This is Part Two of a two-part series I wrote on how the Leafs should manage a unique salary cap problem they have over the next two years. Part One explained the problem of bonus overages and their interaction with LTIR, while Part Two explores how to handle that problem.

We’ve established that the Leafs are probably better off trying to Double Dip the bonus overage in the 2018-19 season, because it gives them a better position for when they need room for Matthews and Marner’s contracts, and because there are likely better options for upgrading in the 2019 offseason.

In Part One of this series, I laid out how the Toronto Maple Leafs have to decide how best to handle the bonus overage problem in the next two years, and why Nathan Horton’s LTIR contract makes that a more complicated decision. Ultimately, I concluded that it was best to use the massive amount of cap room in the 2018-19 season to eat the overage rather than doing so the following season.

This second part will examine a way that the Leafs can pull off the Rainy Day scenario while at the same time making life even easier for themselves in the 2018-19 season. After all, they want to be competitive and you can’t always bet on the future when you have an opportunity to win now.

In Part One I theorized that the Leafs could Double Dip in 2018-19 and leave the bonus overage, a bonus cushion, and Nathan Horton’s contract on the cap as dead money, and still have $3 million or so even if they signed a good third line center. That may sound like a pretty sweet cap position, but what if the Leafs want to do even more? It’s possible that the bonus overage may not be as large as expected, and the Leafs may want to really swing for the fence and get Tavares? Or retain JVR on a short, expensive deal? Maybe they get the opportunity to bring in a right-handed defenceman by trade and have to pay him, like Jacob Trouba? In all these scenarios, finding an extra $1-2 million in cap space would go a long way.

The Leafs strategy is to find a way to turn some of the dead cap money into spendable salary, and to do that they have to find a way to trade Nathan Horton, almost certainly taking back money in the deal (I’m assuming that the Leafs don’t want to give up significant assets in this case). Fortunately, there is a way to do this – it just requires some creativity.

(Credit for this article should go to @PDWhoa, who originally came up with this idea)

From the Leafs’ perspective, such a trade only make sense for them if it allows them to access some money in 2017-18, while not costing them any money (or at least not excessive money) in 2019-20. That leaves two possible options for the type of contract to take back. First, they could take a contract that expires in 2020 worth significantly less than Horton’s, but this would likely be hard to find, hard to convince the other team to trade, and would also place too much of a strain on the 2019-20 cap. The Leafs could also explore a scenario where they trade for such a contract and buy out the final year only, but it would still be difficult to do.

The second and better option is to find a contract that expires in 2019.



For example, let’s use Matt Moulson’s contract, which expires after the 2018-19 season and carries an AVV of $5 million. If the Leafs trade Horton for Moulson, they could reduce their cap hit in one of two ways. They could either bury Moulson in the AHL and save $1.05 million against the cap, or buy Moulson out and incur a small cap hit in 2019-20. Moulson’s deal, due to his signing bonus, is structured in such a way that most of the cap hit would be incurred in 2018-19, but it likely the buyouts of other contracts would be spaced out more evenly. Either way, they’ve given themselves more breathing room in 2018-19 without putting themselves in a difficult position for the following season.

While one might think that it should be easy to find a taker for a contract that will just go on LTIR, Horton’s situation makes it more difficult because his contract is not insured. You may recall that’s why Columbus traded him for David Clarkson in the first place. While his contract can be used for cap savings, it still has to be paid out in real dollars, which makes it a lot harder to move. Specifically, it takes out any budget team that is looking to shed money, such as Arizona, Ottawa, or Florida, as a potential suitor. Even for non-budget teams, it’s difficult to convince an owner to pay out $10.6 million for a guy that will never see the ice. Even in the case of trading for Moulson, the deal would have to be worth spending an extra $5.6 million in total for the Buffalo Sabres.

