2010 salary cap might not be falling
The impact of the global recession upon the North American economy led to expectations it would have an adverse impact upon the National Hockey League's salary cap.
Consensus amongst league officials, pundits and fans was the recession would bite deeply into the league's revenues and, since the salary cap was tied to those revenues, could result in a significant decline of the cap ceiling.
The impact was apparent upon the 2009-10 salary cap which the league announced would be $56.8 million, a miniscule rise over last season's ceiling of $56.7 million and a far cry from the average increases of $6 million per season since 2006.
Some fans expressed surprise over the cap essentially remaining the same but there were two reasons for this. One was much of the league's revenues were collected before the recession struck last fall thanks to season ticket sales, which are the lifeblood of a gate-driven league like the NHL.
While league revenue declined by five percent, the fact most of the revenue was collected prior to the recession ensured the decline wasn't much worse.
Another was the NHL Players Association voted to trigger a five-percent salary escalator, pushing the cap to its current level.
The real concern, however, was revenue collected this summer and into next season, leading to anticipation the league would truly feel the recession's impact next season, especially in NHL cities hit hard by economic hard times or where NHL franchises were struggling before the recession.
It's been suggested the cap for the 2010-11 season could decline to between $50-$52 million, significantly squeezing teams with more than $40 million already committed to their '10-'11 payrolls.
Currently 13 teams, almost half the league, are in that category. If the cap were to decline substantially those clubs could be forced to dump salaries thus potentially tearing apart successful or rebuilding rosters.
Some teams could be hurt more that others under that scenario.