ALL I know is this: The Coy otes wouldn’t have gone bankrupt if Gary Bettman had been able to get “cost certainty” into the collective bargaining agreement.
Do you know what the Coyotes’ calamitous financial state tells us? It tells us that the league’s claims that a hard cap would ensure league-wide prosperity were bankrupt. It tells us that percentage of the gross means as much to low-revenue clubs as the commissioner’s assurances during the season that the media was blowing the Phoenix issue out of proportion.
It’s never personal with Bettman, yet it’s always personal. The league canceled the 2004-05 season in order to remove NHLPA adversary Bob Goodenow from power. Now the league risks suffering a defeat in a Phoenix bankruptcy court that would render its rules on franchise relocation obsolete in order to ensure that Jim Balsillie doesn’t get into the NHL Good Old Boys Club.
The concept of fighting to the death to keep a second team out of southern Ontario in order to maintain a failing operation in the southwest U.S. desert is absurd. The attempt to create a national footprint in the U.S. for the purpose of gaining a lucrative national television contract has failed. Phoenix is not a necessary piece of the NHL map.
This is the time for Bettman to — oh, what’s that word, again? — oh, right, negotiate. This is the time for the commissioner to deal with Balsillie and allow him to purchase the Coyotes and move them to Hamilton, at least for the time being, by charging him expansion fees on top of indemnification payments to the Maple Leafs and Sabres.
The Maple Leafs’ business isn’t likely to be impacted by the addition of a second team in their territory any more than the Rangers were damaged by the Devils moving to an arena six miles away from the Garden in 1982. They are entitled to get something from Balsillie, but not to extort him.
Bettman should mandate that Balsillie pay the Sabres an annual indemnification fee that would ensure Buffalo remains whole while the new team skates in Hamilton. And then the commissioner should charge Balsillie an additional $135 million as an expansion fee to be divided among the other 27 clubs (the Leafs and Sabres would not be permitted to double dip), a cool $5M per team.
That’s what Bettman should do for the good of the league. Instead, though, the commissioner fights to keep an ailing franchise with limited prospects for success in an irrelevant market while putting up dead-end signs on the roads to Ontario. He risks defeat in bankruptcy court. And he does it to keep Balsillie out of the NHL, the way he canceled a season in order to get rid of Goodenow.
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Sources within the NHLPA believe the league will suffer an approximate four-percent decline in revenue that would lower the salary cap by about $2.5 million next season, but that the union will exercise the five-percent bump to bring the 2009-10 cap up to an approximate $56.1M, a drop of about $600,000 per team.
Authorizing the five-percent bump might increase escrow deductions for the players, but will pump more money into the system for free agents and relieve the burden on clubs who spend to the cap.
By the time the CBA expires following the 2011-12 season — assuming the Players’ Association extends the deal — more than 80 percent of the players currently in the league will become free agents, so those who might lose because of the escalator in the short-run will gain at a future date.
That’s the point executive director Paul Kelly and his leadership team that features director of player affairs Glenn Healy, will stress to the 30 player reps before their vote on triggering the five-percent bump.
The NHL will claim, and perhaps accurately, that the revenue decline is owed entirely to the difference in the currency exchange rate, but odd isn’t it, that the league didn’t represent revenue gains the previous two seasons the same way?
Understand. Low-revenue teams, even with their revenue-share portions, would be penalized by Phoenix becoming a large-revenue team in Ontario because that would mean an increase in the cap floor. So there’s no incentive, no incentive at all on Sixth Avenue, to increase revenues, a point we made the moment the CBA was signed.
To that extent, we would urge the NHLPA to propose elimination of the floor, or failing that, reducing it by, say $6M a team. That would reduce the burden on small-market teams, some of whom are required to invest 40-percent of their revenue into payroll based on the money generated by the Maple Leafs, Rangers, Canucks, Canadiens and Flyers. And it would benefit the players by reducing escrow.
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News: Tom Renney hired as associate coach in Edmonton.
Views: No longer any need for Scott Gomez to include the Oilers on his three-team no-trade list.