So the Leafs are looking to trade Horton for a very specific type of cap dump. Here are the parameters I’ve come up with:

The contract must end on June 30, 2019. The player must be negative value relative to the contract – not merely overpaid but significantly so. The AAV contract cannot be too high or too low. Specifically, it must be low enough so that the Leafs would save significant money by burying the player – therefore, the high range the contract can be is roughly $5.3 million. On the other hand, the contract cannot be so low so as to make it not worth it for the recipient team to pay out significant extra money. I estimate the low range to be around $3 million. The recipient team must be one that has the ability and willingness to take on excess salary, and has been comfortable operating in that way before. The recipient team must be motivated to swap out a contract against the cap for real money that is off the cap. This ultimately means that the team must have some desire to contend and spend to the cap in the 2018-19 season. The recipient team cannot be adversely affected by the LTIR replacement, which eliminates teams who, like the Leafs, have a large amount of expected performance bonuses.

With these parameters, it cuts down our list of candidate salary dumps. For example, Jori Lehtera was one possibility I considered, but Flyers are another team with a good young crop of rookies. Between Nolan Patrick, Travis Konecny, Ivan Provorov, and Travis Sanheim, the Flyers need to have a cushion of roughly $4 million. Nonetheless, I found four reasonable possible cap dumps that fit the parameters for a Horton trade.

Also not ranked: I originally had Jimmy Howard, who would be finishing up a 6 year deal with an AAV of $5,291,667, as consideration here. However, I don’t think he would be a good option for three reasons:

He’s still seeing regular playing time with the Red Wings, who are seemingly of two minds about Petr Mrazek. His AAV is right up at the high range of being worth it for the Leafs to trade for. He has 10-team trade list, which the Leafs are likely not on, and would probably not waive it to be a cap dump on the Marlies.

4) Braydon Coburn, TBL, $3.7 million AAV

Since being acquired from the Flyers in 2015, Coburn has been a good soldier for the Lightning. But the team, like always, is tight to the cap and already has a glut of defencemen who have passed Coburn on the depth chart. At 32 years old, he’s down to bottom pairing minutes at even strength, though he still plays a large part on the Lightning’s penalty kill.

Tampa is obviously a cup contender, and will want to be able to re-sign Vladislav Namestnikov, Slater Koekkoek, and Cedric Paquette in 2018. Shedding $3.7 million will help that, although it will mean a possible $1 million overage for Tampa in 2019-20, due to potential performance bonuses for Mikhail Sergachev and Brayden Point.

The biggest obstacle would likely be Coburn’s limited NTC, and his burning desire to not spend his 33-year-old season in the AHL. He has a 16-team trade list in 2018-19, meaning there is a better than even chance the Leafs are on it. With Sergachev and Koekkoek making strides this year, Tampa may find that it no longer needs Coburn on the left side and that his salary could be better spent elsewhere. The team is in win now mode and despite being in a smaller market they have never been shy to spend money. If the trade did go through, a buyout of Coburn’s contract would cost $1.23 million in each of the 2018-19 and 2019-20 seasons, so the Leafs would be better off burying Coburn where his contract would count for $2.25 million against the cap.

3) Matt Moulson, BUF, $5 Million AAV

The original proposal that inspired this idea, Moulson was originally signed to be the guiding veteran on the supertanker 2014-15 Buffalo Sabres. It was a baffling contract then and remains so now, even though Moulson was recently waived by the Sabres and loaned to the Ontario Reign (Los Angeles Kings affiliate). One doesn’t need to be an insider to see that the woeful Sabres are ready to move on from that contract, which will count for $3.95 million against the cap when buried in 2018-19.

The Sabres motivation to take on Horton’s salary for cap relief is a bit of a mixed bag. Despite their rebuild going about as well as Homer Simpson jumping Springfield Gorge, I don’t doubt that the team will want to be competitive next year, if only to avoid their fans storming the home arena like the Bastille.

That said, the team may not need the cap relief that badly next year – despite Eichel’s $80 million payday, they only have $51 million committed at this point. However, that’s before factoring in new deals for Sam Reinhart and Victor Antipin, and even more importantly whoever the Sabres try to bring in to improve. An extra $4 million or so would help for a team that generally needs to pay a premium for free agents in the first place.

Ultimately, Buffalo’s decision could come down to how bonkers they want to go in free agency this year, and it’s tough to get a read on what new GM Jason Botterrill would plan on doing. If the team does shoot for the moon, clearing out cap would be one option they would look at.

