Friday Morning News and Notes

Plenty of news today.

- According to Paul Kelley, the NHLPA Executive Director, the Salary Cap will remain the same or drop next season (Slam):

"He figures the salary cap will be between $54 million and $57 million next season, but he can't say what will happen in 2010-11."

- The Dallas Stars released some ticket pricing information (Dallas Business Journal). Highlights:

• The reduction of the price of 1,303 lower-bowl seats at American Airlines Center, dropping 519 seats in the lower bowl from $55 to $40 and the remaining 784 seats from $73 to $55.

• All of the other season ticket prices are frozen for fans who renew by March 18.

• Fans will get up to $250 credit for food, beverage and merchandise.

• Season seat holders will not pay for this year’s playoff games until the Stars’ 2009 playoffs are over.

• Those renewing season tickets will be eligible for rewards such as double season tickets, tickets to the NHL All-Star Game or Winter Classic, delivery of tickets by a Stars player, and even road trips to an away game on the team plane.

Good deals. One thing that puzzles me is if a season ticket holder does not renew by March 18, does that mean there prices could be going up? Also, its risky, but I really like the credited playoff games. The Stars had a 92% season ticket renewal rate from last season to this season, along with cutting upper bowl tickets by almost 40%, so we will have to see if this plan works out down in Big D.

- The Lightning hack at season ticket prices (Tampa Bay Online):

"The Tampa Bay Lightning are slashing season-ticket prices by an average of 10 percent for next season, with almost 4,000 seats available at the St. Pete Times Forum for only $239...

Almost 1,300 upper-level seats have been reclassified to be included in the $239 season-ticket package that averages out to $5.69, plus tax, per game. Nearly 20 percent of the arena's seats will feature that $239 designation and half-season packages in the same area will cost $149.

The remainder of season-ticket prices in the terrace level will decrease by 20 percent and some season tickets in the plaza level will average as low as $35.69 per game, plus tax."

Those are really low. Along with this, the club is offering an 8 month payment plan and a 3% rebate (in Forum dollars, money you can use at the St. Pete Times Forum) for season ticket holders who renew by March 27.

- Apparently, the Islanders could get off Long Island if they really wanted to, as there supposedly is a release clause that centers around the Nassau Coliseum renovations (KansasCity.com)

"Once the county executive submits a lease for the 150 acres of county-owned property, the legislature has 120 days to approve it. If it doesn’t, the team can leave...

Nassau County loses between $1 million and $2 million a year on the upkeep of the Coliseum, and Wang loses about $20 million a year operating the Islanders."

Charles Wang also had a candid comment before the Town of Hempstead meeting this week:

“Ultimately, if you don’t want to go to an (Islanders) game because the arena is a dump, I lose, the county loses, everybody loses,” Wang said. “I want this thing to proceed. We can talk and talk, but we’ve got to get off our butts. Let’s get it done.

“It’s a Long Island team. They belong where they are.”

All sorts of news swirling on the Island.

- Finally, Nick at Let There Be Light(house) has a fantastic post on some of the issues that surround the Lighthouse Project. Today he dealt with financing, the delay up to now, transportation, and the Islanders situation with Kansas City. If you want to understand Charles Wang and the Islanders situation and all, take a look at the article.

More later.

Updated Escrow Projections

As I mentioned last night, I said I would take the format that Daniel Tolensky provided Saturday in his article over at HockeyBuzz and update it in light of new updates of the Escrow percentage and revenue growth via TheFan 590 and Paul Kelley, the Executive Director of the NHLPA.

As a quick reminder, Kelley said yesterday on TheFan 590 in Toronto that the NHL expects revenue growth at the end of this season, ranging from 1 to 2 %; but more and more its looking like 1%. Along with this, Kelley stated that the second half escrow percentage, which is the amount of player salaries that are held back from them in order to cover any shortfalls of the league and its clubs, will rise to 22.5% from the first half percentage of 13.5. Kelley then confirmed that this would give an average of 18% for the season, which is the number I used in my projections.

As I stated last night, the players will lose money this season due to escrow, it just depends on the bottom-line revenues at the end of the year which will determine how much. So, non-playoff team players, root for 7-game series all around. Without further adieu, here's what I came up with (click to enlarge if necessary):


A couple of quirks I ran into while running these numbers:

- In his +2 Revenue Scenario, Tolensky had an overpayment/shortfall % of 12.9 %. But when I ran his numbers again, I figured it to be 11.43%. Triple-checked and I'm not sure how he came to his number.
- In that same scenario (basis for this report), he has the interest at Escrow at 0.10%. Of a million, this would equal $100,000. Since I doubt the league would be paying 100K per player in interest, I changed this to .01%, or 1%, which equals 10,000. I'm not sure where Tolensky got his figure, but for now, this works.

What to take away from all of this. Focus on the Shortfall dollar and percentage figure. This is the amount of money the players are going to have to foot to bring the leagues clubs out of the red ink. If the league grows by 1%, this figure should be between 205 and 215 million, depending on how the revenue shakes out. This means that players will be handing over anywhere from 10 to 13% of their salaries. For the player making the league minimum of $450K, this means that close to $59,000 will be taken from them. Granted, I think they'll be alright with their bills, but that is still a significant amount.

Please comment if you think anything is wrong, or would like me to explain anything.

More later.

Late-Night Escrow Fun

Catching up on my reading, James Mirtle once again provides a great piece of news. NHLPA Executive Director Paul Kelly said on TheFan 590 in Toronto that the Escrow percentage would rise to 22.5% this half of the season, from 13.5%. Many rumors have been swirling about this, with the most notable figures starting at 19.25% and then ranging to 25%.

This means that at the end of the season, 18% (adding the first half escrow of 13.5 to the now 22.5, and dividing by two) of players salaries this year will be held back in Escrow. Although this seems like a great amount (18,000 out of a million dollar salary), the players will most likely lose money this season on their contracts due to rapid contract inflation the past two seasons.

A great article over at HockeyBuzz by Daniel Tolensky takes the revenue projections of the NHL (2% growth, according to Bettman at the All-Star Game), and uses them to calculate the Escrow returns for three scenarios this season, along with how it has looked the last three seasons. His article was posted on Saturday, so he used the rumored figure of 19.25% for escrow.

I think I'm going to try and update and make my own projection chart once I get a few things clarified by some people on this issue. But at any rate, it looks like the players will not be receiving their full salaries this year because of some crazy salaries. As a Ranger fan, I feel bad for others that will lose money when Wade Redden will be making home improvements this summer due to his deal.

Check back tomorrow for more fun, as always.

NHL Salaries indicating trouble?

James Mirtle points out an article by Mark Spector of Sportsnet.ca, who explains that even though the NHL already holds back an astonishing 13.5 % of players salaries for (if needed) revenue sharing purposes, it may not be enough to cover some of the leagues troubles for this year. Therefore, Spector says, the percentage may increase in the future.


Mirtle says it best here:

If at the end of the season that's the chunk that's missing on a $56.7-million salary cap, it means teams are actually paying only $49-million in player salaries. A $7-million player like Thomas Vanek will make only $6-million this season, Sidney Crosby's $8.7-million deal is worth $7.5-million and the league minimum players fall from $475,000 to $411,000.

No, no one will be crying poor, but that's the difference we're talking about, and that's also likely the ballpark we should be thinking about (a) potential free agent salaries and (b) next year's cap.

I think this is an indication that, although Bettman has said in earlier reports the economy hasn't really had a hard hit on the sport thus far, that hammer will come down soon enough. We will all soon find out.

But hey, at least attendance is rising... right?