Amending the NHL-CHL Transfer Agreement

By Tom Hunter (@PuckDontLie)

By now, everyone in Leafs Nation is likely familiar with the NHL-CHL agreement, which stands between Mitch Marner and the chance to play in the AHL next season.

Thanks to an MVP performance from the uber-prospect at the Memorial Cup, the debate is hot right now over Marner’s near future. We all know he is far too good for the OHL, but no one is certain yet how he will fare against the best players in the world or if he will be ready for Mike Babcock’s system at training camp.

Nobody doubts the talent that Mitch Marner possesses, but the question of being NHL-ready is one that will be debated until we see for ourselves next October. Just last week, I wrote a profile about Marner as a prospect, in which I mentioned that being too good for the OHL does not equate to being NHL ready. It may, but it’s not guaranteed.

The fact of the matter, though, is that the league that is likely the best option for Marner’s development – the American Hockey League – is off limits.

The Problem

Thanks to the NHL-CHL agreement, no players drafted out of the CHL are eligible to play in the AHL until they are 20-years old (they must be 20 by December 31 of the year the season starts).

Why does this agreement exist? It’s simple. Money.

The agreement is a way for CHL/OHL commissioner David Branch to ensure that he keeps as high-level a product as possible on the ice in his league. If junior players were allowed to make the jump to the AHL whenever their NHL team wanted, the product of the CHL would likely drop drastically.

Take this year’s OHL scoring leaders, for example.

The league’s leading scorer, Kevin Lebanc of the Barrie Colts, was AHL eligible so the San Jose Sharks sent him back to junior of their own volition. After him, though, the next three – Christian Dvorak, Mitch Marner and Dylan Strome – all would have very likely been playing in the AHL this season.

That trio all sat in the league’s top-5 in scoring during the 2014-15 season as well, and given the opportunity, Toronto and Arizona might have preferred to have seen them playing in a more competitive league this season.

This is what scares the CHL. We just watched the London Knights cap off a dazzling season at the Memorial Cup, but things would have been drastically different for London this time around had Marner and Dvorak been playing in the AHL this year. You don’t have to be a regular in OHL arenas to know that the OHL product would have been significantly diminished if they were missing the league’s best three players.

Marner Isn’t An Isolated Case

One of the first times this agreement was seen as an issue for NHL teams was in November of 2013, when the Buffalo Sabres tried to send then 19-year old Mikhail Grigorenko to Rochester for a conditioning assignment. The NHL blocked the move, as it would have been in violation for the terms of the agreement – even though it was only for 14 days of ‘rehab’.

While it may seem like it (since as you know Leafs fans believe Toronto to be the Centre of the Hockey Universe), this is not a problem exclusive to Mitch Marner.

Dylan Strome, Pavel Zacha, Mathew Barzal, Ivan Provorov and Zachary Senyshyn – all first round picks from the 2015 NHL Entry Draft – are players that will be forced back to the CHL next season if they don’t make their respective NHL teams, yet look to be ready for pro play.

The New York Islanders stole Mathew Barzal with the 16th pick of the 2015 NHL Entry Draft – and he’s a perfect example of a player who, like Marner, is hurt by this agreement. He was so impressive in training camp that he was one of the last cuts for the Islanders, and if not for contract restrictions may have started the season in the NHL. It’s very likely that Garth Snow and the rest of the Islanders front office would have liked to see what Barzal could have done against pro players. But alas, he was forced back to the WHL for another season.

The Desire To Change

With the development of the AHL’s Pacific Division this past year, we have seen an increasing trend of NHL teams moving their minor league affiliate closer to home base. Doing so allows them roster flexibility when it comes to calling up players – but more importantly, it allows management to keep better tabs on the development of prospects.

With AHL teams closer to home, development coaches can be at the disposal of more players in the organization. Having the ability to play your prized prospects in the AHL while they receive coaching from your top development personnel is something that many organizations would welcome.

The Solution

What if there is a way to make both sides happy?

