RFA's Could Be Ruining the NHL, Here's a Way to Fix It

Recently, James van Riemsdyk of the Philadelphia Flyers signed a 6-year contract extension worth an average of $4.25M.The huge problem with this extension is that it completely defeats the purpose of Restricted Free Agency. In 2004 the NHL had a lockout because of skyrocketing costs of player salaries. A 24% rollback in the new Collective Bargaining Agreement seemed to remedy this issue, along with caps on individual contracts and finally, new rules for UFA and RFA status.

First, this contract needs to be analyzed and picked apart to show why it's a problem. To do so, a "debate" will be held to show why JvR never deserved it. This "debate" will be shown by lists offering pros/cons of what each side could want a negotiation.

 
JvR's interests:
  1. Getting paid big dollars: This is obvious. Playing hockey is in fact, JvR's job. People like to get paid for their work. They like top dollar. No reason to think JvR doesn't have normal human interests or instincts.
  2. Maybe Winning a Cup: No real way to prove this. Comments of his can be analyzed and broken apart but at the end of the day, only JvR himself knows where winning is really ranked.
  3. Living Somewhere: Another easy to measure factor. There some places that some people may not want to live, like Edmonton because of the cold, Phoenix, Columbus, or Long Island because of uncertain futures, or New York because of the cost of living, or Colorado because maybe Mile High Air doesn't agree with some players. (Quick aside, the NYC Cost of living is so high, that it factors into why Glen Sather must overpay for UFA's the best example of this the "Yankees Premium" in baseball, when the NY Yankees sign Free Agents, they overpay to make sure that after Cost of Living is factored in, the player STILL makes more money than they would in another city.)
  4. Security: Long term contract with no movement clauses.
 
Flyers Interests:
  1. Keeping under the cap/costs down: In short, staying within the lines of the CBA rules on the salary cap.
  2. Winning: Losing means attendance falters, this means less profits. Or, more positively, winning is fun.
  3. Roster Flexibility: Tying up too many players with long term contracts usually handicaps a team's ability to make moves and there won't always be teams ready/willing/able to pull off the Carter/Richards deals of June, 2011.
 
Now, each side obviously wants their interests to be met. For instance, from a team's perspective, it's best to sign 23 cost efficient players with mostly short-term contracts and no NTC/NMCs on the books, while staying close to the salary floor. For a player, a 15 year cap crippling deal with a full NMC is ideal. 
 
To meet these interests, negotiations have to happen, and we have to look at some of the facts for JvR:
 
JvR: 2 full seasons in league. RFA at end of 2012 season. Cap hit of $1.654M (bonuses included), base salary of $875K. Ending Entry Level deal. One time 20 goal scorer, one time 20 assist player, 1 time 40 point player. He had 1 good playoff run in 2011, a run that lasted all of 11 games and is therefore, a poor sample size to judge anything off.
 
The purpose of RFA is to allow teams to keep and develop their own players cheaply by granting the team the right to refuse deals with other teams. This is known as matching the offer sheet. Because RFA's have no power to sign with another team without consent, it limits their bargaining power with their current team. To illustrate, I'll draw up this fictional example between RFA Mr X and his Team Z. X is not eligible for arbitration and he hates his current team. Working in the RFA's favor, a Qualifying Offer will usually grant a pay increase.
 
Mr X: I want to get paid more money. 
Team Z GM: How much?
Mr X: I performed well! So 3 years at $4.5M per season
Team Z GM: No. How about 2 years at $1.5M per season
Mr. X: Well, I performed at a high clip. Look at my goals, assists, CORSI rel QoC and Zone Starts.
Team Z GM: 2 years $1.5M per season, 3 years at $2M per season or get an offer sheet.
Mr X: Fine I will.
Team Z GM: If you get the offer sheet, we're gonna match it. And no one will pay an amount so great that we can't afford the cap hit.
Mr X: Ok, new solution, I'm signing the 1 year QO and next year I will take you to arbitration.
Team Z GM: 1 year at $~900K is perfectly acceptable. See you at arbitration next year.
 
