Report: NHL, NHLPA agree on cap formula

[Madferret]

TSN.ca Staff with CP, Globe and Mail files

The Globe and Mail reports that the NHL and NHL Players' Association have agreed on a formula for a salary-cap system based on team-by-team revenue. The salary-cap issue was seen as the biggest hurdle in talks for a new collective bargaining agreement.

According to the Globe's league and player sources, a team-by-team salary floor and cap will based on a percentage of each NHL team's revenue. The paper adds that in the first year - based on revenue projections by both sides - the salary cap will range from $34 million to $36 million US, with the floor from $22 million to $24 million US.

The Globe also reports that the formula calls for a dollar-for-dollar luxury tax to kick in at the halfway mark between the floor and the cap. If the floor of the lowest team is $22 million US and the cap on the highest team is $36 million US, then the 'tax level' will be $29 million US.

The formula would allow wealthier teams to spend a bit more money, but would also bridge the large gaps in spending between higher payroll teams and lower payroll teams. Small group labour talks between both sides ended late Tuesday night and resume today in New York with a larger group meeting.

Both sides have carried over the momentum from last week when 34 hours of talks were described as 'progressive' from both sides. There are several issues to iron out, but sources in both camps believe there's a chance a deal could be done before July. Still, both sides also concede there are potential pitfalls that could prevent an agreement from being reached.

Today's session is the 21st meeting between the two sides since the season was cancelled Feb. 16. NHL vice-president and chief legal officer Bill Daly and NHLPA senior director Ted Saskin declined to confirm or deny anything to The Globe and Mail.

Files from CP and The Globe and Mail were used for this report.

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To get excited or to not get excited...

[Newfie John]

Things are looking up....

The National Hockey League and the NHL Players' Association have cleared the biggest hurdle in their labour negotiations by agreeing on a formula for a salary-cap system based on team-by-team revenue, according to separate sources.

This has been the most contentious issue between the owners and players, but the sources also said it does not mean a new collective agreement is close to completion. The negotiating teams are now working on salary arbitration, free agency, qualifying contract offers and other issues, any of which could be deal-breakers.

"They still have a ways to go," one source said, although with the cap issue settled there is much more reason for optimism that a deal can be reached by early July.

NHL vice-president Bill Daly, the league's chief negotiator, declined to confirm or deny anything. But Daly did say publicly on Tuesday that the negotiators had moved on to other issues.


Daly's counterpart with the NHLPA, senior director of business affairs Ted Saskin, could not be immediately reached for comment. Saskin and Daly and the negotiating teams are in the second day of this week's negotiating session, which began on Tuesday.

According to a source with ties to both owners and players, and another source close to the owners, there will be a team-by-team salary floor and cap based on a percentage of each team's revenue. The actual percentage is not known, although the league had been demanding 54 per cent.

In the first year of what is thought to be a six-year deal, based on revenue projections by both sides, the salary cap will range from $34-million to $36-million, with the floor from $22-million to $24-million.

What is not clear is how the percentage will be applied to each team, since there is a large disparity in revenue among the NHL's 30 teams, although it is clear the agreement is a complicated one. If a strict percentage were used, then a large-revenue team like the Toronto Maple Leafs would have a salary cap not only much higher than $36-million, but vastly higher than a team like the Phoenix Coyotes, whose financial situation is regarded by insiders as one of the worst in the NHL.

According to the formula, a dollar-for-dollar luxury tax will kick in at the midway point between the floor and the cap. If the floor of the lowest team proves to be $22-million and the cap on the highest team is $36-million next season, then the tax will come into effect at $29-million.

This will allow the wealthier teams to spend a little more money, but will prevent the large gaps in spending in the previous agreement that saw teams like the Pittsburgh Penguins with payrolls as low as $18-million, while the New York Rangers were spending $80-million.

The luxury tax will be spread among the lower-revenue teams to help them stay at the salary floor or higher. Plans for further revenue sharing are still vague, aside from the owners' offer to share some playoff gates, but management sources say they have long been assured there will be further sharing.

One source close to the owners said it is important to realize that the $36-million cap does not mean all of that money will be spent on player salaries. It includes all player compensation, which means benefits, signing and performance bonuses will be paid out of that pool of money.

This could cost, the source said, as much as $5-million, which would leave about $31-million for salaries. This was what the owners demanded as a salary cap in an offer made in October, 2003, which came in response to an NHLPA offer of a 5-per-cent pay cut for every player along with other concessions.

However, that $31-million also included all player compensation and no minimum payroll, so the figures finally agreed upon represent an increase. But it is believed the offer of a 24-per-cent pay cut made by the players last December will be part of the new deal.

