After a run of daily articles that tracked and analyzed the day to day of the start of the Carolina Hurricanes 2017-18 season, today’s Daily Cup of Joe will take a bit of a diversion and look forward to next summer and the salary cap math that comes with it.
At a high level, the Carolina Hurricanes will inevitably see their annual salary commitment rise as a number of young players come off sub-$1 million entry-level contracts. The trick to balance things out will be some combination of back filling a few slots with new young players on entry-level contracts and more significantly increasing revenue by playing winning hockey and boosting attendance at PNC Arena.
The 2018-19 season actually offers some salary relief that will offset a few established and expected increases and make it possible to come close to holding the line on salary for one more year before heading upward.
2018-19 Carolina Hurricanes salary changes
NOTE: I am looking at ACTUAL salary (which is the more important number for the Hurricanes) not salary cap.
Buy out savings
Minus $2.5 million — Both Eddie Lack and James Wisniewski are being paid buy out amounts for 2017-18. Both of them will come off the books for the 2018-19 season making for a nice chunk of savings that does not cost the Hurricanes a player in the process.
Players coming off significant contracts
Minus $5.6 million — Lee Stempniak and Cam Ward are the only two players coming off significant contracts representing potential savings.
Jaccob Slavin and Brett Pesce
Plus $7.8 million — General Manager Ron Francis acted early in re-signing his two top defensemen this summer even though each was already under contract for the 2017-18 season. Jaccob Slavin’s salary will increase by $4.7 million to $5.5 million, and Brett Pesce’s salary will increase by $3.1 million to $4.0 million.
Other players with changing salaries (already under contract)
Plus $0.3 million — The Hurricanes have historically had a number of contracts that escalated year to year. The impact in this regard going from 2017-18 to 2018-19 is minimal. Justin Williams contract decreases by $1 million; Justin Faulk’s contract increases by $0.5 million; the part of Marcus Kruger’s contract that the Hurricanes will actually pay increases by $0.8 million. (Kruger’s 2017-18 salary included a big signing bonus that was paid by Chicago before Las Vegas and ultimately Carolina acquired him.)
Depth unrestricted free agents
Net effect $0: Derek Ryan, Joakim Nordstrom and Josh Jooris are all scheduled to become unrestricted free agents next summer. Regardless, of how their contract situations are resolved, the impact to total salary should be minimal. If they are re-signed, I would expect similar salaries. If instead they are replaced by youth or newly acquired players, there could be savings but not significantly so. Simplest is just to figure them in at a similar cost whether they return or not.
Netting out the reasonably straightforward stuff
Interestingly, when you net out those reasonably big ticket items, the net change is exactly $0. Essentially, the big raises due Jaccob Slavin and Brett Pesce are covered by a few players (and former players) coming off contracts. Wisniewski and Lack are pure savings for next year, but Cam Ward and Lee Stempniak will either need to be re-signed or replaced.
There is some uncertainty, especially with Ward, but I think a reasonable guess is that Stempniak will be replaced by a younger and less expensive player making $800,000 to $1,000,000 and that Ward will either be re-signed or replaced for a bit less than his current $3.1 million salary.
Plus $2.8 million: If we assume $2 million to re-sign Ward (could be higher if he has a strong season and takes on a bit more than a backup role) and youth in Stempniak’s slot, the salary is up about $2.8 million relative to 2017-18.
The three big wild cards – Noah Hanifin, Elias Lindholm and Trevor van Riemsdyk
Plus $4.5 million (with greatest possible range of outcomes): The biggest wild cards are a trio of restricted free agents who will all be due raises that in part depend on their 2017-18 season.
Noah Hanifin who is still on his entry-level contract is making only $925,000 will be paid more on his next contract. Exactly how much more has a pretty wide possible range. If he finds a higher gear scoring-wise and establishes himself as a solid top 4 defenseman, his salary could be in the Slavin and Pesce range (so let’s call it $4.5 million). If instead, Hanifin still has some ups and downs and a modest season scoring-wise, a bridge deal similar to Lindholm and Teravainen’s recent deals in the neighborhood of $2.5 – $3.0 million per year could be in order. Either way the increase will be significant.
Elias Lindholm who is coming off his second contract has a higher starting point at $2.8 million. With a modest season scoring-wise, Lindholm could see a modest raise up to $3.3 – $4.0 million. But if he nets higher production numbers offensively, he could suddenly push up to the $5-6 million range that is become more common even for middle of the roster forwards who score some.
Finally, Trevor van Riemsdyk likely sees his $825,000 salary roughly double with upside from there if he has a strong year offensively.
So how does it all end?
If I had to guess, Ward will be retained but at a lower rate in more of a pure backup role. Stempniak is replaced by a younger player.
The Hurricanes will not be high stakes players in the free agent market, so it is mostly a matter of replacing or retaining the players they have at a similar price.
My wild guess is middle of the road for all three restricted free agents with Hanifin having a decent 2017-18 but still slotting below Pesce and coming in at $3.5 million. I similarly think Lindholm will have a decent but not spectacular 2017-18 season and get a modest raise to $3.8 million. Finally, I think van Riemsdyk re-signs in a $1.4 – $1.8 million range.
When I add it all up, the net effect salary-wise is an increase of $7-7.5 million in salary importantly without making any free agency upgrades.
I will save the broader ramifications for another day, but I think the two biggest upshots are as follows:
1) It is vitally important that team winning growth matches up to player salary growth. If that happens, attendance should increase and help pay for the growing salary cost. If that does not happen, the math is really challenging for increasing costs but flattish revenues.
