Hossa Ultimatum

The Hossa Ultimatum

While we’re delighted to have on-ice issues to talk about again, and don’t want to get into financial messes and conundrums, you can bet that Stan Bowman is already sweating over one aspect while he reads through the new CBA.

And that’s the Hossa Problem.

You’ve read about it the past day or two or might be catching up on it now. In the new CBA, these back-diving contracts are going to get severely punished. To try and boil it down to terms you can understand easily, teams will be penalized the total amount of their savings on the cap vs. actual salary paid out every year of that contract that player does not fill out.

We’ll throw some numbers at you. Essentially, for the three years Hossa has already played, the Hawks have saved 2.625 on their cap hit each year. That’s because Hossa has been paid $7.9 million in salary, but his cap hit has only been $5.275. So for just those three years, it’s a penalty of $7.87 million.

So let’s say that Hossa plays every year until the salary drops from it’s current level to the $1 million years (that includes one year at $4 million). That would be a $12 million penalty (threabouts) to be inflicted over the last four years of his contract. Now, maybe by that point the cap has risen again where you can swallow a $3 million hole for a bit, but as we’ve seen these things never quite work out that way. If Hossa plays one of those years at $1 million, the penalty drops to $8 million over three years. But considering he’s entered the lands of the Brown Brain, you wouldn’t bet on him getting to the latter parts of this deal.

Trade him, you say? Fine idea, except the savings you’ve already gotten will still be waiting for you when he retires with his new team. And that new team would be taking on the risk of penalties later down the road, while only getting an aging player who is an injury risk. That makes it seem like it would be a real trick to get someone to take on Hossa, at least to a GM who doesn’t huff paint at lunch (what’s Feaster’s number?).

If you’d like a chart, check out this nifty breakdown from reader Jon Walker: https://docs.google.com/spreadsheet/pub?key=0AqVVBReVIojsdGZ5T3laTVVuY3pjT1ZmLXZtM21iV1E&output=html

So essentially, Hossa has now become a prime buyout candidate, more likely in the summer of 2014 than 2013 however. He’ll still be useful then. But it is an awful pill to swallow for a GM — buyout a very popular player or face some real complications down the line? Buying him out also keeps you from getting to other players you’d like to punt, because Rusty Olesz is going to have to have that treatment as well. So Oduya or Montador might have to stick around or be packaged somehow.

But by then, it might not hurt so much. Brandon Saad projects into that power forward role. Either McNeill or Danault or both could be here. If either of the Hayes brothers pops, it’s a place they could play. Conservatively, in 2014 Toews, Sharp, and Kane will still be half of your top six. It’s a fairly safe assumption that Saad will be too. That only leaves one forward spot, and the Hawks have a lot of candidates to take it. It might not hurt so bad to have to lose a wonderful yet aging player who can’t consistently stay in the lineup.

Oh, and Duncan Keith might provide this problem too, just farther down the line.

 

  • Ian S Carr

    Rusty Olesz couldn’t possibly be a buyout candidate after 2014. Contract ends then. Maybe after 2013, but surely they could offload him (with a pick) for something useful?

    • http://twitter.com/oregon_hawk Oregon_hawk

      Rusty counts against the cap regardless of where he is, I believe. Thats what hmakes him such a buyout target.

      • Ian S Carr

        A trade makes him someone else’s problem, mostly. Unless he retires.

        • putmeinthemadhouse

          Trading olesz would require the hawks to give up something else that is actually worth something.

          • Ian S Carr

            True. Not the worst situation to be in. The fact he’s a buyout candidate might actually be useful for something (assuming there’s not a clause that closes that whole).
            Either way, there’s only ONE YEAR left on that contract after this season. He can’t be that high up the list. Even if he is useless. Montador perhaps.

          • Detroit Must Die

            I think you have that backwards. Montador can probably be more readily offloaded by a trade because he actually has some value. I thought that when he was actually used properly, as a third pairing defenseman, he was quite effective, especially at EV. Olesz, however, has no transferable value.

          • Ian S Carr

            Depends on what you’re trying to acquire. A buyoutable Olesz + a pick for that rugged 3pr defenseman we keep looking for wouldn’t be a bad trade for a team trying acquire things to build with. Or a team short on picks & cap space next year.

