While things in the NHL seem to be good or better than they've been in a very long time, not everything is falling in the league's favor, as it was reported today that the NHL salary cap may not rise from its current $69 million next season, foregoing the usual and expected 5 percent yearly increase.
This is due in large part to the projected decline in the Canadian dollar, according to a report from Larry Brooks of the NY Post.
Given the fixation of escrow under which the players currently are having 14 percent of their pay withheld, it certainly is a realistic possibility the NHLPA will not exercise a 5-percent escalator for 2015-16.
That might mean a stagnant cap in the $69 million range, which fall some $5 million to $6 million shy of previous optimistic projections.
The decline has already had an impact on extension negotiations in at least three cases, sources told Brooks.
The revelation will, no doubt, cause many tense moments in front offices across the league, especially those operating at or extremely close to the cap ceiling, as well as for players hoping to cash in with big free agent deals next season, according to Chris Peters of CBS Sports.
Teams are starting to spend bigger on extensions -- just look at the extensions the Chicago Blackhawks signed stars Patrick Kane and Jonathan Toews. Part of the aggressive annual figures teams are agreeing to was that the cap will go up. For a team like Chicago, the possibility of a stagnant cap could have significant consequences for its current roster.
Teams like Chicago, Philadelphia and Tampa Bay all have razor thin salary cap margins with which to improve their teams next season - shedding a sizable contract or two may be in the cards.
But the repercussions of this decision go well beyond for league GMs.
The fear that the salary cap could remain stagnant impacts so much more than offseason planning for next year for general managers. It could also have an impact on this year's trade market as teams will have to think about the year ahead without any concrete numbers. Rental players with expiring contracts could potentially become more attractive at that point. It will be interesting to see how aggressive the market becomes for those types of players.
One thing is for certain, should the Canadian dollar keep the cap from going up, general managers across the league will be forced to maneuver creatively just to stay compliant, let alone competitive.
