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Compliance Buyout Options for the Oilers

Of course when Oilers fans think buyout they think Shawn Horcoff but does it make sense to buy him out? Are there any other players they should be looking at?

Will the 2013 season be the last for Horcoff in an Oilers uniform?
Will the 2013 season be the last for Horcoff in an Oilers uniform?

In the last days of the lockout word emerged that the players and owners had agreed to allow two compliance buyouts per team. In Edmonton fans are in love with the idea of buyouts as they see them as the easiest, and perhaps only, way to get rid of the albatross that they believe Shawn Horcoff's contract to be. So disliked is the Horcoff contract that fans were giddy at the prospect of sending the Oilers captain packing this coming summer when this news broke.

These compliance buyouts, which will be exercised following the 2013 season (see update below), are intended to help those teams which have already allocated a significant amount of cap space for the 2013/14 season get under the cap; a cap that we now know will be set at $64.3M.

From a personal standpoint I'd have been much happier to see the new CBA not include these buyouts because they're nothing more than a Get Out of Jail Free card for stupid contract decisions made by owners around the league. Bad contracts are on the teams that sign them not the players. That teams can simply buy their way out of the bad decisions that they've made, and that these buyouts come from the players share of revenue, seems wrong to me.

Of course my personal feelings count for nothing in the CBA process so they form part of the agreement and therefore are worth looking at.

So what players make the best candidates for a buyout. The first criteria is an easy one, is the player unable to live up to his cap hit? And secondly does the buyout provide the team with needed cap space and/or roster flexibility? It was on this second point where a buyout for Horcoff hasn't made sense in the past. Even Horcoff's biggest supporters, of which I am one, won't argue that he isn't overpaid but the cost of buying him out combined with the cost of replacing him would have totalled more than keeping him and so the buyout made no sense from a cap standpoint.

Because these compliance buyouts won't count against the cap meeting the second criteria will be much easier now than it has been in the past but it's still a worthwhile check from a quality perspective to ensure that money is being spent wisely. After all you're essentially paying a player to play elsewhere so you'd want to make sure that is a smart decision even if the cap hit associated with doing so is zero.

Since the buyouts can't happen until this summer we can shorten the list of potential candidates to those whose contracts extend into next year. I'm going to assume the Oilers won't be extending anyone just to buy them out. According to Capgeek the Oilers have fourteen players under contract for next season, they're listed below with their cap hit.

Shawn Horcoff $5,500,000
Ales Hemsky $5,000,000
Ryan Nugent-Hopkins $3,775,000
Nail Yakupov $3,775,000
Taylor Hall $6,000,000
Ryan Smyth $2,250,000
Eric Belanger $1,750,000
Jordan Eberle $6,000,000
Ben Eager $1,100,000
Justin Schultz $3,775,000
Nick Schultz $3,500,000
Jeff Petry $1,750,000
Corey Potter $775,000
Devan Dubnyk $3,500,000

From that list I see four players whose performance could be worth substantially less than their cap hit: Horcoff, Belanger, Eager, and Dubnyk. Baring a miracle Horcoff isn't going to be worth $5.5M this year or in either of the two years that will remain on his contract after this year so he's the obvious option. Eager and Belanger both struggled in their first season with the Oilers and if that was to happen again this season they could become targets of a buyout. This is especially true if other options further down the depth chart establishes themselves as viable and cheaper alternative.

And then there's Dubnyk. Of the four listed he is who I would consider the least likely to be bought out but if he proves unable to take the reins as the number one the Oilers could/should go looking for someone else next summer after Khabibulin's contract expires or even before this season finishes. If they were lucky enough to land a definitive number one goalie then allocating $3.5M worth of cap space for a backup would become a costly luxury. Again, I doubt it's a likely outcome but it's not outside the realm of possibility.

With the candidates established lets look at whether or not buying these players out would provide the Oilers with needed cap space and/or roster flexibility. Following the Hall extension this summer I argued that the Oilers should wait and see what the new CBA looked like before signing Eberle. The argument was simple, if the cap was reset rather than rolled back the Oilers could find themselves in a very difficult situation as soon as next season, therefore it made sense to wait and see.

Since I wrote that two things have happened, the Oilers decided not to take my advice instead signing Eberle to a contract with the same cap hit as Hall and the cap was reset as I had feared. The good news is that when I looked at the number this summer I had assumed a $60M cap next season which was a little more than $4M low that what the actual cap will be. But with nine players to sign - including Sam Gagner, Ladislav Smid, and a replacement for Ryan Whitney - the $15.85M they have available to them will go quickly.

When you look at the numbers it seems unlikely that the Oilers will be able to afford any players not living up to their contract. Even if that player is the team's captain. If it was my team Horcoff would be the first to go. After that I'd take a long hard look at my roster to see if there is a second option available. Right now the smart money would probably be on Belanger if he doesn't recover this season. This would be a tough pill for Steve Tambellini to swallow, especially after his apparent joy at getting Belanger to "agree" to a three-year contract just last summer. Eager probably has a slight edge over Belanger right now because this team places tremendous value on whatever it is that Eager and Darcy Hordichuk do. Dubnyk would likely have to Khabibulin bad to be bought out. That might also see him declared the team MVP.

But let's not forget, this is the Oilers and they have been know to do some strange things from time to time. Just because it makes sense to you and me doesn't mean that is the route the Oilers would choose. It's not inconceivable that they choose to buyout nobody.

If there is a single good thing that Tambellini has done in his tenure as the GM of the Oilers it's that he has avoided long term deals. These deals, while commonplace in the NHL, can be death in a cap world and Tambellini has so far managed to avoid falling into that trap (the jury is still out on the Eberle deal). Because of this the Oilers might think they have just enough flexibility under the cap that they could try to make a go of it without riding themselves of one or more of their existing contracts. It wouldn't be easy and would likely need some savvy moves by the GM in order to be successful. Unfortunately savvy moves aren't what I would consider to be Tambellini's strong suit.

Not exercising their buyout option would be very high risk with the only real reward being points for loyalty. Loyalty is nice but this is business and after all the pain of the last few seasons it would be a shame if this iteration of the rebuild were derailed out of a sense of loyalty.

Update: According the Pierre LeBrun teams will be able to use their compliance buyouts in either the summer of 2013 or 2014. While the dates have changed there are still only two available to each team. For the Oilers this change means virtually nothing as they've got only four players under contract for the 2014/15 season: Horcoff, Hall, Yakupov, and Eberle. Horcoff is likely the only buyout option in that group and it makes more sense from a cap perspective to buy him out this summer than next. So unless the Oilers sign a new contract this summer that they want to get out from under after one season they will be done with their buyouts when the puck drops next fall.