Yesterday, Sean Shapiro from The Athletic and Matt DeFranks from The Dallas Morning News were on a conference call with Dallas Stars team president Brad Alberts in which he announced more cost-cutting measures for the NHL franchise.
The gist of those measures was furloughing nearly all front-office employees, further salary reductions beyond the 20% that upper-level management took back in April, and salary reductions to the hockey operations side of the business (coaches, scouts, etc.) that had been previously untouched by cuts. The AHL Texas Stars, whom the Dallas Stars also own, were almost completely devastated by furloughs of employees after the remainder of that season was officially canceled.
Can confirm that all #txstars staff except for Michael Delay (chief sales and marketing officer) have been furloughed as part of Dallas Stars announcement today.
— 100 Degree Hockey (@100degreehockey) May 15, 2020
It was a really bad day for the organization. In fact, I don’t believe that these drastic of measures were taken during the last lockout that cost the team half a regular season’s worth of games.
Then again, the entire economy wasn’t doing….all of this then either.
Tom Gaglardi, the owner of the Dallas Stars, is president of Northland Properties, one of North America’s largest privately-owned hospitality groups in North America. They have hotels (Sandman, Sutton Place), resorts (Grouse Mountain Resort in Vancouver, Portmarnock Hotel & Golf Links in Dublin, Ireland), and restaurants (Denny’s in Canada, Moxie’s, Chop, and others), in addition to the three hockey teams they own – the Dallas Stars (NHL), Texas Stars (AHL), and Kamloops Blazers (WHL).
That’s a lot of investments in industries hardest hit by the current global pandemic – hospitality and leisure. Some reports have hotel occupancy rates in the 10 to 15 percent range right now. Restaurants that aren’t barred from being open altogether are limited in many areas to curbside delivery or takeout orders only. With each city, state, province, and country taking different measures on different timelines, there’s really no way of projecting when businesses like these would return to “normal” operations (or whatever the new version of “normal” happens to be.)
So the fact that all of Gaglardi’s businesses are being hit, unlike what happened when the NHL lockout happened back in 2012-13, it makes it harder to continue to operate under business as usual standards. It’s understandable from the practical dollars-and-cents perspective, but the human impact is much more heart-wrenching. You just hope that when the NHL determines how games can resume, the cost of the loss of human capital isn’t too high for the big club’s front office staffs. And that the next season of operations for the AHL and WHL aren’t greatly impacted and those staff members can come back for a full season like normal.
In the grand scheme, getting people back to work safely and ensuring they are healthy — and that it can stay that way — is more important than watching a game. Even still, eventually the hockey games will return. Given all of the economic impact that the Gaglardi holdings are currently experiencing, will the ownership of the team be willing to continue to put out a salary cap ceiling team when preparing for future seasons?
I broke down just a few weeks ago where the Stars stood in terms of cap space for next season. Many of those contracts are committed to the long-term — the likes of Jamie Benn, Tyler Seguin, Ben Bishop, Joe Pavelski, Alexander Radulov, John Klingberg are all signed for at least another three seasons beyond this one. Key pieces of the roster like Roope Hintz, Radek Faksa, Denis Gurianov, and Miro Heiskanen will need new contracts in the next two years.
With those kind of commitments on the table, it seems possible that the Stars look at more internal promotions to fill roster holes now more than ever before in order to control the salary costs in an effort to help Gaglardi out where they can. General manager Jim Nill has already stated that those are considerations they’ve been undertaking even before the pandemic plunged the economy towards recessions not seen since the Great Depression.
“First of all, Tom Gaglardi has been very supportive of me, given me all the tools I need to work with,” he told the Dallas Morning News at the end of March. “I know that his parent company is going through a tough time. He’s in the hotel/restaurant business, and it’s been hit hard. So I know they’ve had to make sacrifices up there, and so can I help him out a little bit that way?”