The Cap Space Argument

St. Louis Blues v Edmonton Oilers

I’m a little surprised at the favourable reaction of many Oilers fans to the Denis Grebeshkov trade. While I didn’t think it was a brutally one-sided deal, I do know that I wouldn’t have made it in Steve Tambellini’s shoes. Because the biggest argument in favour of the trade is the cap space issue, I thought I’d spend a little time on that today.

Despite Edmonton’s struggles with the salary cap this season, it’s actually not all that difficult for them to clear cap space, even if they aren’t able to trade Sheldon Souray or Lubomir Visnovsky – either of whom would give the Oilers room (to the tune of $5.4 and $5.6 million, respectively).

Up front, Fernando Pisani and Mike Comrie are replaceable for less than the combined $3.75 million they took up this season (side point: I almost called “this season” “last season,” which I assume is the mentality of most Oilers fans). With two exceptions (Sam Gagner and Gilbert Brule), the Oilers other free agents, both restricted and unrestricted, won’t be due for much in the way of pay increases either.

Let’s assume the very worst: Steve Tambellini can’t move any of the expensive but useful players, and he’s totally incapable of moving four guys making significant dollars: Patrick O’Sullivan, Steve Staios, Robert Nilsson and Ethan Moreau. How would the Oilers clear cap space?

One word: buyouts. The incredibly helpful capgeek.com has a buyout calculator which tells us what it would cost in terms of both dollars and cap hit to buy out these players.

Because of the age of O’Sullivan and Nilsson, it’s easier to buy them out than it is Steve Staios and Ethan Moreau. In fact, by spending a little over $1.5 million, Daryl Katz could nix both of those contracts. Instead of a nearly $5.0 million cap hit between the two of them, the Oilers would now have a total cap hit of around $0.8 million for the next two years, just like that.

Things are less rosy with Moreau and Staios, but given that at their current level of play they can be replaced with dirt cheap players they still deserve some consideration. For a total cash outlay of roughly $2.8 million, the Oilers could buyout those contracts. Instead of a combined $4.7 million cap hit between the two of them, the Oilers would have a $2.0 million cap hit next season, and a $1.4 million hit in 2011-12. Personally, I think a better move would simply be to dispatch Staios to the minors – the cash outlay is a little less ($2.7 million), the cap savings for next season would be the same, and there would be now pesky 2011-12 cap hit to worry about.

So let’s assume that Tambellini has been given the green light (as both Katz and Tambellini have indicated) to spend about $4.0 million, and he follows the course laid out above (buyout Nilsson, O’Sullivan, demote Staios, let Comrie and Pisani walk). That course of action would clear more than $10 million in cap room.

To make a long story short, I don’t think that clearing cap space is a huge issue for the Oilers. In the worst case scenario, the team can clear $10 million with minimal effort, and it goes without saying that with a few deals Tambellini can improve that significantly.

  • Jason Gregor

    Here is another angle. The Oilers don't want to pay him $3 million next year, and they'd have to offer him at least $3.125 to stick around.

    If they don't they lose him and he becomes an UFA. Then on the open market he might only get offers of $2 million, and if the KHL offers the same he'd probably go there.

    This wasn't clearing cap space, it was ensuring they wouldn't have to overpay a player moving forward. I think we'd all agree over paying your middle-tier players won't help you win.

    • Bucknuck

      Don't disagree with you, Jason.

      I'm also going to suggest that Tambo simply had a look at his blueline and realized that he had about four types of offensive d-men – the shooter (Souray), the sorta-playmaker (Gilbert), the riverboat gambler (Grebs) and the two-way guy who generally combines the best aspects of all of the above (Lubo).

      Cap space, KHL, makeup of the blueline – I think all played a factor in Grebs' departure. And, to be honest with you, I was surprised that they managed to pry a second-rounder out of Nashville for him.

      It was a surprising deal that no one saw coming. Hopefully there will be more soon.

    • Ogden Brother Jr. - Team Strudwick for coach

      If this is the theory Tambo is using then fine, I'm okay trading a player away when he is at an all-time low for value as an Oiler.

      As for your last paragraph lets just hope they stay true to that way of thinking this off-season.

      Also morning show wants someone to call in an ask saddlebags to get on the scale. And yes that is the nickname used by the morning show not something I made up.

  • Harlie

    I'm still happy Grebs is gone. He reminded me too much of Bergeron. Decently good when they were on their game and painfully bad when they weren't. And both those guys played more bad then good. So bye bye.

