Gauging Mike Gillis – Part 5: The Luongo Contract

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Luongo

When Canuck fans look back at Roberto Luongo’s eight-year tenure in Vancouver, several things should come to mind.

Six Northwest Division titles. Two Presidents’ Trophies. Two Vezina nominations. One Hart Trophy nomination. One Lester B. Pearson nomination. One Jennings Trophy. Two team MVPs. Game 7 of the Stanley Cup Finals. A record of 275-140-50.

Yet, perhaps more than anything, fans will remember an unrestrained, headline-grabbing quote from April 2, 2013.

“My contract sucks.”

In the immediate context, many agreed with Luongo. After all, his back-diving deal had just killed a much-desired, mutually beneficial trade to Toronto. As a result, Luongo would stay front-and-centre of a two-year goalie controversy that captivated Vancouver’s media market unlike any sports story in the city’s history.

The problem was, Luongo’s assessment was dead wrong. In reality, the deal represented one of Mike Gillis’ finest moves as Canucks’ GM.

In this ten-part story, Vancity Buzz breaks down the seminal moments of Gillis’ reign, offering pertinent insight into the defining moments of the franchise’s brightest period. We’ll take a look at it all: the good, the bad and the awkward.

The Background

When Mike Gillis took the organizational reins in April 2008, he left no uncertainty that an extension for Luongo, the team’s backbone, would be an immediate focus.

“Roberto is clearly a priority. I feel he’s the best goaltender in hockey…he has to be a priority…we need to ensure that the asset is utilized as quickly and efficiently as possible.”

Gillis knew that establishing and maintaining a championship window necessitated retaining Luongo’s services beyond his 4 year/$27M deal.

He was right, too. In his two seasons in Vancouver, Luongo had established himself as (arguably) the league’s finest goaltender. In 2006-2007, Luongo played 76 games, posted a 2.29 GAA and .921 SV%, and earned Hart, Vezina and Lester B. Pearson nominations. It was an unparalleled season that resulted in the greatest hockey meme in Canucks history.

http://www.thetoque.com/images/stories/canucks_team_photo.jpg

A year later, Luongo played 73 games, posted a 2.38 GAA and .917 SV%, and earned his second straight team MVP award. Simply put, the Canucks had their goalie. They just needed to keep him.

The Logic

On September 2, 2009, Gillis finalized a 12 year/$64M deal with Luongo, keeping the 30-year-old goaltender in Vancouver through 2021-2022. In doing so, Gillis established Vancouver as a destination where elite players wanted to play, win, and finish their careers.

For Luongo, the deal made perfect sense. Kicking in at age thirty-one, Luongo would derive $57M in the first eight years of the deal (taking $10M in year one). In other words, through creative accounting, Luongo would be compensated as the league’s highest paid goaltender.

For Gillis and the Canucks, the deal was equally enticing. With no clear NHL goalie in the team’s system (23-year-old Cory Schneider had played just eight NHL games, posting a 2-6 record with an .877 SV% and 3.38 GAA), Luongo’s contract stabilized the back-end for the foreseeable future. It also dropped Luongo’s cap hit from $6.75M to $5.3M, affording additional flexibility for other extensions and signings (including, but not limited to, Ryan Kesler, Dan Hamhuis and Raffi Torres).

And best of all, the contract had no downside.

Based on the NHL’s collective bargaining agreement, if Luongo retired before 2021-2022, the deal would effectively vanish. With no reasonable expectation that Luongo would play until age 42 (and structured payments dropping to $3.38M in 2018, $1.6M in 2019, and $1M in 2020 and 2021), Gillis had locked up an elite goaltender, for the duration of his career, at a $5.3M cap hit. In that sense, it was a series of one year deals with a player option.

The Contract

In the first year of the contract (2010-2011), Luongo would start 60 games, turn in a 2.11 GAA and .928 SV% while earning a Vezina nomination and William M. Jennings Trophy. This success would coincide with the Canucks’ first Presidents’ Trophy and a trip to Game 7 of the Stanley Cup Finals. Despite his $10M salary, Luongo’s $5.3M cap hit would place him 9th among NHL goaltenders.

The following season (2011-2012), Luongo would start 54 games, turn in a 2.41 GAA and .919 SV%, and drive the Canucks towards a second Presidents’ Trophy. Despite earning $6.7M in salary, Luongo’s cap hit would rank 8th amongst NHL goaltenders.

In 2012-2013, amidst an ongoing media circus and demotion to Cory Schneider’s back-up, Luongo would play 20 of 48 games, posting a 9-6-3 record with a .907 SV% and a 2.56 GAA. While Luongo’s numbers faltered, the results were not disproportionate to his cap hit (ranked 9th amongst NHL goaltenders).

In 2013-2014, plagued by yet another media circus, Luongo would play 42 games, posting a 2.38 GAA and .917 SV% (numbers reflecting a top-10 goaltender) before being jettisoned to Florida in the tumultuous aftermath of the Heritage Classic. His cap hit would rank 12th amongst NHL goaltenders.

This season, amongst goaltenders playing at least 25 games, Luongo’s 2.28 GAA ranks 7th, while his .926 SV% ranks 3rd. His cap hit sits at 13th.

Maybe Gillis was on to something, after all.

Additional Considerations

Ultimately, we can only evaluate Gillis’ decisions based on the legislation of the time. As such, it’s unrealistic to fault Gillis for the retroactive sanctions applied to Luongo’s deal in the 2013 collective bargaining agreement.

The reality remains that Gillis locked-in an elite goaltender, at a mid-range cap hit, for the duration of his career. As the salary cap has increased, the impact of Luongo’s cap hit has waned (moving from 9th in 2011, to 13th in 2014, to 15th in 2015). This trend is not by accident. It’s Gillis’ handiwork.

It’s also imperative to dispel the notion that Cory Schneider’s ascent made Luongo’s contract a “bad deal”. Simply put, if you removed Cory Schneider from the equation, you still had a top-end goaltender with a manageable cap hit. When you added Cory Schneider to that equation, you had a problem of riches.

Sadly, Vancouver’s fanbase could never comprehend that logic. Instead, they “supported” Schneider by berating Luongo and his contract. They’re on-pace to repeat this ordeal with Ryan Miller and Eddie Lack.

Finally, it’s crucial to recognize the deal’s intention to marry Luongo and the Canucks. The terms and related no-movement-clause reflected the parties’ wishes that Luongo would end his career in Vancouver, effectively making the contract immovable. In short, it was strategically designed to be a Canuck-friendly (rather than a generic team-friendly) contract. When plans changed, the parties were largely victims of their own drafting.

Conclusion

In the end, Mike Gillis’  legacy in Vancouver will likely be plagued by spotty trades, poor drafting, countless no-trade-clauses and an inability to control an alleged “goalie controversy”.

But for everything he got wrong, Gillis’ logic, analysis and execution with the Luongo deal were absolutely right. It laid the foundation for the team’s ascent to the NHL forefront, afforded invaluable cap flexibility, yielded immediate results, and (almost five years later) continues to hold value (despite its potential implications) with a top-end goaltender at a below-market cap hit.

Funny enough, we could use a deal like that in Vancouver.

Featured image: Canadian Press

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Jay Adams Jay is a Canucks writer at Vancity Buzz. His work has been featured by ESPN, Sports Illustrated, National Post and others. He works as a corporate lawyer in downtown Vancouver.
@JayVCB

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