As I've bemoaned in a previous blog and something that is an acknowledged belief of all Rangers fans, Glen Sather has painted the team into a real corner as it pertains to the salary cap. With the UFA additions and/or re-signings of Chris Drury, Scott Gomez, Wade Redden, Michal Rozsival and Henrik Lundqvist, the Rangers have approximately $32.78 million dollars per year against the salary cap tied up for each of the next three years. Given that this year's cap will likely be around last year's ceiling (around $56.5 million) and we can't count on large increases to the cap limit in subsequent years because of the sluggish global economy and its possible impact on Hockey Related Revenues (HRR), the Rangers should plan to have only have around $23 - $24 million in cap room to flesh out their roster. Clearly it would behoove the Rangers to shed some of the long term commitments in order to give the team some flexibility to add players and also to re-sign some of their own impending Unrestricted Free Agents (UFA's) and Restricted Free Agents (RFA's). The question that Glen Sather must answer is how to do that.
The first, and most obvious solution, would be to trade away one or more of those big contracts. The problem with this is that there will likely be few teams willing to add payroll this offseason. The global economic troubles and its potential impact on HRR will likely steer most Managers away from expensive, long term commitments. To make matters worse, the high salaried players the Rangers would most like to move (Redden, Gomez, Rozsival) didn't exactly improve their marketability with their lackluster performances last season. No, unless the Rangers are willing to take back salary (which defeats the purpose with which I began this post) the trade market is likely to be slow for these players.
Another alternative afforded in the by the Collective Bargaining Agreement (CBA) that could be exercised to slash payroll is buyouts. The formula given in the (CBA) for contract buyouts is as follows: two-thirds of the remaining total Annual Average Salary (AAS) remaining on the contract spread out over twice the number of years remaining on the original term. For example; Rozsival has 3 years and $15 million left on his original deal. Two-thirds of $15 million is $10 million. That amount averaged out over twice the original term, 6 years, is $1.67 million per year. That would be the cap hit to the team if they should buyout Rozsival's contract for each of the next 6 years.
Using this alternative here is what the cap hits would be if the Rangers were to buy out the remaining terms of the following contracts:
Chris Drury - approximately $2.35 million per year for each of the next 6 years.
Scott Gomez - approximately $2.45 million per year for each of the next 10 years.
Wade Redden - approximately $2.167 million per year for each of the next 10 years.
Michal Rozsival - approximately $1.67 million per year for each of the next 6 years.
Granted, nobody wants to carry dead money against their salary cap but if you think of this in terms of "can I find a replacement player for the difference in the bought out players original contract?", then maybe it wouldn't be so bad. If the Rangers were to buy out Rozsival, then the difference between his current cap hit and his cap hit should he be bought out would be $3.33 million. Remember Mark Streit signed with the Islanders for an AAS of $4.1 million. Would you pay an extra $800,000 per year to have an offensive force like Streit over Rozsival? In Redden's case the difference between the cap hit on his AAS and his cap hit after a buyout would leave the Rangers over $4.3 million in each of the next 5 years. Hmmm, Streit or Redden?!?!?
With the real possibility that the economy could deflate the UFA market this season (much like it did in MLB) then there could be some real bargains on the market for teams to look at. If the Rangers were to take the radical option of buying out one of the contracts I mentioned, the Rangers could find themselves in a position to actually improve their roster if quality UFA's saw their value drop on the market. Yes, the Rangers would be wasting cap space in the years beyond the current term of the potentially bought out player's deal but if the economy recovers and the cap rises in 4 or 5 years (which is quite likely) then the Rangers might be able to handle it.
In conclusion, I'm not necessarily advocating this solution for the Rangers but it has to be something that Glen Sather at least considers. Doing it could at least achieve the short term savings neccesary to improve the roster; almost an addition by subtraction situation as it relates to either Redden or Rozsival. Let me know what you guys think whether for the Rangers or your own team.