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Should the NHL punish teams for financial mismanagement?

In other sports (in the UK this is common) teams are punished with point penalties for going into administration and/or worse (an example is a Premier League soccer team that goes into administration is docked 10 standings points; other sports have similar penalties). Yet, despite a salary cap system the NHL is operating Phoenix, with Dallas and New Jersey having issues and alleged issues. Would a deduction of standings points be a fix/solution or a draconian punishment?

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  • 9 years ago
    Favourite answer

    It is a double edge sword to punish teams for financial mismanagement under the current cap system. Sure there is a cap system, but included in there is a cap floor that each team must reach. I understand the ceiling is calculated to be that of 54% (I believe it is 54% anyway) of the total NHL revenue, so that players can get their fair share of the pie. However, we are heading into the sixth NHL season since the lockout, and the cap ceiling is nearly $30mil higher than it was in 05-06, and the cap floor is now almost $10mil higher than that previously mentioned original cap ceiling of $39mil.

    Now I can't find any more recent or more reliable numbers than the report Forbes did in 2010. In that report, Forbes ranked the 30 NHL teams based on 5 different categories. An interesting point to look at in that report is the Operating Income category, which is defined as "earnings before interest, taxes, depreciation and amortization". Now without going into an intro to Financial Accounting class, lets just leave this as the best indicator of profits (unless you want to show off your skills) that Forbes has. Of the 30 teams in the NHL, only 14 teams operated with a positive Operating Income, and of those 14 teams, only 7 were in the double digits ($mil).

    Now what am I getting at? Well, there is a handful of teams making killer money in the NHL (Leafs, Canadiens, Rangers, Blackhawks, Canucks, Red Wings, and Flyers). Yes the salary cap does help the small market teams, but only to a certain extent. With these large market teams continually making money at a larger rate than the rest of the league, the small market teams are going to find themselves hard pressed not only to put a decent product on the ice, but to meet the cap floor. How can the NHL fine teams for having financial problems, when the league itself has almost returned to its old nature dominated by a few financially rich teams, albeit within a cap system. Docking a team like Phoenix could be the difference between the team staying in Phoenix.

    Hell, since the cap has risen so much, the only thing that creates parity is the shootout/3 point games, but that is an argument for another day.

    EDIT - Yes I did watch the game this morning on PVR. Now those are some playoff beards!

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  • Luckily I have a little inside information and in site on this coming as a dallas fan.. I can tell you that for dallas fans anyway this would actually drive the team into further finalance loss. every one thinks that Dallas is a sports town but its not... Its a winners town.

    If you start taking points away from the stars who are already missing the playoffs by the skin of their teeth your going to loose attendance by the fans that blow the dust off their Modano jersey during every win streak and play off birth.

    Maybe the reason that this works in other countries is that people are just a fan of the sport and not the team more so then U.S./Canada

    Source(s): Look at me useing paragraphs!
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  • 9 years ago

    If they were over the cap that would be one thing. Since the players take the salary they are partially responsible. Being a team that spends more then it can afford, but still under the cap, they shouldn't be. That's the owner's fault. Actually WINS will help bring money in more then anything, and being behind in the standings won't help.

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  • Anonymous
    9 years ago

    No. It's the NHL's fault for expanding beyond the number of franchises that can remain viable year in year out. The NHL tried to press the issue of expansion in non-hockey markets and they alone are to blame for the consequences.

    The best solution would be to drop the number of teams to 24. This would help eliminate teams that are in the red ink every year despite receiving revenue sharing. It would also make each team better and more competitive, so the product on the ice would attract more fans. Instead of the watered down teams we see now that are littered with AHL caliber players.

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  • Anonymous
    9 years ago

    A deduction of standing points really affects everyone in the franchise, which is not a good idea, because like others said it isn't fair to the players and the players. The players aren't the ones who are doing this, which is also to say I can't think of any other solution.

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  • 9 years ago

    If anyone should be punished, it is the owners and/or whoever else is responsible. I believe that a deduction of standings points would not be a fix/solution and would only hurt the players, which earned those points in the first place.

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  • The problem is, the fans and the players would be the ones who suffer, and they're not the ones responsible for mismanagement. I imagine that sports management is different in the UK from the U.S., so what works there probably would not work here.

    Also remember that the U.S. itself is in terrible financial straits and fewer people are spending money on entertainment--such as hockey games--because of it.

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  • Anonymous
    9 years ago

    I have mixed emotions because no matter if you do or you don't punish the team, the losers are the fans and the players and neither one of them have control over the financial mismanagement of the team. However on the other hand, it could be a deterrent to prevent over spending.

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    6 years ago

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  • RM
    Lv 6
    9 years ago

    No. Let them collapse and be retracted.

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