It’s not a surprise that the Pittsburgh Penguins and Kris Letang announced a contract extension today, as news and reports over the last week or two have been trending positively towards just such a resolution.
The particulars of the contract are fascinating, however, as more details come out.
At 34 years old for most of last season, Kris Letang turned back the hands of time in 2021-22. He had a tremendous season that showed Ron Hextall and the Pens that this player was worth an investment for the rest of his playing days. Letang was fourth in the whole NHL with 25:47 average time on ice per game, set a career-high with 58 assists and 68 points with a tremendous performance.
Kris Letang is still an elite defenceman and should age gracefully as he retires a Penguin. The contract is obviously long, but should be great value for the next three seasons. pic.twitter.com/Ubu1XJr4Ph— dom (@domluszczyszyn) July 7, 2022
Moving forward, Letang will drop off with age, but at a $6.1 million cap hit, it’s a very manageable and favorable trade off for the Penguins — especially considering the immediate one, two and three years where Sidney Crosby is still under contract.
As Dom points out, there is some precedent of a defender in his late 30’s keeping up significant on ice value in the case of Dan Boyle.
Dan Boyle's career arc in his twilight years is probably the best bet for what to expect pic.twitter.com/9WNlonP4L3— dom (@domluszczyszyn) July 7, 2022
The risk would be if Letang’s 35+ years mirror that of Sergei Gonchar, whose game cratered when he left Pittsburgh for Ottawa in 2010. Another favorable comparable for Letang, whose style and game are fairly similar — is 37-year old Brent Burns. Burns actually played slightly more than Letang last season, and also recorded 54 point for the Sharks.
Letang’s new contract will run through the 2027-28 season, where he would turn 41-years old during those playoffs.
In a sense, though booked and filed for six years, this might be actually be considered more of a four-year contract for the Penguins due to the way it is structured.
Deal includes full no move but goes to modified no trade (submits a list) last two years of the contract.— Pierre LeBrun (@PierreVLeBrun) July 7, 2022
As Lebrun notes above, for the first four years Letang will have a full no move contract, and Pittsburgh will be unable to trade him or move him off the NHL roster without his agreement. The money is front-loaded to the beginning of the contract as well, with the cap hit being the average ($6.1 million) of the total money divided by six year length.
Another key point by Lebrun - not yet known - is the timing of the salary bonuses Letang will receive. This contract isn’t filed with the league, but chances are due to the league’s CBA, all bonuses are probably going to be paid in the first two seasons of the contract in order to structure it more advantageously.
In the July 2020 CBA, the over 35 rule was changed so it no longer applies if there’s no bonus in year 2+ and year 2+ Comp is equal to or greater than Year 1 comp.— PuckPedia (@PuckPedia) July 7, 2022
If structured that way, the 35 rules for retirement or buyout don't apply, and it's just a regular contract.
If the bonuses are in the first two years, should Letang be forced not to play in the last two seasons, the team could benefit by recouping his cap hit either through LTIR — or also due to the loss of some trade protection, it could be possible to move Letang’s contract to a team looking to get to the salary floor as a “dead hit”. (As in, this is how Pavel Datsyuk technically ended his NHL days as a member of the Arizona Coyotes, as well as several other long-retired players flung away at the end to similar teams).
In all, the structure and makeup of this contract makes for a very advantageous situation for Pittsburgh. They get to keep a vitally important player for the near-future, and down the road ought to have some options to shed the player and/or contract if that becomes necessary.
Off the ice in the immediate future, the Pens now have $67.1 million of the 2022-23 salary cap accounted for (with a $82.5 million upper limit), leaving just over $15 million in space to go.
After resigning Letang we now show the #Penguins with $15,308,158 in projected cap space based on a tentative roster of 18 players (9F-7D-2G).— CapFriendly (@CapFriendly) July 7, 2022
Some unsigned RFA's include
Some unsigned UFA's include
At this point the rough lineup looks something like this:
Jake Guentzel - Sidney Crosby - Bryan Rust
Jason Zucker - ???????????? - ????????????
Brock McGinn - Jeff Carter - ????????????
Drew O’Connor - Teddy Blueger - ?????????
Brian Dumoulin / Kris Letang
Mike Matheson / John Marino
Marcus Pettersson / Chad Ruhwedel
With Letang in the fold, the Pens can now turn their full attention to figuring out what to do with Evgeni Malkin, as well as possibly circle back to some or all of Rickard Rakell, Evan Rodrigues, Danton Heinen and Kasperi Kapanen or suitable replacements for those impending free agents.
Letang’s cap hit being only $6.1 million is a very big blessing in the short-term, that relatively low rate allows more operating room to fit other players, even if the Penguins are unable to move a player with a sizeable salary via a trade.
At the end of the day, the most important piece of news is that the Pens have figured out a way to keep Kris Letang and their defense should more or less remain largely intact. Below the surface, the setup and structure of this contract carries some risk for Pittsburgh, but is likely about the best case scenario for how to handle retaining the services of what still is such a critically important player in the twilight years of the Crosby era.