EHEC Financial Policy Changes
Posted: Wed Jan 12, 2011 9:42 pm
Keep all discussion to this thread. Here are the proposed changes.
Draft picks are going to be paid based on slot. Why? Because there's not really a better way to do it. The current NHL format is a base + "Exhbit 5" Bonuses (which will be discussed further down in this post). The way the NHL works is that the team must have enough cap room for the bonuses. As a result, a player like Tyler Seguin makes 900k per season, but his cap hit is 3.55M, based on the bonuses he is eligible to receive. Rather than keep track of all of these bonuses, we will pay guys slot money.
Here's the payscale:
Draft: 1-10 = 2.5M; 11-20 = 2M; 21-30 = 1.75M
31-40 = 1.5M; 41-50 = 1.25M; 51-60 = 1M
61-75 = 900k; 76-90 = 850k; 91-105 = 800k, 106-120 = 750k
5th-7th = 600k
As a result of these new numbers, UNDERAGED players on the FARM can make above the 1.2M threshold. This way we can still permit them to develop rapidly.
Entry level contracts (ELCs) will no longer be allowed to include team/player options.
Why do we enforce slot salaries over bonuses? Because, unlike the NHL, there is little to no chance of a player "busting" with EHM, especially as a first round pick. So all of these first/second players will range from great to good, and would likely hit their bonuses anyway within the first year of playing on the pro team.
----------------------------------------------------
Similarly, we obviously have a problem with young players making too little money. So, we will use the Exhibit 5 bonuses to increase their salaries. I'm still working on a capped number for these.
Exhibit 5 bonuses can be found here: http://www.nhlscap.com/Exhibit5.htm
In the NHL, each bonus is worth $212,500. For us, each bonus will be worth $250,000. In terms of the 2010 draft class, the bonus raises to the base salary will stop when the player reaches the new 2011 Draft slot format. For example, Brett Connolly, PHX's first round pick, currently makes $600,000. If he got three of the bonuses in his first contract year, his base salary would then be 1.35M (750k increase). If he got those three bonuses again, his salary would go up to 2.1M. If he got a different bonus and earned another 250k, his salary would be 2.35M. Another bonus would put him above the draft slot (9th overall), so his salary would be capped at 2.35M.
Also, any players under 25 that were signed to contracts after EHEC began are able to earn these Exhibit 5 bonuses. I have yet to decide how I am going to cap the salaries for these players, because some of them will earn a majority, if not all of these bonuses. A player like Phil Kessel, for example, would likely get at least seven, if not all nine of them. That would be a 2.25M increase. While that is not a ridiculous number for him (base would be 3.355M), he would earn some of these bonuses every year. And that would get pricey. So I'll be searching for a way to cap this.
The adjusted salary begins the following season. So it's not like it will happen the instant a player hits the 20-goal plateau.
--------------------------------------------------
Contracts will be limited to 4 years or 3 years + a team option. We see a handful of 5 and 6 year deals in the NHL, but they have escalating salaries and that would be a bit labor-intensive to keep an eye on here (read: I'm lazy).
-------------------------------------------------
The new contract raise rules will be based on the average of the 6 main stat categories. (It was discussed in last night's chat to use a weighted system on the more important ones and that can also be elaborated on in this thread.) In any event, for now, this is the framework for the new system. I expect this to be the system that we will use, with a few tweaks of course, to perfect it as much as possible. If a player has not reached his ceiling, the EXPECTED value will be used to determine the contract (I realize there are some issues with ST, PO, and CH in regards to this, so we'll have to figure that out).
This applies ONLY to PLAYERS UNDER 32:
85+ OF/DF average: 25% 5M+; 50% 4M+; 100% 3M-4M; 200% of current contract if under 3M; 300% if under 2M, 500% if under 1M
80-84 OF/DF average: 25% 5M+; 50% 4M+; 100% 3M+; 200% of current contract if under 3M; 250% if under 2M, 400% if under 1M
75-79 OF/DF average: 25% 4M+; 50% 3-4M+; 75% of current contract if under 3M; 150% if under 2M, 300% if under 1M
70-74 OF/DF average: 25% 3M+; 50% of current contract if under 3M; 75% if under 2M; 100% if under 1M
Players who average below 70 are TBD, but I think it would be safe to assume something along the lines of up to 20% decrease 4M+; up to 10% decrease 3-4M; 5% increase 2-3M, 10% increase 2M, 25% increase if under 1M. Just a rough guess, with no examples thrown in.
