Salary Cap Issues Looming for 2015 NY Rangers

Good News, Bad News

Earlier this month the New York Rangers extended Marc Staal, signing him to a six-year deal worth $34.2 million. We here at THW talked about potential salary cap problems in store for the Blueshirts as a result. Now it’s time to take a closer look at exactly what the Rangers are up against, and what options they might have.

The tight position is not exactly a new one for this team.  They were facing a similar scenario at the end of last season, and had to make some very difficult personnel decisions. In addition to the long-awaited compliance buyout of Brad Richards, they lost Brian Boyle, Anton Stralman, and Benoit Pouliot to free agency.

If nothing changes at the trading deadline, the Rangers will still not have signed Martin St. Louis, Mats Zuccarello, Carl Hagelin, Derek Stepan, J.T. Miller, Jesper Fast, Matt Hunwick and John Moore.  Additionally, they will only have around $20 million to do it with (depending on next year’s salary cap, which has not been finalized yet, but looks to be in the range of $73 million).

The Harsh Financial Realities

While $20 million is a lot of money for most of us, when an NHL team is dealing with potential $6 million contracts, that money can disappear in a hurry. And that’s what the Rangers are facing right now.

Note that I’ve included Anthony Duclair in this chart–while it’s far from a given that he will be in the NHL next season, he is definitely one of the team’s most NHL-ready prospects, and his salary for 2015-16 is already set. He also represents a significant discount over some of the other options available. That may come in handy, as we can see from the next chart showing next year’s currently unsigned players.

Most of these numbers represent the possible salaries these players could get on the open market. While there may be some chances for “hometown discounts,” it’s highly doubtful that these discounts could cover the $5 million gap.  It’s no coincidence that this gap is very close to what Mats Zuccarello could get as a free agent. This is why many people who cover the Rangers believe they will not be able to re-sign Zuccarello next year. But there may be other options for the Rangers that will allow them to keep the Norwegian Hobbit.

Crafting a Cap Compliant Roster

Of all the players the Rangers still need to sign, Derek Stepan is the most likely to be given a long-term deal.  Stepan has grown into the first line center role this season, and no potential replacement would cost less than his rumored asking price of $6 million per year. He would likely get a larger offer in free agency, but the Rangers would have the right to match. The more likely scenario here would have Stepan signing his extension before July 1.

The second player most likely to remain a Ranger next year is Martin St. Louis. Yes, he will be an unrestricted free agent, but he also has made no bones about his desire to play out the rest of his career in New York. He will likely be willing to negotiate both amount and contract length to make himself more “cap friendly” to the team.

What this means is that while he may be willing to agree to, say, $4.5 million for the next season, he may also be willing to sign a front-loaded deal that will reduce his cap hit even further. For the sake of argument, if St. Louis were to agree to a three-year contract that paid him $4.5 million for the first year, then $3 million for the next year, and $1.5 million for the last year, it would result in a cap hit of “only” $3 million. That’s a huge difference.

The only issue here would be how many more seasons St. Louis has left in him.  Given his recent performance, three years is not out of the question. Still, crafting a deal like this could backfire on the Rangers if St. Louis decides to retire after one year. If that happens, the cap benefit that the Rangers got from that first year will be imposed as a penalty (called “cap recapture”) over the remaining life of the deal.

Another possibility for the Rangers is the contract of Tanner Glass. If they can trade or demote Glass, then they would save his $1.45 million cap hit.  This action would be dependent on them getting another gritty player to take his place (for this exercise, we’ll assume that Dylan McIlrath can take over that role at a roughly $800,000 cap hit).

From this point, most of the remaining players could be signed for roughly their asking price.  The one exception could be Carl Hagelin.  The prevailing wisdom puts either Hagelin or Zuccarello as the likely victims of the Rangers’ current cap situation. The Rangers have more options with Hagelin (a restricted free agent) than they do with Zuccarello (unrestricted), though. They may be able to sign Hagelin to a shorter term for less money.

So where do all these machinations leave us?  Even with signing fewer players (teams can carry between 21 and 23 skaters on their rosters), some deep hometown discounts and creative contract structuring, there’s still less than $4.5 million to sign Zuccarello.  If they do offer Zucc a long-term deal at less than $4.5 million (he would surely get more as a free agent), would he take it? It’s possible, but Glen Sather surely has his work cut out for him.  The more likely outcome is that next year’s Rangers roster will again look much different than this year’s.