  • I'm thinking that trading Grebs was less about clearing up cap space and more about getting a return on a guy who is likely gonna bolt back to Russia to play in the KHL next year. I have a funny feeling that either Grebs or his agent have hinted as much to the Oilers.

    Think about it: In today's NHL, if you're a middling-to-decent player who shows a mere modicum of desire to stay with the team, you can pretty much count on getting lots of term in a new deal – three, four, five years, if you want.

    But last year, Grebs re-upped for one single year. And, as memory serves, the media reported that he was reluctant to go longer-term because he wanted to keep his options open with the KHL (I would stand corrected on this, but I don't think there's anything in the CBA about RFAs bolting for another league, right?)

    Of course, it may also have been that Grebs was clairvoyant enough to realize were going to stink and a one-year deal would give him a chance to git while the gittin' was good.

    Either way, it's my belief he was traded because he had no intention of re-signing in Edmonton. Fair enough – but out the door he goes.

    I'd say Tambo did a good job getting a second-rounder in that situation.

  • Is it just me, or does this trade feel more like a knee jerk reaction?
    "We have to make some kind of trade to show the fans that I am in fact still alive. Hopefully those bloodhounds will finally stop sniffing around the yard for my body".

    I'm not going to miss Grebs terribly, but I'm having a hard time figuring out the end game here. But I agree: if he bolts to the KHL then this will look like a decent move. If he stays in Nashville and picks his game up (like pretty much every other Oiler traded well before his expiry date) then it should be just another nail in Tambo's coffin. Which brings up an interesting point; Are the nails super tiny, or is the coffin gigantic? Because sadly I don't see him getting escorted off the property any time soon.

  • @ Menacer:

    I'm actually starting to wonder if coaching could be part of the problem. Aside from Visnovsky, every defenceman on the team has been either stagnant or worse than expected.

    Souray's been bad, Gilbert's been bad, Grebeshkov's been bad, Smid's been about the same, Staios has been bad, Strudwick's been bad, Chorney's been bad.

    It's ugly back there.

    • Bryzarro World

      You could be right. There has to be a reason that pretty much everyone is sucking at the same time. Either coaching or a taint in the locker room that needs to be dealt with.

    • Ogden Brother Jr. - Team Strudwick for coach

      Souray, Staios and Strudwick, injuries or age has caught up to them. Smid I'd say has been better. Chorney really, rookie I had little expectations for him. Grebs and Gilbert are the question marks for me.

  • @ Tracie:

    To keep Grebeshkov, the Oilers would have offered his current salary (3.15MM), and in a good year he's worth that.

    If anything, this trade makes me feel the Oilers are looking at contending next year rather than at a lengthy rebuilding process.

    • Bucknuck

      I do not understand how that is a bad thing. If they could get into the playoffs next year then why the hell not.

      Once you are in the second season anything can happen. Unlike a lot of people on here I am unexcited to watch four years of suck just to get some draft picks that may turn into Patrick Stefan or Jason Bonsignore.

      No thanks.

      Don't trade away any first round draft picks, but if you can make the team better you don't turn your nose up just to get a better draft position.

    • Don't qualifying offers need to be more than the current salary? I thought it was current plus 10%. I could be wrong though.

      If that is the case it is closer to 3.5 M to hang onto him as nobody else should pony up that kind of dough for Grebs. I wouldn't want to pay him what we have paid him.

      If he ended up in arbitration then what do we have? i think looking at him like a UFA is the way to go seeing is that is what he would have been if we didn't qualify him.

      We might have received a bit more but I still don't think this is a bad trade.

    • Ogden Brother Jr. - Team Strudwick for coach

      I said as soon as the Jagr talks came up and other rumors that there was no reason to believe this team was going to rebuild much longer then a year or two.

      • VMR

        No,no,no,there's no short cut to rebuilding. They may try and only rebuild this season and bring in a savior like Jagr for next but all that does is bump us up to 10 to 13 and makes the rebuild take longer.

        As for Grebeshkov. I'm fully in favor of dumping his salary. The option you point out Willis is buying out salaries which doesnt gain us a second round pick and loses players already on the team while not totally clearing their salaries. Grebeshkov makes too much for how poorly he's played on the back end. I'm willing to give up on him and develop Chorney or Peckham with his ice time and smaller salaries. He might find his game in Nashville and be worth the $3.15 but I doubt he ever would have here.

