COMMENTARY | As the NHL Board of Governors meetings wrap Tuesday in Pebble Beach, California, the league's owners, general managers and other brass have plenty to discuss.
They've got plenty to celebrate, too, as the long awaited Canadian broadcast deal (valued at over $5 billion) has led to revenue increases that could bring the salary cap right back to all-time high levels.
If the former is good for the NHL, the latter is good for the Pittsburgh Penguins.
Following Monday's BoG meetings, a figure of $71.1 million emerged as a likely number for the 2014-15 salary cap. The NHL saw it's spending limit fall to $64.3 million per team this season, a condition of ending the 2012 lockout. The shortened 2013 season had a cap of $70.2 million, the highest in the cap era.
Under the terms of the current CBA and consistent with the last one, the salary cap is determined as a percentage of hockey-related revenues (HRR) from the season prior.
A few weeks ago, Forbes released numbers claiming NHL teams have never been so healthy financially. If their numbers are accurate, every one of the 30 NHL member clubs appreciated in value following the lockout -- welcome news for a league which seems to run in a perpetual circle of relocation rumors, mainstream obscurity and owner lockouts.
The Penguins, like the NHL, are as financially stable as they've ever been.
Pittsburgh has seen its value increase by almost $400 million since the 2005 season, outrunning a second team bankruptcy to become one of the most important and healthy franchises in hockey.
Before the salary cap came into play in 2005, the Penguins routinely played the low-rent loser, shedding talent after talent to get nothing in return.
Following years of sustained success that include a 300-plus game home sellout streak and the best TV ratings in the league, they're now beneficiaries of a salary ceiling that climbs ever higher, having spent to the cap ceiling in every year since 2008.
What would a cap ceiling of $71.1 million do for the top-heavy Penguins payroll?
-Provide room to breathe. The Penguins' depth going into this season was limited by their top-heavy roster. It took AHL demotions and LTIR relief to even become compliant before the season. With the rash of injuries Pittsburgh is experiencing (7 players currently on injured reserve, including three of the team's top-four defensemen), a little room to breathe would allow them to make moves other than AHL call-ups. The Pens are currently carrying 8 AHL regulars. (One of them, Andrew Ebbett, has really taken to the Penguins' way. He's on injured reserve.) -Keep the core together. The Penguins have a core of players around which they like to build their roster. Most of those players were drafted in the lean years of the early 2000s, and they're all rather expensive to keep around. Malkin and Sidney Crosby count more than $8 million against the cap. Letang will be over $7 million next season. James Neal, Paul Martin and Marc-Andre Fleury have hits of $5 million. Four other players carry cap hits of $3.5 million or more. A growing cap will allow the Penguins to keep the core together while still having the space to build around them.
The Penguins certainly seemed to anticipate a rising salary cap when they offered extensions or new contracts topping $176 million to Malkin, Letang, Chris Kunitz, Pascal Dupuis and Rob Scuderi this offseason.
Monday's news confirms that the Penguins gambled well last offseason.
Their continued success in Pittsburgh is one example of a traditional franchise having been rejuvenated by the salary cap. In turn, their gain is the NHL's gain, as a healthier league with popular teams will be able to, among other things, continually increase players salaries via the salary cap.
Smart spending will always win out, in any league. An increasing cap will give the Penguins room to breathe, as well as the space to continue building around their core players.
James Conley is a Penguins contributor for Yahoo Sports and an Editor at SB Nation's Pensburgh. Shower him with your praise and adulation on Twitter at @Slew_James.
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