O’Reilly and Saad Contracts Put Rangers in Bind

The New York Rangers were already in somewhat of a tight spot in terms of the salary cap and trying to keep their key restricted free agents – Derek Stepan, J.T. Miller, Jesper Fast, and the recently acquired Emerson Etem.

Their predicament, particularly with respect to locking up the 25-year-old Stepan, has now just become a bit more difficult with recent contracts signed by Ryan O’Reilly (Buffalo) and Brandon Saad (Columbus).

Stepan Poised for Big Money

Saad’s six-year agreement with the Blue Jackets for an annual cap hit of $6 million has a ripple effect on Stepan’s asking price, as $6 million now seems to be at best the low end for the Rangers’ center. Saad, a left winger, eclipsed the 50-point mark for the first time in his career this past season with the Chicago Blackhawks, compiling 23 goals and 29 assists. Stepan, meanwhile, has done that three times, and had 44 points in the shortened 48-game season of 2012-13. Saad, though, is only 22 years old so arguably has more upside than Stepan.

The more comparable player, however, and the one whose contract really hurts the Rangers as they try to secure a deal with Stepan, is O’Reilly. The former member of the Colorado Avalanche is now locked up in Buffalo after signing an extension for seven years at an average annual value of $7.5 million.

Like Stepan, O’Reilly is a center, and is almost the same age (24). Also like Stepan, he is a very strong two-way center, known for his strong defense in conjunction with contributions to the score sheet. O’Reilly has also broken the 50-point plateau three times, including each of the past two seasons. In 2013-14, he had a career-high 64 points (28 goals, 36 assists). Stepan’s career high of 57 points that same season is not far off, and his 55 points this past season came in only 68 games, as he missed the beginning of the year with a broken leg. Stepan has also had more of an opportunity than O’Reilly to prove himself as a big-game player in the postseason, with his Game 7 overtime winning goal in this past season’s second round standing out as a prime example.

Gorton’s First Big Challenge

Newly promoted general manager Jeff Gorton has been thrown into the fire with a major challenge mere days after taking the job. The Rangers have about $10.8 million of salary cap space remaining (via General Fanager) to fit Stepan, Miller, Fast, and Etem. Something between $6 million and $6.5 million previously seemed like a realistic annual price tag for Stepan, and likely would have allowed the Rangers to sign Miller, Fast, and Etem as well. If Stepan were to sign for $6 million, that would leave New York with $4.8 million for these remaining three players. Miller could likely be retained for no more than $2 million, and likely less. Even assuming $2 million for Miller leaves another $2.8 million to split between Etem and Fast, which seems more than doable.

Now however, $6 million per year for Stepan, who is coming off a two-year contract with an average annual value of $3.075 million, seems like a pipe dream with the Saad and O’Reilly contracts. Stepan is now justified in asking for $7 million to $7.5 million per year, which would really put the Rangers in a bind with respect to their other RFAs, as well as with locking up Chris Kreider and Kevin Hayes next offseason. As Larry Brooks of the New York Post points out, arbitration and even a trade are in play for Stepan, but the Rangers would be wise to try to find an alternate route.

To find that alternate route and keep Stepan and the club’s other RFAs, Gorton might have to get creative. This situation again supports the argument to trade defenseman Kevin Klein and his $2.9 million cap hit. As good as Klein was for the Rangers this past season, the team has decent depth on defense and could let prospects Brady Skjei, Dylan McIlrath, and the newly signed Raphael Diaz battle for the sixth spot on the blue line. Trading Klein for prospects and/or draft picks, even low-value ones, would be addition by subtraction for the Rangers. They could then give Stepan his big payday, which he frankly deserves, given his performance and importance to the team. They would also still have room to sign their other RFAs.

The time is now for Gorton to make the necessary moves to keep the most important components of the Rangers’ roster intact. It will be interesting to see what he does in his first big challenge as general manager.