        • Bucknuck

          Is there some sort of manual that needs to be followed. Is there some sort of rule book?

          Does a team have to absolutely stink in order for it to be a rebuild? Does it violate rule 22 subsection E of the rebuilding rulebook if we make the playoffs next year?

          Wouldn't that be awful if they actually tried to plan to win next year. every winning team has had mentors to bring the young people along. This team will need them too.

          I agree that trading away the farm for the homerun hit would be a bad idea, but if you had a good offensive horse that could play for the next five years it would go a long way in my opinion.

          • VMR

            There's no manual to rebuilding but there's no way around the fact that this team needs significant change to become a contender. We have to many offensive puck moving dmen and none that are solid defensively and only one who has a real physical edge, that has to change. Our forwards including our best prospects all come from the same mold, small playmakers, not enough shooters or guys with skill and size. Our goaltending is old and injured or young and not particularly promising.

            This team faces serious challenges and those who think we'll be back in the hunt next season, I think they're kidding themselves. Unless they manage to bring in some significant talent via free agency, and going that route risks getting stuck with contracts you probably cant move, like Souray and Khabibulin.

            Then there's the crazy ideas of bringing guys like Jagr in as a mentor. The guy is not mentor material. He was always getting in trouble with Pittsburgh and Washington and the Rangers over his poor work ethic and refusal to show up for practices. You dont want him around young developing players especially now that he's washed up and getting outscored in the KHL by players like Patrick Thoresen and Marcel Hossa, guys who never managed to stick in the NHL.

            Real fans of this team have to expect several years of bad teams, you can hope every year that they manage to turn it around but for that to happen we need several players to suddenly develop into significantly better players then they have been.

          • Ogden Brother Jr. - Team Strudwick for coach

            Did you see Jagr play in the Olympics he was one of the best players on the ice when the Czech's played.

            It's not even about being a mentor as much as it is being support for the offense. Only having one go to player is hurting Hemsky, the other teams matchup against him and then Hemsky doesn't produce. Having Penner and Brule opened up that space for Hemsky, adding Jagre would just open up more.

          • VMR

            Is it worth it if he's costing us goals against every game due to poor defensive play? Jagr had a good Olympics, that's great but so did Patrick Thoresen and Tore Vikingstad, are we looking at bringing them in? Jagr is a name not a talent anymore, if you can get him cheap than it might be worthwhile but if you are paying $2 million or more (and I'm sure it would take more) then there are better options.

  • Could this move also be based on the Oilers not thinking that Grebs was a fit there long term?

    Quinn did not seem happy with his play, and maybe they wanted to get something for him now instead of letting him walk for nothing in the summer (assuming they already knew they were not planning to re-sign him).

  • Ogden Brother Jr. - Team Strudwick for coach

    So if we trade Moreau and a pick for Exelby, does that not tell us that Katz hasn't given the green light to bury players or buy them out?

  • Tracie wrote:

    I'm glad you cleared up the cap space issue but buyouts also mean you are using dead cap space right? like the 2 mil hit next season and the 1.4 mil hit will be dead space meaning that space can't go to players now right? so wouldn't trading away big salaries for picks be a better option?

    That's exactly right. This was 'worst case scenario' where Steve Tambellini is unable to make any trades.

  • Bucknuck

    I don't think Grebs is worth over 3 million dollars. That is probably why the low return. If Grebs was at 2 mil and an RFA I bet the return would have been a lot higher.

    Cap space is only important if you are going to do something with it. I am almost afraid of what Tambellini will do with 10 mill of cap space when you see what he did with eight million of it last season.

  • And because I opened with the Grebeshkov trade I should probably clarify – I wasn't trying to say anything specific about that here, but I was disagreeing with the notion that moving Grebeshkov was needed to gain cap space.

    My issue with the trade itself is tactical. The Oilers had five expensive defencemen: Visnovsky, Souray, Gilbert, Grebeshkov and Staios. The only two of those guys likely to be around at the end of a lengthy rebuild are Gilbert and Grebeshkov, so if a lengthy rebuild is the aim I don't understand moving them.

    If acquiring maximum return is the aim, both Gilbert and Grebeshkov are struggling through bad seasons, so there value is at an all-time low, i.e. it would make more sense to trade them later.

    If instant contention is the aim, then Grebeshkov is worth more than a 2nd round pick.

    That means that the only scenario that I see where moving Grebeshkov makes sense is if he's a) a huge problem behind the scenes or b) planning to bolt for the KHL. I've seen nothing to indicate that either of these situations is the case, so going by my current knowledge I don't think the trade makes sense, big picture.