It's really not hard, players in JvR's situation don't deserve money because quite honestly, they have NOTHING to negotiate against. Offer sheets are so rare that they aren't a real threat, so no GM should ever give in to a non-arbitration eligible player that hasn't done anything special. Forty points is EASILY replaceable in the NHL. If JvR wasn't willing to take it, the Flyers could have just sat on their hands (like Los Angeles with Doughty, Winnipeg with Bogosian and Toronto with Luke Schenn) until next season. JvR was under contract and locked down. If he earned it, there's already a perfect example on the team of what to do. Claude Giroux's 3 year extension was perfect. He's still an RFA at the end and he's paid reasonably cheaply. Do that with JvR, give him 2-3 years at 2.5-3.3M (Giroux plays Center, a more difficult position and Giroux PK's and is more well rounded than JvR, so JvR deserves less cash). Have another RFA deal after that to pay him and lock him up. 
 
Now in a perfect world, these deals wouldn't cripple the NHL because they would be so few and far between that costs wouldn't be driven up. The problem is, these deals force teams like Florida to overpay average players to fill out a roster which in turn drives up the costs of all players. Teams like the Flyers with Ian Laperriere or Boston with Marc Savard use LTIR to toss out an extra contract with means higher costs. This leads to higher ticket prices which leads to less attendance which leads to less revenue which leads to 2004 all over again. 
 
In short, the NHL's salary cap may not be enough to keep costs down. The Salary floor is needed because a 23 man minimum team would most likely be so bad that no one would watch them. Luckily there is a solution that can be added into the next CBA. Since Offer Sheets are rarely used, they aren't a viable threat to the system. So something else needs to be done.
 
Put in an RFA Cap and make it clear waivers. Here's how it would work.
 
When a player hits RFA after their ELC the chart is put out for compensation. Added to this, under this new RFA system would be a cap hit/contract value/year value chart of "max" contracts an RFA cIould sign. it would look like this:
 
Player with 1 RFA year left: no limits other than standard contract limits.
Player with 2 RFA years left: no year limit, cap hit limit at 10% of Max Team Salary Cap ($6.43M).
Player with 3 RFA years left: 5 year limit, cap hit value at 10% of Max Team Salary Cap ($6.43M).
Player with 4 RFA years left: 3 year limit, cap hit value at 7.5% of Max Team Salary Cap ($4.82M).
 
The "penalty" for exceeding either cap is simple. If a team offers a deal that exceeds EITHER year limit OR Dollar limit by less than double the value, the RFA player must clear waivers. if a team offers a deal that Exceeds BOTH the dollar limit AND year limit OR either the year limit OR Dollar by 200% the player must clear re-entry waivers and can be lost at half price. If a team attempts to increase by MORE than 200% of both categories, the deal would be flat out rejected by the league.
 
Note: OFFER SHEETS WOULD NOT BE PENALIZED. If a team used an offer sheet, the current system of matching or compensation would be applied. Basically if a player really did earn the ability to be paid better than the system, an offer sheet would hopefully be used.
 
For instance, if JvR signed his 6 year deal under this system, he would have to clear waivers in order to stay a Flyer. Steven Stamkos on the other hand, would have to clear recall waivers. Doughty's 9 year 61M proposed deal would also clear recall waivers. The hope being, that if a team had to force a signing through waivers, much like European players returning to the NHL from time in other leagues, the threat of losing the player or losing the player and paying half their salary would be enough to convince teams to contracts reasonable and keep the league running as a whole at maximum profits so the cap would be high enough to make the contract value not hurt the RFA in turn.
 
Long story short, if the NHL wants to keep costs down, RFA's can be prevented from being paid by implementing some sort of RFA cap. This would lead to lower league wide costs which would make the game better for fans.