The Illusion of Projected Cap Space and the 2022-23 New Jersey Devils

On Friday, Pierre LeBrun of The Athletic ($) decided to share some offseason bits of news that was not enough for a full-length post at the site but still valuable to share. It opened with how the New Jersey Devils were absolutely in on Johnny Gaudreau and Brady Tkachuk. As you know, they got neither. That was not the part of the bit that caught my eye. It was this part:

This Devils team will turn a corner led by its young core of Nico Hischier, Jack Hughes, and Dawson Mercer. And getting more saves this season.

But I would keep an eye on the Devils again for next offseason. They’ve got up to $25 million in potential expiring UFA contracts that could come off the books. They’ll want to re-sign some of those players, but still, there’s big-time cap flexibility coming if that’s what the Devils want.

The latter point has been almost a refrain for the better part of the last seven years. The Devils will have a lot of cap space to use. It has been a point made by some of the People Who Matter, noting that the Devils could still re-shape the roster as needed after the 2022-23 season. LeBrun is making a similar point. And it is a valid one. However, I do want to point out that this amount of cap space - and the overall projected cap space of $36.5 million that is currently listed at CapFriendly - is not quite as real or as large as it seems.

About The Seven UFAs Taking Up Roughly $25 Million on the Devils’ Cap...

The $25 million that LeBrun referred to is how much money is coming off the books for the Devils if all of their pending UFAs walk. Those UFAs are Andreas Johnsson, Tomas Tatar, Miles Wood, Erik Haula, Damon Severson, Ryan Graves, and Jonathan Bernier. Those seven players make up roughly $24.92 million of the Devils’ cap. LeBrun’s point (and estimation) remains true; it is a lot of money that will become available. It could even be larger if the salary cap ceiling increase after 2022-23. However, the actual number the Devils will have to work with will be different than that - and smaller.

First, the Devils may want some of those pending UFAs to return. LeBrun did point that possibility out. A lot can change between now and next season. Or, more appropriately as they are pending UFAs, between now and the 2023 NHL Trade Deadline to try to salvage something for the player. Maybe the player the Devils want to keep does not feel the same way. Maybe the player does exceedingly well and, therefore, wants to be exceedingly well-paid. Maybe the player does poorly or does not perform to expectations and the Devils just want part ways at the end of next season.

At this moment in time, right before training camp, I can see the Devils showing interest in returning one or even both defensemen Severson and Graves. Severson is practically an elder statesman as he is the last Devil with ties to the previous, far more successful regime in New Jersey. Graves has been a solid defensive hand. I can also see the Devils wanting to bring back Miles Wood for his character, intensity, and if he can bang in 15+ goals again. The other four - Johnsson, Tatar, Haula, and Bernier - could walk. Bernier may not play again; Haula has been a journeyman third line center and could be replaced; and Johnsson and Tatar have arguably not performed to the level of expectations that people hoped for in New Jersey.

However, to keep one or all three of Severson, Graves, and/or Wood would mean spending additional and significant money to do so. I would strongly bet against them taking a pay cut. Even if the players are super-generous and are willing to come back on their 2022-23 salary, that’s $3.2 million for Wood, $5.1 million for Severson, and $4 million for Graves. That’s $12.3 million right there; which is almost half of the $25 million in UFA savings. And that’s, again, a trio of team-friendly deals filled with generosity rarely seen in pro sports. I would expect the actual number to bring all three back to be even higher than that. This may be a factor as to why one or all three of those players may not be Devils beyond the 2023 NHL Trade Deadline.

Even if the Devils let all seven players go to free agency, the Devils will need someone to fill in those roster spots. That’s four forwards, two defensemen, and a goalie. The Devils do have players in Utica among other prospects they can call up to fill in all spots. The issue is that by doing so, they will take up space on the Devils’ cap. Not as much as the 7 they would be replacing, but still space nonetheless. To illustrate this point, let’s consider an even less likely scenario. What if the Devils replaced all seven pending UFAs with seven players making the NHL minimum salary for 2023-24? The minimum salary in the NHL will increase from $750,000 to $775,000 for 2023-24. That value times seven is worth $5.425 million. Again, the Devils would save a lot of money in that highly unlikely case, but it does eat a fraction of what they would gain. It is an unlikely thing to happen for two big reasons. One, the Devils have players in their organization, they do not need to sign 7 players at NHL minimum salary if they want to “lean” out their roster. Two, most players on NHL minimum salaries are not very good and replacing even Tatar or Johnsson with one is going to be a significant downgrade in quality. I presume the Devils want to improve for next season (and be better this season); that would not do it.

Still, the main point is that the Devils will need to make a choice with these 7 players at some point throughout 2022-23. If they want to keep a player, then they need to be willing to negotiate a more expensive contract than the one they are getting. If they do not, then they need to identify replacements. Either from someone in the organization - meaning their contract will be added to the Devils’ cap - or someone outside of it. The latter will be quite costly, especially if it is from free agency and for someone worth more than the league minimum.

