MLS Salary Information Day: What It Means For MNUFC

The MLS Players Union published their twice-annual listing of player salaries on Thursday, shedding insight into how each team is investing their funds. For the first time, Minnesota United have a player cracking the top-50 in individual compensation, with Darwin Quintero making a guaranteed amount of $1.65 million following his transfer from Club America. The Loons rank 17th in overall compensation, dishing out just over $8.15 million in salaries, but also come in second to New York City FC in giving out a median salary of $206,711. Our own Zak Lippert posted the data in a Tableau Dashboard here for easier filtering and manipulation.

The offseason appears to have been a profitable one for a number of MNUFC players. Both Christian Ramirez and Francisco Calvo earned raises pushing their guaranteed salaries above the salary cap budget maximum, with Ramirez getting a raise of nearly $250,000 per year and Calvo’s extended deal paying a little over $190,000 more per year. Ibson also saw his salary increase by $100,000, while Ethan Finlay and Kevin Molino each picked up increases of $85,000 and $75,000 respectively.

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In addition to the Quintero splash, Minnesota United added two more salaries above the $300,000 mark with the loan signings of Alexi Gomez and Maximiano. Tyrone Mears’s salary comes in just under $195,000, while the recent trade for Eric Miller saw the Loons pick up around $205,000 in salary relief, with Miller’s $106,000 offset by the $311,000 made by newly-minted Colorado Rapid Sam Nicholson. Mason Toye’s Generation adidas deal gives him a cool $178,000, and the remaining new Loons make either the reserve or senior minimum salary.

While the salary figures don’t incorporate all of what gets figured into the salary cap—various signing fees, performance bonuses, and transfer costs all get amortized eventually—the data gives a good sense as to how Minnesota United comes into cap compliance. Additionally, it helps to show what amounts of resources are being used for additional acquisitions.

MLS has a salary cap where the 20 players on the senior roster must earn less than $4.035 million. If the rules were this simple, no teams in MLS would currently be compliant. Thankfully, there are a bunch of acronymic mechanisms. Teams can use General Allocation Money (GAM) both to pay transfer fees and to buy down half of the budget charge of an individual player. They can also use Targeted Allocation Money (TAM) to pay for transfer fees, as well as to buy down the budget charge of both players receiving more than the budget maximum and players whose transfers used TAM. Finally, teams can use a Designated Player (DP) slot to make a player’s budget charge lower; for senior players like Darwin Quintero, that figure is $504,375, while players signed as Young DPs are subject to lower charges based on age.

With those funds expiring at staggered times, teams need to be creative in how they use them. Using very rough estimations—tracking publicly reported allocation moves since 2016, estimating transfer fees at 110% of player value from TransferMarkt.com at time of sale and loan fees at 35%, assigning TAM if the league indicated its use, and using leftover funds according to getting the team exactly compliant with the 2017 cap—Minnesota United FC had roughly $1 million in GAM reserves and, depending on discretionary adds, between $2 and $4.8 million in TAM coming into this season.

The bad news: Minnesota United are one of the 23 teams whose senior rosters make more than $4.035 million; only accounting for Darwin Quintero using a DP slot, their budget charge currently sits at a hair under $6.18 million. The good news: Minnesota United feasibly have space to buy down existing salary to add Adrian Heath’s mythical “one or two guys” in the July window.

Here’s how:

• Johan Venegas’s loan: Despite playing for Deportivo Saprissa this year, Johan Venegas technically is still a Minnesota United player and is subject to the salary cap, hence why he appears still on the salary listing. However, assuming any amount of salary is picked up by Saprissa, that amount would buy down the salary charge from Venegas’s $237,500 for 2018.
• Christian Ramirez got a raise: It’s weird that someone getting paid opens up salary relief, but hear me out. The raise that Ramirez got puts him squarely above the budget maximum. This would open him up to be either A.) a designated player, or B.) a TAM-eligible player. As a TAM player, the Loons are able to buy his budget charge with TAM funds to a lower level ($150,000) than would be available via GAM (half his salary, so around $320,000). That rule also applies to Francisco Calvo and Rasmus Schuller, whose transfer fees used TAM. Additionally, doing so allows for more available GAM for buying down the rest of the roster.

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• Season-ending injuries: When Kevin Molino and Ethan Finlay went down with ACL tears, Minnesota put them on the Season Ending Injury list. That allows the team to use the budget charge of either player to sign one player to take their place with no salary cap penalty. The catch: the replacement player must make between $100,000 and $250,000. Salary watchers (read: me) were looking to see if either Alexi Gomez or Maximiano were making something in that range, but the team will still be eligible to use that slot in the summer.

All of these potentially open the door for Minnesota United to add to the roster this July. Accounting for a full writeoff of Venegas’s salary, maximum TAM buydowns, and no hidden fees—that’s the kicker—Minnesota would be able to use GAM funds to buy themselves down below the cap level with room to add a small amount of salary, and could execute a trade of their current excess of TAM funds for GAM, which would free them up to get closer to the oft-rumored second Designated Player targeted for this summer.