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IN DEPTH: Numbers Game

by Chris Wescott / Edmonton Oilers

There is truly a remarkable amount of work put in behind the scenes of a professional sports team.

One of the most important, and rather time-consuming, responsibilities kept behind closed doors is left to those better suited to keeping track of numbers.
 
The salary cap and roster transactions are more than just paper pushing. Those are around-the-clock burdens shared by Oilers President of Hockey Operations and General Manager Peter Chiarelli and Assistant GM Bill Scott. The two work closely together to ensure the club has ample cap space and resources to achieve their desired success.

Oilers GM Peter Chiarelli sits at the team's 2015 draft table. Photo by Getty Images.

“It’s been a great relationship," said Scott. "I didn’t know Peter very well when he came in but he’s been great right from day one. Peter is very focused on the task at hand and making the Oilers better, and he relies on me for a lot of support in different details of the job, especially when it comes to salary cap, cap projections and roster issues.
 
“I feel like my role is to serve the GM and his needs and be kind of his right-hand man with whatever he needs on a daily basis. He’ll throw projects at me and we have weekly meetings on top of just the daily things that we’ll talk about. He’s a great leader in that respect and we’ve got a great working relationship. My role is to basically be a support to him in whatever capacity he needs.”
 
When it comes to the salary cap, it truly is a daily chore. That is more so for the teams pressed up against the cap. For those who have lots of room, the worry is considerably less.
 
“They don’t have to monitor it too much because normal transactions of players going up and down from the minors don’t have major implications on their cap for that year,” said Scott.
 
The Oilers are in a unique position with a lot of young players on entry-level contracts and several who have performance-based incentives and bonuses. This requires a little more daily maintenance and monitoring. The NHL announced a salary cap of $71.4 million for the 2015-16 season. But there is a cushion for players with performance bonuses built into their contracts. That cushion equates to an additional $5+ million.
 

You also have to factor in long-term IR. The Oilers have place two players on LTIR this season: Jordan Eberle and Andrew Ference. Those moves also save the team some room. Even with some cushion, the Oilers need to stay under that $71.4-million threshold, not knowing which bonuses will be earned or what contracts may be moved in or out.
 
“We’re always monitoring where we stand because no team wants to be in an overage situation at the end of the year and essentially have dead space on your cap the next year,” said Scott. “Teams have had dead space on their cap.”
 
It’s a daily responsibility and Scott takes on a lot of it.
 
“It’s something you want to monitor throughout the year; you want to know where you are, basically every day,” said Scott. “If you can accumulate space day by day, being under that cap number, then that money accumulates and you don’t need to use it down the road. It’s part of the reason sometimes you see a team go to a 22-man roster, to not have that extra $750,000 or million dollars on your cap. Every day counts in this business for salary cap purposes.”
 
There are certain tools at a team’s disposal when it comes to staying under the cap. The aforementioned 22-man roster is one. There are also trades, assignments and recalls. There are constant tweaks. Ever wonder why a player may get recalled and immediately assigned back to the American Hockey League without playing a game or skating with the club? It could be a tool used by the NHL club to pull the team closer to the cap in order to get the most relief out of something like LTIR.
 
Teams may not need or use the extra space they can accumulate, but that’s better than the alternative.
 
“You can try to save a lot of cap space and it may be for no purpose in the end other than cash savings, but if all your players hit all their bonuses, you really want to minimize any potential overages if any,” Scott explained.
 

Bill Scott watches an American Hockey League game when he was GM of the Oklahoma City Barons. Photo by Steven Christy.

A day in the life of Scott generally consists of a lot of office hours and a lot of time spent on the phone as the team deals with salary-cap issues, player transactions or items pertaining to the CBA.
 
“Every day is a little bit different, but there’s a big pile of things to do on our plate, so we just get through them and try to check one off at a time,” said Scott.
 
One of those things that comes up is contract negotiations. While Scott does some of that, Chiarelli is the lead.
 
“Peter has a pretty good idea, because he’s done this for a long time, of what a player is going to get on the open market or should get as a restricted free agent in salary arbitration,” said Scott.
 
Chiarelli will sometimes task Scott with digging into the numbers and finding comparable situations to the player they’re signing to a contract or extension. Once they find a certain number of comparable players and look at their salaries and when they signed, the front office gets a rough idea of what the agent and player are expecting.
 
Once again, the cap has to be taken into consideration when deals are being negotiated. If a player, let’s say, is expected to demand $6 million per year and the team negotiating knows they are strapped against the cap heading into the next season, then “you know what you’re going to have to do.”

The negotiating team will have to determine what contracts to move out in order to make space. The Oilers also have to keep in mind their own contracts and players and the numbers they will demand in the future. Future cap implications are just as important as monitoring the current cap status.

If the team wants to acquire a player with three years left on his deal, what does that look like for their salary cap? What will it look like when Connor McDavid or Leon Draisaitl, both young players on their ELC, need a new deal? Projecting internal salary numbers is part of trades and roster decisions.
 
“How is that all going to fit in to your overall team structure in those coming years? It’s basically being nimble, being flexible and really digging into the numbers and players are the big things,” said Scott.
 
As the season moves closer to the trade deadline on February 29, cap conversations heat up around the league.
 
“As you get closer to the deadline, teams that are going to need to move out money need to figure out what dollars make sense,” said Scott.
 
If teams are in an overage situation, they will need to move out a big contract or a couple to get under and give themselves enough cushion to account for player bonuses and incentives, as well as potential incoming contracts.
 
“You have replacement players come in and play in those spots,” said Scott. “There’s a lot of manoeuvring with the deals and often times you’re not trading a player for draft picks or a prospect, you’re getting an immediate player back as they may want you to take some salary off their books to make the deal work. There’s all these different scenarios you work with every day and a scenario could change by the day or by the hour.”
 
There are a lot of behind-the-scenes actions that happen before putting an NHL team on the ice. Teams around the entire league are constantly projecting, monitoring and tweaking the salary cap to their advantage. Constant vigilance and awareness allow the Oilers to manoeuvre through this tireless task.

By Chris Wescott/edmontonoilers.com

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