Caprobatics: How the Sens Should Spend Their NHL Allowance

The post Eugene Melnyk era of the Ottawa Senators started unexpectedly on March 28th. I have written numerous articles for Sens Nation Hockey where I alluded to the team’s former owner and none of them were done flatteringly. None were done with malice, but I was not portraying him as the hero of the story. Never having met the man, my entire opinion was based on secondhand information and what I saw in the media. It’s not lost on me that I never would have been able to contribute to this platform and would likely be back to cheering for the Los Angeles Kings, my team up until 1993, if Eugene Melnyk hadn’t stepped in to buy the team in 2003.

Though Melnyk is gone, his legacy isn’t finished. It’s on the team and its leadership group to deliver a Stanley Cup.

Now that the Senators are in the post-trade deadline portion of the season, it’s time to plan a strategy for how they should allocate their cap on a go forward basis. When I say that, I am not talking about a year-to-year plan where the two Pierres sit down in front of a table and ask themselves:

“So, how are we going to spend the money?”

I am talking about a strategy or organizational philosophy as to how to allocate the money that can guide spending on UFAs and RFAs to help build this championship team that Sens Nation is dreaming of. Whether you are talking about a sports franchise or not, when no organizational philosophy exists to help guide decision making, it’s like you are making every decision for the first time.

The need for this type of process has never been more evident than in the past few weeks leading up to March 21st. There were all kinds of debates as to whether Nick Paul should stay or go. If he stayed, what was the appropriate amount of term and money to give him? If he were traded, what would be an acceptable return? Decisions about whether Colin White should be bought out or not during the two-week window after the Cup is awarded were and will continue to be bandied about by media and fans alike.

At the root of everything that is being discussed, more so even than performance, is the CAP. Based on the Ottawa Senators website, cap compliance falls under the umbrella of the Director of Hockey Operations, Tim Pattyson. With the Senators projected to come nearly $11 million under the cap, you could argue that not a lot of "Caprobatics" are required to make things work.

However, if an organizational philosophy on how to allocate cap money isn’t already in place, you can bet it will take Olympic caliber Caprobatics to keep them cap compliant in the unparalleled spending years.

I have noted a tendency, in the NHL, for organizations to be reactive rather than proactive in their decision making. Obviously, I don’t have access to the inner sanctum. I also understand that not all decisions can be foreseen. However, in a league where everyone, save for the owners, are on contracts with expiry dates, it’s fair to say that most of the personnel decisions can be anticipated to one extent or another. Everything to do with contracts is on file with the league. If you don’t believe me, ask the Vegas Golden Knights (ZING!).

Whether or not a decision is foreseen or unforeseen, a strategy in place makes those decisions, especially the unforeseen ones, a lot easier to make. It also helps take the emotion out of decision making which can easily get a GM fired.

For instance, teams plan for the next wave of prospects in their organizations, but few recruit the next head coach until the current one gets fired. CBA agreements are set to expire with plenty of notice and one would swear the real negotiating doesn’t start until the expiry date is within sight. Point being the lack of contingency plans creates a very reactionary approach to decision making.

Before I get too far into this, no cap management strategy should include putting a player on LTIR with no intention of taking them off when they are healthy enough to return. If Pierre Dorion ever avails himself of that option, I won’t criticize him for it. It just shouldn’t be a part of the strategy. LTIR was created so that unforeseen injuries wouldn’t necessarily derail a season for a team that was already up against the cap. It wasn’t intended to hide malingering players as a part of Caprobatics. For the purposes of this discussion, I will assume that the league is going to review that policy and start policing the use of LTIR.

Teams that spend to the cap should have a seven-player profile in play. Show me a cap team that doesn’t, and I will show you a soon to be unemployed general manager. Let’s assume starting next season, based on Pierre Dorion’s presser, that the Sens will spend to the cap or close to it. I will hold him to “Don’t judge us by the roster we have today but rather the roster we have for opening night next season.”

As a quick reminder, here is the standard seven-player profile, the places that are already spoken for, and their cap hit.

1) #1 All-Star Center - Josh Norris - $925K – RFA - 2021/22

2) #2 All-Star Center - Tim Stutzle - $925K – RFA - 2022/23

3) Top Power Forward – Brady Tkachuk - $8.33M – UFA - 2027/28

4) Specialist/Utility/Agitator/Shut down center – TBD

5) All-Star D-Man – Thomas Chabot - $8M – UFA – 2027/28

6) All-Star D-Man – TBD

7) All-Star Goalie – TBD

It’s easy to see based on this why the Senators are looking at their fifth straight finish in the lottery.

In a previous article, I suggested that Shane Pinto would have been an all-star center in slot #2. However, with him having lost the season and Tim Stutzle being groomed as a center (for the moment), I will reserve judgment on him. He may yet be the #2 center I predicted him to be before. He may also become the two-way shutdown center in #4. This is an important decision to make as you will see later in this piece.

Jake Sanderson only just arrived and can’t play right now. He may be that second All-Star Defenseman, but I won’t put that kind of pressure on him just yet.

Finally, our goaltending is still in flux, and I am not putting Anton Forsberg there based on a small sample size. For all we know, Matt Murray will recover from his problems and be what we all hoped he would be for the next two seasons. He may also be Pierre Dorion’s LTIR maneuver.

Since the cap is always in flux based on total hockey revenue, what I am looking for is a percentage formula to allocate team spending. I would suggest that a team’s seven player profile should get 50% of the salary based on being a cap team.

Let’s apply that model to the Senators and try to predict future spending.

Based on spots already awarded within the profile, the Senators currently spend $18.18 million on Brady Tkachuk, Thomas Chabot, Josh Norris and Tim Stutzle. We know that Norris is up for RFA extension this summer and Stutzle the summer after.

