Dion Phaneuf for Marian Gaborik: Full Salary Breakdown
Who’s saving the dollars in the deal, and how much?
The Ottawa Senators acquired Marian Gaborik and Nick Shore from the Los Angeles Kings in exchange for Nate Thompson and Dion Phaneuf. The salaries of both Gaborik and Phaneuf make the financial aspect of the deal a tangly web, which is only further complicated by the Senators retaining 25% of Phaneuf’s salary.
Here’s the full breakdown of the traded salaries, to find out who’s actually coming ahead in this money-fuelled trade.
Actual Cost
Dion Phaneuf
Phaneuf’s contract, which extends until the 2021 offseason, is the largest contract in this trade with a cap hit of $7 million. His year-by-year salary doesn’t stay the same, however, as his salary structure is scheduled to decrease until the end of the contract. Here’s what each team owes Phaneuf:
Phaneuf Salary Breakdown
| Season | Phaneuf's Salary | Ottawa | Los Angeles |
|---|---|---|---|
| 2017-18 | $2,000,000 | $500,000 | $1,500,000 |
| 2018-19 | $6,500,000 | $1,625,000 | $4,875,000 |
| 2019-20 | $6,500,000 | $1,625,000 | $4,875,000 |
| 2020-21 | $5,500,000 | $1,375,000 | $4,125,000 |
| Total | $20,500,000 | $5,125,000 | $15,375,000 |
Note that players have received 18 out of 27 weeks of pay so far this season, which nicely works out to one third of their salary left to be paid by their new teams. Phaneuf was already paid a $1 million signing bonus as well, so the remaining third of his $6 million will be split between the two clubs.
From the $20.5 million he’s owed from now until the contract expires, Ottawa will still be due to pay him a total $5.125 million, even though he’ll be playing for Los Angeles.
The Rest - Ottawa
The Sens will also take on the salaries of Marian Gaborik and Nick Shore. Gaborik’s contract will expire at the same time as Phaneuf, while Ottawa will still retain Shore’s rights after his contract is up this offseason.
Like Phaneuf, Gaborik is also on a declining salary, as they’ll have to work with his cap hit of $4.875 million. Here is the breakdown:
Ottawa’s Side
| Season | Marian Gaborik | Nick Shore |
|---|---|---|
| 2017-18 | $1,691,667 | $308,333 |
| 2018-19 | $4,575,000 | $0 |
| 2019-20 | $3,175,000 | $0 |
| 2020-21 | $3,075,000 | $0 |
| Total | $12,516,667 | $308,333 |
Adding that to the amount owed to Phaneuf, the Ottawa Senators are on the books for $17,950,000 between the three pieces.
The Rest - Los Angeles
The Kings have it a bit easier, taking on only Nate Thompson’s salary of $1.65 million for this season and next on top of Phaneuf. His salary structure stays the same in both seasons.
LA’s Side
| Season | Nate Thompson |
|---|---|
| 2017-18 | $550,000 |
| 2018-19 | $1,650,000 |
| 2019-20 | $0 |
| 2020-21 | $0 |
| Total | $2,200,000 |
Add that to the amount owed Phaneuf, and the Kings will be paying out $17,575,000 to the players received through this trade, right underneath the amount Ottawa owes to its players ($17,950,000).
Year-By-Year Breakdown
The shifts in salary structure plus the expiring contracts for Shore and Thompson mean that the savings won’t be the same in every season. Putting together all the above tables, here’s what it breaks down to:
Year-By-Year Breakdown
| Season | Ottawa | Los Angeles | Difference |
|---|---|---|---|
| 2017-18 | $2,500,000 | $2,050,000 | $450,000 |
| 2018-19 | $6,200,000 | $6,525,000 | -$325,000 |
| 2019-20 | $4,800,000 | $4,875,000 | -$75,000 |
| 2020-21 | $4,450,000 | $4,125,000 | $325,000 |
| Total | $17,950,000 | $17,575,000 | $375,000 |
Overall, the Los Angeles Kings will pay $375,000 less than the Ottawa Senators in player salaries. That’s awfully close for the amount of salary that was involved overall, although the Kings come out ahead.
Cost Savings
Now we take these amounts and compare them to what each team would’ve had to pay previously, in order to find out how much each team is saving or taking on.
