Compliance buyouts mean goodbye to Lundqvist and Staal

 The loss of revenue from the Covid-19 suspension will impact the salary cap next season and that may mean compliance buyouts.  How would that affect the New York Rangers?

With the 2019-20 season on the brink of cancellation, the NHL is already considering the financial implications. No playoffs means millions of dollars lost in ticket revenue, concession sales and television ad sales income. There’s no way to look at it except as a disaster.

One sure impact will be on the salary cap.  Once estimated to grow to as much as $88 million, now the best estimates are that it will remain at the $81.5 million it was for the current season. All teams budget for an annual increase and if there is none next season, there will be teams that won’t be able to afford all of their players.  So, the belief is that the league is considering as many as two compliance buyouts per team.

If that is the case, say goodbye to Henrik Lundqvist and probably Marc Staal.

What is a compliance buyout?

Compliance buyouts, also known as amnesty buyouts, allow a team to buy out the contract of a player at two-thirds the amount due over twice the remaining length of the contract and the cost doesn’t count against the salary cap.

Compliance buyouts were used once before, after the 2012-13 lockout.  It was the only time the salary cap has actually gone down, that time by almost $6 million.  There were some restrictions on who could be bought out and the time frame that buyouts were permitted, but it allowed teams to eliminate some big contracts and get cap compliant.

In 2012-13 the Rangers used an amnesty buyout to get ride of Wade Redden who had signed a six-year $39 million contract in 2008.  It eliminated a $6.5 million cap hit for the 2013-14 season.

They waited a year before using the second amnesty buyout on Brad Richards.  He had signed a nine-year, $60 million contract as the marquee free agent in 2011.   Although he was an important member of the team that made it to the Stanley Cup Finals in 2014, at age 35 with  five years left on his deal with an annual cap hit of almost $6.7 million, the buyout was a no-brainer.

The irony is that Richards then signed with the Chicago Blackhawks the following season and won the Stanley Cup as a bottom six forward.

So, who do the Rangers buy out?