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In an otherwise neutral day of deliberations about expansion, the one message that came through from the NHL's board of governors' meetings was that the league absolutely, positively does not want to add any more basket-case franchises.

Even as league revenue rises, too many teams (Arizona, Florida and Carolina, to name three) are still bleeding red ink. Franchises in non-traditional markets that play to thousands of empty seats every night must be propped up through revenue sharing – and adding one or two more new teams that will need to belly up to the trough every year makes no financial sense to existing franchisees.

It's why the NHL has adopted a go-slow approach to this round of expansion and it raises red flags internally about Quebec City's otherwise solid expansion plan.

The question is this: Is Quebec City a viable business if the buy-in is $500-million (U.S.), which at Tuesday's exchange rate is about $680-million (Canadian)? Consider that when the ownership in Winnipeg bought the distressed Atlanta Thrashers in 2011, it paid a quarter of the expansion amount – $170-million (U.S.). And that was at a time when the loonie was above par.

Winnipeg has been a smashing success at the box office. Every game is sold out; the love affair with the Jets is as strong today as it was when commissioner Gary Bettman originally announced the move.

But even at that, Winnipeg is a mid-market team that has to stick carefully and efficiently to a budget. The franchise remains on solid ground, though the loonie's value has since fallen to 74 cents and player salaries are all paid in U.S. dollars.

But what if the buy-in for the Jets had been four times higher, as it would be for expansion teams? Could Winnipeg keep operating in the black if the cost of financing the Thrashers purchase was that high?


And however well the Quebec City franchise does at the box office, in merchandise sales and local television revenue, the market could not spin off enough cash to make a $680-million (Canadian) buy-in work. That is the NHL's concern, even though Quebecor, the prospective buyer, has deep pockets.

So, while Bettman always discourages the relocation of teams, it would make far more sense for Quebec City to pursue an ailing franchise whose owners are weary of mounting losses. At that point, the cost of the transaction becomes a different financial equation – simply a business deal between an eager buyer and a motivated seller, with the price to be mutually negotiated.

Chances are good that Quebec City could land a distressed franchise for less than the current expansion price – and frankly, any team arriving with an existing roster of players in tow is far more valuable than a team starting from scratch. Remember, when the Quebec Nordiques left for Denver back in 1995, they were loaded. It took exactly one season for the rechristened Colorado Avalanche to win a Stanley Cup.

So, the takeaway from the governors' meetings is that Quebec City didn't move any closer to getting a team, but the league didn't slam the door on the idea either – a good thing.

Procedurally, what happens next is this: The NHL's 10-member executive committee, which features some of the most powerful owners in the league, will meet again to sift through the financial documents and ultimately make a recommendation at some unspecified date in 2016.

What's worth noting is that the majority of owners who serve on the executive committee have been through expansion cycles before – so the appeal of a $1-billion (U.S.) expansion windfall means less to them than it might to less committed owners who could use the cash right now. Adding one or two new partners means fractionally shrinking their own slice of the league's shared-revenue pie in perpetuity.

League governors understand that putting a franchise back in Quebec City probably makes sense – it has a state-of-the-art arena in place and a well-heeled ownership group. But they also want to protect that group from itself and make sure it has a fighting chance to succeed – on the ice and on the balance sheet. The league does not want to admit a 31st or 32nd team, pocket the expansion fees and then be forced to underwrite the new teams' losses the way it does now with some of its struggling franchises.

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