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NHL Rumors did a piece on the possibility of the cap going up. Before I get into it, here is the kind of “double speak” I mean when it comes to this
A quote by Dave Altar says, “in 2020-21 in that 56-game season, they got their money too.
Sure the escrow payment was 18 percent but essentially they got their full check without playing a full year.”
Ok, the players got their full check, except for 18 percent. And for the past full seasons played they got their full check, except for 20 percent. Not to go full math, but that means they didn’t get their full check. Escrow is the thermometer for league financial health. With the 50/50 split, if the players make more than the owners money is taken back to even it out. It seems idiotic to say “someone got their full check, except for 18%”. Agent fees are pre escrow. Taxes are based on salary. Players pay taxes and agents the same as if there was no escrow. And if you get 5 checks with 20% escrow, you just gave back one of your checks to the league.
The argument comes up each year. It was assumed when the 50/50 split I came that the cap would be over 90 million by now. It’s around 83 million. However, there hasn’t been a single year since the inception of escrow where at least some money hasn’t been given back to owners. With the AZ situation, it’s going to add to the imbalance of what that team can make in HRR and what the players are paid. It messes things up for the whole league. Oh, and the money taken during shutdown conditions still hasn’t been fully paid back.
Owners want the cap raised to keep talent on board. Players want more money, but unless spending goes up and more revenue comes in, everything they add to the cap will go right back to the owners. The cap number is as false a narrative as you can create.
Now, people are saying that because of inflation the cap HAS to go up. That could be true if the CBA didn’t have the 50/50 split. It means that teams are spending more money on everything from equipment to concessions and hoping that customers will fall in line with the price hike and in fact spend more. The Players Association will debate a cap increase once the numbers come out for this year’s HRR haul. For anyone that expects 2 new franchises to inject 2 billion into that equation, those fees aren’t HRR. They also aren’t paid up front. Seattle didn’t make their final payment until weeks before their draft. The money trickled in.
The loophole had been signing bonuses. However, once escrow was at a fixed rate during payback bonuses could be hit. I won’t go into it but most of you know why there is less money expected to come from Bally and ESPN. Add to that two different currencies. If the U.S. currency holds as it is now, $1 American is worth $1.36 Canadian. So teams north of the border have to bring in an extra third of Canadian revenue just to be on equal terms.
I’ll finish with this. How many of us have or have had salaried jobs where the company takes a percent of your guaranteed income based on how the company does? They do layoffs and cost cutting. The NHL players continue to pay 1/5th of their checks right back to their respective employers. To believe that inflation will just make the cap go up is the same insanity as believing Bettman when he says the cap will go up 5-7 million. Well, now it’s 2-3 million. Well, it will go up 1 million if players agree.
Ticket prices will reflect inflation, but so will peripheral spending. All 3 auto unions are threatening to strike for up to 46% in increased wages. The fact that you have to dig to see exactly what the “real” cap is gives the smoke and mirrors effect. 83 million in spending is actually 66.4 million if Escrow is at 20 percent. It’s far past time that the league was honest about the numbers they throw around.
Detroit Red Wings Blogger • 
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