the "bonus cushion," then paying out the bonus actually takes the team over the cap. If this is the case, the amount by which the team exceeded the cap will be deducted from next year's cap.

TL;DR Potential performance bonuses can exceed the cap by 7.5%, but if they end up getting paid out, the amount the team is over the cap will be deducted from their cap for next season.

There are a handful of performance bonuses built into Ranger contracts, and we'll have to take those into account when calculating our total cap hit: we technically can exceed the cap by these amounts (up to $4.455 million), but it's dangerous to do so, because if they all get paid out, we'll have that much less of a cap to work with next season.

Anyway, we'll get to those soon. Let's start simple: goaltending is all figured out. Lundqvist and Biron will be the two on our roster, totaling a cap hit of $7.75 million (6.875 + .875). Remember that the cap this season is $59.4 million, leaving us with $51.65 million to spend on skaters.

Now, it's hard to know exactly which forwards will make the cut, but we know we need at least 12, and I think it's fairly easy to name exactly 12 that will definitely on our opening day roster. Comment if you disagree, but I'm willing to claim that Gaborik (7.5), Drury (7.05), Frolov (3), Callahan (2.3), Prospal (2.1), Avery (1.9375), Dubinsky (1.85), Boogaard (1.625), Christensen (.925), Anisimov (.821667), Prust (.8), and Boyle (.525) all qualify. I don't feel like that assumption is too far out.

Remember that a roster requires a minimum of 12 forwards, 6 defensemen, and 2 goalies, and a maximum of 23 people. So, that leaves 3 "open" spots for extra men. I imagine some of those will be filled by forwards (Mats Zuccarello-Aasen, Patrick Rissmiller, Derek Stepan?), but let's just talk right now about those minimum 12, which will likely be the 12 mentioned above. Those 12 total a cap hit of $30,434,167. Throw in the $1.3 million that Donald Brashear will count against our cap from Hartford, and you're at $31,734,167 spent on forwards, leaving $19,915,833 to spend on defensemen (and an extra forward or two). However, it's worth noting that $1.1 million of that figure is in performance bonuses for Prospal, so we could exceed the cap by that much.

Let's assume we sign Staal at a $4.5 million hit. I know this number is highly under debate by the powers that be (Glen Sather and Bobby Orr?), but 4.5 is a good figure to work with: it's probably right between what the two sides are trying for, so unless something crazy happens, we can use it and not end up too wrong. Sather has already made it clear that he will re-sign Staal, claiming he would match any offer sheet Staal is given, so we're comfortable with the idea that he'll be back. Let's call it a $4.5 million hit.

We need to carry at least 6 defensemen, and will probably carry 7, but I think that it's not worth debating a solid 5. I believe that Rozsival (5), Staal, Girardi (3.325), Eminger (1.125), and Del Zotto (1.0875) will all definitely be on that opening day roster. Again, comment if you disagree, but I think those five are definitely there. Using the 4.5 figure for Staal, these five defensemen cost us $15.0375 million. $212,500 of that is in performance bonuses for Del Zotto.

We said we had $19,915,833 left after our 12 forwards and 2 goalies, and this $15.0375 for 5 defensemen leaves us $4,878,333 to spend on at least one defensemen, and then hopefully some backup. Between Prospal's and Del Zotto's performance-based bonuses, we have another $1.3125 million by which we are technically permitted to exceed the cap (although if they get paid out, that'll be $1.3125 million we can't spend next season). So, theoretically speaking, that would give us $6,190,833 free at the absolute maximum - still a bit short of Redden's salary.

So, what would we have to do to keep Redden around, at this point? The above figure is $309,167 shy of Redden's incomprehensible $6.5m hit, so if we knock that off of our original $4.5m guess at Staal's contract, we come up with the answer: sign Staal to a contract with a cap hit of $4,190,833 or less. Oh, and carry around the absolute bare minimum roster of 2 goalies, 12 forwards, and 6 defensemen, not bringing up Mats Zuccarello-Aasen, Matt Gilroy, or Ryan McDonagh, let alone Patrick Rissmiller or Derek Stepan. And be on the hook to potentially lose $1.3125 million from next year's cap.

On the other hand, sending Redden to Hartford means we have that full $4,878,333 remaining before we even leak into the bonus cushion at all. This must be used to afford at least one defenseman, and can then be used to add more than the absolute minimum roster. For example, assuming we're right about $4.5m for Staal, this money can be used to add Gilroy at $1.75m and McDonagh at $1.3m (of which $425,000 is in performance bonuses). Theoretically, that would still leave room to bring up Mats Zuccarello-Aasen at $1.75m (of which $850,000 is in performance bonuses) before even crossing into the bonus cushion. This would leave us barely any room ($78,333) under the cap, but does give us $2,587,500 that could go up under the bonus cushion, if we needed wiggle room for some reason (like a Staal contract negotiation).

So, there you have it. It is still theoretically possible to keep Redden on the roster, if we sign Staal for under $4.2 million (which would not make him happy), borrow $1.3 million from next year's cap, and cripple our roster to the bare minimum of 12 forwards and 6 defensemen. Does that seem likely to you? It sure doesn't seem likely to me.

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