2) Niklas Kronwall, DET, $4.75 million AAV

Kronwall is a relic of the bygone era of the Red Wings, and hasn’t been an effective defenseman for at least two seasons. Detroit is rebuilding, but the signals from management are that they want to remain competitive while doing so. Swapping out Kronwall’s salary for LTIR relief would give the Red Wings an extra $4.75 million in a year where Dylan Larkin, Anthony Mantha, and Andreas Athanasiou all need new contracts. Moreover, Detroit has very little in the way of performance bonuses, and is already using LTIR for Johan Franzen’s contract, so Nathan Horton would not disrupt their cap situation.

The reason why Kronwall may not make a good cap dump is that he might simply choose to retire instead. His salary dips from $3.5 million in 2017-18 to $1.75 million in 2018-19, which indicates some possible planned retirement in 2018, especially for a lifelong Red Wing who may not want to exit the stage in a Marlies uniform. Ultimately, it would be his decision, as well as Detroit’s, as Kronwall has a modified NTC that allows him to submit a 10-team list to be traded to.

Ultimately, Kronwall’s decision could come down to simple money – it’s hard to imagine anyone turning down $1.75 million to play in the AHL or sit at home. If he wants to collect his 2018-19 salary, Detroit would be in a much better position if they moved him for $5.3 million in replaceable money.

1) Carl Hagelin, PIT, $4 million AAV

Some of you might be surprised by Hagelin being an option, let alone the best option, for a Horton trade, but I assure you there is a method to my madness, as it’s quickly becoming apparent that Hagelin is sliding into negative value territory.

Hagelin has been a useful player for the Penguins since being acquired from Anaheim midway through the 2015-16 season. He was an integral part of the famed HBK line that helped Pittsburgh win the cup that season, and he sealed their consecutive win in 2017 by outracing Predators defenseman PK Subban to score an empty net goal in Game 6 of the Cup final.

However, since scoring 16 points in 24 playoff games in 2016, Hagelin has struggled badly in the offensive side of the game. He scored a mere 22 points in 61 games during the regular season, and that Cup clincher was only his second point of the 2017 playoffs. This year his struggles have continued, as Hagelin has managed only two goals and three assists in 29 games.

In fairness, Hagelin was not acquired to be Phil Kessel, and he does play a large role on the Penguins’ penalty kill. However, unless Sidney Crosby and Evgini Malkin both retire this year, Pittsburgh will plan to contend in 2018-19, and in that offseason they will need to give a raise to Brian Rust (who could presumably do Hagelin’s job) and find a replacement for Patric Hornqvist. Getting $5.3 million in replaceable cap room instead of paying $4 million to a defensive-winger with little offensive upside will be a plus for a team that may need to shore up its depth to make what could be their last push for a Crosby-Malkin era Cup.

From a salary cap perspective the fit works very well. Pittsburgh has only $125,000 in potential performance bonuses for Jake Guentzel, and is already right up against the upper limit this season. Hagelin could either play for the Leafs for one season as a depth defensive option, replacing Leo Komarov on the penalty kill, or count $2.95 million against the salary cap playing in the AHL.

Hagelin’s contract, which I note he signed with Anaheim rather than Pittsburgh, does not contain any trade protection, so the ball would be entirely in Jim Rutherford’s court. It would come down to whether or not Hagelin continues his poor output for the rest of the season, which is a good bet considering his track record over the last year, and Rutherford’s decisiveness to cut ties with a player who helped his team win back-to-back Stanley Cups.

Ultimately, it appears that Hagelin is a negative value player and Pittsburgh would do well to trade him for replaceable cap in order to improve the forward depth rather than spend assets trying to offload his contract.

Conclusion

The Leafs should definitely put themselves in the best position to manage their salary cap when they have to pay their big name players, but that’s no reason not to compete next season. Trading Nathan Horton would go a long way towards building a contender, but the Leafs will need to get creative. I think Carl Hagelin is a target that would make the most sense for both teams, but any of the four players I’ve listed should provide enough relief to give them the flexibility necessary to build a contender.