There are two caveats to this system. The first is the concept of a player who is a "specialist". This will be any player whose OF is 5 points higher than their DF or vice versa. Right off the top, any player whose OF is 5 or more points above the DF will be labeled an offensive specialist. As we know, offensive guys are paid more in real life. These players will receive an automatic 500k increase to their base salary from the percentages. Any "defensive specialist", 5 or more DF higher than OF will get 250k added to their base.
The other caveat is that any supplemental attributes (with the exception of fighting) with a value of 80 or more will lead to another 250k increase. So, a player with a 85 HI, a 84 SK, a 82 EN, and a 81 CON would get an extra 1M on their base salary.
I'm beginning to come around to Parker's idea last night of a human element in terms of arbitration and I think I have a concept that would suit his wishes, along with Dan's wishes of having some sort of human element to this. Players over the age of 32 will done on an arbitrary basis. What I mean by that is a group of GMs, from the opposite conference, will assess the older player and determine if his performance warrants a raise, a decrease, or a similar contract. We can use comparisons to similar players, both statistically and on their in-game attribute values.
It's an idea. One that can be elaborated on.
Now, let me hit you with some examples of this new system.
First example would be Steven Stamkos. Stamkos is 89 OF and 71 DF. (89 + 71) / 2 = 80. (his stickhandling may go up slightly, but he has technically reached his ceiling value). As a result, Stamkos falls under the 80-84 average. His current salary is 875k. Under the formula, his base salary must increase by 400%. 875,000 * 4 = 3.5M. Stamkos would also fall under the "offensive specialist" bonus, bringing his base salary to 4M. He also has four supplemental attributes above 80 (SK, EN, FA, and CON) leading to a 1M base salary increase. Steven Stamkos's next contract would be, at a minimum, 5M per season.
David Backes is 75 OF and 80 DF. (75 + 80) / 2 = 77.5. As a result, Backes falls under the 75-79 average. His current salary is 2.5M. Under the formula, his base salary must increase by 75%. 2,500,000 * .75 = 1,875,000. 1,875,000 + 2,500,000 = 4.375M. Backes would get a 250k increase for being a "defensive specialist" bringing him to 4.625M. He has four attributes above 80 (SK, EN, Strength, FA) adding another 1M to his base salary. David Backes next contract would be, at a minimum, 5.625M per season.
Let's use my hypothetical under 70 to look at Tim Connolly. Tim Connolly is vastly overpaid at 4.5M per. If we assume a 20% decrease for Tim Connolly, he would make 3.6M, though he would get another 500k for being an "offensive specialist". So that would give him a base of 4.1M. So, I'd probably tweak that down to something more like 30, or 40, maybe even 50%. At 30%, his base would be 3.15M, At 40%, 2.7M. At 50%, 2.25M. So I think we can see that something can be worked out here.
Maxim Lapierre was last night's example of one of the few times that this may not work. Lapierre is 68 OF 80 DF. That gives him a 74 average. He currently makes 900k. Under the formula, his base would increase 100%, to 1.8M. This is not a crazy number for an 80 DF guy with 99 HI. When you add in the escalators of being a "defensive specialist", that's 250k. He gets another 250k for 81 EN. That makes Lapierre worth 2.3M.
Is Maxim Lapierre worth 2.3M? We can debate that all day long. In real life? Probably not. In EHEC where there's a premium placed on HI? How about with his 49 PEN? Reasonably, we could set a decrease clause for attributes below a certain number. It's open to discussion.
-----------------------------------------------------
Another wrinkle to this financial policy is the "Franchise Tag". Similar to the NFL, the player will be "Franchise Tagged" and cannot be traded, but their contract is extended at a discount. Exactly what that discount will be, I'm not sure. But every team will have one of these. The player will receive a No Trade Clause that can be appealed to the Committee to be overturned.
Again, the exact discount isn't known just yet, but it will be worthwhile.
------------------------------------------------------
In summation, here is how to determine a player's future contract:
Player salary * (percentage increase based on the formula of the group where the player's ((OF + DF) / 2) falls). Check for any added increases (Attributes 80+, offensive/defensive specialist).
Not a perfect system by any means, but significantly more realistic than anything we have tried to do before. Again, use this thread for discussion.
In terms of contract extensions, the contract extensions will begin the following season. So the new contract will not count against this year's salary cap. I don't know what next year's will be, so don't ask. But, these new higher-percentage rules will not count against you for this season.
