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In The NHL’s Flat-Cap World, The Seattle Kraken Hold The Cards

By News Creatives Authors , in Business , at July 15, 2021

Four years ago, the brand-new Vegas Golden Knights stunned the hockey world by riding their ‘Golden Misfits’ identity all the way to the Stanley Cup Final.

Next Wednesday, the Seattle Kraken will attempt to match or beat the Vegas benchmark when they announce their initial roster via the 2021 NHL Expansion Draft. And while the bar for success is now very high, the NHL’s current landscape offers plenty of reason for optimism if you’re a newly minted Kraken fan.

The new franchise has assembled a formidable and experienced management team. Former Carolina Hurricanes general manager Ron Francis, a Hockey Hall of Famer and two-time Stanley Cup winner with the Pittsburgh Penguins in the early 1990s, is running the ship. He’s supported by two assistants — longtime right-hand man Ricky Olczyk and former Buffalo Sabres GM Jason Botterill — along with a crack squad of data analysts and scouts.

The Golden Knights had just one year to get ready for their expansion draft after their franchise was officially awarded on June 22, 2016. Seattle, by contrast, has been preparing for more than two and a half years, since their franchise was officially rubber-stamped on December 4, 2018.

It was a stroke of luck that the club moved off its original launch target of 2020 when it looked like the extensive renovation of what is now Climate Pledge Arena might take longer than originally projected. This prevented the awkwardness of introducing a new franchise in a fan-free setting in a shortened 2020-21 season. And as it turns out, the challenges and delays caused by Covid-19, including supply chain issues, have now pushed back the arena’s opening to mid-October, after the Kraken play their home preseason games in other hockey markets around Washington State.

With just a year to prepare, McPhee was hired by Vegas within weeks of their official franchise announcement. Francis will have been on the job for just over two years when he reveals the Kraken’s opening lineup next Wednesday.

And while he could never have foreseen all the twists and turns that the NHL has gone through since he took the job, he’s starting with some significant leverage as the existing teams look ahead at a third-straight season with a salary-cap ceiling of $81.5 million.

While no team wants to lose key talent from its roster, Francis can offer lifelines if he’s willing to claim veteran players who have significant cap hits still owed to them.

But that generosity will likely come at a cost. And don’t expect him to throw every team a bone; not every player selected by Seattle next week needs to be an established NHLer. Out of their 30 expansion draft selections (Vegas is exempt), at least 20 must be under contract for the 2021-22 season. And while Francis has said that he is authorized by ownership to spend to the cap ceiling, the players selected in the expansion draft are only required to carry an aggregate value of 60-100% of next year’s salary cap ceiling. So, possibly as low as $48.9 million.

Watching McPhee maneuver in 2017, fans quickly realized that his expansion draft strategy ran much deeper than watching Vegas claim the best players available. And while the rival GMs say they’re better prepared this time around, the Kraken’s unveiling should also bring plenty of surprises.

For one example, let’s look at the Stanley Cup Champion Tampa Bay Lightning — famously cap-strapped with $85 million already on their books for next season, according to CapFriendly.

Rich in talent, even the lower-level players from the Lightning could impress if they’re given a bigger role on Seattle next season. Tyler Johnson’s name has come up again and again — a Washington State native who has 361 points in 589 NHL games, plus another 116 games of playoff experience. Over the last few weeks, he proved he’s still got it after he was elevated up the Lightning lineup in the Stanley Cup Final, filling in for the injured Alex Killorn.

But with three years left on a contract that carries a cap hit of $5 million, the Lightning decided that it was better to have him Johnson off their books than on their roster when they placed him on waivers in January.

At that time, no team had enough cap space to justify claiming him. The same was true through the season when we saw other roster players around the league like Montreal’s Paul Byron, Philadelphia’s Shayne Gostisbehere and the Islanders’ Leo Komarov go unclaimed following waiver assignments.

In 2017, the Lightning were also up against the cap, and forced to leave promising young defensemen Slater Koekkoek and Jake Dotchin exposed in the Vegas expansion draft. Then-GM Steve Yzerman bought himself some breathing room when he sent two draft picks and the rights to KHL forward Nikita Gusev to the Golden Knights in exchange for future considerations. In return, McPhee used his expansion draft pick on veteran depth defenseman Jason Garrison — who had one year remaining on a contract that carried a cap hit of $4.6 million.

This year, Tampa Bay’s cap issues are glaring, and many other teams are also under pressure. If the Kraken select the Lightning’s Yanni Gourde (four years remaining at $5.167 million) or Ryan McDonagh (five years remaining at $6.75 million), who could be left unprotected, they’ll be getting a really good player to build their franchise around. The Lightning would also get much-needed cap relief. Would they need to offer Francis an incentive to build out his franchise starting from one of these cornerstone players?

Every team that signed important players to long-term deals before the pandemic was counting on steady salary-cap increases to create more breathing room as the years went on. The flat cap is suffocating them — and many will be asking for Seattle to help them get a breath of fresh air.

McPhee was able to use the Golden Knights’ wide-open cap space to his advantage in 2017. Despite the cautious words of the other general managers, Francis’s leverage over the next week is even stronger.

The Golden Knights’ immediate success has also dimmed the stigma of playing for an expansion team. Players who are looking for fresh starts or more meaningful roles could relish the chance to play in the Pacific Northwest. Their salaries will also deliver maximum bang for the buck. Like in Nevada, Florida, Tennessee and Texas, there is no state income tax in Washington.

The clock is now ticking on final decisions for the 30 teams involved — each of whom received a $21.67 million share of Seattle’s $650 million expansion fee as compensation for the player they’re about to hand over.

Protected lists must be submitted to the NHL by Saturday; they’ll be revealed on Sunday morning.

The Expansion Draft itself will take place Wednesday, July 21 at 8 p.m. ET, live from Gas Works Park in Seattle and televised on ESPN2 in the United States and Sportsnet in Canada.


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