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Despite high cap number, Rangers are not going over the ceiling

August 5, 2013, by
Don't worry, there's enough room to sign him (Photo credit: Christopher Pasatieri).

Don’t worry, there’s enough room to sign him (Photo credit: Christopher Pasatieri).

When the Rangers re-signed Mats Zuccarello the other day, the attention rightfully shifted to Derek Stepan. Many went to Capgeek and saw that the Rangers had a shade over $2 million of cap space, and began to instantly panic. After all, if Stepan’s market value is the $3.75 million that Claude Giroux received in his bridge deal (that value will be used as Stepan’s cap hit for the sake of this post), then the Rangers don’t have enough room. However, the data on Capgeek is a tad misleading.

Capgeek currently lists everyone signed to a one-way deal. Per the summer cap rules, any player that does not have a separate –and lower– AHL salary, thus the definition of a two-way deal, must count against the summer salary cap. This is why players like Aaron Johnson are currently listed on the roster. There are some nuances that I don’t quite understand — For example, why Chris Kreider counts, but JT Miller doesn’t. I seriously don’t understand that, so any answer would be helpful– but this is also the reason why each team can spend 10% over the cap ceiling each summer. For the Rangers, this means they can spend $70 million this summer, giving them ample space to sign Stepan.

Teams need to be under the $64.3 million cap ceiling come the start of the season. At that point, the Rangers will be down to 13 forwards and 7 defensemen, as opposed to the 15 forwards and 8 defensemen currently listed. Johnson will be sent to the AHL, clearing $600k from the cap. With Stepan’s $3.75m added and Johnson’s $600k removed, the Rangers have 14 forwards and 7 defensemen, and stand $1 million over the cap.

Darroll Powe is likely to be demoted as well, but since his one-way contract has a salary over $925k, the remainder ($141,666) counts against the cap. That leaves the Rangers a shade over $44k over the salary cap. Since Arron Asham was waived earlier in the offseason, it’s likely that he will be demoted as well, clearing another $925k from the cap (his contract follows the same rules as Powe’s, so $75k will count against the cap). Now the Rangers sit with $880k in cap space. However, this does not take into account the injuries to Ryan Callahan and Carl Hagelin.

This is where things get a bit tricky. LTIR rules state that a player must be on LTIR for ten games and three weeks to qualify for LTIR cap savings. If neither player is ready to go for the start of the season, then the Rangers will need two extra forwards at the start of the season. For simplicity purposes, let’s use Asham and Powe as the replacements, and round down Powe’s salary to $1 million ($66k less).

Since cap space is calculated on a daily basis, the cap savings would be equal to the percentage of days on LTIR. For example, if they are on LTIR for exactly 41 games, then the Rangers have an LTIR savings of 50% of their salaries. The ten-game qualifier takes the Rangers through their nine-game road trip and the home opener, then the club would save roughly 12% of their salary from the cap (if they come back after that tenth game). If both can’t go for the home opener, then the Rangers save 12% of their salaries, which is $270k for Hagelin and $513k for Callahan. Total savings of $783k.

Asham and Powe would only account for 12% of their $1 million salaries each, which is $120k each ($240k total). Since Asham and Powe, at the ten game mark, would only account for $240k in cap space, then only one of Hagelin/Callahan would have to be placed on LTIR, since the savings for one is greater than the cost for the soon-to-be-waived duo. The math is a bit of a pain to do, but the Rangers are going to be ok heading into the season.

Categories : Business of Hockey


  1. Jakki says:

    You could also use guys like Micheal Haley on the 4th line, which has a lower salary(600ish) then Powe/Asham.

  2. Walt says:

    You need to be a CPA to understand this stuff!!!

    The team will be where they should be, and Step will be signed, that my friends is all that matters.

  3. RangerSmurf says:

    Much more likely than Asham/Powe being called up is using guys on their ELCs. Because of the nature of the ELCs, those cap hits appear larger because of the A/B bonuses built into the deals.

    When you use capgeek’s cap calculator, you can see that when players like Miller and Kristo are recalled, only their base salary counts against the cap.

    So Kristo and Miller, who appear to have $1.3m hits, have just ~$875k salaries. Lindberg’s base is only $675k, so he’s a guy that would give them some benefit if he proves ready quickly.

    Cheaper guys like Haley and the recently reacquired Mashinter, who are around $600k, are also more likely than the two vets on waivers.

    • Dave says:

      For call ups, that’s true. Since this is the beginning of the season, it wouldn’t surprise me to see the Powe/Asham duo since they won’t be on waivers initially.

      • RangerSmurf says:

        I’ve lost track of what day they were waived, but it would surprise me if either started with the big club.

        The bigger point though is strong, the cap problem people are talking about doesn’t exist. It’s definitely tight, but unless Step wants a McDonagh deal (which he’s not getting given organization RFA policy with forwards), there’s no issue.

        • Dave says:

          I have Step at a 3 year bridge deal similar to what Giroux got (3/$3.75m per). That’s market value.

  4. Hockey talk says:

    Stepan will sign delzotto will be traded I don’t see no bridge either I see them signing him to a contrct. Similar to mcdonagh

  5. Frank Cerbone says:

    Dorsett looks like a goner @ $1.5 mil. He’s nowhere near as good a fighter as Mashinter or Haley and makes 2X as much. For the time on ice
    Dorsett will get, he will make too much.

    Dorsett only makes the team if McIlrath doesn’t.
    Dorsett is a “knife” and you don’t bring a knife to a gun fight.

    Mashinter and & Haley together cost as much as Dorsett and are better fighters and don’t take stupid penalties.