Caps Balk at Free Agency Frenzy - with good reason…
The Caps entered free-agency on July 1st with a total of $15,981,538.00 to spend and, as we sit here on the 5th day of free agency, it should come to the surprise of no one that the Washington Capitals have the exact same amount of salary space available.
Yes, the Caps did sign jack-of-all-trades backup, Dany Sabourin, to a 1 year, two-way deal, but Dany has already been earmarked as Braden Holtby’s backup in Hershey, so his signing will not count against the cap until the team has a need to use him in the NHL.
Other than that, all has been quiet at the Verizon ranch. Outside of casting a sideways glance at a free agent or two, George McPhee hasn’t tendered an offer to any of the available players.
And with good reason.
With McPhee looking at spending at least 2/3rds of the team’s available salary on current restricted free agents, there really was no need for the team to involve itself in a bidding war for any one players services, therefore, they haven’t.
In terms of why the Caps have stood pat, it’s fairly simple, cap space.
If McPhee were to have blown a significant chunk of his available dollars on one of the UFA’s, there would have been a much greater chance that he would lose one of his RFA’s. Although the Caps have over $15 million in cap space, the truth of the matter is that it’s far less.
To help clear up the matter, I will provide you with a breakdown of the Caps plans(players, salaries, etc…)
All of the salary numbers are from capgeek.com.
Signed Players:
Forwards(8): Ovechkin, Backstrom, Knuble, Semin, Laich, Chimera, Steckel, Bradley
Defense(5): Green, Carlson, Poti, Sloan, Erskine
Goaltending(1): Varlamov
2010-11 Cap Hit: $43,418,462
Although, according the capgeek.com, the Capitals appear to have $15.9 million in cap space, it’s more akin to $12.5M if you take into account that Karl Alzner($1.625M), Michal Neuvirth($821,667k) and one of Marcus Johansson($900k) or Mathieu Perreault($716,667k) will most certainly be on the roster come opening night.
By taking into account Alzner, Neuvirth and Johansson, the Capitals will have approximately $12,584,871M to play with.
Alzner is an automatic as he will be a part of the Caps top 4 on D.
Neuvirth will be splitting time with Varlamov this season and is guaranteed, at least, the backup role.
And, as of now, McPhee and Boudreau seem to be very inclined to let either Johansson or Perreault duel it out to center sniper Alexander Semin and workhorse Brooks Laich on the 2nd line.
That takes up 3 more roster spots and brings the Caps up to 17 confirmed players.
With the remaining $12.5M($12,584,871M to be precise) that McPhee and the Capitals have to play with will, more or less, go towards the 9 RFA’s that Washington extended qualifying offers to back in June.
Those 9 players were Jeff Schultz, Boyd Gordon, Eric Fehr, Tomas Fleischmann, Jay Beagle, Chris Bourque, Andrew Gordon, Patrick MacNeill and Zach Misckovic.
Of that group of 9, Schultz, Gordon, Fehr and Flash all have guaranteed spots on the Caps roster, provided they don’t put themselves outside of the Caps budget.
When qualifying RFA’s on their 2nd contracts, it’s common place that teams offer up a 30% minimum raise over the previous contract.
In the case of the 4 RFA’s who have guaranteed spots though, chances are they will all likely get fair sized raises.
Here is the way I see it shaking out:
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Jeff Schultz:
previous contract: $700k
30% min raise: $910k
Likely contract: $1.35M
Reasoning:
Although a cap-hit of $1.35M sounds like a little much to most Cap fans, the fact is that Jeff figures into the teams plans for the long-term. Although he could easily accept a 1 year deal at the qualifying minimum and attempt to play his way into a bigger contract, chances are more likely that both sides would like to get a longer term deal done. Considering Schultz led the NHL in +/-, the most casual of all stats, it’s not likely that it will land him a big reward, but with expectations being met and continually rising when it comes to Schultz, it would seem a lot more reasonable that McPhee would want to lock up Jeff for at least 3 years. Although the +/- was rather inflated due to the performance of his team, his steady progress has impressed management. With a 30% raise already a given for Schultz, I expect GMGM will be generous in a sense and offer the lanky defenseman a 3 years term with a small, but increasingly lucrative deal. 3 years with a cap hit of $1.35M per season makes sense, and, hoping all goes well and Schultz can continue to improve his overall game, locking him up long-term may wind up being an extremely smart move. On a 3 year deal, with a salary increase of $100k a year(Y1; $1.25M, Y2: $1.35M, Y3: $1.45M), should appeal to Schultz. So should the security of a longer term contract.
Finally, considering the cost of shutdown defenseman on the free market, keeping a young, successful and still developing defender seems like a wise idea.
Tomas Fleischmann & Eric Fehr:
Flash’s previous contract: $700K
30% min raise: $910K
Likely contract: $1.25M
Fehr’s previous contract: $800k
30% min raise: $1,040M
Likely contract: $1.25M
Reasoning:
Although you would think it wise to separate these two when it comes to negotiations, I believe it may be a smarter move to offer both players similar deals. Both of them have developed quite a bit over the last 2 seasons, but neither has yet to fully prove they can fulfill their potential consistently. At various times throughout the last 2 years, both Flash and Fehr have proven to be important elements that help balance out the offense. Although they are known more for their offensive potential, they’ve grown defensively as well. The key factor in these discussions remains the fact that there are a lot of prospects in the Caps system that are itching to replace these two and, although they have proven themselves to be valuable at times, they have yet to prove they are the top 6 material they were projected to be.
