NHL players are like the rest of us when it comes to the rudimentary details of life - and hey, let’s face it, the day your tax refund arrives is usually a pretty good day, no matter how much money you might earn.
Well, the NHL equivalent of the tax refund is the player escrow cheque, which after a lengthy delay that signified the first real skirmish between the league and the players association over upcoming CBA negotiations, they should be arriving in the mail shortly, maybe even before next weekend’s all-star break.
The NHL issued a statement Friday confirming that fact, although it is unknown exactly when the players will receive their share.
"The NHL and the NHLPA have reached a settlement of their dispute over 2010-11 Hockey Related Revenue (HRR). The return of Escrow monies to the Players and Revenue Sharing payments to the Clubs were on hold while these matters were being resolved. The Players' Association and the League have also reached an agreement about how some of the disputed HRR issues will be addressed for this season (2011-12). The disbursement of Escrow and Revenue Sharing monies will occur in the coming weeks."
The cheques were delayed this year because of a dispute between the NHL and the NHL players association over what constitutes hockey-related revenue for the 2010-11 season under the collective bargaining agreement. Back in the fall, the NHLPA made the case that the $25-million subsidy paid to the league by the city of Glendale to underwrite their operating losses for the Phoenix Coyotes (and a similar payment made by the city of Nashville to the Predators) should count as part of the league’s gross revenues.
Since the players are guaranteed 57 per cent of the overall take under their deal with the owners - it’s a partnership remember - a favourable ruling would bump the players’ share by many millions.
Escrow is the CBA mechanism designed to keep the above percentages straight - which means that every two weeks, on payday, during the regular season, a varying amount is withheld from the players paycheques, in the same way that income tax is also withheld.
Eventually, the league’s revenue numbers come in, the accountants tally them up, and the players usually get a significant chunk of their cash back because the NHL is doing pretty well these days - and have managed to grow the revenue pie each year, according to commissioner Gary Bettman.
Of course, if things are so rosy, surely that means that Bettman and players’ association executive director Donald Fehr should be able to wrap up the new round of CBA negotiations that are likely to get under way soon with a quick phone call, right?
Well, probably not. Even if the big picture looks pretty good, the fact that franchises in St. Louis, Phoenix and elsewhere are so hard to sell has to tell you that the model isn’t exactly working the way the NHL imagined it would when the current agreement was negotiated (at the cost of the 2004-05 season, making it the only pro sports league in history to lose an entire year to a labour dispute).
Two of the fixes that the owners will want for sure: 1. Knocking the players overall share closer to the new NBA levels, where a seven-week work stoppage earlier this year resulted in a 50-50 split between owners and players; and 2. Tinkering with the gap between the salary cap ceiling and floor. Coming out of the lockout, teams were limited to a $39-million payroll, but were required to spend a minimum of $23-million. Because the business has prospered since then, the ceiling is now $64.3-million and the floor $48.3-million - and the latter is an unsustainable figure for small-market U.S. teams.
Weirdly, the players (under former executive director Bob Goodenow) weren’t even all that insistent on a salary-cap floor in the last round of negotiations; it was something the NHL gave them. There will probably be a floor in the new CBA as well, but the gap will be wider than $16-million, just so the Nashvilles, Phoenixes and St. Louises can set their budgets and spend to their limits. The gaps between the haves and have-nots will widen financially, although how that actually plays out on the ice remains to be seen.