Questions, comments, concerns. Let them rip.
Draft picks are going to be paid based on slot. Why? Because there's not really a better way to do it. The current NHL format is a base + "Exhbit 5" Bonuses (which will be discussed further down in this post). The way the NHL works is that the team must have enough cap room for the bonuses. As a result, a player like Tyler Seguin makes 900k per season, but his cap hit is 3.55M, based on the bonuses he is eligible to receive. Rather than keep track of all of these bonuses, we will pay guys slot money.
Here's the payscale:
Draft: 1-10 = 2.5M; 11-20 = 2M; 21-30 = 1.75M
31-40 = 1.5M; 41-50 = 1.25M; 51-60 = 1M
61-75 = 900k; 76-90 = 850k; 91-105 = 800k, 106-120 = 750k
5th-7th = 600k
As a result of these new numbers, UNDERAGED players on the FARM can make above the 1.2M threshold. This way we can still permit them to develop rapidly.
Entry level contracts (ELCs) will no longer be allowed to include team/player options.
Why do we enforce slot salaries over bonuses? Because, unlike the NHL, there is little to no chance of a player "busting" with EHM, especially as a first round pick. So all of these first/second players will range from great to good, and would likely hit their bonuses anyway within the first year of playing on the pro team.
----------------------------------------------------
Similarly, we obviously have a problem with young players making too little money. So, we will use the Exhibit 5 bonuses to increase their salaries. I'm still working on a capped number for these.
Exhibit 5 bonuses can be found here: http://www.nhlscap.com/Exhibit5.htm
In the NHL, each bonus is worth $212,500. For us, each bonus will be worth $250,000. In terms of the 2010 draft class, the bonus raises to the base salary will stop when the player reaches the new 2011 Draft slot format. For example, Brett Connolly, PHX's first round pick, currently makes $600,000. If he got three of the bonuses in his first contract year, his base salary would then be 1.35M (750k increase). If he got those three bonuses again, his salary would go up to 2.1M. If he got a different bonus and earned another 250k, his salary would be 2.35M. Another bonus would put him above the draft slot (9th overall), so his salary would be capped at 2.35M.
Also, any players under 25 that were signed to contracts after EHEC began are able to earn these Exhibit 5 bonuses. I have yet to decide how I am going to cap the salaries for these players, because some of them will earn a majority, if not all of these bonuses. A player like Phil Kessel, for example, would likely get at least seven, if not all nine of them. That would be a 2.25M increase. While that is not a ridiculous number for him (base would be 3.355M), he would earn some of these bonuses every year. And that would get pricey. So I'll be searching for a way to cap this.
The adjusted salary begins the following season. So it's not like it will happen the instant a player hits the 20-goal plateau.
--------------------------------------------------
Contracts will be limited to 4 years or 3 years + a team option. We see a handful of 5 and 6 year deals in the NHL, but they have escalating salaries and that would be a bit labor-intensive to keep an eye on here (read: I'm lazy).
-------------------------------------------------
The new contract raise rules will be based on the average of the 6 main stat categories. (It was discussed in last night's chat to use a weighted system on the more important ones and that can also be elaborated on in this thread.) In any event, for now, this is the framework for the new system. I expect this to be the system that we will use, with a few tweaks of course, to perfect it as much as possible. If a player has not reached his ceiling, the EXPECTED value will be used to determine the contract (I realize there are some issues with ST, PO, and CH in regards to this, so we'll have to figure that out).
This applies ONLY to PLAYERS UNDER 32:
85+ OF/DF average: 25% 5M+; 50% 4M+; 100% 3M-4M; 200% of current contract if under 3M; 300% if under 2M, 500% if under 1M
80-84 OF/DF average: 25% 5M+; 50% 4M+; 100% 3M+; 200% of current contract if under 3M; 250% if under 2M, 400% if under 1M
75-79 OF/DF average: 25% 4M+; 50% 3-4M+; 75% of current contract if under 3M; 150% if under 2M, 300% if under 1M
70-74 OF/DF average: 25% 3M+; 50% of current contract if under 3M; 75% if under 2M; 100% if under 1M
Players who average below 70 are TBD, but I think it would be safe to assume something along the lines of up to 20% decrease 4M+; up to 10% decrease 3-4M; 5% increase 2-3M, 10% increase 2M, 25% increase if under 1M. Just a rough guess, with no examples thrown in.