Obviously, these two could easily accept their qualifiers and play their way into a larger contract next summer, but given the investment by the team into both of these players, it wouldn’t make sense to force them into that situation this early in their careers. The truth is that both still have plenty of untapped potential and are still developing, as a result of that, it would only be wise to offer them contracts that offer not only better dollars and a longer term, but also a commitment to the team and vice versa.
The team wants to keep them and they want to stay. In order for both the team and the players to get the most out of these contracts, it would likely be wise for the players to take a little less to stay members of the Caps and for management to offer a little bit more in terms of years, to allow them the room to finish developing into the players they are expected to be.
Boyd Gordon:
Previous contract: $800k
30% min raise: $1,040M
Likely contract: $1.1M
Reasoning:
Although Gordon’s 30% minimum raise of $1,04M falls between his line-mates salaries, David Steckel($1.1M) and Matt Bradley($1M), and would fit perfectly with the teams budget for their 4th line, it would not hurt to offer Gordon a slightly higher raise in order to lock him up for 2 years. A key concern with Boyd has been his back as it sidelined him for numerous long stretches during the 2009-10 campaign, yet his youth and proven ability to win face-offs, kill penalties and be a grinder when the team needs one, make him an easy candidate for a ‘soft-raise’. With other qualified RFA’s such as Chris Bourque and Jay Beagle knocking on the door though, there is definitely a chance that McPhee opts to sign Gordon for only 1 year and to let him fight it out with the other two RFA’s. Regardless of the details, it is all but a guarantee that Gordon will accept his qualifying offer or any other offer the team throws at him.
_________________
Getting back to the Capitals budget, if we account for the average raises to all 4 of the players mentioned above(Schultz at $1.35M, Flash & Fehr at $1.25M and Gordon at $1.1M = $3.9M), the Caps would then have a roster of 21 players at a cap hit of $51,765,129M with Marcus Johansson(or $51,581,796M with Mathieu Perreault).
If I have lost any of you, let me recap:
Caps signed roster:
14 players @ $43,418,462M(*signed players listed at top)
Automatic Additions: Alzner($1.625M), Neuvirth($821,667k) and Johnansson($900K)or Perreault($716,667k) = $3,396,667M (using Johansson)
Automatic RFA re-signings: Schultz($1.35M), Flash & Fehr($1.25M) and Gordon($1.1) =
$4,950,000M
Here’s the math:
$43,418,462 (14 signed players)
+$3,396,667(3 rookies)(= $46,815,129)
+ $4,950,000 (4 RFA’s)
____________
21 players = $51,765,129M
Finally, there remains the 5 other RFA qualifiers that McPhee sent out to Chris Bourque, Jay Beagle, Andrew Gordon, Zach Miskovic and Patrick MacNeill. Considering there doesn’t seem to be much room for the 2 defensemen on the squad, chances are they will accept their offers and play for the Bears in ‘10-11. As for Beagle and Gordon, they will likely accept their offers and remain one of the first call-ups to the Capitals for 2010-11.
The lone difficulty may lie in how to get Chris Bourque signed. Although Chris has received a qualifier(expected to be in the neighbourhood of $780k), with offers on the table from the KHL and an MVP run with the Calder champion Bears in his back-pocket, C-Bo may have other plans. In all fairness, there doesn’t yet seem to be a vacant position in the Caps lineup for the son of former Bruins All-Star. If anything, perhaps Bourque could out-compete Boyd Gordon for a spot on the 4th line, but chances are that McPhee will only be willing to offer up a slight bit more in terms of dollars and years(say 2 years at $850k). Yet, Bourque is chomping at the bit to get a shot to stick in the AHL and may likely want more security than a two-way deal. And so that is the lone predicament when it comes to all of the players the Caps have qualified and, although it may seem like Bourque may become a problem, chances are both sides will be able to come to an agreement.
The cap-hit of these 5 RFA’s at the NHL level is approximately $4,620,000, yet won’t come into affect until any of them play an NHL game, so, technically, they will not affect the teams cap hit heading into next season.
Coming full-circle, it becomes a lot clearer as to why George McPhee and the Washington Capitals have been hesitant to dip their feet into the UFA pool. The costs have soared and the quality of player to dollar paid ratio is slowly getting way out of whack. Rather than becoming entangled in a bidding war, the Caps have decided to stick with what they’ve got and to then turn their remaining cap space towards help at the appropriate time.
Considering my calculations, when all is said and done, the Capitals will have (approximately) $51,765,129 million committed to 21 players, leaving them $7, 634,871 million in cap space to spend on 2 roster spots.
Now, that might sound like a lot, yet expectations are that McPhee will leave the team a buffer cushion of at least $2 million in salary in case of injuries, call-ups, etc…
Therefore, yet again, the safe estimate of what the Capitals have left to spend this summer should end up around $5.6 million with 2 roster spots available.
In a round-about kind of way, it makes a lot of sense that Washington has held themselves back. With 9 qualifying offers yet to signed and final cap hits yet to be determined, airing on the side of caution will only play into the Caps favour later on.
Finally, after all the numbers have been crunched, the truth is that there is definitely some room to play around, but without any of the RFA’s locked up yet, it makes sense to wait until they are good and ready to spend their money.
There still remains a chance that the Caps will dip into free agency, but don’t expect it to happen until all current offers are signed and sealed.
The cool, calm and collected approach couldn’t come at a better time as the Caps are more inclined to pursue additions via a trade. Looking forward to the rest of the summer, I would expect for the Caps to become major players on the trade market once other teams have finished locking up all of the UFA’s.
I will be in cottage country for the next few days, so if I miss any breaking news, I apologize in advance, if not, I will return this weekend with more Caps talk.
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