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The NHL’s LTIR Crisis

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The NHL began to face the early stages of the escalation of a new issue in 2020-21. It is centered around the creative use of long-term injury reserve (LTIR) cap relief to exceed the salary cap in the postseason. Teams will place players on LTIR or acquire players already on LTIR to expand their relief pool and spend more in the regular season. Then, when the playoffs roll around, the team can reactivate the injured player (if applicable) to gain a cap space advantage in the playoffs when the salary cap is not enforced. 

Now let me be clear here, there is nothing technically wrong with teams doing this. It is allowable in the way LTIR is currently applied. The whole process is really just smart to find a way to game the system. And, the players being put onto LTIR are actually verifiably hurt and unable to play so it’s not stashing healthy players and preventing them from playing.

But all of this considered, it is still a bad look for the league to have teams gaming the system in this way. Especially when the teams and players doing it decide to get cheeky with the situation.

The Escalation in 2021-22

After seeing what the Tampa Bay Lightning did in 2020-21 with Nikita Kucherov’s hip injury keeping him out until exactly Game One of the playoffs, the strategy of using LTIR for regular season cap relief appears to have become more commonplace. This concept had been used for years, but more along the lines of a cap dump rather than gaining cap space. In 2021-22, other teams are more seriously using the new version of it. Currently, 17 teams have a cap relief pool available to them from having players on LTIR during the season. 

But, most significantly are the Lightning (again), Toronto Maple Leafs, Florida Panthers, and Vegas Golden Knights

Toronto has used this for years already to an extent, but it was more in the cap dump category of acquisitions. This season, they’ve been able to overspend and, for example, add Mark Giordano at the trade deadline.

Tampa Bay traded for Brent Seabrook’s contract and had other big names, like Kucherov, on LTIR through the season.

The Panthers were able to add Claude Giroux, Ben Chiarot, and Robert Hagg with LTIR as a part of their cap maneuvering after Aaron Ekblad was placed on LTIR shortly before the trade deadline. He is expected to be ready for or in the early stages of the playoffs.

But most egregiously in 2021-22 is the Golden Knights. This is a team that on many occasions the past couple of seasons has had to ice a roster short a player or two because they literally could not call anyone else up or dress a full lineup of skaters under the cap. They’ve spent most of this season with Mark Stone, Max Pacioretty, and Alec Martinez on LTIR at various times, with some others joining the LTI Party as well.

This has allowed them to, for example, trade for Jack Eichel. A team that was already under a cap crunch to the extent they had to trade the reigning Vezina Trophy winner for nothing was able to trade for a $10 million player. The strategy would work, assuming everyone is ready to play in the postseason. If the team even makes the playoffs, that is. Which is the funny part as there is a very real chance they won’t be able to ice their best players when they need them for a playoff push.

How Do You Fix the LTIR Problem?

The players on LTIR are actually injured and unable to play. There is a process the NHL has in place to verify the severity of injury and ability to play. But that doesn’t mean teams haven’t found a way to game it, like Kucherov’s surgery and recovery timeline happening exactly when it would need to in order for him to miss the whole season but be ready for game one of the playoffs.

But it clearly is not a perfect system and is easily exploited. This is something that needs to be fixed as soon as possible. Some of the league’s general managers are wanting to, it was a topic at their recent meetings. And from an optics standpoint, having this loophole open for teams to take advantage of is acting in bad faith in regards to why the cap is there in the first place. Teams with financial resources and ownership permission can overspend and stack their teams with more star players by acquiring LTIR cap relief in whatever form.

So what can the league do? They’ll probably come up with some intricate and complicated deterrent but there are a couple of extremely simple options to stop this madness.

First, teams can continue to have expanded rosters in the postseason, having the Black Aces with the NHL team and practicing around them in case they’re needed. But the fix will be that the game-day lineup, the card submitted at game time, must be cap compliant. Simple. The salary cap does not apply in the playoffs, which is why teams can exploit LTIR in the first place. Extending the salary cap to the playoffs for game-day lineups requires teams to be cap compliant. None of this $18 million over the cap nonsense.

Second, LTIR cap relief should not apply to players who have been traded after being placed on LTIR. This is more addressing a specific situation (the attempted Ryan Kesler to Vegas trade at the past deadline, for example). But teams should not be able to acquire cap space in that way regardless.

Commissioner Gary Bettman is not overly concerned about closing the loophole, unfortunately. But the NHL should not be allowing teams to exploit LTIR cap relief and the lack of enforced salary cap in the postseason. It is a bad look for the league to have these exploits left available and it defeats the purpose of why the cap is there in the first place in creating an uneven playing field amongst teams. With how it has escalated into this season, I can only imagine it will become even more prevalent in future years.

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