    • Detroit Must Die

      My guess is that Stan won’t have to waste too much time deciding to buyout Olesz. Just glad we no longer have Huet stashed down there too.

  • Dude McNude

    Great post. It’s a no brainer for a good GM. Does it suck to spurn a good player that helped you win a cup? Yes. Of course it it does. But that doesn’t change the fact that it has to be done.

  • http://twitter.com/oregon_hawk Oregon_hawk

    Urgh. I suppose we don’t have text available to peruse – there is no grandfather clause?

    • raditzzzz

      its hard for me to imagine there is no grandfather clause. i mean, what the hell does minnesota do with parise and suter? i can’t imagine the owners shackled themselves with such enormous buyouts of all their star players (who are the ones with these types of contracts) without some kind of safety net.

      im severely confused as to how this clause pans out, because even a guy like patrice bergeron has a 900k savings in his first contract year (which gets recouped over his next two years), but if for some reason he has to retire, then the team is just left with this penalty that hits their cap? with all the cumulative savings each team is making with all of its players, and the amount that shuffle in and out of the league, how does the league then operate?

    • shinkicker

      I assume not, since the new CBA is meant to avoid contracts like this and someone (Wyshynski?) mentioned that it might be used as a boogeyman to GMs looking to exploit yet to be found loopholes in this CBA. “It may not hurt you now but it’ll get you in the end!!”

    • boldmatter

      I’m pretty sure part of the intention here is to punish teams that have been exploiting the loopholes. HIGHLY doubt there’s any sort of grandfather clause

  • Bullitt315

    Just wait 8 years until the next lockout to buy him out…

  • JesusMarianHossa

    Do these amnesty options have an expiration date? If not, why not save it and buy him out at age 36 or later?

    [waves]

    • Ian S Carr

      Everything I’ve read so far indicates amnesty buyouts after this season and next only. But there may be more details we don’t yet know.

      • JesusMarianHossa

        That would be unfortunate. Because Hossa could be the Blackhawks Carlos Boozer (with apologies to Marian in terms of talent and two-way play).

        • Ian S Carr

          I see your comparison. All apologies to Hossa. Genuflect toward Stará Ľubovňa

          • http://twitter.com/CheerTheAnthem Cheer the Anthem

            In my bright eyed dreams, Marian became the next Teemu.
            Just dominating teams into his 40s.

          • Ian S Carr

            I love that dream. May it happen.

    • TKHO

      From what I’ve heard, the amnesty clauses can be used in the summer of 2013 or the following summer, after which they will no longer be available.

  • TKHO

    Does anybody actually know if an amnesty buyout relieve a team of the Luongo-rule liability?

    Also, for those wondering, Duncan Keith’s (non-trade) per-year cap penalty goes up every season, from $738K if he retires this off-season to $4M if he retires after 2021-22, when he has 1 year remaining on his contract.

  • Paul the Fossil

    It seems unlikely that he’ll actually do it, but Kovalchuk is at least making noises about staying in the KHL:
    http://aol.sportingnews.com/nhl/story/2013-01-08/ilya-kovalchuk-russia-rumors-devils-nhl-lockout-news-nhl-schedule?sct=uk_t2_a3

    In the short term that would clearly hurt the Devils, Kovalchuk is still only 29. But over the longer term, given the new CBA…might Lamoriello be tempted to actually want Ilya to try to bail out of his Devils contract?

  • Detroit Must Die

    My thought was that the amnesty could actually provide the Hawks with an opportunity to renegotiate with Hossa, retain him long term, get him paid, and reduce his caphit. Let’s call it the “Hey, we’ve already found a loophole to the new CBA deal.”

    Negotiate with Hossa to buy out his current contract and renegotiate a non-cap circumventing deal. Say, oh, buy out his current deal, and then renegotiate a new deal paying out an average of 2 million or so that doesn’t have the same big dip to it.

    This way, Hossa actually get’s a raise, but his cap hit is reduced to a very skinny 2 million per season (or thereabouts). It could be sold to him that this is in fact a long term commitment to keeping him Chicago (which it would be) Severly reducing his caphit would make it less necessary to move Hossa as he ages and as his role on the team reduces.

