Phoenix's future, next season's cap and relo talk

December, 16, 2009
12/16/09
12:01
AM ET

PEBBLE BEACH, Calif. -- Day 1 of the NHL's board of governors meetings wrapped up after an address from NHL commissioner Gary Bettman and director of hockey operations Colin Campbell, and four items grabbed my attention:

1. Bettman told the board the league's involvement in Phoenix won't end up costing owners any money.

2. Bettman gave governors a sneak peek at what next season's salary cap should look like. As we've reported before, the cap likely won't budge too much, although that depends on the volatility of the Canadian dollar.

3. As we speculated earlier tonight, a source told ESPN.com that Bettman told the board that the league believes it's fair for the Phoenix Coyotes to get a full share of revenue sharing even though the team doesn't actually meet the criteria for it under the normal guidelines.

4. Despite all the media coverage in Canada on the subject, Bettman insisted to gathered media Tuesday night that putting a seventh team in Canada (Toronto, Winnipeg or Quebec City) is not really on the radar at this point.

OK, let's look at these four issues in more detail.

1 and 3. The league, Phoenix and revenue sharing
Collective eyebrows were raised in the media room when Bettman told us that owners wouldn't lose any money on the whole Phoenix mess. This is a team that lost anywhere in the $40-$60 million range last season depending whom you believe; this season, with the league owning the Coyotes, the team is playing in front of near-empty arenas. Still, with Ice Edge willing to purchase the team for $140 million, according to its letter of intent, Bettman said it would come out a wash.

"Ultimately, the [team] won't have cost us anything once we sold it," Bettman said. He later added, "What I told the governors is our expectations are to get out of it with what we put in."

Now, my thinking here is that getting the Coyotes a full portion of the revenue sharing is also an important part of this equation. A full portion this season would run about $10-$11 million. As we reported earlier Tuesday night, one NHL governor we spoke to grumbled about the Coyotes' getting a full share even though they don't meet the criteria, which includes having to average at least 14,000 fans a game.

When Bettman mentioned it during his address Tuesday night, however, "Nobody said a thing," a source said.

But when the same governor was later reached by ESPN.com, he countered by saying, "We didn't have a chance."

In any case, sources say that when Bettman puts the revenue-sharing item with the Coyotes to a full board vote, he likely will get it passed. Most governors likely would agree with the league that the Coyotes had exceptional circumstances in the past year and a half (Jim Balsillie trying to hijack the team and move it to Hamilton, Ontario) that would impair their chances to meet the revenue-sharing criteria.

Bettman said the Coyotes' possible sale to Ice Edge would be discussed with the board in more detail Wednesday.

I asked Bettman Tuesday night about Ice Edge's intent to play five regular-season games in Saskatoon, Saskatchewan, next season. I don't think the league is thrilled about this idea, but it likely isn't a deal-breaker.

"That's something that obviously requires further discussion," Bettman said. "It's something the board will have to ultimately approve."

2. Next season's cap
Bettman gave his annual projection on next season's salary cap. This is when the GMs on hand at this meeting drop everything and listen carefully. They're dying to know how much money they'll be allowed to spend.

"My own view is it's not going up dramatically and it's not going down dramatically," Bettman said. "My guess is within a million, a million-and-a-half or 2 million either way is the swing we're looking at."

The cap is at $56.8 million this season.

Given that team ticket sales and sponsorship sales are down in most NHL markets because of the recession, one wonders how the cap could possibly not go down. The answer, as we've said before, is the Canadian dollar. With the six Canadian franchises accounting for 25-30 percent of leaguewide revenues, the 95-cent Canadian dollar is the biggest factor in revenues -- and, therefore, the salary cap -- not going down too much.

"Whether or not the Canadian dollar goes up or down will impact what the cap will be next year," Bettman said.

Bettman pointed out that the governors were talking about a Canadian dollar in the 84-85 percent range a year ago.

"Now we're talking 94-95 [cents]," he said. "That impacts it. If it's at 95 cents and stays there for the rest of the year, the cap will go up a million or so. If the Canadian drops under 90 [cents], it may be down a half a million or so. All of these prognostications of 10 and 20 percent declines, that's not going to happen."

4. Another team in Canada?
Speaking of the Canadian dollar, how about another team in the Great White North? Not going to happen soon, Bettman said.

"The board has no interest in expanding or relocating right now, but they are aware of the interest," said Bettman, who met with the mayor of Quebec City earlier this season.

Other Day 1 nuggets:
• Stars owner Tom Hicks had a busy day on the baseball side of things, choosing an ownership group with which he will begin the process of selling his majority share in the Texas Rangers. I asked him if the baseball sale goes through, how will that affect his ownership of the Stars.

"One at a time; we'll only worry about baseball now. But we'll see about that," Hicks said.

I also asked him about reports that say he's struggling to pay bills for his sports teams.

"The holding company has too much debt," Hicks said. "We're no different than a lot of companies around the world. We just have to de-leverage, and that's a process we're working hard at."

Then I asked him whether he still wanted to own the Stars. "Absolutely," he said.

Bettman said he was aware of the baseball developments with Hicks.

"The discussions I've had with Tom have been ongoing," Bettman said. "My understanding is he's prepared to sell the baseball team and his goal is to keep the hockey team."

• Overall, the sense from Bettman's address Tuesday night was that the NHL has held its own through a very difficult world economic crisis.

"Some markets get hit harder than others," said Carolina Hurricanes GM Jim Rutherford. "Some of it's from the economy, some of it's from performance, but overall I think the league has held its own through this time."

His market?

"It's down," Rutherford said. "What we already know is what level we got to [in 2006]; we know the interest is there. We have to play better or get the fans excited about one of these top draft picks."

• Campbell updated governors on the decisions by GMs last month to take a harder look at blindside hits and head shots in general. He showed them a video presentation.

"Some of the hits, where the player had no chance to anticipate it, had no chance to see it coming or avoid it, then maybe we have to look into it," said Toronto Maple Leafs president and GM Brian Burke. "But a player still has some responsibility.

"When I was playing in the AHL and got drilled, you got back to the bench and your own teammates would tell you to keep your head up. … There is some accountability for the player."

The GMs will decide at their March meeting whether they want to ban blindside hits, a decision that will need the players' approval via the competition committee and final approval from the board of governors in June.

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