This can't be good for hockey

The hockey world is experience a form of sticker shock following the announcement that the New Jersey Devils had signed Ilya Kovalchuck to a 17-year, $102 million contract.  There is no question a future Devil GM will have regrets about this contract.  Kovalchuk will be paid $10.5 million at age 35 and $8.5 million at age 36 although the cap hit will remain at $6 million.  Of course who knows what the collective agreement will look like in 2019.

Really what’s the point of a salary cap when a $9.5 million player (based on the first 10 years of the contact of the contract) only uses up $6 million in cap space.  The cap was supposed to help small market teams but limiting the amount that big market teams could spend on salaries.  Well it’s not quite working that way.  Teams are paying salaries above the cap level and it’s perfectly legal.  For example, the New York Rangers have 19 players with salaries totalling $56.8 million.  But the cap hit is only $54.4 million.  That extra $2.4 million will be spent the Rangers and can help be strengthen their lineup. 

Frontloading salaries does catch up to you eventually.  For example, in 2011-12, Chris Drury of the Rangers will be paid $5 million but his cap hit will be $7.050.  In 2013-14, Daniel Briere of the Flyers will be paid $3 million but his cap hit will be $6.5 million.  But that won’t be a problem because these players will be traded (if they don’t have a no-trade contract) to small market teams who will gladly take on low salaries and big cap hits so that they can reach the minimum cap floor without actually spending the full amount.

My suggestion for Brian Burke is that he doesn’t trade Tomas Kaberle.  Instead extend his contract for 20 years.  The first five years pay him $7.5 million and the next 15 years pay him $0.5 million.  The cap hit will only be $2.25 million.  Kaberle becomes one of the best paid defensemen in the league and but his cap hit will be one of the lowest on the team’s defense.  I know you’re thinking that there is no way Kaberle will play until he is 54. Well when Kaberle’s salary drops to $0.5 million at age 39 he will likely choose to retire. There will still be 15 years and $7.5 million remaining on the contract but because it was signed before Kaberle reached the age of 35, it will not count against the Leaf’s salary cap.

Sounds absurd? No more so than the contract given to Kovalchuk. 

UPDATE: As I was completing this post I hear that the NHL has rejected Ilya Kovalchuk’s 17-year deal with the New Jersey Devils because it circumvents the league’s salary cap. Finally  a rationale decision coming from NHL headquarters.