2) I think the upward cost pressure from the existing roster will limit Francis’ ability to make expensive additions. This will make it very important for the team to be able to back fill a few roster slots and ideally even find another difference-maker from the ranks of the inexpensive prospect pool which is largely on entry-level contracts.
What say you Caniacs?
1) Did I mess up any math finishing this up late at night after the Calgary game?
2) What is your guesstimate for salaries for Lindholm, Hanifin and van Riemsdyk’s next contracts?
3) Of the two biggest contracts coming off the books, do you see Ward and/or Stempniak being re-signed next summer?
Go Canes!
It will be an interesting offseason for sure. There are more options that I can count for GMRF to make a roster.
Using Cap friendly, it says we are expected to be 9.4 million less salary than this year (based on current contracts). If I add up your projections of Ward, a youth, TVR, Hanifin and Lindholm then its 11.7 million. So maybe an increase of 2.3 million at this point? Possibly a 3.5 million increase with the re-signing of Nordstrom added into the bunch.
I think we’ll see some movement to fluctuate the numbers. With Necas, Kuokkanen, Roy, Wallmark, Saarela, Zykov and Bean all having legitimate shots at joining the team we’ll have to make room.
1) The math appears accurate.
2) I think Hanifin is where you indicate: $4.5M; Lindholm is a touch higher at $4.7-$5.2 (based on players like Arvidsson and Niederreiter). TVR around $2.2M
3) Definitely Ward. He has expressed a desire to remain in the Triangle. I think if the organization is willing to give him 2 more years, he signs for $2M per. Stempniak is more interesting. I said several months ago (and I admit it sounded wildly unconventional at the time) that I think the Canes could both make the playoffs AND be sellers near the trade deadline. Stempniak will add a little more to the offense when he returns, but McGinn has demonstrated that he is not a liability. By February, one or more of the prospects should be capable of playing at the NHL level. I still think it is possible (maybe not likely) that Stempniak gets moved to a western team for a 2nd rounder.
4) I know you didn’t have a four, but I need one. The big questions this coming offseason are the offers to Skinner, Aho, Teravainen, and even Kruger. Getting the first three signed before the last season of their current contracts will be an imperative. And if we get 82 games of the Kruger we have seen so far, then the team will want to retain him. Bottom line is that for Canes to continue the level of play they are approaching will be expensive. The salary cap looms large.
In response to CT’s number 4:
Between Staal, Lindholm, Rask, Kruger, and Wallmark we are going to need to make some decisions on who to keep. They all play a high possession, smart game with some offensive production. We want more from Rask and Lindholm but aren’t getting it. We pile on possession dudes and hope we win games 1-0 or 2-1 with some expected 1 goal losses? Or do we make a decision on which couple to keep and get some offense?
!. I think the math is correct.
2. I could see Lindholm getting 4.5-5mil, maybe a little more if he keeps being a primary assist machine, and ups his scoring total.
3. Stempniak is going to be the odd ma out, based on our depth. If Ward can give us average goaltending for 25-30 games, and the Organization thinks Booth and Ned would be better served playing minutes in Charlotte, then they will resign him.
The Canes have one of the most enviably salary cap situations in the league. Many crucial components locked up to team friendly deals, and lots of room to make the re-signs you’ve spoken of. Plus room to add impact players and whatever salary comes along with them.
I know i’m thinking ahead, but if the Canes don’t trade for any forwards I wonder how throwing some salary cap at Henrik and Daniel Sedin to come here next year. They could replace Derek Ryan and Lee Stempniak as the 3rd line players.
We need salary space for our tight budget. I don’t see us blowing it for older gentlemen to play third line. They are a combined -8 with 4 points total.
I had a long reply focussed on (3) written – then lost it! 😛
I will just offer a correction – Nordstrom is still a RFA at the end of this year.
I think Stempniak is out and maybe even before the end of the season – replaced by a prospect (if not Kuokkanen, maybe Wallmark – who is having a bodacious start to his season as a playmaker – with Ryan moving to the wing).
I don’t see Ned or Booth ready for an NHL back-up role next season – so I expect Ward will be re-signed, and that will make sense providing he has a solid year this year.
1) math looks correct.
2) too early to say. I hope they all have great season’s and command the high end of the ranges, but middle is more likely.
3) Stempy is 34 yrs old, in an era when the big data says players peak at age 27. We will probably replace him with a high ceiling prospect well under age 27. Ward makes sense to bring back if he plays well and is reasonable about the salary.
1st – it’s pretty early to do this…we still have no solid proof (one way or the other) what team we are!
Last two games looked promising, but I would NOT MAKE A BIG BET on the team YET! …too much can go wrong…for the Canes, and there are a lot of good teams to beat, just to make it to the playoffs…!
2nd – Working on who to keep (and how much to pay them) is complicated, and involves a lot more than how well the Canes do, at
the box office!
3rd – If we ever want to compete with the BIG BOYS…this team needs to start thinking about the salary cap, not ALWAYS GETTING BY ON THE CHEAP… I’m not saying we spend up to the CAP, but in the long run MONEY SPENT IS MONEY EARNED.
4TH – The seats will be filled if the product is good, the TRIANGLE has a lot of options for the sports and entertainment dollar, and a very intelligent and discerning customer base.
5th – If you build it (A GOOD / GREAT TEAM)…they will come!
….mediocre just won’t cut it!