Powder Keg

Here are a few fun facts about Ottawa Senators forward Mike Hoffman:

1. His 91-goals over the last four seasons are 22nd best in the NHL; on a rate-basis, that’s identical to Joe Pavelski and Filip Forsberg

2. He is on pace for his 4th consecutive 20+ goal season

3. He carries a $5.1mm AAV cap hit through 2019-20

4. Ottawa is +39 in goals with him on the ice;

At this point in his career, it’s reasonable to conclude that Hoffman is a first-line forward on a team-friendly contract in the prime of his career. It is also reasonable to conclude that he’s one of the league’s preeminent goal-scorers and whatever defensive deficiencies he may (or may not) have are sort of moot because, well, Ottawa always out-scores the opposition when he’s on the ice.

Hoffman is the type of player every team around the league covets. Every single organization – from Stanley Cup contenders to tank-heavy rebuild teams – are in the market for an impact player, and these guys just don’t shake loose very frequently.

That appears to matter little to Ottawa, a team now militantly hunting for any and every way to shed player salaries. I know this because the owner last week proclaimed that he would cut player payroll next because he had already cut non-roster personnel to the bone.

Hoffman trade rumors have been making the rounds for the last few days and you already get the sense that this team is going to pitch this type of trade as a way to spark the rebuild and improve the team long-term. After all, Hoffman is a desirable asset to most teams (all teams?) and is the type of player that can provide future assets that Ottawa sorely needs. So the argument will be shoehorned as pain now, gain later.

It is here you might ask why Hoffman doesn’t fit into the picture through this rebuild. Hoffman, by most first-line standards, is underpaid. And since he still has 2.5 years left on a contract that only carries him through the age of 30, there’s stunningly little long-term risk in keeping him around. Ottawa’s clearly better with him on the roster today and is almost certainly going to be more valuable than whatever asset(s) they get in a trade. I know this because, uh, only 20 or so players have out-produced Hoffman over the last four years, and the vast majority of those names are franchise cornerstones who border on untouchable.

Well, it’s worth reiterating what we know about the Ottawa Senators. They are cash poor and prioritize spending less money than their competitors above all else. Paralyzed by a grim financial outlook, Ottawa will continue to look for any way at keeping costs down.

The last six years or so has been a stark reminder on how serious they are about winning. They have spent $73mm less than Philadelphia over that interval, which is one fully-burdened roster these days. They have been out-spent by a sun belt team in Nashville. They have been out-spent by New Jersey, who were carrying at least $230mm of debt in 2013. They have been out-spent by Buffalo, who have actively purged personnel *at least* twice in an attempt to tank for draft picks. Their closest comparable? Florida – a non-competitive team that reportedly was in the hole to the tune of $154mm in 2015. (That sounds familiar!)

So, Ottawa’s in a bind now – the organization is financially unhealthy and the roster is under-performing. In any market, this is the green light a general manager needs to start purging older and declining assets for futures. This is the sort of move that satisfies an owner and can help improve the on-ice product long-term.

But Ottawa can’t do that. The team has more or less rolled the dice twice on big salaries. They made a big splash in acquiring Bobby Ryan out of Anaheim, then extended him on a seven-year deal worth $51mm. They made another big splash in trading for older defender Dion Phaneuf and his seven-year, $49mm contract.

What must be increasingly frustrating for the team right now is that neither had to happen. Ryan’s extension came a year after Ottawa traded for him. In Phaneuf’s case, the team either did not or could not get Toronto to withhold even a single dollar from what can only be considered a ridiculously oversized contract.

Why does this matter? Ottawa still owes a whopping $67mm to these two names. Ryan, now 30 years of age, has just four goals this season. Phaneuf may even be a larger predicament – he’s turning 33 in just a few months and is a whopping -30 in goals since joining Ottawa. (That’s 9th worst in the entire NHL over that span, and when you consider the only guys below him have played on incredibly crappy teams like Buffalo and Arizona, it’s really something.)

I suspect there is extremely little trade market for either of these players. They are rapidly declining assets on bloated deals, and the only way these types of players get traded is if the trading team is willing to absorb or retain a significant piece of salary. Don’t bet on that happening, though – the average NHL team has held back about $3.5mm in salary since 2014-15, and Ottawa is at $1.4mm. (This is, not surprisingly, one of the lowest numbers in the league.)

It’s this sort of financial powder keg that creates situations where teams trade great players for pennies on the dollar. Ottawa has an unstable financial situation and, in the rare moments where they have opened the wallet, have completely misfired. Combine a cash issue with roster mismanagement and you end up convincing yourself that trading a first-line winger for a future(s) asset makes sense. (It’s the mystery box! It could be anything! It could even be Mike Hoffman!)

Unfortunately for Ottawa the Mike Hoffman trade situation is just the beginning. The team is still staring down the barrel of an $11mm AAV contract for Erik Karlsson (to say nothing of some of the other assets coming due, like Mark Stone).

We already know Karlsson is cool on re-signing under the current ownership situation and have every reason to believe he’ll take nothing less than a max contract. You dangle a non-competitive roster in front of a generational talent who cares an awful lot about winning, and you have the exact recipe you need to, well, lose that very player.

Keep this part in mind if and when a Hoffman trade is effected. Losing Hoffman would hurt Ottawa. Losing Karlsson would cripple them. And make no mistake, these two are related.