Monday, June 20, 2011

NHL Cap Gets Raised to $64 Million Dollars

When the NHL locked out it's players until the new CBA promised a fiscal responsibility and cost assurances, the salary cap was a ceiling so that the rise in players' salaries weren't exceeding the team's income.

Now, the NHL salary cap has been raised to 64 million dollars, it is far beyond the initial 39 million that was established making this year's floor salary level 48 million dollars - a precarious position to be in if an owner is without deep pockets or losing money at alarming rates.

This news is actually a double edged sword. Both good news and bad. It's great that the NHL can claim they calculate league revenues at a growing pace while keeping their NHLPA happy continually growing salaries for them. It shows the fans as well as advertising investors that the game still has room to grow. Treat it as a vote of confidence in the direction that the league is taking. And in my opinion, as long as league revenues grow, the NHLPA is less likely to want to go on strike or get locked out in the future.

But on the bad side, many teams who do not have enough revenues to cover the salary floor, can't keep up. It's League rules demand that the floor is met by all 30 teams causing an inflation of salaries among players deemed "marginal".

Weather or not this is going to be a sticking point in the next CBA agreement will no doubt be debated over the next year.  Can the players lower the NHL floor for struggling teams or will we see NHL franchises be forced to fold or move again?

[Via: Rogers Sportsnet]
Post a Comment