Management sources said the agreement on the cap was reached because moderate voices like NHLPA president Trevor Linden were willing to make a deal and because both sides were able to agree on accounting methods after long and arduous studies of team finances by groups from both sides.

What is not clear is the role of NHLPA executive director Bob Goodenow in the agreement. While management sources insist he has moved into the background, with Linden and Saskin handling most of the negotiating, there is a long history of animosity between owners and general managers and Goodenow, who fights hard at every turn for the NHLPA members.

Player sources say there is no sign of any erosion of Goodenow's leadership, but that he has tightened up the flow of information from the negotiators.

[PDO]

About f'ing time.

Gotta love how the PA screwed themsleves out of a better deal.

Golden Bob, Golden.

Here it is plan and simple for anyone that's lazy:

Lower revenue teams: floor of $22,000,000.
Higher revenue teams: floor of $24,000,000.

Tax kicks in at $29,000,000

Lower revenue teams: cap at $34,000,000
Higher revenue teams: cap at $36,000,000

But here's the kicker..

Tax dollars count towards the cap.

So that means that a team like the Oilers can spend right to $29,000,000.. and then a team like the Leafs can spend their payroll until $32,500,000..



VICTORY IS OURS!

[grim]

It ain't over til....

Source: Reports of NHL progress 'screwed up'

BY ALAN HAHN
STAFF WRITER

June 9, 2005, 10:59 AM EDT

And so begins what expects to be a furious competition within the hockey media to be the first outlet to report the end of the NHL lockout. Wednesday's report in Toronto's Globe & Mail trumpeted an alleged agreement of a salary cap structure that, for most, had been believed to be a given for quite some time.

Those working within the negotiating room were annoyed by the report -- "As screwed up as most 'reports'," said one person involved in the situation -- which was not the first premature report by the media during this lockout. With an agreement on the horizon, anything said lately by the parties directly involved in collective bargaining has had a delicate, cautious tone.

"We're working in small groups and subcommittees over the days to come," the person said. "There won't be any piecemeal reports about what's resolved and what's remaining. The process really doesn't benefit from that kind of analysis."

"It ain't over 'till it's over," the person added. "Many a labor negotiation has blown up over some small piece after the main piece is 'settled'."

Though it mostly reinforced what had been widely reported by several other outlets, including the New York Post, the Globe & Mail, based on sources, outlined a system that involved salary ranges based on revenue, maxing out at $34 million to $36 million per team with a minimum of $22 million to $24 million. The newspaper reported a dollar-for-dollar luxury tax at the mid-range, perhaps $29 million.

"It isn't coming from here," said a person close to the NHL's negotiating team. "And it wouldn't make sense for it to be coming from the PA. We're working hard; long hours and going through everything."

The person reiterated the point that while the process could be resolved within the month, it could go into July only because of diligence by both sides. Neither is in a rush to make a premature announcement and produce the same false hope that came in February, when a last-ditch attempt to save the 2004-05 season failed.

http://www.newsday.com/sports/hockey/ny-sphahn0610,0,2388025.story?coll=ny-sports-headlines

[MadDevil]

Does anybody else think this circus would make an interesting movie? I was just waiting for the denial to come out from one of these sides.:laughing:

[go_leafs_go02]

Does anybody else think this circus would make an interesting movie? I was just waiting for the denial to come out from one of these sides.:laughing:

Nope, I can watch two people argue continually here at home, with my two younger sisters.

[KB in Kelowna]

Does anybody else think this circus would make an interesting movie? I was just waiting for the denial to come out from one of these sides.:laughing:

There was a facinating documentary on labour negotiations made in Canada, called "On The Line" from the late 80's. At least it showed people talking and not being in a furthest up the wall contest for 9 months. :curse:

[grim]

My 9 year old hockey-obsessed son informed me this morning that the NHL lockout was over. I told him that he was wrong. He said I must be wrong because his teacher had announced it was over in class. His friends all said the lockout was over. I blame the %$#*&@+ media for producing ambiguous headlines like:

NHL sides agree on salary cap

Salary cap deal made: report

%$#*&@+!!

[butterfly_style]

Grim, I think now would be a good time to inform your son about Santa Claus
http://www.futurama-madhouse.com.ar/claw/santa_grave.jpg

and the Easter Bunny
http://www.geocities.com/jawboneofass/c/easter.jpg

[Max Power]

Yah but I'm sure the teacher will be embarrassed because it's all over the news this morning. Even so the media never said it was resolved they just said it was near resolution

Similar story when I was 9.. I told my teacher stars are suns like our sun but far away and she laughed at me and told the whole class I was wrong *sniff*
I look back now and wonder what the hell these people taught and how did they become teachers?