With a flat cap of $81.5 million for next season, the Senators are already spending 22.3% of the cap on players in the profile. It sounds like a lot of room to spend, doesn’t it? However, let’s imagine that based on his season this year, that Josh Norris gets a seven-year extension. Ideally, he would extend for eight. However, Brady Tkachuk seems to have set the template. It would seem to me that Norris’ camp would want something in the AAV range of Tkachuk. For argument’s sake, let’s say he gets $8 million AAV for seven years.

Now the Senators are up to 32% of the cap assigned to four of the seven players in that profile. Tim Stutzle will be looking for his extension the year after and if he isn’t one of the All-Star Center positions in the profile then is he in the profile at all? That decision will be critical in terms of allocating money. If Shane Pinto is a better center than Stutzle when Jimmy Stu comes up for extension, it could create an awkward negotiation. I don’t think we will be slotting Stutzle in the utility forward/shut down center role.

We also don’t want to become the Toronto Maple Leafs now do we? I don’t know about you, but I am happy to learn from Kyle Dubas’ mistakes all day long. Harry Potter has committed 59% of his cap next season to Auston Matthews, John Tavares, Mitch Marner, Michael Nylander and Morgan Reilly. None of those players fits the description of a utility forward/specialist or shutdown center. They are also missing a second all-star defenseman and an all-star goalie from their seven-player profile. They have found themselves robbing Peter to pay Paul and they have left the jugular completely exposed because of poor money allocation. Can you imagine them beating either the Panthers or Lightning in round 1? They had better get to first in the division so they can get an easy out like Washington or Boston. 😊

Using the 50% allocation of cap for the seven-player profile does allow that a team can pay someone well when they are not in the profile. The profile doesn’t mean that the highest paid players are all within that group. Usually, however, the players in that group are on long-term deals and are part of the core or nucleus of your championship team.

You will notice we haven’t mentioned Drake Batherson yet. He doesn’t seem to fit in the seven-player profile though, we would all agree, he is a key piece going forward. Pierre Dorion takes it on the chin for the Colin White contract. Batherson is a younger and more talented version of William Nylander, and he is signed for 5 years beyond this year at $2 million less per year. Those kinds of contracts are made possible if the seven-player profile is built and paid accordingly. John Tavares has an annual cap hit of $11 million per season. That’s big-time scratch for a point per game player even if he is your captain.

Even if Tim Stutzle turns out to be a legit #1 or #2 center in the league, he won’t get that kind of money and nor should he. If the Sens sink too much into too few, like the Leafs or the Oilers, then they will ultimately have to take a potential championship roster into the playoffs with a goaltending duo like Jack Campbell & Peter Mrazek or Mike Smith & Mikko Koskinen.

I hate to say this, but it may be a blessing that the Senators don’t have a player like Connor McDavid or Auston Matthews. Are they worth their max contracts? You would have to say yes. However, when you pay players north of $11-12 million per season, in a cap world, something has got to give. The Leafs had to let go of Freddie Andersen and, if he were there instead of in Carolina, the Leafs fortunes would look significantly different going into the playoffs.

So, what kind of decisions should the Senators anticipate having to make?

Well, let’s look at one they just made. For better or for worse, the Senators were right to let Nick Paul go. Yes, they spent a lot of time developing him and he was effective. However, the contract he is going to get could not be justified and he will never live up to it. Mathieu Joseph at half the money makes far more sense.

For Colin White, the Senators need to learn from his contract. He got a contract to suggest that he was part of a seven-player profile when he really hadn’t proven himself. Sometimes, it’s okay for the team to go the bridge contract route and assess their talent more. It might mean paying more further down the line but you avoid situations like these. Now that he is coming up to the age of 26 and he has three years remaining on his deal after this year, the team needs to decide whether to buy him out and avail themselves of the 1/3 remaining rule given his age. Even budget teams have to do a little Caprobatics. With $14.25 million in cap money remaining on the deal, 1/3 of the remainder is $4.7 million versus buying him out the following year at 2/3 of the remaining value at the time which would be $6.37 million.

I agree he has been underwhelming and injury prone. That said, the only reason to buy him out is if you need that money to bring someone else in who is going to be better. Everyone wants to pull the buyout trigger because of the money involved. Sometimes the devil you know beats the devil you don’t. I say let it ride and put him in a position to succeed and see what happens. Save the caprobatics for when the team is a legit contender.

The Senators need to learn from the White contract when allocating funds to Alex Formenton. I love what I see from him and his first full season in the league has been a success in my opinion. It is, however, one season. I think his agent should gamble on him with a short-term deal. I think a longer contract is not a huge risk, but I certainly wouldn’t offer him Colin White’s deal. That kind of money is for proven players over multiple seasons.

This leads to my next point and that is how to spend money on UFAs in the cap era. John Tavares’ management team invited teams to come to a hotel in Los Angeles when he was a UFA and court him like it was an episode of The Bachelor. Given the contract he got, you would have to say it worked beautifully….for him. However, this and other contracts garnered in free agency should serve as a cautionary tale for teams like the Senators. Your seven-player profile should not be built out of free agency. They should also avoid bidding wars for complimentary players. The pieces of the profile should come through drafting, trades and development. Filip Forsberg is going to be a prize free agent this summer and I think the Senators should kick the tires and see what is going to take to get a player like that. I think they should also have a philosophy about cap allocation for players and not overpay them.

Chris Tierney and Tyler Ennis come off the books this summer which frees up $4.4 million and Bobby Ryan’s cap hit goes down by $1.75 million next season as well so Pierre Dorion will have some money to spend. Hopefully, he has a strategy in place to spend it wisely.

In the Caprobatics world…..less is more.

By Pat Maguire | Sens Nation Hockey