NHL offer sheets: put those pens away
Excited that your team is going to sign one of this year’s high-end RFAs? Don’t be. It’s not gonna happen.
Kids rule, veterans drool. Well, not quite, but eight of the NHL’s top 50 scorers in 2018-19 played on entry-level contracts. Among that group, seven were third-year players set to become restricted free agents this summer. Auston Matthews and Jake Guentzel inked their contract extensions in-season, but five of the league’s top young point-getters – Mitch Marner, Brayden Point, Mikko Rantanen, Sebastian Aho and Matthew Tkachuk – are headed toward the off-season as unsigned RFAs. And that quintet barely scratches the surface of the RFA board for 2019, which also includes snipers Patrik Laine and Kyle Connor, defensemen Jacob Trouba and Charlie McAvoy and goalie Jordan Binnington.
The incredible RFA class has led some prognosticators to unofficially declare 2019 as The Summer of the Offer Sheet. The qualifying-offer window closes June 25. Teams can begin negotiating offer sheets with players as of 5:00 p.m. that day, and a player can sign one from July 1 onward. Teams jammed against the cap such as the Tampa Bay Lightning and Toronto Maple Leafs, in theory, appear vulnerable once their RFAs become fair game for offer sheets.
That’s what the tabloids want you to believe. The truth: offer sheets are like Loch Ness Monster sightings. We’ve seen none in the past six years, the last being Ryan O’Reilly’s two-year deal from the Calgary Flames in 2013, which the Colorado Avalanche matched. Offer sheets are so rare because every poaching party must clear hurdle after hurdle to make them work. What exactly stands in the way?
1. Draft-pick compensation
Offer-sheeting a player with an AAV over $4,227,437 costs you a first- and third-round pick. The scale slides up continuously after that, peaking at four first-rounders for any player with an offer-sheet AAV of $10,568,590 or more. And getting under the four-first-rounder threshold isn’t as simple as it looks thanks to the rules designed to protect an RFA’s original team. To learn more, take two Advil and read the sidebar.
2. A team’s ability to match
“I’ve talked to GMs who said, ‘I have no qualms about doing an offer sheet, there’s no restriction on me doing one, but tell me how it makes sense,’ ” said agent Allan Walsh, the co-managing director of Octagon Hockey. “The feeling is an offer sheet in almost every situation is an exercise in futility because teams are always going to match. One GM, who I’ve had this conversation with many times, said, ‘The only way I’m doing it is if I believe I’ve got a great chance to get the player and they’re not going to match.’ ”
The best chance an RFA hunter has lies in the sweet spot of players below the star tier. In this type of case, the offering team might see something in the player his original team doesn’t, and the gap between values makes it likely the original team won’t want to match. That’s what happened in 2007. The Edmonton Oilers offer-sheeted left winger Dustin Penner for five years and $21.25 million, stealing him from the Anaheim Ducks, with whom he’d just scored 29 goals and won a Stanley Cup, because they refused to pay him anything close to that. “I wanted to stay in Anaheim, but I was lowballed pretty dramatically,” Penner said. “I just knew that it was so egregious, the offer that Anaheim made me, that it really didn’t leave me any choice.”
3. Bad blood between GMs
We all remember what happened after that. Then-Ducks GM Brian Burke was so incensed with then-Oilers GM Kevin Lowe that Burke challenged Lowe to meet him in a Lake Placid barn for a fistfight. Burke even offered Lowe multiple dates and times. “I knew what it was like to be a product of divorce,” Penner said. “Those awkward moments at the dinner table, I fully identified with.”
Lowe remembers the incident as uncomfortable because he and Burke were close enough friends to have gone fishing together, but Lowe doesn’t remotely regret what he did.
The logic with the Penner offer sheet was the same as the logic with the seven-year deal to which Edmonton signed Thomas Vanek 20 days earlier only to have the Buffalo Sabres match it. The poach attempts weren’t Lowe’s first choice, but he’d exhausted all other routes to upgrade his team and wasn’t getting the traction he wanted with UFAs. He felt he owed it to his franchise to improve it any way he could. “You’re beholden to one group of people, and that’s your fan base and your ownership,” Lowe said. “You’re not beholden to any friends you have in the league. If you think you are doing the right thing to improve your team, and you don’t do it because you have a relationship with the manager on the other team, that’s disrespectful to your fan base.”
Lowe’s philosophy makes plenty of sense, but for every Lowe there is a Burke. By offer-sheeting a player, you run the risk of angering another GM – and burning a bridge to future trade talks. “I’m puzzled by the fact that people get upset by it,” Lowe said. “It’s in the rulebook. It’s a tool within the means to operate your teams. I wasn’t doing it to prove anything.”
4. Player must want to sign
Everything’s moot if the player isn’t interested in joining a new team. The offer sheet requires a successful courtship. For Penner, it worked because Anaheim’s offer insulted him and because he had a former Ducks teammate, Joffrey Lupul, who was an Oiler and could tell him all about Edmonton as a city. It isn’t always that easy.
Several factors must come together for an offer sheet to work successfully. If we see one this summer, it will likely be for a lower-level RFA. The barriers to landing an elite player are too numerous.
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Since Mitch Marner has been subject to the most offer-sheet speculation this season, we’ll use him as a case study. Any deal with an AAV of $10,568,590 or higher would require sending four first-round picks to the Leafs. Even if the new team gets cute and inks Marner for $10,568,589 a year, the compensation would be two first-rounders, a second-rounder and a third.
An AAV inflator is used for draft-pick compensation rulings. It pays the player the total compensation divided by the “lesser number of the years of the offer sheet or five years.” So if Marner signed a seven-year, $70-million offer sheet, dividing by five would give him a $14-million AAV, for the purposes of the draft-pick-compensation threshold. It thus would be extremely tricky for any offer-sheeting team to get below the four-first-rounder line.
Even, for instance, a six-year offer at a $9-million AAV would divide the $54 million by five to give the star right winger a $10.8-million AAV. Boom, four first-rounders to the Leafs. To get below the four-draft-pick threshold on a seven-year contract, a team would have to offer-sheet Marner for no more than $52,842,945, creating an offer-sheet AAV of $10,568,389. But the actual cap hit, dividing that contract by seven, would be slightly below $7.55 million. If Marner signed it, the Leafs would laugh and immediately match it. There’s also no way Marner would sign for so little.