The New York Rangers Struggles with the Salary Cap

After going through a four-year rebuild where the organization traded away aging, expensive stars for younger, cheaper talent, the New York Rangers are one of the youngest and brightest teams in the NHL. Despite having just entered the window of competing for the Stanley Cup, the Rangers already find themselves in salary cap hell, not because they gave out bad contracts to their new stars, but because they got unlucky with the timing of their rebuild.

The Rangers’ rebuild began before Covid-19 changed the landscape of the NHL and did not finish until after the salary cap was significantly altered for the immediate future.

The Rangers are currently experiencing the aftermath of the 2020 CBA extension, where the NHL and the NHLPA agreed to extend the Collective Bargaining Agreement through 2025-26. This extension meant the salary cap remained stagnant for two years, following average yearly growth of 3.48% over the previous six years. In the 2020-21 and 2021-22 seasons the upper limit of the salary cap in the NHL was set at $81.5 million the same as the 2019-20 season.

This spelled trouble for teams who spent big in the summer before the 2019-2020 season or gave players long-term, high AAV extensions during the 2019 season.

NHL contracts are all about predicting a player’s future value compared to future salary cap growth. Say I am a team looking to sign a player to a long-term contract. The player’s AAV can be higher than his market value when the contract is first signed, but over time, if the player continues to get better and be an asset to the team, the contract will give some salary cap flexibility as the total salary cap increases.

Take Vincent Trocheck, for example. Formerly of the Carolina Hurricanes, Trocheck signed with the Rangers earlier this offseason to a seven-year contract with an AAV of $5.625 million. Right now that is consistent with the other team’s second-line centers, like former Rangers Ryan Strome, who signed a five-year $25 million contract with the Anaheim Ducks this offseason, and Andrew Copp, who signed a five-year contract (with the same $5.625 million AAV as Trocheck) with his hometown team, the Detroit Redwings.

Given Trochek’s career thus far, there is a strong possibility that, barring injury, he will be a solid center option for the Rangers in four years or five years. At this time, the salary cap will likely grow to a point where this $5.625 million AAV is more in the ballpark of third-line center money, not second-line center money.

What would contract offers look like for Lafrenière, Miller, and Chytil?

Lafrenière will almost definitely command the highest AAV from the Rangers, due to the contracts that the #1 overall picks in 2018 and 2019, Nico Hischier and Jack Hughes, signed with the Devils. When he commands this AAV it is the question. Lafrenière can sign a bridge contract like the one the Rangers just signed with Kappo Kakko this offseason in the one to two-year range worth probably around $5 million.

A bridge contract would push this inevitable offer he will receive a little longer to have more current salary cap flexibility. I eventually see Lafrenière getting around a $7 million AAV due to how he compares to Hishchier and Hughes.

Hischier signed a seven-year $7.25 million AAV contract in 2019 and Hughes signed an eight-year $8 million AAV contract in 2021. That is more than Lafrenière is going to make because they have not produced on the same level in the NHL yet. Is that really the case though?

Lafrenière has been stuck on the third line both of his first two seasons in the league and has not played on the first power play unit. Lafrenière has simply not been given the same amount of ice time as Hughes and Hischier. In his career so far Lafrenière has scored one goal per 61 minutes on the ice. Hughes has scored one every 68 minutes and Hischier has scored one every 69 minutes. That is also with all of his goals coming at even strength.

Lafrenière may not have as many assists as the other two players, but if each of the players plays 18:04 per game (Hughes’ TOI) their points per game would be Lafrenière 0.5, Hughes 0.65, and Hischier 0.69.

In two seasons, Lafrenière has recorded just two power-play points, which bodes well for him if he can receive consistent first-line power play minutes in 2023. If he fills Strome’s spot on the powerplay, Lafrenière has significantly more opportunities to produce. This position on the first powerplay saw Strome record 32 points in two years.

If Lafrenière can see a few more minutes on the ice next season and Strome’s spot on the first power play unit, he will likely produce the same amount of points or more as Hughes or Hischier.

If the Rangers can convince Lafrenière to take a bridge contract and save between $2 and $3 that would be a massive step towards keeping as much of the 2022 core together as possible. The Rangers risk Lafrenière being worth more than $7 million after his bridge contract, but regardless, signing him to this bridge contract is important to the team cap flexibility.

Why not offer Miller a bridge contract as well?

He is in the same position in his career as Lafrenière, and in the same position as Chytil and Kakko were when the Rangers engaged in bridge contract discussions with them. After a breakout season last year, the Rangers risk Miller’s AAV jumping significantly after two more impressive seasons.

If the Rangers give Miller a bridge contract, the next time he is ready to sign an extension he may be demanding a seven-year $8 million AAV contract. It would be smart and likely a good investment on the part of the Rangers if they can find a way to sign Miller to a five to a seven-year contract in the $6 million AAV range at some point during this season.

There is a chance that giving Miller a bridge contract in addition to Lafrenière could work out in the Rangers’ favor, given the rumors of an expected salary cap jump over the next few years. If the salary cap goes up by $5-10 million in the next two years then the Rangers could get away with bridging both Miller and Lafrenière.

