Is 15 Years So Bad (Part Two)

Okay. The Rick DiPietro contract. A Garth Snow boondoggle or did this tender finally score?

What we know:

-- contract is for $4.5 mill /yr for 15 years
-- he is, currently, a top-10 ranked goaltender in the NHL
-- he will be 40 years old when the contract concludes

We also know that, compared to his peers-by-performance, he will be underpaid by the end of the 2008-09 off-season (per my previous post). We can, in fact, deduce the extent to which he may or may not be underpaid or overpaid by making two assumptions:

1. What will be the typical pay of an established top-10 goalie? **
2. How long will Rick DiPietro rank as a top-10 goalie? **

Typical Pay

Note the secondary assumption made: that we assume the goalies are established performers (or that their performance level is established). Eliminating the outliers - a rookie 'phenom' a la Roberto Luongo or a veteran 'revelation' like Tim Thomas - is an important first step. Remember - our objective is to determine the probable.

Existing contracts at, or over, the $4.5 mill /yr mark include:

4.50 /yr .. Rick DiPietro
5.20 /yr .. Martin Brodeur
5.45 /yr .. Olaf Kolzig
5.70 /yr .. Tomas Vokoun (starting 2007-08)
6.75 /yr .. Nikolai Khabibulin
6.75 /yr .. Roberto Luongo

Probable additions to that list include: JS Giguere (UFA end of 2006/07), Mikka Kiprusoff (UFA end of 2007/08), MA Fleury (RFA end of 2007/08) and Ryan Miller (RFA end of 2008/09).

Of all the names listed (existing and future):

-- the only goalie who is not in the top-10 in sv% is Khabibulin.
-- the only goalie who signed a long-term deal BEFORE Cap inflation*** was established was Martin Brodeur

Given those factors it is quite reasonable to assume that the typical pay of an established top-10 goalie in the NHL will be ~ 6.00+ mill /yr.

Age & Playing Effectiveness

The expected career arc of a player signed to a 15 year deal is, one would think, a pretty big deal. If Rick DiPietro is just another way to spell Jim Carey then Snow just gave it to Wang pretty hard. That said, it looks like DiPietro is the real deal. He may never be Brodeur or Luongo good but he will be very good for quite a while.

That is good for me because it means I don't have to think about the front-end of the career arc. I can assume he is already pretty close to where he will always be until he starts an, inevitable, age-related decline.

Approximate current age, along with the age they will be when their contracts expire, of some of the 'older' goalies in the NHL:

34 .. 39 .. Martin Brodeur
36 .. 38 .. Dwayne Roloson
36 .. 37 .. Olaf Kolzig
39 .. 39 .. Sean Burke
39 .. 39 .. Curtis Joseph
41 .. 41 .. Dominik Hasek
41 .. 41 .. Ed Belfour

Other goalies of note: Thomas' contract takes him to age 34, Legace 35 and Khabibulin 35.

Given that most, if not all, of the goalies above are starters for their teams it is not unreasonable to assume that DiPietro will continue to remain effective for many years. The decline would probably start around age 34-35 and become more pronounced the closer to age 40 he gets.

Charting Timelines & Pay Together

Using age as our baseline to chart pay becomes fairly easy at this point. It would also be realistic to adjust for Cap inflation and the effects of age so we will do so. Note that the linear scales presented are nowhere near scientific however they do serve well for approximation purposes.

01 .. 26 .. 100% .. 4.50 .. 4.50 .. 0.00
02 .. 27 .. 100% .. 4.50 .. 5.00 .. 0.50
03 .. 28 .. 100% .. 4.50 .. 6.00 .. 1.50
04 .. 29 .. 100% .. 4.50 .. 6.00 .. 1.50
05 .. 30 .. 100% .. 4.50 .. 6.00 .. 1.50
06 .. 31 .. 100% .. 4.50 .. 6.00 .. 1.50
07 .. 32 .. 100% .. 4.50 .. 6.25 .. 1.75
08 .. 33 .. 100% .. 4.50 .. 6.25 .. 1.75
09 .. 34 .. 095% .. 4.74 .. 6.25 .. 1.51
10 .. 35 .. 090% .. 5.00 .. 6.25 .. 1.25
11 .. 36 .. 085% .. 5.29 .. 6.50 .. 1.21
12 .. 37 .. 080% .. 5.63 .. 6.50 .. 0.87
13 .. 38 .. 075% .. 6.00 .. 6.50 .. 0.50
14 .. 39 .. 070% .. 6.43 .. 6.50 .. 0.07
15 .. 40 .. 065% .. 6.92 .. 6.75 ..-0.17 .. SUM = 15.24

This chart represents a decent approximation of the economic effects of deterioration due to age and savings due to inflation.

-- the % column indicates effectiveness comparative to his 'norm' at that age
-- the value of the contract over time regresses as his performance decreases
-- the typical salary of a top-10 goalie has had a slight inflation aspect added

In essence, over the life of the contract, I can confidently say that the Islanders should save some $15 million or more in Cap and budget space. I expect it will actually be far higher.

I should have one more post to offer on this subject but as of right now Garth Snow is looking pretty good.

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** in the NHL of course

*** the Salary Cap underwent a rapid increase this past off-season and looks poised to increase in a similar fashion again - I expect it slow down after this though

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Have a great evening everyone.