    • Bryzarro World

      Forgot another scenario… What if he just sucks and never gets any better? You are assuming that he is going to be good enough to keep around for "lenght" of the rebuild…. however long that is.

    • Jason Gregor

      How is he worth more than a 2nd rounder?

      Can you explain why you think he is worth a first round pick?

      It wasn't just a salary dump. The fact is this team has way too many soft players, and he was one of them. Can anyone say with much conviction what type of player he is? Probably not.

      Is he the guy we saw for 50 games last year, who made smart decisions with and without the puck, or is the player we are seeing this year and in his first year, where he was a giveaway waiting to happen.

      If this team is in a rebuild mode, moving Grebeshkov makes sense because he won't make your team better down the road.

      And your explanation about buyouts, while it makes sense since we've all talked about it, it doesn't make it a better decision than trading Grebeshkov.

      The buyouts will save the team some money, but they still will have to pay guys to do nothing, and then replace them with other contracts.

      This way the rid themselves of a player who they didn't think was going to help long term, and I'd agree. And they got a decent pick in return. Now it is up to the scouting staff to make that pick count.

      Grebeshkov was not going to be part of nucleus on a winning team, and since this team is a few years away from winning I don't see why moving him was a bad decision.

        • Jason Gregor

          What is the definition of a decent prospect? That is very debateable as to which player is a decent prospect.

          Outside of Eberle, MPS, Lander and maybe Petry, do the Oilers have any other decent prospects?

          Would you put Riley Nash in that category?

          I think it makes it very hard to debate what is a decent prospect. And then you add a 3rd rounder, which isn't that much worse than a 2nd and your are asking a team to give up two prospects.

          Would you have traded Petry (or an Omark) and a 3rd for Grebeshkov?

          • Ogden Brother Jr. - Team Strudwick for coach

            Quite frankly I probably would move Omark and a 3rd for Grebs if I was desparate for a potential 40 point puck mover. As for decent prospect, anyone that can help us out. Whether it's for the AHL or NHL.

            We need depth in this organization and I hope the Oilers aren't just looking to make themselves better at the deadline. They do have two farm clubs that are equally as bad that need attention.

            Plante is another guy I'd consider decent.

            Edit: I'd probably have Eberle, MPS and Petry in the blue chip prospect and Lander, Nash and Plante in the decent list.

    • Tracie

      ok, that makes sense. if he has a bounce back year, then it was a dumb trade. If he bolts to the KHL then it was a genius trade…I guess I just can't see us giving him a raise to see what he can do next year after this year…I mean, isn't that why we only gave him a 1-yr contract to begin with, was to see which player we would get consistently? maybe Tambo was done with the experiment. Hopefully this means that we are committed to Gilbert and hoeefully watching him improve!

  • @ Pajamah:

    What are you talking about? All I did above was explain that I don't think cap space is that big of an issue because the Oilers can clear space fairly easily.

    I didn't take shots at anyone, and I wasn't trying to. I was examining a specific issue that I thought could use some clarification.

  • Tracie

    So, are you saying that the Grebs trade is a bad one then? Would you be willing to pay the guy 4 mil next year? I'm confused…

    If we are looking to get some Czech buddies for Hemmer to play with next year, or we are looking at raises for Cogs and Gags this off season, a long with seeing if we can sign UFAs, then we'll need the cap space. Plus a second round pick is a good pick. Grebs really ahsn't done anything this year to warrant a pay raise yet we'll be forced to give him one or let him walk for nothing…

    I'm glad you cleared up the cap space issue but buyouts also mean you are using dead cap space right? like the 2 mil hit next season and the 1.4 mil hit will be dead space meaning that space can't go to players now right? so wouldn't trading away big salaries for picks be a better option?

    I am just trying to understand…alot of this perplexes me…

  • OB1 Team Yakopov - F.S.T.N.F

    In my mind the move was more about creating roster balance, but we seem to have this fixation with cap space so that gets 99% of the attention. Like you said, the cap space is relatively easy to create (and quite frankly we don't have a big need for it for 3+ years) so really it should be at most a vary minor factor in this evaluation.

    Like most deals, you can judge each one on it's own, but really it's the big picture that matters.

    I'd be more then happy with what we got for Grebs if the team went out and aquired Volchenkov/Mitchell/Ballard or someone of that mold to fill his spot.