This past week, having gotten back from my summer escapades in the Canadian wilderness, I hopped onto the internet (hello again, Wi-Fi) in search of the biggest summer storyline in MLS to kick the tires of The Wins Column back into motion.
The arrivals of big names were tempting. The unveiling of a name and logo for Atlanta’s 2017 expansion franchise was even more appealing for this marketing minor and resident department jersey lover.
But then, like the brick that hits the “hoopla” fish in SpongeBob Squarepants, Targeted Allocation Money (TAM) came out of nowhere and smacked me right between the eyes. And to continue on that nautical note before I say my piece, my “how MLS GMs who actually spend money reacted when TAM was announced” GIF of the Week:
What is Targeted Allocation Money?
A full breakdown of what TAM is can be found in MLS’ 2015 Roster Rules. From what I’ve read, here’s what’s important:
- Every team gets $500,000 of TAM over five seasons. On paper, it’s allocated as $100,000 per season. In practice, teams can use all of it right away. Teams have to use or trade the $100,000 they get each season in that season or the season following though.
- TAM is similar to regular Allocation Money in that it can be used to “buy down” a player’s salary budget charge, or reduce their cap hit in layman’s terms. Like regular Allocation Money, TAM can be traded. However, TAM and Allocation Money cannot be used together on the same player.
- TAM can only be used on players earning more than the maximum salary budget charge ($436,250 in 2015). Because of this, TAM is intended to be used to buy down an incoming player or existing player so that they don’t take up a Designated Player slot. However, if an existing DP is bought down with TAM, a club must immediately sign a new DP at a salary equal to or higher than what the old DP was making.
In essence, it’s what many predicted would come out of the offseason CBA negotiations, just a few months late and with a bit more flexibility. Teams can use TAM to un-DP a player who under the old rules would have had the DP label but only a mid-level paycheque. If they have enough TAM and enough players in the right salary range, clubs could in theory un-DP multiple players, as clubs can use TAM on three players in a given season.
In other words, teams are better equipped to save DP slots for the marquee players with paycheques in the millions, the types of players the rule was originally intended to bring in.
What’s Good About TAM?
Primarily, what I just said above. If you think of the global player pool like a dartboard, every DP slot a MLS club has is like a dart. Some darts will land on the triple-20 (the Kakas and Giovincos), some will land on the target (the Gerrards and Pirlos), and others will land all the way in England (the Shaun Maloneys). Essentially, TAM is a fourth dart for clubs to throw, provided that at least one of the darts is less expensive than the others.
If (and this is a big if) clubs are on the mark with their signings, the number of elite level players in MLS will increase by 33%. Even if we tone down our optimism, it’s a virtual guarantee that more big names will be able to join the league, while the league’s best existing talent will be more likely to stay in the league.
What’s Bad About TAM?
We all know that parity is one of those buzzwords that gets thrown around in MLS circles. We’ve also observed a general decline in parity over the past few seasons, as the big market clubs with a willingness to spend have generally climbed up the standings.
TAM would be excellent in helping reverse this decline in parity. Big clubs like NYCFC that have three high-earning DPs wouldn’t be able to buy them down, while small clubs like Philadelphia could potentially free up space for a genuine top-drawer talent or marquee name to attract fans.
TAM would be great for all of that, if it wasn’t tradeable.
If every club had to spend all of their TAM, the penny-pinchers would finally feel some heat from the league and they would go out and spend the money to help grow the game. But since TAM can be traded, expect clubs like the L.A. Galaxy and Seattle Sounders to siphon it from clubs like Colorado and Columbus. This will lead to wider gaps in team payrolls, and if the current trends continue, wider gaps between the good and bad teams.
So How Should We Be Feeling About TAM?
At this point, like many things Major League Soccer throws our way, that’s unclear.
Putting money into the wallets of players is long overdue, but it’s better late than never. Being able to attract star power like Giovani Dos Santos (who signed as a DP with the Galaxy in July after Omar Gonzalez was un-DPd with TAM) is clearly a positive too. Having a slightly less sketchy way to keep top domestic talent than Retention Funds (aka the Besler/Zusi secret stash) is also good.
But at the same time, it’s tough to see how the rich won’t get richer with this new rule. Even when they were wasting a DP slot on Gonzalez, the Galaxy were a class above the league once they started hitting their usual start of summer stride. But un-wasting Gonzalez and throwing Dos Santos into an attack that already includes Keane, Zardes, Gordon, Gerrard, Jamieson IV, and Villareal? If I’m the GM of a small market club, I’m calling foul.
What could stop TAM from being a parity killer is how it gets traded. There will be clubs like the Galaxy that will need a lot of it. There will be other clubs like the New York Red Bulls, who only have one DP in Bradley Wright-Phillips and nobody else on their roster making more in base salary than the $436,250 maximum (according to the MLSPU’s most recent salary information), that will need to get it off their hands. The clubs that lie in the middle of that spectrum could try to take advantage of each of these respective situations by forcing those clubs into unfavourable-but-necessary-to-stay-roster-compliant trades.
Until that happens I plan to sit back and watch as the fight between exciting stars and even standings rages on.
Stay positive people, but keep a healthy hint of skepticism close at hand.
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