NHL Cancels Escrow Payments; What It Means For Islanders

Per Marco D'Amico of RG, the league's profits in 2023-24 were much higher than initially predicted.

As a result, players are projected to receive the full 6% in escrow payments back, plus an additional 1.5 to 2%, meaning they will be paid around 101.5 to 102% of their 2023-24 salaries.

Essentially, the league has financially recovered well after a rough few seasons during the pandemic, and now both teams and players are expected to reap the benefits.

Escrow is a preemptive tax on player salaries held to ensure players and owners get a 50/50 split in hockey-related revenue.

The NHL's 2024-25 season salary-cap ceiling sits at $88 million and was projected to jump to around $92-93 million for 2025-26. Now, it is expected to go even higher.

Recently, prominent NHL agent Allan Walsh reported the NHL's salary cap ceiling will rise to $97 million for the 2025-26 season. This would be a 10% increase.

For the New York Islanders, this news is especially promising.

Sitting tight to the current $88 million ceiling with the current roster, the Islanders would not have been able to sign all their pending free agents had the salary cap remained flat, or even slightly increased, next season.

The most prominent pending free agents include Brock Nelson, Kyle Palmieri, Simon Holmstrom, Maxim Tsyplakov, Noah Dobson, and Alexander Romanov, who currently combine for a $19.3 million cap hit.

Nelson and Palmieri, each 33 years old, are set to hit the unrestricted free-agent market this offseason.

Dobson, Romanov, Holmstrom, and Tsyplakov will each be a restricted free agent but with arbitration eligibility.

While the six have each had their ups and downs this season, their combined cap hit on their next contracts will surely rise, potentially into the $25-30 million range.

Whether the Islanders hold on to Nelson and Palmieri at the 2025 Trade Deadline is yet to be determined, but a wholesale rebuild remains unlikely.

So, even if Lou Lamoriello opts to trade a player or two, the Islanders are expected to be active in the free-agent market on July 1.

The Islanders have 14 players under contract for next season, not including Marcus Hogberg's $775,000 at $66.66 million.

With Mikko Rantanen, Mitch Marner, Nikolaj Ehlers, and Sam Bennett among those headlining the expected pending free-agent class, the Islanders will now have the ability to make a major signing without sacrificing many current roster players.

Currently, no financials have been confirmed by the league, but recent reports are very promising.

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