Hurricanes Face Serious Salary Cap Issues

The Carolina brain trust has not had answers for the many problems facing the Hurricanes so far this season, but with head coach Paul Maurice recently signed for three years, is the job his regardless of the wins or losses? (photo by LTD)

Here is one situation that some long time Caniacs probably never thought they would see.  The Carolina Hurricanes have come very close to reaching the limit of the salary cap and are extremely restricted with what they can do regarding player movements because of this problem. 

While management has been buried under a mountain of criticism because of the recent losing streak, "taking the cheap way out" is one complaint that can officially be crossed off the list of typical fan complaints.

Jim Rutherford has just about painted himself into a corner because of his unusual lack of foresight and fiscal responsibility during this past off season's moves and signings. 

On top of that, he has severely limited himself on what he can do regarding the coaching staff because of his recent three year signing of head coach Paul Maurice.  If he were to fire Maurice, he would officially have two ex-coaches on the payroll because the team is still paying Peter Laviolette. 

If he can not fire the coach or move players, what else can the general manager do?

Some fans are under the impression that players on the injured reserve list do not count against the salary cap, but nothing could be further from the truth.  The only time a team gets cap relief regarding injuries is if a player qualifies for the "long term injured reserve".   

The Collective Bargaining Agreement states the following regarding those circumstances, (page 226):

d) Bona-Fide Long-TermInjury/Illness Exception to the Upper Limit. In
the event that a Player on a Club becomes unfit to play (i.e., is injured, ill or disabled and
unable to perform his duties as a hockey Player) such that the Club's physician believes,
in his or her opinion, that the Player, owing to either an injury or an illness, will be unfit
to play for at least (i) twenty-four (24) calendar days and (ii) ten (10) NHL Regular
Season games, and such Club desires to replace such Player, the Club may add an
additional Player or Players to its Active Roster, and the replacement Player Salary and
Bonuses of such additional Player(s) may increase the Club's Averaged Club Salary to an
amount up to and exceeding the Upper Limit, solely as, and to the extent and for the
duration, set forth below. If, however, the League wishes to challenge the determination
of a Club physician that a Player is unfit to play for purposes of the Bona-Fide Long-
Term Injury/Illness Exception, the League and the NHLPA shall promptly confer and
jointly select a neutral physician, who shall review the Club physician's determination
regarding the Player's fitness to play.

 

So in plain English, if a player qualifies for the LTIR, the injured player's salary still counts toward the cap, but the team can go over the salary cap if needed when they sign another player.  The catch?  When the injured player gets healthy and is ready to return to the lineup, the team must cut or waive the necessary player(s) so they can fit under the salary cap once again.

Right now the Hurricanes do not have anyone that qualifies for LTIR.  Cam Ward's status has been upgraded and he is presently listed at being out for 3-4 weeks. So injured or not, every player in Raleigh currently counts toward the cap.

Let's take a closer look at the exact problem facing Rutherford:

 

2010
Cap Hit Actual Cash
1 Staal  $    8,250,000  $   6,000,000
2 Pitkanen  $    4,000,000  $   4,000,000
3 Brind'Amour  $    3,600,000  $   3,000,000
4 Whitney  $    3,550,000  $   3,550,000
5 Cole  $    2,900,000  $   2,800,000
6 Gleason  $    2,750,000  $   2,500,000
7 Samsonov  $    2,530,000  $   2,500,000
8 Walker  $    2,500,000  $   2,500,000
9 Cullen  $    2,875,000  $   2,800,000
10 Ward, C  $    2,666,667  $   3,500,000
11 Corvo  $    2,625,000  $   2,750,000
12 Ruutu  $    3,800,000  $   3,000,000
13 Ward, A  $    2,500,000  $   2,500,000
14 Wallin  $    1,725,000  $   1,725,000
15 Leighton  $       600,000  $       600,000
16 Sutter  $       875,000  $       875,000 base
17 Yelle  $       550,000  $       550,000
18 Jokinen  $    1,700,000  $   1,500,000
19 Alberts  $    1,050,000  $       800,000
20 Conboy  $       487,000  $       500,000
21 LaRose  $    1,700,000  $   1,500,000
22 Kostopoulos  $       916,667  $       700,000
23 Legace  $       399,000  $       399,000
24 Ryan, (LTIR?)  $       500,000  $       500,000
25 Harrison/Rodney  $       500,000  $       500,000
buy outs Kaberle  $       733,333  $       733,333
Hamilton  $       267,000  $       267,000
 $ 56,549,667  $ 52,549,333
  Boychuk  $       875,000  $       875,000 base

 

Keep in mind that the Salary Cap Limit this year is $56.8 million.  Since the present cap hit for the team is about $56.5 million, (give or take a few dollars because of bonus numbers or partial payments), if the Canes want to bring back Zach Boychuk or anyone else from Albany, someone has to go and it looks like Tim Conboy is the sacrificial lamb, at least for now. 

The biggest waste of cap space on the lineup sheet at the present time is Michael Ryan, who has been unable to play all season because of concussion like symptoms.  Apparently, the team can not put him on waivers because of his health status, but they might be attempting to qualify him for LTIR status soon.

The franchise is approaching dire circumstances concerning injuries.  Cam Ward and Eric Staal remain unavailable and Ray Whitney, Stephane Yelle, and Scott Walker are questionable regarding their playing status for Friday night's game against the Islanders.  If none of those players are healthy enough to play, the Canes would not be able to recall anymore help from Albany because they have no cap space available.

They would have to play shorthanded, or one of the least injured players would need to suit up, injured or not.  If any other players fall to injury or illness, things could really get ugly.

Injuries or not, management is still spending much more money than they wanted to.  With three goalies on the payroll, two buy outs, and several injured players who can not play, management is certainly not getting much bang for the buck. Looking at the grand scheme of things and the results so far this season, this might be one of the most over-paid, under-performing group of players in the league since the inception of the salary cap.     

Those are strong words, but look at the statistics for most of those players compared to their salaries.  While other highly paid teams have failed in recent years, how many teams who had maxed out the salary cap finished in last place as well as at the bottom of the league in scoring?  (The 2006-07 Flyers might be a good comparison, but the salary cap was much lower back then.)

So what can Jim Rutherford do?  He can try to trade some of these players for draft picks to try to unload salary, but he certainly would not be dealing from a position of strength.  Every GM in the league knows that he is in a desperate situation and he would be hard pressed to get much value for any of the players he's interested in trading. He could try to trade a valuable player, but he would not get the same value that he could get closer to the trade deadline.

The only alternative is for one or two of the higher paid players, (LaRose?), to be put on waivers.  That would be a "final option", but a possibility if things don't change.

Perhaps the best move for now is to just sit back and wait for the losing streak to eventually subside, but one thing is certain, if the losses mount and the Canes fall further and further behind the pack, future decisions and actions will become more and more difficult for the former, two-time NHL General Manager of the year.

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