Question about the cap and how it could affect Burrows and Higgins

[Arrow 1983]

This topic is about the NHL cap concerning the Possible buyouts off Higgins and Burrows.

 

First Higgins, if I am not mistaken to buyout a player it is 2/3 of his salary. For Higgins this means 2/3 of  $2.5 mil = 1.675 mill which is a savings of $0.825 mil for next season. The problem I see with buying Higgins out is we would save even more if we bury him in the minors which allows a team to save $0.950 mil instead of the 0.825 mil. A saving of an extra .125 mil. This also allows the team to call him up if he plays well and Higgins could be a good mentor to the younger players in the minors. I would even suggest making him captain of the Comets.

 

You may even suggest  that .125mil is such a small amount in the bigger picture of a 70 mil plus cap but I would remind you that it could mean the difference of going over if one of the younger players meets their bonuses.

 

Second and this is where I think it really gets interesting is Burrows contract. I am not 100% sure about this but this is how I read the CBA. I would just point out my background is in accounting and I do deal with contracts like this on a daily bases. That said, and as I said before I am not a 100% sure as if what I am about to write is fully correct. If you have a better interpretation of the CBA feel free to post it.

 

Burrows current cap hit is $4.5 mill per season, However his salary this season is $3.0 mil. So to my understanding 2/3 of $3.0mill = $2mil it would cost the Canucks $2.0 mill to buy him out. However, 2/3 of 4.5 mil is 3 mill which would equal a cap savings of $1.5mil savings. Notice that is > $0.95 mil if he was buried in the minors.

 

My point that I am getting to is that I could see the Canucks buying out Burrows and not Higgins for this reason. Please don't get me wrong I Think that Burrows has been a model Canuck. This topic is just to point out why burrows may be bought out and not Higgins. Also to get a better understanding of the current CBA and if I am incorrect about what I have posted please inform me of your understanding of the CBA.

 

 

[MadOgre]

I don't know if they will desperately need the cap room this upcoming season?

 

So I think it would be more to try and release Burrows to find another place to play instead of being banished to the minors to end his career. Same goes for Higgins.

 

I also think that naming Higgins the Captain of the Comets would be an extreme insult to him. HAHA your the Captain of the AHL LOL. I can see the humor in that already! But Higgins wont! 

[WhoseTruckWasIt]

This might save you some speculation.

 

https://www.capfriendly.com/buyout_calculator

 

[bushdog]

  thanks truck, didn't know that site existed.  seems it might be most prudent to buy out miller, but

that would sure leave a big hole for a year or two.  I wonder about signing him for 1 more year, maybe

as part of a 3-way tandem. demko will need to be evaluated properly and it's likely he's not as close to

super-hero as some think...

  this guy has played his guts out for the team and he's kept us from getting the best shot at #1.

  oh...

  LOL

[Boddy604]

I'll have to see if I can find it but I do recall reading that Higgins was likely to just retire rather than play next year in Utica.

Canucks other Buyouts are off the books next yr so Canucks could buy out both. 

I think the decision matters more on the rest of the roster than it does on Burrows & Higgins though.

If we assume that Baertschi, Granlund, and Etem are all brought back (and it's pretty likely they will be.) Canucks have a lineup something like

Sedin-Sedin-Sedin-Hansen

???-Sutter-Rodin

Baertschi-Horvat-Etem

Dorsett-Granlund-Virtanen 

Extra: Gaunce/McCann

 

If Canucks draft someone like Laine, that 2nd line spot is filled. Rodin and Etem can also play the other wing if Canucks get Puljujarvi.

There's also the possibility that Canucks sign a free agent like Lucic, Eriksson,  or Okposo.

When you consider all of that, the problem with Higgins and Burrows isn't the money they cost, it's that other guys on the team have already taken their jobs.

[khay]

1 hour ago, WhoseTruckWasIt said:

This might save you some speculation.

 

https://www.capfriendly.com/buyout_calculator

 

 

Based on this, buying out Burrows saves us 2 million dollars next season but adds 1 million dollars two seasons later and buying out Higgins saves us 1.67 million dollars next season but adds .833 mil two season later.

 

So, 3.67 mil savings next season but 1.833 penalty two seasons later. Hmm.. 3.67 is quite a lot of savings. Could give us enough money to sign two UFAs instead of just one.

 

14 minutes ago, Boddy604 said:

I'll have to see if I can find it but I do recall reading that Higgins was likely to just retire rather than play next year in Utica.

Canucks other Buyouts are off the books next yr so Canucks could buy out both. 

I think the decision matters more on the rest of the roster than it does on Burrows & Higgins though.