    • JesusMarianHossa

      Can’t re-sign a bought-out player.

      • Detroit Must Die

        The plan goes down the toilet.

  • Neal Schmidt

    Absolute Kudos to capgeek.com. They already have a “buried” section for the new CBA rule concerning one way contracts in the Minors. Seriously fast work there.

    • Accipiter

      They have a neat contract buyout calculator too !

  • Hi, I’m Bob LeDonne

    Let me pigs in your cornflakes for a moment. Mirtle’s article today stated definitively that the cap floor can’t go down during this CBA. Hopefully Hossa is productive enough over the next few years where we’ll be able and happy to eat the last year or two of his contract in TWENTY TWENTY.

    • Accipiter

      How did you know ?
      That is the only way I like my cornflakes.

  • http://www.facebook.com/people/John-Faker/558555424 John Faker

    Dont know if anyone caught this, but Danault got traded to Moncton in the QMJHL. It really doesnt mean anything to the hawks as hes stilltheir property but holy shit look at what they got for him: 2 first round CHL picks in 2014 and 2015, a 2015 2nd rounder and a 1st round europe pick whatever that is. Now im not going to pretend that a CHL draft = and NHL draft but jeez man, thats a very highly thought of prospect if you give up that much and to boot hes going to be in the AHL/NHL next year so its pretty much a rental!

    • Joe Banks

      I agree. It speaks volumes that someone would think so highly of Danault to do this. Wow.

  • laaarmer

    Saad at some point = Hossa? No pressure kid. You are the replacement for a possible hall of famer. 429 goals, just under 1 point per game. No pressure. I know you are not saying he replaces him, but you are saying he replaces him.

    • laaarmer

      Not to mention Duncan Keith, who is signed through 2023 to a very wonky deal too

    • http://whatisthebestadverb.wordpress.com/ I am not Chico Maki

      Heh … I was about to post the same. It fucks us over, that we took on these contracts, but two things: first, they should fuck us over, because it was clear cap circumvention and teams who took them on are paying the piper. Second, keeping and/or attracting players with those contracts got us the Cup. (I realize you aren’t arguing otherwise … it’s just the way I’ve chosen to deal with the predicament we’re in.)

  • LetsGetWeird

    so what does this mean for weber’s contract. I don’t understand this…

  • Z-man19

    So the odds Luongo gets traded are what now?

  • Sludgefeast

    We are talking about someone who will score over 500 goals before his career is over. This isn’t a hard pill to swallow, but a hard bottle full of pills to swallow.

  • http://www.facebook.com/mario.digiulio.3 Mario Di Giulio

    Toews, Sharp, and Kane making up half of the top 6 with Saad penciled in leaving only one forward spot open is probably fuzzy math. I have no problem with that as long as I can pencil in Eugene Hutz as Minister of Ambience and let the dice fall where they may.

    • Accipiter

      The math is rock solid.

  • burbank152

    This makes no sense at all. Remember the big negotiations about these contracts when Kovy signed? At the time the NHL and NHLPA agreed that all contracts before Kovy would be allowed but no further contracts that did this tactic would be allowed.

    Also contracts signed under the old CBA can not be affected by the new CBA.

  • PainSt

    deferring part of the cap hit for ten years to when the cap will be much higher was the whole point of front loading a long term contract for hossa
    i seriously doubt that the contract contains any reference to his retirement age and he might very well decide to play the contract out
    whether he would want to play for 1m while having 50m in the bank is another story

    i would fully expect to be liable for the deferred cap hit even if his later years were renegotiated upwards (jagr is making 4m at 42)
    buying him out while he is viable would be a public relations disaster and a tacit admission of trying to cheat the system to begin with
    this isnt real money we’re talking about

    i would be very surprised if rocky traded positive public perception for pretend cash

    the point of the buyout provision is to help teams with bad contracts get under the lower salary cap
    classifying hossa’s contract as a bad contract is specious
    it may have been on the high end three years ago but its since become a bargain for the hawks
    as is the continually deferred cap hit