The NHL and NHLPA announced the salary cap for the 2016-17 season earlier today. The upper limit of the cap will be set at $73 million, up $1.6 million from last year. The lower limit of the cap will be set at $54 million. This is up from $52.8 million in 2014-15. The mid-point is at $63.5 million.
2016-17 NHL Salary Cap Set
In order to increase the cap, the players used the 5% escalator clause from the NHL/NHLPA CBA. This clause allows the cap to be 5% higher than what it would be set at using 2015-16 revenues. Without the escalator, we would have seen a small decrease in the cap.
The players association had to choose between a decreasing cap; and a very tough off-season for a small percentage of their members (those who are UFAs and RFAs this summer); or spreading out the pain to all members. As a result all players could see higher escrow payments next year. These payments will be due if Hockey Related Revenues do not increase by at least 5% next season. As a result of their decision, there will be a little more money taken off NHL paychecks next season.
A weaker Canadian dollar is being cited as the main reason for the limited cap growth. While only seven of the NHL’s 30 teams are located in Canada, it is estimated that upwards of 30% of NHL revenues are generated by those seven teams.
This Week’s Events
The NHL made the announcement ahead of their annual awards. The NHL awards show goes down tomorrow in Las Vegas. Also expected tomorrow is the NHL’s official announcement that the league will be expanding to Las Vegas for the 2017-18 season.
The NHL Entry Draft goes from Buffalo on Friday. The Toronto Maple Leafs hold the first pick.
The NHL’s Free Agency Period opens on July 1st at 12:00 pm. All eyes will be on Steven Stamkos, as the Tampa Bay Lightning centre is the biggest name to hit unrestricted free agency in several years.
PHILADELPHIA, PA – JUNE 27: NHL Commissioner Gary Bettman speaks during the first round of the 2014 NHL Draft at the Wells Fargo Center on June 27, 2014 in Philadelphia, Pennsylvania. (Photo by Mitchell Leff/Getty Images)