If we assume that Baertschi, Granlund, and Etem are all brought back (and it's pretty likely they will be.) Canucks have a lineup something like

Sedin-Sedin-Sedin-Hansen

???-Sutter-Rodin

Baertschi-Horvat-Etem

Dorsett-Granlund-Virtanen 

Extra: Gaunce/McCann

 

If Canucks draft someone like Laine, that 2nd line spot is filled. Rodin and Etem can also play the other wing if Canucks get Puljujarvi.

There's also the possibility that Canucks sign a free agent like Lucic, Eriksson,  or Okposo.

When you consider all of that, the problem with Higgins and Burrows isn't the money they cost, it's that other guys on the team have already taken their jobs.

 

Yeah I completely agree. I guess the problem is that we have players younger and cheaper that can do the job at least as good as these guys now. The additional 3.67 mil savings is not as big a gain because we get penalized 1.833 two seasons later.

 

Daniel, Henrik, Horvat, Sutter, Baertschi, Hansen, Etem, Virtanen, Gaunce, Dorsett, Rodin, Granlund, McCann already gives us 13 forwards. Add (Matthews, Laine, or Puljujarvi) and a UFA (Eriksson or Ladd) and that's 15 forwards. 

 

[Ossi Vaananen]

2 hours ago, Arrow 1983 said:

This topic is about the NHL cap concerning the Possible buyouts off Higgins and Burrows.

 

First Higgins, if I am not mistaken to buyout a player it is 2/3 of his salary. For Higgins this means 2/3 of  $2.5 mil = 1.675 mill which is a savings of $0.825 mil for next season. The problem I see with buying Higgins out is we would save even more if we bury him in the minors which allows a team to save $0.950 mil instead of the 0.825 mil. A saving of an extra .125 mil. This also allows the team to call him up if he plays well and Higgins could be a good mentor to the younger players in the minors. I would even suggest making him captain of the Comets.

 

You may even suggest  that .125mil is such a small amount in the bigger picture of a 70 mil plus cap but I would remind you that it could mean the difference of going over if one of the younger players meets their bonuses.

 

Second and this is where I think it really gets interesting is Burrows contract. I am not 100% sure about this but this is how I read the CBA. I would just point out my background is in accounting and I do deal with contracts like this on a daily bases. That said, and as I said before I am not a 100% sure as if what I am about to write is fully correct. If you have a better interpretation of the CBA feel free to post it.

 

Burrows current cap hit is $4.5 mill per season, However his salary this season is $3.0 mil. So to my understanding 2/3 of $3.0mill = $2mil it would cost the Canucks $2.0 mill to buy him out. However, 2/3 of 4.5 mil is 3 mill which would equal a cap savings of $1.5mil savings. Notice that is > $0.95 mil if he was buried in the minors.

 

My point that I am getting to is that I could see the Canucks buying out Burrows and not Higgins for this reason. Please don't get me wrong I Think that Burrows has been a model Canuck. This topic is just to point out why burrows may be bought out and not Higgins. Also to get a better understanding of the current CBA and if I am incorrect about what I have posted please inform me of your understanding of the CBA.

 

 

Good topic, I like the thesis upfront. 

 

There's a few things you're off on, namely that buyouts can be paid out over a 2-3 year period. The buyout itself is 2/3rds of the salary outstanding. So with Higgins, if we buy him out, we would pay 1.675 over 2 years. That would mean a savings of 1.675 for next year, as we would be paying 825,000 for the next 2. The same goes for Burrows, who right now is only making 3 mil in salary with a 4.5m cap hit. So his buyout could be 1m a year, saving us 3.5 million in cap next season. 

 

I think it's likely that Higgins is bought out, or given camp to show if he can still compete for a shop. Burrows means a lot to the team, and doesn't look out of place on the 4th line at worst. We're also in a pretty good spot cap wise, with Vrbata's 5m, Hamhuis's 4.5m (potentially), Weber + Bartkowski (3.25m) coming off of the books. Regardless of Higgins/Burrows, JB can have some fun this summer. 

[Bob Long]

30 minutes ago, Ossi Vaananen said:

Good topic, I like the thesis upfront. 

 

There's a few things you're off on, namely that buyouts can be paid out over a 2-3 year period. The buyout itself is 2/3rds of the salary outstanding. So with Higgins, if we buy him out, we would pay 1.675 over 2 years. That would mean a savings of 1.675 for next year, as we would be paying 825,000 for the next 2. The same goes for Burrows, who right now is only making 3 mil in salary with a 4.5m cap hit. So his buyout could be 1m a year, saving us 3.5 million in cap next season. 

 

I think it's likely that Higgins is bought out, or given camp to show if he can still compete for a shop. Burrows means a lot to the team, and doesn't look out of place on the 4th line at worst. We're also in a pretty good spot cap wise, with Vrbata's 5m, Hamhuis's 4.5m (potentially), Weber + Bartkowski (3.25m) coming off of the books. Regardless of Higgins/Burrows, JB can have some fun this summer. 