Currently though, with the Ranger’s current salary cap struggles, it is going to be impossible to re-sign Lafrenière, Miller, and Chytil without having to make some kind of moves. With Lafrenière, Miller, Chytil, Ryan Reaves, Julien Gauthier, Dryden Hunt, Ryan Carpenter, Jaroslav Halák, and Sammy Blais all entering free agency after this offseason, the Rangers will have many positions to fill, and not enough money to pay everyone.

How much cap space will the Rangers have to work with next season?

Following Kappo Kakko’s extension, the Rangers have $1 million in salary cap space to use for next year’s roster. Another $3.43 million in dead cap space will be freed up after this season. Finally, expiring contracts next offseason will open up a further $16.2 million in space bringing the Ranger’s salary cap space to about $20.5 million.

If the Rangers can sign Lafrenière to a bridge deal with an AAV of $5 million and Miller to a long-term contract in the $6 million AAV range that leaves the team with about $10 million in remaining space.

Excluding Lafrenière, Miller, and Chytil, the Rangers have eight more restricted free agents who in total open up $8.86 million in cap space after this year. Assuming around $9 million is set aside to re-sign these free agents or bring in similar replacements, that leaves the team with about $1 million in cap space. Chytil will most likely not be on the team in 2023 if this is the direction the team takes.

There is also a very good possibility that Lafrenière breaks out this season and looks for a contract in the $7 million AAV range, instead of a bridge deal. Miller might continue to grow after a stellar 2021-22 season, and command a similar AAV. The Rangers cannot pay these two more than $11.5 million or so because they have to dedicate around $9 million to the rest of their team.

How can the Rangers resign Lafrenière, Miller, and Chytil?

If the Rangers decide that they want to extend Lafrenière, Miller, and Chytil, the organization could try to free cap space by trading a high-paying veteran. It is unlikely the Rangers trade Jacob Trouba so soon after naming him the organization’s newest captain, which leaves Chris Kreider and Artemi Panarin as the likely trade candidates should the Rangers choose to free more cap space.

Kreider is under contract until the end of the 2027 season but has a no-move clause until the end of the 2025 season, but as we saw this offseason with Ryan Mcdonagh being traded from the Tampa Bay Lightning to the Nashville Predators, no-move clauses do not always prevent a player from being traded. They can however help a player navigate a move to a contender.

If the team can trade Kreider for inexpensive assets, either young players on NHL contracts or prospects then they have a path to re-sign Lafrenière, Miller, and Chytil. Instead of having no space to sign Chytil, the Rangers will have between $6 and $8 million depending on Lafrenière and Miller’s contracts.

Chytil will likely cost in the $4-$4.5 million range, so the Rangers can use the remaining money to fill out the rest of their roster with more expensive depth pieces, or retain players they acquire at the trade deadline.

Trading one of the Rangers’ veterans at the end of next season makes sense not only when it comes to signing their young players, but also in terms of how aggressive they can be at the trade deadline. New York has been heavily linked to Patrick Kane, who they could go after at the trade deadline, giving up some kind of package of Kakko, other prospects, and picks.

With the salary cap space the team has right now, they might be able to get away just by giving up Kakko’s salary while bringing in Kane and staying under the upper limit maximum.

This depends on how much Chicago is willing to eat of Kane’s cap hit, but if the Blackhawks and Rangers split the difference, and both pay Kane $5.75 million, then Kane could be a Blueshirt. In the offseason, if Trouba gets dealt, the Rangers could keep Kane and re-sign Lafrenière and Miller to the deals I discussed above.

Retaining Chytil would be the biggest challenge for the organization if they do find a way to acquire Kane at the trade deadline, but it can be done. Maybe Chicago asks for Chtyil instead of Kakko which solves the Rangers’ problems, but for the sake of the scenario, let’s assume that the Blackhawks want Kakko. The difference between Kane and Kakko will be about $3.6 million to the Rangers cap.

This bumps them down from what was around $7-$9 million to sign Chytil to just around $3-$5 million. This is in the ballpark for what Chytil’s market will likely be, so there is a chance that if the Rangers find a way to acquire Kane, they can keep Lafrenière, Miller, and Chytil if they can find a way to trade Trouba.

Wrapping it all up

When the Rangers gave out these big contracts to Panarin, Trouba, and Kreider in 2019 they did not expect to be facing such salary cap problems only three years later. The organization, like all others throughout the NHL who are facing similar issues, thought that the upper limit of the salary cap would be around $93.5 million. This would have allowed for significantly more flexibility with how the Rangers go about extending their young players next offseason.

Sure, Adam Fox, Igor Shesterkin, and Mika Zibanejad all signed after the 2020 CBA extension froze the salary cap which means they likely would have received higher salaries if there was no salary free, but the Rangers still would have plenty of money to sign at least Lafrenière and Miller.

With new rumors that the salary cap will rise exponentially in the next couple of years, there is hope that the Ranger’s salary cap woes will be coming to an end after a few more seasons. Currently, though, there are still many decisions that the Rangers’ front office will need to make during the 2022-23 season and in the following offseason.

In the meantime, let’s sit back and enjoy the season as the Rangers look to build off of their trip to the Eastern Conference Finals and raise the Stanely Cup trophy for the first time since 1994.