What if we could see players like Dylan Strome and Mitch Marner eligible for the AHL a year early while making the drop in talent comfortable for the CHL?

Neate Sager wrote a piece for Sportsnet a few days ago, suggesting that junior eligibility not be based on age – but on time served in the CHL. Counting all games played, regular season and playoffs and when a player hits a certain threshold, they become eligible to move on.

That’s a good idea and one that would likely work, but what is in it for the CHL and their teams?

What if amending the agreement could be a lot more simple?

As with most things in the business of sports, everything to do with the NHL-CHL agreement comes down to money. The CHL isn’t worried about a diminished level of hockey because of some altruistic ‘passion for the game’. They are worried that if the top talent isn’t available, ticket sales will drop, resulting in lower revenue league-wide.

So pay them. Pay the CHL and their teams actual, tangible cash money in exchange for their top players.

What if NHL teams were allowed one ‘buy-out’?

Hear me out. My suggestion is that the transfer agreement contains a loophole that would allow each NHL team the ability to buy a prospect out of their 19-year old season. Have the leagues negotiate a set fee that would be the price of ‘buying’ a prospect – say somewhere around $250,000.

Let’s use Marner as the example (because he’s the only one we care about, right?). If after training camp, the Leafs decided he might not yet be strong enough – or Babcock believes he’s not ready to fit into his system yet – the Leafs would pay for the right to have Marner play for the Marlies. An organization like MLSE wouldn’t bat an eye at spending upwards of half a million dollars to have one of their prized young prospects stay in Toronto, working with Sheldon Keefe and the rest of the team’s development staff instead of dancing circles around his opponents and scoring four or five points in a night.

While NHL teams might view that as an easy stipend to pay for their prospects, it would be a huge number for the CHL and the team. In 2012 (the latest figures I could find), the CHL’s average ticket revenue was a little over $2.7 million, with the WHL at the high end (Calgary topping out at $10.4m) and a few QMJHL teams bringing in less than $1m for the season.

A figure in the neighbourhood of $250,000 would be a huge boost in revenue, especially if it went directly to the team.

Of course, an agreement based on financial compensation will inevitably open itself up to favour certain NHL teams. That’s why I propose limiting this to one ‘buy-out’ per organization. The loophole stipulates that an NHL organization may only designate a single prospect ot be bought out of the CHL.

Where Would the Money Go?

Here’s where things get a little more complicated. There is already a huge discrepancy among the have and have-nots in the CHL. For example, $500,000 – that high end figure – for Dylan Strome would be a much bigger boost in Erie than it would in London for Marner.

It’s not likely that the CHL would sign off on any sort of amendment to the agreement unless they were to get a boost in league revenue. The way I see it there are two options:

  1. A revenue sharing program where the fee is split 21 ways, with equal shares going to each of the 20 teams as well as a share for the league.
  2. A split between the league and the team that holds the prospects rights.

The second scenario is the more likely since it would mean a larger revenue bump for the OHL (in the case of Marner), as well as the team that would be losing their star player.

Don’t Hold Your Breath

In recent days, CHL commissioner David Branch mentioned that there has been no desire expressed by the NHL to change the agreement. For every Marner and Strome, there are hundreds of prospects for which this is not an issue.

The fact of the matter is that whether we should or not, we won’t see a change any time soon. Barzal and Zacha seem like locks to make their NHL teams next season and Senyshyn will be back with The Soo.

Of the roughly 1,500 players in the league, the NHL-CHL agreement will likely only be an issue next season for Strome, Marner and possibly Provorov. All have proven to be way too good for junior hockey, but still have major questions as to whether or not they are ready to be playing in the NHL on a regular basis.

If only there were a league in the middle that they were allowed to play in.

 

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6 Comments

  1. Great idea, one suggestion though. I don’t think teams should be able to do this every year, maybe 1 for every three drafts? Put the onus on the teams to really get it right. I’d also reward the CHL teams with extra draft picks for producing players who are ready for that jump.

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