Higgins is probably bought out just for the roster spot, or they might wait and see if he retires if the thought of riding the bus on road trips is too much to handle. I do think Benning will try to trade Burrows instead of a buyout and retain a lot of salary in the deal. 

 

According to this article we can retain up to  50% of his actual salary and we'd also keep 50% of the cap hit (http://thehockeywriters.com/nhl-retained-salary-trades/)

 

So in a trade, a team like Montreal could get Burrows for 1.5 in actual salary and 2.25 in cap hit. If the cap hit was the same as his salary, I don't think there would be any trouble trading him, but I think the deal would have to include multiple players if it was with Montreal. Another team wanting to save actual money but also meet the floor team cap hit might be interested though. 

 

 

[mll]

The buyout cap hit is not equal to the cost of the buyout but is in fact the cap hit less the salary savings.  The cost of the buyout is 2/3rds of the remaining salary and it's spread over twice the remaining length of the contract.  For players under 26 it's 1/3rd and not 2/3rd.   There are detailed illustrations in the CBA (see page 269 - article 50.5)

 

For Burrows - his buyout cap hit is 2.5M in 2016/17 and 1M in 2017/18.  As for Higgins it's 833K in both 2016/17 and 2017/18.

 

In more detail:

For Burrows -  his remaining salary is 3M and 2/3rds is 2M.  There is one year left on his contract so it's spread over 2 years (ie 2M ÷ 2years  = 1M x 2 years)

 

                A. Cap hit         B. Salary       C. Buyout cost     D. Salary savings (B-C)    E.  Buyout cap hit (A-D)

2016/17        4.5M.                 3M                    1M                            2M                               2.5M

2017/18            -            -                                 1M                           (1M)                              1M

 

 

For Higgins - the buyout cost is 2/3rds of 2.5M spread over two years (as he has one year left on his contract) so 833K x 2 years 

 

                    A. Cap hit    B. Salary    C. Buyout cost        D. Salary saving (B-C)     E. Buyout cap hit (A-D)

2016/17              2.5M        2.5M               833K                         1.66M                                  833K

2017/18                 -              -                    833K                         (833K)                                 833K

[Positive Canuck]

Burr at 4.5 . do we really need him ?

[Provost]

Keep in mind that the buyout window ends before free agency opens.  That means you have to buy a guy out before finding out if you need the cap space or can find a better player.

 

I don't see Burrows getting bought out.  I can see him being traded to a budget team who likes that the dollars owed are less than the cap hit.  Cap hit and actual dollars are retained at the same %, so if we retained $1 million in salary, of the $3 million owed in real dollars... we would be retaining $1.5 million in cap hit.

 

That is a reasonable possibility.  A team like Ottawa that doesn't spend to the cap gets Burrows for $2 million in real dollars (doesn't care about the cap hit), and we get $3 million in cap savings.

 

The Higgins dollars are way lower, so we can wait to see what we get in free agency and waive him at the start of the season and bury him in the minors if he doesn't earn a spot on the roster and doesn't get claimed.

[Bob Long]

3 hours ago, mll said:

The buyout cap hit is not equal to the cost of the buyout but is in fact the cap hit less the salary savings.  The cost of the buyout is 2/3rds of the remaining salary and it's spread over twice the remaining length of the contract.  For players under 26 it's 1/3rd and not 2/3rd.   There are detailed illustrations in the CBA (see page 269 - article 50.5)

 

For Burrows - his buyout cap hit is 2.5M in 2016/17 and 1M in 2017/18.  As for Higgins it's 833K in both 2016/17 and 2017/18.

 

In more detail:

For Burrows -  his remaining salary is 3M and 2/3rds is 2M.  There is one year left on his contract so it's spread over 2 years (ie 2M ÷ 2years  = 1M x 2 years)

 

                A. Cap hit         B. Salary       C. Buyout cost     D. Salary savings (B-C)    E.  Buyout cap hit (A-D)

2016/17        4.5M.                 3M                    1M                            2M                               2.5M

2017/18            -            -                                 1M                           (1M)                              1M

 

 

For Higgins - the buyout cost is 2/3rds of 2.5M spread over two years (as he has one year left on his contract) so 833K x 2 years 

 

                    A. Cap hit    B. Salary    C. Buyout cost        D. Salary saving (B-C)     E. Buyout cap hit (A-D)

2016/17              2.5M        2.5M               833K                         1.66M                                  833K

2017/18                 -              -                    833K                         (833K)                                 833K

 

Good explanation. Thats why I think Benning will try hard for a trade - if we retain 50% of his salary (the max allowed) we're better off cap-wise. 

