One Timers

Loophole Has Cap-Strapped Teams Aiming High at Deadline

With the 2016 trade deadline just four days away, most serious contenders are cap-strapped to the point where it is will be extremely difficult to make a significant move. If these maxed-out salaried teams are looking to acquire big contracts, they will have to give up big pieces in return — a move that not many general managers are keen to make.

But for some, taking advantage of a loophole in the system may be the best course of action when trying to load up for a playoff run this year.

Many fans are unaware of the masterful ways general managers manipulate and/or circumvent the salary cap to make it work in their favor. Take the David Clarkson situation, for example, where Brendan Shanahan (acting as the Toronto Maple Leafs’ GM at the time) traded his underwhelming, over-priced forward for the Columbus Blue Jackets’ Nathan Horton, whose serious injuries made it unlikely he’d ever return to the NHL, last year.

David Clarkson with his new team, the Columbus Blue Jackets

Although their salaries were similar, the Blue Jackets simply could not afford to pay Horton’s hefty contract with him sitting out. When a player is on long-term injured-reserve (like Horton was then and still is today), he comes off the cap until reactivated; however, the team still has to pay his salary in full, and as an organization, the Maple Leafs took advantage of their wealth by acquiring him. They are paying him his full contract amount, but he isn’t hitting the cap. They essentially cleared out Clarkson’s cap hit entirely, nixing all cap responsibility from either player in the process.

As Twitter erupted over the exploitation of that loophole, one fact remained: Toronto did nothing wrong, and they are in a much better situation today because of it.

But heading into this year’s deadline, just over a year after the Clarkson trade, there exists a clause that may lead to teams finding another loophole – there is no salary cap in the postseason.

How does this all tie together? Teams such as the Florida Panthers, Los Angeles Kings and New York Rangers have one or more high-priced player(s) currently injured/on regular IR. If one of those players is hurt enough that sitting him out until the playoffs begin may be the best course of action for his health, then he can be placed on long-term IR – and his team, in turn, can add a player and/or players valued up to the injured player’s allotted cap hit.

For example, New York Rangers forward Rick Nash has been out since January 22nd with a knee injury. If GM Jeff Gorton were to shut him down until the playoffs by putting him on long-term IR, he would be opening up $7.8 million in cap space to work with at the deadline. This means that all those Eric Staal rumors actually do have a chance at coming to fruition – with Nash on LTIR, the Rangers will have almost $9 million in cap space to work with. And then, because of the loophole, both can participate in the Rangers’ postseason run.

09 February 2016: Los Angeles Kings left wing Marian Gaborik (12)  skates during warm up. (Photograph by Fred Kfoury III/Icon Sportswire)

The Los Angeles Kings have a similar situation with Marian Gaborik, who is on regular IR. Without a target date for a return, it would be best for the Kings to give themselves some cap relief and put him on LTIR, giving them the ability to make a move of their own on deadline day. Unlike the Rangers (who need offense), the Kings are in desperate need of defense after Matt Greene was placed on LTIR and Christian Ehrhoff was sent to the AHL. They can shift their focus toward one of the top defensemen available – Dan Hamhuis, Kris Russell or Justin Schultz – with Gaborik’s cap hit off the books until the playoffs.

And the Florida Panthers, who currently have five regular roster players on IR, can definitely benefit from a few moving over to the LTIR list. That would open up significant cap space as they charge toward their first playoff appearance since 2012. The Panthers are also contending for the Atlantic Division title, so it would give them a boost to have another player or two on the roster (who can then serve them alongside the current injured players once the postseason begins).

There’s nothing to worry about with circumvention or tampering penalties, either – the Chicago Blackhawks used this method last year as they loaded up for their postseason run, placing Patrick Kane on LTIR until the playoffs began and acquiring a big trade chip in Antoine Vermette at the deadline. Needless to say, they went on to win the Stanley Cup, and a big part of their championship was Vermette – the loophole acquisition.

We’ll soon find out if another team explores this route as the deadline is Monday afternoon.

 

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