The RFAs Are Also Going to Be Pricey

Even if the Devils are able to be careful in terms of which UFAs they want to keep, which ones they want to move on from, and what they want to do for a replacement, the bigger issue for the salary cap flexibility are the pending restricted free agents. Most RFAs are retained by their teams. Pretty much any GM worth their salt is going to qualify most of them to ensure they remain with the team. Failing to do so could cost a GM their job; just ask Dale Tallon.

For the Devils, they have six pending RFAs up with New Jersey and one that I hope makes the New Jersey Devils out of training camp - which begins later this week. Those RFAs are: Jesper Bratt, Yegor Sharangovich, Michael McLeod, Jesper Boqvist, Nathan Bastian, MacKenzie Blackwood, and Fabian Zetterlund (who is listed with Utica at CapFriendly right now; I hope he makes the team). That’s the Devils’ best player in 2021-22, a top-six forward in Sharangovich, and the goalie that Tom Fitzgerald is still showing faith in to be good for the team in the future along with four bottom-six forwards. Retaining them will not be cheap at all.

We know this because the qualifying offers alone do add up. We can determine how much that will cost right now. CapFriendly has a Qualifying Offer Calculator with the requirements of the offer detailed on the page. For Bratt, Sharangovich, and Blackwood, it is going to be 100% of the base salary they will make in 2022-23. Not their cap hit, their base salary for the season. That’s $5.45 million for Bratt, $2.05 million for Sharangovich, and $4.125 million for Blackwood. We have not even looked at the other four RFAs and that’s $11.625 million pretty much spoken for just for the qualifying offers. The actual amount of money the Devils would have to spend to keep those players will be much, much higher than that. Especially if Bratt repeats his last season, Sharangovich puts up 25+ goals, and Blackwood is legitimately good for a season. Those three could eat up a lot of the savings coming from letting UFAs walk.

Then there’s the other four. While they make less money, they do add up. McLeod’s base salary is exactly $1 million for this coming season. His offer will be $1 million. Boqvist’s base salary of $874,125 is less than a million so he will get 105% of his salary in the offer: approximately $917,831. Bastian’s base salary is $875,000 so his offer will be $918,750. Zetterlund’s base salary for this season is at the NHL minimum of $750,000, so his offer will be $787,500. Again, all four may actually sign for much more than their qualifying offers. Yet, the point remains, the offers for those four alone is about $3.6 million in total. Combined with the other three RFAs, the qualifying offers will sum up to about $15.225 million.

Even if Tom Fitzgerald uses dark magic to convince each player to re-sign at exactly their qualifying offers, the cap space to keep the RFAs will leave $21.275 million to take care of the rest of the roster. And that will absolutely not happen; especially with the fact that all of the pending RFAs except for Boqvist and Zetterlund are eligible for arbitration and will likely push for a far more lucrative deal. Of course, the more they get paid, the less space there will be for the 2023 offseason. I would also expect the trio of Bratt, Sharangovich, and Blackwood to take up much more than $15 million combined in terms of future cap space depending how they do in this coming season.

So What Does This All Mean?

The main point I am trying to make is that the Devils really don’t have $25 million in cap space to work off of from their UFAs walking. That the Devils really don’t have $36.5 million in cap space for 2023. If only to ice a full roster, some of that money is already spoken for. The more the Devils want to retain their pending UFAs and RFAs, the more money it is going to take. The highly unrealistic and “best case” numbers I put together in just keeping the RFAs for at least another season and retaining Severson, Graves, and Wood for their current salaries total up to $27.525 million. Already that $36.5 million projected cap space is cut down to $8.975 million - and no games have been played yet.

Of course, those numbers are far too low. Some of those RFAs - especially Bratt and Sharangovich - could command some significant raises. Some of those UFAs may ask and get more than just their base salary from this past season. While it does appear that the Devils will have a boatload of cap space for the 2023 offseason, that is only if they sign no one whose contracts are ending. That is not going to happen. And so, the real number that Tom Fitzgerald and his staff will work with will account for who the team wants to retain, who they can retain, and how much they think it will take to keep them. This also means that the projected cap number is not going be as much as it looks, with or without RFA contracts ending.

As a result, since a whole season between now and the 2023 offseason, Tom Fitzgerald and his staff will have to be mindful of not only how these pending free agents perform but also how much he is willing to spend to keep them. That real number can change from month to month. For the pending UFAs, the pressure will be even higher to either try to trade them before the risk of going to free agency. Even if they join someone else for some ridiculous contract, then the back-up plan has to be in place to fill in that roster spot. For some positions, that is easier than others. Simon Nemec or Luke Hughes could be argued to back fill a spot on the blueline. For forward, outside of Alexander Holtz, it may be a tough sell to bring up someone from Utica to fill in those spots - even if you find Tatar, Johnsson, and possibly Haula to be disappointments in 2022-23.