 

[Bob Long]

3 minutes ago, Provost said:

Keep in mind that the buyout window ends before free agency opens.  That means you have to buy a guy out before finding out if you need the cap space or can find a better player.

 

I don't see Burrows getting bought out.  I can see him being traded to a budget team who likes that the dollars owed are less than the cap hit.  Cap hit and actual dollars are retained at the same %, so if we retained $1 million in salary, of the $3 million owed in real dollars... we would be retaining $1.5 million in cap hit.

 

That is a reasonable possibility.  A team like Ottawa that doesn't spend to the cap gets Burrows for $2 million in real dollars (doesn't care about the cap hit), and we get $3 million in cap savings.

 

The Higgins dollars are way lower, so we can wait to see what we get in free agency and waive him at the start of the season and bury him in the minors if he doesn't earn a spot on the roster and doesn't get claimed.

the cap hit is still based on the AAV - at 50% thats still 2.25 mil - so he's more attractive to teams looking to meet the floor of the total team cap as they get him for cheaper in real vs cap hit dollars

[Provost]

1 minute ago, Bob Long said:

the cap hit is still based on the AAV - at 50% thats still 2.25 mil - so he's more attractive to teams looking to meet the floor of the total team cap as they get him for cheaper in real vs cap hit dollars

Yes, but in my example we were only retaining 33% of the salary and hence 33% of the cap hit ($1.5 being a third of the $4.5 aav)

 

I don't see us having to retain 50% of his cap hit, he is a bargain for a budget team at $2 million in real dollars.  There are a few trading partners out there at that price and he seems resigned to moving and I doubt he would block a a trade.

[WhoseTruckWasIt]

2 hours ago, Bob Long said:

 

Good explanation. Thats why I think Benning will try hard for a trade - if we retain 50% of his salary (the max allowed) we're better off cap-wise. 

 

buut beunung cant math ......  (stuppid vey haha)

[Crabcakes]

I'm sure Benning's Capologist has this all figured out 

Even if he doesn't, there are bigger fish to fry and money is secondary when deciding what to do with Burrows and Higgins anyways.

 

That's my 2 cents.

[Z Hockey]

If anybody is being bought out its Higgins. 

 

Burrows brings so much more, I don't care if he looks like a 4.5 Mil fourth liner. I love seeing him not letting McCann get shoved around in the corner especially after the whole Prust ordeal with that. He will have an outstanding effect on the guys in the pipeline with his attitude. I also think he has more offense left in the tank, he had 24 points in 47 games in the lock out season in 2013, that's like a 42 point pace which is only three years ago. Then in 2014 he had 15 points in 49 games while missing time with two injuries that obviously nagged him even during the games he did play.

He hasn't been the same since those

injuries, he said he's going to get solid workout time in the summer and train hard. 

He will be fresh and well trained, I think he can pot 40 points next season.

[desiboynux4lifee*******]

Panthers rolled 3 lines in the playoffs, Burrows and Higgins, might have a market who knows?

[Baggins]

7 hours ago, Ossi Vaananen said:

Good topic, I like the thesis upfront. 

 

There's a few things you're off on, namely that buyouts can be paid out over a 2-3 year period. The buyout itself is 2/3rds of the salary outstanding. So with Higgins, if we buy him out, we would pay 1.675 over 2 years. That would mean a savings of 1.675 for next year, as we would be paying 825,000 for the next 2. The same goes for Burrows, who right now is only making 3 mil in salary with a 4.5m cap hit. So his buyout could be 1m a year, saving us 3.5 million in cap next season. 

 

I think it's likely that Higgins is bought out, or given camp to show if he can still compete for a shop. Burrows means a lot to the team, and doesn't look out of place on the 4th line at worst. We're also in a pretty good spot cap wise, with Vrbata's 5m, Hamhuis's 4.5m (potentially), Weber + Bartkowski (3.25m) coming off of the books. Regardless of Higgins/Burrows, JB can have some fun this summer. 

A buyout has to happen by June 30th. The second option for buyout relates to going to arbitration and I highly doubt we'll have any arbitration hearings this summer. Regardless, it can't be done after camp.

[Baggins]

3 hours ago, Bob Long said:

the cap hit is still based on the AAV - at 50% thats still 2.25 mil - so he's more attractive to teams looking to meet the floor of the total team cap as they get him for cheaper in real vs cap hit dollars

I keep seeing this come up but last season there wasn't a team in the league remotely close to the floor. It's a pipe dream. That said, Burrows isn't actually a bad deal for his actual salary. He could be attractive to a team that aren't tight to the cap limit and there are several such teams. For those teams salary would mean more than the cap hit.