The Toronto Maple Leafs wasted no time getting their guy, inking right winger David Clarkson to a seven-year, $36.75 million contract on Friday as free agency officially began. Right wing wasn't necessarily a top need for the Buds, but there's no denying Clarkson embodies the type of player head coach Randy Carlyle likes having on his roster, as Clarkson possesses a rare blend of truculence and high hockey IQ.
Nevertheless, the substantial commitment made by the organization to a player who has never cracked the 50-point plateau received mixed reviews by fans and members of the media alike. While Clarkson's value can't simply be measured by offense, there's no question the Leafs overpaid for the 29-year-old.
The argument that the Devils' defense-first system has had a negative impact on Clarkson's offensive numbers may be valid, but compared to players signed to contracts of similar average annual value (AAV), Clarkson falls short on multiple fronts. Factor in the Leafs' decision to lock him up for seven years (the contract expires three months after Clarkson's 36th birthday), and it makes the deal look even worse.
That is, until you consider comments made by Leafs general manager Dave Nonis during a media scrum Friday evening, when he subtly revealed the team's strategy with regard to free agency under the new collective bargaining agreement (CBA):
If we wanted to get in on a player like David Clarkson, that was the price-tag for us to pay. ... I'm not worried about [years] six and seven right now. I'm worried about [year] one and year one I know we're going to have a very good player. ... We have some money coming off the books next year, both in expiring contracts and in some buy out money that'll be gone. We're all hopeful that revenues continue to grow and the cap goes up.
The strategy? Pay a player what he's worth to you today, not what he'll be worth to you in the future.
Nonis' "hope" of the salary cap increasing in the future is more of a safe assumption. Under the new CBA, according to James Mirtle from The Globe and Mail, the salary cap will steadily increase after the 2014-15 season and could approach the $80 million mark before the end of Clarkson's deal.
Mirtle assumes in his calculations that league revenues will grow annually at a modest rate of 5 percent. As he notes, his estimate is a safe one, considering revenues grew an average of more than 7 percent annually under the last CBA, peaking over the past two seasons to close to 10 percent annually. Under these assumptions, it's safe to say that just four years into Clarkson's deal, the cap will have increased more than the AAV of his contract.
Moreover, under the new CBA, teams with deep pockets—like the Leafs—can afford to flex their financial muscle thanks to the annual buyout period each June.
For argument's sake, let's assume Clarkson is a complete bust and the Leafs opt to buy him out in June 2015 after just two seasons. Because he's over the age of 26, the Leafs would be on the hook for two-thirds of the remaining $27.5 million left on his contract spread over 10 years. According to capgeek.com, the cap implications would be as follows:
Clarkson's buyout after two seasons would initially cost the Leafs slightly less than $1.6 million in cap space. In 2014-15, Mirtle estimates that the Leafs—along with the other 29 teams—will be forced to operate under a salary cap of approximately $62.7 million with the cap increasing by approximately $3 million each year beginning in 2015-16.
The increase in the salary cap alone would more than cover the dead cap space caused by Clarkson's buyout, while barely making a dent in Maple Leafs Sports and Entertainment's substantial bottom line.
When you're the Toronto Maple Leafs, it's just the cost of doing business.
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