There are two caveats to this system. The first is the concept of a player who is a "specialist". This will be any player whose OF is 5 points higher than their DF or vice versa. Right off the top, any player whose OF is 5 or more points above the DF will be labeled an offensive specialist. As we know, offensive guys are paid more in real life. These players will receive an automatic 500k increase to their base salary from the percentages. Any "defensive specialist", 5 or more DF higher than OF will get 250k added to their base.
The other caveat is that any supplemental attributes (with the exception of fighting) with a value of 80 or more will lead to another 250k increase. So, a player with a 85 HI, a 84 SK, a 82 EN, and a 81 CON would get an extra 1M on their base salary.
I'm beginning to come around to Parker's idea last night of a human element in terms of arbitration and I think I have a concept that would suit his wishes, along with Dan's wishes of having some sort of human element to this. Players over the age of 32 will done on an arbitrary basis. What I mean by that is a group of GMs, from the opposite conference, will assess the older player and determine if his performance warrants a raise, a decrease, or a similar contract. We can use comparisons to similar players, both statistically and on their in-game attribute values.
It's an idea. One that can be elaborated on.
Now, let me hit you with some examples of this new system.
First example would be Steven Stamkos. Stamkos is 89 OF and 71 DF. (89 + 71) / 2 = 80. (his stickhandling may go up slightly, but he has technically reached his ceiling value). As a result, Stamkos falls under the 80-84 average. His current salary is 875k. Under the formula, his base salary must increase by 400%. 875,000 * 4 = 3.5M. Stamkos would also fall under the "offensive specialist" bonus, bringing his base salary to 4M. He also has four supplemental attributes above 80 (SK, EN, FA, and CON) leading to a 1M base salary increase. Steven Stamkos's next contract would be, at a minimum, 5M per season.
David Backes is 75 OF and 80 DF. (75 + 80) / 2 = 77.5. As a result, Backes falls under the 75-79 average. His current salary is 2.5M. Under the formula, his base salary must increase by 75%. 2,500,000 * .75 = 1,875,000. 1,875,000 + 2,500,000 = 4.375M. Backes would get a 250k increase for being a "defensive specialist" bringing him to 4.625M. He has four attributes above 80 (SK, EN, Strength, FA) adding another 1M to his base salary. David Backes next contract would be, at a minimum, 5.625M per season.
Let's use my hypothetical under 70 to look at Tim Connolly. Tim Connolly is vastly overpaid at 4.5M per. If we assume a 20% decrease for Tim Connolly, he would make 3.6M, though he would get another 500k for being an "offensive specialist". So that would give him a base of 4.1M. So, I'd probably tweak that down to something more like 30, or 40, maybe even 50%. At 30%, his base would be 3.15M, At 40%, 2.7M. At 50%, 2.25M. So I think we can see that something can be worked out here.
Maxim Lapierre was last night's example of one of the few times that this may not work. Lapierre is 68 OF 80 DF. That gives him a 74 average. He currently makes 900k. Under the formula, his base would increase 100%, to 1.8M. This is not a crazy number for an 80 DF guy with 99 HI. When you add in the escalators of being a "defensive specialist", that's 250k. He gets another 250k for 81 EN. That makes Lapierre worth 2.3M.
Is Maxim Lapierre worth 2.3M? We can debate that all day long. In real life? Probably not. In EHEC where there's a premium placed on HI? How about with his 49 PEN? Reasonably, we could set a decrease clause for attributes below a certain number. It's open to discussion.
-----------------------------------------------------
Another wrinkle to this financial policy is the "Franchise Tag". Similar to the NFL, the player will be "Franchise Tagged" and cannot be traded, but their contract is extended at a discount. Exactly what that discount will be, I'm not sure. But every team will have one of these. The player will receive a No Trade Clause that can be appealed to the Committee to be overturned.
Again, the exact discount isn't known just yet, but it will be worthwhile.
------------------------------------------------------
In summation, here is how to determine a player's future contract:
Player salary * (percentage increase based on the formula of the group where the player's ((OF + DF) / 2) falls). Check for any added increases (Attributes 80+, offensive/defensive specialist).
Not a perfect system by any means, but significantly more realistic than anything we have tried to do before. Again, use this thread for discussion.
In terms of contract extensions, the contract extensions will begin the following season. So the new contract will not count against this year's salary cap. I don't know what next year's will be, so don't ask. But, these new higher-percentage rules will not count against you for this season.
Questions, comments, concerns. Let them rip.