With the cancellation of the 2004-05 NHL season only hours away, the league and its players exchanged a flurry of proposals yesterday, but the two sides remained far from reaching an agreement.

Late last night, the players association made what it called a “final attempt to reach an agreement,” proposing a $49 million salary cap. The league, which had also submitted a “final offer” earlier in the day, summarily rejected the proposal.

“If every team spent to the $49 million level you have proposed,” NHL Commissioner Gary Bettman wrote to NHLPA executive director Bob Goodenow, “total player compensation would exceed what we spent last season and, assuming for discussion purposes, there was no damage to the game, our player compensation costs would exceed 75% of revenues. We cannot afford your proposal.”

The commissioner has scheduled a press conference for 1 p.m. today, and he is expected to announce the cancellation of the season if a deal is not reached by 11 a.m. Not surprisingly, the approach of this long-overdue deadline has spurred considerable movement on core issues from both sides, but it appears that time may have run out anyway.

After months of refusing to negotiate because of “philosophical differences,” the NHL and NHLPA finally began to speak the same language on Monday evening. The owners moved off their demand that player salaries be inextricably linked to league revenues, while the players finally backed down from their steadfast opposition to a salary cap.

“We wish that the NHL had offered a ‘no linkage’ proposal before yesterday so that negotiations in that arena could have commenced sooner,” Goodenow said in his letter to Bettman. “However, we recognize that they did not and we agree that time is short.”

Earlier in the day, Bettman made a take-it-or-leave it offer of a $42.5 million cap, warning the players that no negotiations were forthcoming.

“This offer is not an invitation to begin negotiations – it’s too late for that,” he wrote to Goodenow. “This is our last effort to make a deal that’s fair to the players and one that the clubs (hopefully) can afford. We have no more flexibility and there is no time for further negotiation.”

Bettman appears to have been serious: The league had not modified its offer as of this writing.

Nonetheless, it is significant that the owners’ proposed cap is not based upon a percentage of league revenue. This represents the league’s first meaningful concession of these negotiations, and gave many in the hockey establishment cause for hope early yesterday. Until now, each NHL proposal has simply been an exercise in semantics; each plan would have ultimately delivered the exact same desired result.

The NHLPA, too, took a significant step yesterday by proposing a solution based on a $52 million soft salary cap, a figure they later lowered to $49 million. Under their plan, luxury taxes would be levied on all team payrolls over $40 million: a 25% tax on payrolls between $40-43 million, a 50% tax between $43-$46 million, and a 75% tax between $46-$49 million. Teams would be permitted to spend up to 10% beyond the $49 million salary cap twice during the proposed six-year deal, but would be faced with a punitive 150% tax as a consequence.

The players’ proposal is also believed to have incorporated the 24% salary rollback offer first made in December. Additionally, each team would be required to have a minimum payroll of $25 million, but clubs would be allowed to drop no more than 10% below the total twice during the deal.

There is also some reason to believe that the players’ capitulation with regard to the salary cap issue was intended to thwart the owners’ inevitable impasse declaration rather than to save the season. If the owners cannot prove that the players have negotiated in bad faith, it will be difficult for them to convince the National Labor Relations Board that the use of replacement players would be an acceptable solution.

Back in 1995, Major League Baseball attempted to open its training camps with replacement players. Before the regular season started, owners were ordered back to the bargaining table when the NLRB determined they had not negotiated in good faith.

Of course, there is also plenty of cause for regret on both sides. Perhaps a deal could have been consummated months ago had the two sides gotten past their “philosophical differences” and instead focused on the money.

“We probably could’ve gotten this thing done in the summertime,” the Blackhawks’ Matthew Barnaby told the Associated Press. “Am I mad? No. I want to get back to work. But at the same time, I’m just a little disappointed that it went this far to play poker and to have someone call your bluff.”

If a deal is not reached, the NHL will earn the dubious distinction of becoming the first North American professional league to lose a full season because of a labor dispute. The Stanley Cup, which was first awarded in 1893, has been contested in every year except 1919, when an influenza epidemic canceled the finals.

Today will be the 154th day of the lockout, and 834 of the 1,230 regular-season games have already been lost. In recent days, the idea of playing a 28-game season with a full playoff schedule has been proposed.

That the negotiation is now focused specifically on dollars and cents is a good thing. But they remain extremely far apart with precious little time remaining on the clock, and it remains to be seen whether either side will concede enough to finalize a deal before Bettman drops the guillotine.