Cost Savings
| Season | OTT Before | OTT After | OTT Savings | LAK Before | LAK After | LAK Savings |
|---|---|---|---|---|---|---|
| 2017-18 | $2,550,000 | $2,500,000 | $50,000 | $2,000,000 | $2,050,000 | -$50,000 |
| 2018-19 | $8,150,000 | $6,200,000 | $1,950,000 | $4,575,000 | $6,525,000 | -$1,950,000 |
| 2019-20 | $6,500,000 | $4,800,000 | $1,700,000 | $3,175,000 | $4,875,000 | -$1,700,000 |
| 2020-21 | $5,500,000 | $4,450,000 | $1,050,000 | $3,075,000 | $4,125,000 | -$1,050,000 |
| Total | $22,700,000 | $17,950,000 | $4,750,000 | $12,825,000 | $17,575,000 | -$4,750,000 |
As a result of this trade, the Ottawa Senators shed $4,750,000 of player salaries to the Los Angeles Kings. Although the actual cost for both teams amounts to be nearly identical, the Kings come out with the short end of the stick financially. When Eugene Melnyk talked about cutting player salaries, this is what he meant.
Cap Implications
Although this shouldn’t be of worry for the Senators, who have been operating under the salary cap for years, the Kings have been spending closer to the limit, as this trade could affect future moves in order to accommodate for the salary cap.
As it turns out, Ottawa once again is the team taking on cap, this time to a more dramatic extent.
Cap Hit Breakdown
| Season | Phaneuf (LAK) | Phaneuf (OTT) | Gaborik (OTT) | Shore (OTT) | Thompson (LAK) | Total (OTT) | Total (LAK) | Difference |
|---|---|---|---|---|---|---|---|---|
| 2017-18 | $5,250,000 | $1,750,000 | $4,875,000 | $925,000 | $1,650,000 | $7,550,000 | $6,900,000 | $650,000 |
| 2018-19 | $5,250,000 | $1,750,000 | $4,875,000 | $0 | $1,650,000 | $6,625,000 | $6,900,000 | -$275,000 |
| 2019-20 | $5,250,000 | $1,750,000 | $4,875,000 | $0 | $0 | $6,625,000 | $5,250,000 | $1,375,000 |
| 2020-21 | $5,250,000 | $1,750,000 | $4,875,000 | $0 | $0 | $6,625,000 | $5,250,000 | $1,375,000 |
| Total | $21,000,000 | $7,000,000 | $19,500,000 | $925,000 | $3,300,000 | $27,425,000 | $24,300,000 | $3,125,000 |
Unlike the player salaries, the actual cap hit coming back for Ottawa is more significant than that for LA, exceeding theirs by more than $3 million. What we’re really after, however, is the difference from what the cap hit they would’ve been on the books for before.
Salary Cap Savings
| Season | OTT Before | OTT After | OTT Savings | LAK Before | LAK After | LAK Savings |
|---|---|---|---|---|---|---|
| 2017-18 | $8,650,000 | $7,550,000 | $1,100,000 | $5,800,000 | $6,900,000 | -$1,100,000 |
| 2018-19 | $8,650,000 | $6,625,000 | $2,025,000 | $4,875,000 | $6,900,000 | -$2,025,000 |
| 2019-20 | $7,000,000 | $6,625,000 | $375,000 | $4,875,000 | $5,250,000 | -$375,000 |
| 2020-21 | $7,000,000 | $6,625,000 | $375,000 | $4,875,000 | $5,250,000 | -$375,000 |
| Total | $31,300,000 | $27,425,000 | $3,875,000 | $20,425,000 | $24,300,000 | -$3,875,000 |
Additionally to the costs being cut, the Senators will be decreasing their cap space, going down as much as $2.025 million next season. The Kings’ cap goes up that amount next season, bringing them closer to the limit. As it currently stands, however, Ottawa has the higher team cap hit by over $2 million.
Final Thoughts
This was Pierre Dorion’s motive for the trade. The Sens weren’t in need for an additional depth forward (although their depth has been a problem), because they’re not going for a playoff spot.
The team is in a dire state financially, and costs needed to be cut somewhere. Melnyk mentioned in his infamous December interview that player salaries were next on the chopping block, and he wasn’t lying.
The trade deadline is still two weeks away, and although saving $3.875 million over four years is substantial, it may yet to be enough.
