Thursday, June 08, 2006

NHL Plays CalvinBall

Do you know the game CalvinBall? Its an invention of the comic strip Calvin and Hobbes. It's a game where Calvin makes up the rules as he goes along to suit himself. That seems to be the way the NHL is run. They are constantly changing rules on the fly.

The NHL CBA had a signing moratorium for the last two weeks of June. Any team was not allowed to negotiate contracts with their own free agents from June 15th until the free agency date of July 1st. I'm not exactly sure what the purpose of this rule is. One could argue it would prevent a resigned player from taking the hockey news lead against the Stanley Cup playoffs, except that the finals would have to go six games to even make the June 15th deadline. Most likely, the rule was designed to increase player movement. Anything that makes it harder to resign your own players makes it easier for them to move to new markets. At any rate, the rule is stupid. So the NHL has announced that this year the rule is not going to be enforced (though it might be in future seasons). Here is TSN's story on this announcement.

When free agency does open up in July, there are still rules to be decided. Namely, what will the salary cap be? In an almost inexplicable admission that they are useless, the NHLPA is trying to have next year's salary cap lowered. The players will likely pay high escrow payments to the owners unless NHL revenue keeps up with payroll increases - a very unlikely prospect given that this year's revenue exceeded projections in part because the projections were lowball figures following the lockout and in part because the Canadian dollar has risen against the American dollar creating apparent increases in revenue from Canadian markets (which do not exist when calculated in Canadian currency). Tom Benjamin explains this in detail. In fact, if revenues were measured in Canadian dollars instead of American ones, the NHL failed to reach its revenue goals this year. These reasons for "revenue success" are highly unlikely to repeat themselves, so players are looking at large escrow payments next year.

It's less than a month before free agent signings begin and the NHL has not set a salary cap. Some teams are laready making signings of their own players based upon cap figures that they assume may exist (for example Tampa Bay's signing of Brad Richards). How can you plan a budget when you do not even know the salary cap - or the mechanism for its calculation at the time you must plan your summer's signings? This NHL disorganization makes it very hard for a general manager. Planning for July must include contingencies for several different salary caps.

How do you play a game when the rules are made up as you go along? Thirty general managers are asking that question right now.

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