The Toronto Maple Leafs have two players under contract for next season who haven’t played in more than a year, and are destined for long-term injured reserve once again. Before doing that, the team needed to bring Nathan Horton and Joffrey Lupul in for medicals, which they subsequently failed. The Maple Leafs will use the cap space opened by the pair this season, as they already project to be over by $4.78MM by CapFriendly.
Though usually it is believed that teams need to get under the salary cap by the start of the season, this is not necessarily the case for the Maple Leafs. Toronto will use a type of “offseason LTIR” to work their way under the cap, since both Horton and Lupul’s injuries were known long in advance. LTIR is calculated in two ways, depending on when it is used.
In season, the formula to find out how much extra cap space is created is as follows:
Bonus cap space = Cap hit of LTIR player – Current cap space
This usually results in teams using paper transactions to call players up and push them as close to the cap as possible, before placing a player on LTIR. That gives them the maximum amount of extra room to work with. During training camp though, it’s a little different.
Bonus cap space = Current team cap hit – Season salary cap
That means, a team like the Maple Leafs can place Lupul and Horton on LTIR during training camp in order to give themselves a huge amount that they’re allowed to exceed the cap by. The combined salaries of the injured pair is $10.55MM, meaning the Maple Leafs can manipulate the salary cap several ways. By pushing the team’s salary as close to $80.25MM as possible before putting one of the players on LTIR, they’ll get back under the limit for the start of the season. That’s what has allowed them to sign players like Patrick Marleau and Ron Hainsey this summer with little risk, even though they already were right up against the cap.