As for the RFAs, that the team and Bratt narrowly avoided arbitration suggests to me that another excellent season from the winger is going to lead to a far more expensive contract than what could have been signed this Summer. Especially in the wake of what players like Jordan Kyrou, Josh Norris, Robert Thomas, Tage Thompson, and others received. The cost may provide the temptation to move one of them if they are not performing or going to become far more expensive than they may be worth. I absolutely noticed LeBrun citing Hischier, Hughes, and Mercer as pillars of the team. I do not think he forgot about Jesper Bratt’s existence. I worry that the Devils do not see him as crucial despite how outstanding he was in 2022-23. Hopefully, Fitzgerald is not thinking of going that far. But it is a reason why Bratt or any other pending RFA gets dealt before July 1, 2023.

And what is all discussion of cap space ultimately for? LeBrun says the Devils could make a splash in the offseason. Knowing that the Devils have far less than $25 million from their UFAs walking to work with, that splash may be smaller than anticipated. The potential UFA class of 2023 does include names like Nathan MacKinnon, Dylan Larkin, David Pastrnak, Tyler Bertuzzi, and Bo Horvat among a group of 30+ year old players that have a strong history but questionable amounts of gas left in their tanks like Patrick Kane, Jonathan Toews, Vladimir Tarasenko, Ryan O’Reilly, Dmitry Orlov, James van Reimsdyk, and Shayne Gostistbehere. That list may get smaller as the season goes on. MacKinnon is already working on an extension. So is Pastrnak. Larkin has had discussions but nothing concrete yet. The opportunity to make a splash may not be so bold as it may look today even if the Devils did have the ton of cap space they are projected to have.

No Need to Worry Too Much

The good news is that despite my concerns, the Devils still have a fairly healthy cap situation for 2023-24. The Devils have just 22 contracts on the books for the following season, so there is a lot of flexibility in terms of re-shaping the roster as Tom Fitzgerald or a future GM sees fit. The dead cap hits of Cory Schneider and Janne Kuokkanen are just $2.325 million and will enter their final season. Just about everyone in Utica is on a cheap ELC or two-way deal. If the salary cap ceiling goes up, then these concerns are eased and the Devils (and everyone else) will have more room to play with. The Devils are not in a position where they will absolutely need to use Long Term Injured Reserve or, worse, make an undesirable trade to get below the salary cap ceiling in 2023.

The Devils’ current position is not the best, though. After re-signing Bratt, Wood, Vitek Vanecek, Boqvist, and Tyce Thompson; trading Pavel Zacha for Erik Haula; trading Ty Smith for John Marino, and signing Ondrej Palat, Brendan Smith, and Simon Nemec, the Devils are just about capped out. CapFriendly lists their projected cap space for this season at $73,375. I did not forget a digit. Of course, this is not a true number. Nemec may be sent to Utica and, more importantly, Jonathan Bernier is likely going to LTIR. The latter will give the Devils $4.125 million of breathing room for call ups and any other transactions to be made.

What that means is that the sheer number of contracts ending after 2022-23 will give Fitzgerald & Co. the flexibility to go into next offseason with many different options. As much as their projected $36.5 million in cap space is spoken for, they will have plenty of control over how much really has to be used. And, again, as this season goes on, should any players emerge (e.g. Utica Comet players, a certain Michigan Wolverine) as someone for the NHL roster in 2023-24, then there will be more of an opportunity to spend in the 2023 offseason.

Fitzgerald and his staff will still need to be judicious with whatever space they will have after accounting for RFAs and any UFAs to keep. This past offseason was very active and pushed the Devils closer to the cap ceiling since before The First Rebuild. It would be difficult to spend that much again short of the salary cap rising up and the Devils cutting most of those pending free agents loose. Whether it would be a good idea to spend that much again is another question; and the answer will change as the season goes on and free agency picture is moved.

Your Take

The major lesson, again, is that the projected cap number or how much space a team will get in the next season is not what it seems on the surface. It is very easy to say the cap is not an issue for next season because the Devils have a massive amount of it: LeBrun’s citation of ~$25 million from the UFAs walking and CapFriendly’s projection of $36.5 million. But those numbers is only true if those free agents - restricted or otherwise - do not return. It is very unlikely the Devils will let them all walk and very foolish if they actually do. Which ones to keep and for how much will be an ongoing debate, but Fitzgerald and the rest of Devils management need to at least estimate how much of that space will be used for that so they can have an idea of how much space they will need for the future. Which will change as players play in the season, the team performs in the season, the trade market comes up by early March 2023, and the offseason gets closer to July 1, 2023. I do not think the Devils are in such dire straits where they need to move players to make space now; but as with this Summer, the Devils would be wise to be careful about how much they hand out to whom. Giving big money to “mid” players is a common way for teams to quickly get into cap problems - regardless of whether the team is any good.

Now I want to know your take on all of this. I know it is for something about a year from now, but what do you make of the Devils’ cap situation for the future? While it seems like there will be a lot of room, the Devils will definitely bring some players back - and that will take up some of that room. Who do you think is worth retaining? Who do you think the Devils need to move on from instead of re-signing them? If the Devils are legitimately (and hopefully!) competitive in 2022-23, how should their approach change for the next offseason? Please leave your answers and other thoughts about this in the comments. Thank you for reading.