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Why the Golden Knights should have waited on the Nate Schmidt extension

Nate Schmidt always seemed a lock to get an extension from the Golden Knights. No one is arguing that. But the timing of the extension is odd given the suspended Schmidt hasn't played so much as a single season this season.

Nate Schmidt hasn’t played a single second for the Vegas Golden Knights this season, hasn’t scored a goal, has no points to his name and with 11 games still remaining on a 20-game ban that was handed down due to a violation of the NHL and NHLPA’s Performance Enhancing Substances Program, Schmidt won’t have an opportunity to do much of anything for the Golden Knights until mid-November at the earliest.

But that hasn’t stopped Vegas from inking Schmidt to a long-term extension, though. Thursday morning, the Golden Knights announced Schmidt has put pen to paper on a hefty six-year, $35.7-million extension that will pay the 27-year-old blueliner $5.95 million per season. That’s a significant raise, a hair more than $3.7 million per season, from the $2.225 million cap hit Schmidt’s current two-year pact carries.

In the final season of the aforementioned two-year deal, and a pending unrestricted free agent, Schmidt emerged as one of the Golden Knights’ top blueliners last season. It could even be argued he was Vegas’ absolute best defenseman throughout the campaign. He was certainly relied on more heavily than any other rearguard and his numbers warranted the re-signing. His 22-plus minute ice time average during the regular season was almost two full minutes clear Shea Theodore’s 20:21 average, which was the second-highest mark among all Golden Knights defensemen. Schmidt also finished second in scoring among Vegas blueliners, behind Colin Miller, with 36 points. In the post-season, Schmidt continued to be trotted out as the top defenseman, leading Vegas’ rearguards in average ice time (24:25) and again finishing second in scoring (three goals, seven points) as the Golden Knights stunned the NHL with a run to the Stanley Cup final.

Schmidt’s underlying numbers also warranted an extension. Given his zone starts last season, which had a slight defensive slant, Schmidt was a fairly effective play driver against high-quality competition. In fact, he was the only Golden Knights defenseman who has a sub-50 percent offensive zone start percentage while maintaining a possession rate above 50 percent. And Schmidt continued to do the same in the post-season despite generally going head-to-head with the opposition’s top line.

All of this is to say that Vegas has extended Schmidt comes as no surprise. But the issue here isn’t the extension. It’s the dollar amount attached to it, especially given Schmidt hasn’t suited up this season.

At $5.95 million per season, Schmidt now enters into the upper-echelon when it comes to contracts for blueliners. Though this stands to change as signings roll in towards season’s end and into next summer, Schmidt’s cap hit is, for the moment, set to be the 25th-highest in the NHL next season. And if you want to argue cap hit percentages and the like, consider that Schmidt’s contract will carry the 10th-highest cap hit of blueliners who have signed within the past two years. It’s also, somewhat stunningly, only $300,000 less per season than the Nashville Predators handed to Ryan Ellis. (Albeit Schmidt’s deal is two years shorter and Ellis copped to taking less money than he probably could have earned himself on the open market.)

There’s certainly an argument to be made that the near-$6 million annual salary isn’t some vast overpayment for Schmidt. As noted, he drove play fairly well while playing big minutes against top competition and he contributed offensively. He did everything right when it came to proving his effectiveness. So, why can’t he do it again? Why can’t he go out and be a half-point per game rearguard that skates 20 minutes or more per night against top competition? Heck, maybe he can be better.

But that seems like betting big on something that’s far from a guarantee, especially when the only real proof of Schmidt’s effectiveness as a top-pairing blueliner is a scant 96 games split between the regular and post season. It seems like an awful lot of stock to put into one (admittedly excellent) season.

Barring some sort of unreported ultimatum between player and team, it’s not as if the Golden Knights had to go out and sign Schmidt to the extension right away, either, which might be the most puzzling thing about the contract. If they had waited until January or February, what’s the worst that could have happened? It’s hard to fathom that Schmidt would have had the type of offensive outburst that resulted in him commanding much more than the $5.95-million cap hit he’ll now carry on his new deal. It’s just as likely — and maybe more, given the alternative is a 50-plus point season from Schmidt — that he would have regressed somewhat. In turn, that likely would have shaved some money off of the contract’s bottomline.

In a league where the dollars and cents matter, too, finding a way to save some money on Schmidt could have paid dividends for the Golden Knights. However, with Schmidt’s extension, not to mention the extension Alex Tuch received last week, Vegas is currently projected to have roughly $12 million in spending room at season’s end, according to CapFriendly. Even assuming a rise in the salary cap of, say, $2 million, that leaves the Golden Knights with about $14 million to spend next summer. A healthy portion of that will likely go into retaining first-line center William Karlsson, who while his goal total is lacking is still a near point per game player in the early going, while Pierre-Edouard Bellemare, Oscar Lindberg, Ryan Carpenter, Deryk Engelland and Brad Hunt will all be UFAs at the end of the campaign, with Tomas Nosek, Tomas Hyka, Jake Bischoff and Malcolm Subban all due new deals as RFAs. That doesn't leave all that much room for Vegas to wrap up their own free agents and patch whatever holes exist next summer.

If all goes well for the Golden Knights, all this worry will be for naught. Schmidt will not only prove his merit as a top-pairing defenseman, but he’ll continue to excel and make the $5.95 million cap hit look like a song. The unfortunate reality, though, is that there’s serious risk involved and risk that Vegas didn’t necessarily need to assume. The Golden Knights very likely would have been able to work out a similar extension in the next few months.

But, hey, it’s Vegas. Maybe sometimes you have to gamble.

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