The MLS player salaries were released by the Players Union for the 2017 season and we can begin to look behind the curtain of the Union front office. This year Major League Soccer has increased the transparency around General Allocation Amounts and roster statuses, making MLS capology a little more accurate. The key pieces of information we still don’t know are the following:
- Transfer fees paid and contract length
- The exact amount of the salary cap hit for each player (although it’s believed to be between the base salary and the total guaranteed compensation of the player).
- Allocation money that changes hands via trade
- How allocation money exactly is allocated
The biggest issue without a doubt is the cost of transfer fees which can be quite high, while we can make reasonable assumptions about the other gaps that will get us close to the Union’s cap situation. This season the Union had a pretty vanilla offseason with some minor trades probably resulting in very little change to allocation money and two significant signings from a financial standpoint.
Here’s a table of the Union player salaries accompanied by my best estimate of the maximum cap hit that each player could potentially have.
|Player||Pos||Roster||Des.||Base Salary||Total Comp||Est. Max Salary Cap||Est. Min TAM|
|Pereira Dias Junior, Ilson||M||Senior||INTL||$470,000||$518,333||$480,625||$25,625|
|Herbers, Fabian||M||Supp.||INTL, GA||$110,000||$135,500||$0|
|Allocation Money Requirement||$1,089,322|
|Pre-Trade Allocation Money||$1,400,000|
|Remaining Pre-Trade Allocation Money (before transfer fees)||$310,678|
|Ayuk, Eric||M||Senior, On loan||INTL||$65,625||$65,625|
|Yaro, Josh||D||Supplemental, Disabled List||INTL, GA||$130,000||$194,000|
|Jones, Aaron||D||Reserve, On loan||INTL||$53,004||$53,004|
Couple of quick observations before we get into the cap situation:
- The Union are paying out about $7 million to their roster, not including any transfer fees paid. This ranks 12th in MLS.
- Players can make good money in the fourth division of English soccer. Jay Simpson is getting paid over a half million dollars to sit the bench right now after coming over from Leyton Orient. This automatically calls to question Earnie Stewart’s talent acquisition strategy.
- When you add Maurice Edu’s cap hit with Simpson’s the pair are taking up 20% of the $4.9 million the Union are receiving from the central office. ONE FIFTH!! That’s not helping.
- CJ Sapong, Richie Marquez and Keegan Rosenberry all received substantial raises of at least 30% with Sapong making the most of the trio at $300,000.
From a cap perspective, only senior roster players count against the cap so we only need to pay attention to those salaries. This year MLS has actually given us the designations, whereas in prior years we had to make an educated guess. When you add up the maximum possible cap hits (TAM players and DPs have a maximum of $480,625) the Union are paying out over $4.9 million in cap money and the maximum is $3.845. Enter allocation money. This year the Union were potentially given $200,000 in general allocation money and $1.2 million in targeted allocation money. The reason I say “potentially” given is that in expansion years the league says that all teams receive the same amount of GAM. And what that is I don’t know. In a normal year the Union would have gotten $200,000, so potentially they have some more. I doubt they have less. But adding the allocation money together means its feasible to get below the cap. Let’s see how much they might have left.
General Allocation Money can be used to buy down a player’s cap hit, including designated players. The amount paid over the maximum cap amount for a designated player is paid by the club, which means that teams can either use GAM to buy more cap space or put it in the pocket of the owner. Obviously from a competitive point of view it’s better to buy more cap space. Let’s be optimistic and assume that the Union and Jay Sugarman did the right thing. Now the Union are over the cap by about $900,000. Time for TAM.
Targeted Allocation Money (TAM) can only be used in certain circumstances. It can only be used by players who cost above the $480,625 threshold and below $1 million, and that cost also includes any amortized transfer fee. GAM and TAM can’t be mixed so the list of eligible players is pretty clear. Jay Simpson, Haris Medunjanin and Ilson Jr. qualify. The Designated Players, Alejandro Bedoya and Maurice Edu, are likely not TAM players otherwise they would have changed their status. And if TAM was used to buy down part of their salary we really don’t want to hear it because that means the owners are sticking it in their pocket.
Medunjanin, Simpson and Ilson Jr, from a salary perspective, barely qualify for TAM. The last column in that table shows that it would only take about $50,000 to get them to the max cap threshold. Which means that the Union have used about $900,000 of their $1.2M in TAM to get below the cap. What that means is TAM is essentially being used, not to bring in near million dollar talent, but to pay for the middle roster talent. I am not sure if this is how you win in MLS. Medunjanin seems like a pretty good deal but Ilson Jr. and Jay Simpson are horrible deals and the TAM is being used on them, as well as paying for the likes of Roland Alberg at nearly $400,000.
The salary budget, GAM and TAM essentially allow teams, in a perfect world, to build a senior roster with about $5.245 million of centralized money and then whatever budget the owners give the Technical Director to go over that amount for designated players. The Union have spent $4.9 million and therefore have about $300,000 remaining. However, that money may have already been spent on the amortized transfer fees for Jay Simpson and/or Haris Medunjanin. It’s entirely possible the Union are out of cap space and out of allocation money, which given the talent on this team brings a whole host of questions to the forefront. In any event they don’t appear to have the money for a big summer signing without other roster moves happening first.