Modified UEFA Financial Fair Play + Revenue sharing

You're right, you describe a typical company and a typical company can enter into employment agreements with people who are also shareholders. But MLS isn't a typical company.

Here, the teams are operated, managed and the "guts" that really makes them more then trademarks and names is owned by 19 legally distinct entities. While their financial performance may be related, it is not identical -- some I/Os, by their acumen, can prosper when others do not. (That's not true for the shareholders in even the smallest companies -- they divide the profits and share the losses equally in proportion to their shares.)

And MLS wants it that way. The reason the pure single entity -- where the league operates every team and profits of every team are pooled and distributed to investors in equal shares just like in your company -- was abandoned early on is that no one has enough at stake from any one team to pay attention to its operation and control costs. The league quickly realized it needed legally separate profit maximizing entities and gave up on the final league owned teams long ago.

To make the profitable I/Os cough up more cash and give it to the bad operators goes against the very rationale for the I/Os in the first place.

 

How can any one club in the MLS spend more than any other club, right now ?

Outside of "being able to spend 'X' outside of the cap on Beckham/etc" .... how can it be done ? <--- that isnt' an answer though, because regardless of salary structure you're always going to have clubs making more money and thus, able to spend more.

 

Besiktas has been suspended from European competition for breaching financial fair play regulations.

http://www.telegraph.co.uk/sport/fo...uropean-competition-for-one-year-by-Uefa.html

 

It begins already, and why am I not surprised it's a Turkish club ?

 

Some good stuff from Deloitte and the Guardian:

http://www.guardian.co.uk/football/2012/may/31/deloitte-premier-league-survey-wages

 

I like the idea of pooling all national-level/collectively bargained resources. I would like to see something like this tried:

1. Take all collective resources (national TV contracts, league sponsor, % of gate revenues, % of merchandise sales, etc.) and install a salary floor. To approximate what's already in place, make it say 3 million.

2. Along with the salary floor, install a salary cap. Make it a percentage, say 200% of salary floor. So in this case, the salary cap would be 6 million.

Eliminate allocation. Really dislike having different buckets for different things. The way to implement things like transfer fees is the following:

A. Prorate a portion of the transfer fee paid to each year a player is under contract. Add it to the salary, and that's the total cap hit for that player. Example: if a team buys a player for 2.5 million and negotiates a 5 year contract for a salary of 1 million per season, then that player's salary would be the 1 million, but his cap hit would be 1.5 million for each of those 5 seasons.

B. Prorate the revenues from player sales to reduce a team's cap hit. The way to do this is to take the revenues from player sales for a particular year and prorate based on the average contract length at the beginning of that year. So for example, if a team is at the salary cap ceiling (6 million) but they sold a player for 5 million, and beginning the year the average contract length for all 30 players on the roster was 5 years, then that team could reduce its salary cap number by 1 million (5 million/5 year avg. contract length).

With these proposals in place, there's also a couple more measures I would implement:

1) Make base salaries 100K (based on 3 million/30 roster spots). Sure, it might lead to inflated salaries for a couple of seasons, but I'm sure that those players would be replaced with better quality players when their contracts expired. Also, I would assume that most contracts are negotiated with buyout clauses, and I think that in many cases increasing the minimum salaries could trigger those clauses.

2) Academy players. Teams should be rewarded for developing their own players. I think something reasonable would be to exclude 50% of the salaries for up to 3 academy players on the 30 man roster from the salary floor/salary cap. Maybe a way to mitigate abusing this rule would be to phase out this exclusion for specific players over a number of years, say 5 years?

3) Finally, along with all these measures, I would throw in a luxury tax similar to MLB. Sure, a salary base of 3 million and cap of 6 million would ensure a level of parity, but along with parity, it is also good for a league to have brand name teams. So, take for example a NYRB team that wants to spend more than that. I would say, sure go ahead, but this is what it would cost you: you have to write the league a check for 30% of salary expenditures in the range of 0-50% of the salary cap, 50% for expenditures in the 50-100% range, and 75% for anything greater than this. So in the NYRB case, if they spend an extra 6 million over the 6 million cap, then they have to send the league a check for 2.4 million (3M*30% + 3M*50%). The league would distribute this money to teams, strictly to pay for player salaries. The caveat would be that whatever money is not used up at the end of the season would be returned to the team.

So, there it is, just some thoughts on what I believe would mark a dramatic improvement to the quality of play and the level of competition for MLS.

 

*Edit: When I wrote this I wasn't aware that only the first 20 players count against the salary cap. If going under this rule, I would only change # 1) from before, Re: Academy players. Same principle, only that it would apply to academy players on the 20 man roster. All other points apply, just assume 20 roster spots instead of 30.

 

GO THE ******** AWAY PC4TH

 

Hopefully without seeming to endorse your other suggestions, I'd like to point out some problems with this one.

For the most recent year I've got on hand (2010), only 188/405 MLS players made $100k (guaranteed compensation). 89 of them were international players. Raising the salaries of the other 217 players to $100k would cost a total of $9.4 million or roughly an additional 20% of total salaries.

What would you get for that additional $580,000 outlay per team? Jack squat. You'd be paying the same players more money. Not only that, you'd be paying players that have maybe a 50/50 chance (draftees, development players and the like) of staying in the league more than twice what they'd have happily received otherwise.

The only way to have 20 players that are worth $100,000/year per team is to blow up the international player limits. Otherwise, you'll be paying the same American guys more money for the same kind of soccer.

Unless you're talking long-term, and you think that a lower salary floor would attract more kids to stick to soccer in the first place, thus increasing the player pool and the number of $100k American players. In which case I'm going to have to ask you to show your work.

 

Thanks for the response. I would suggest that the domestic/international rules for players in MLS are more fluid than in a lot other countries. Here is the link from mlssoccer.com: http://www.mlssoccer.com/2012-mls-roster-rules. Basically each team starts the year with 8 international slots. Not having researched this issue thoroughly, I suspect that immigration laws are a lot stricter in most other countries regarding who would be a domestic/international player. Here, once a player acquires his green card, he's counted as a domestic player. I think that 8 international slots out of 30 is a good enough number, specially considering that a team would hire an international player with the expectation that he'd be on the 18 player match day roster.

On your point that increasing the minimum salary to $100K would lead to inflated salaries, I agree with you. I even said it would, in the short term. This is all scenario building, and this is YBTD, so I'm throwing a hypothetical. Of course, very few ideas are perfect when initially conceived, they're usually tinkered to improve the initial thought.

What I also said was that it would lead to better players after those initial ones are purged. Finding information about the number of international slots being used per team is tricky, since green card holders are counted as domestic players per inmigration laws. According to this page, there are currently 136 international players occupying rosters in MLS. That averages to nearly 7 roster spots per team. So it appears that teams have no shortage of slots available to them. You want to increase the number of international roster slots, sure go ahead. If the salary increases to $100K minimum, I think that increasing to 10 slots would be a good number, but there is no evidence that MLS needs to "blow up the international player limits".

Instead, if the objective is to display more American born/USMNT eligible players then it would be better to offer teams incentives for doing so without running the risk that teams will roll out a squad full of foreign born players. My suggestion would be (working along with the other proposals I brought up) to allow teams to count only 50% of a USMNT elegible player, so long as he is in the 18 man match day roster for more than half of the A squad's games, AND said player averages 45+ minutes per match. Phase this exemption out over a period of 3-5 years for each player. I would think that would be incentive enough for teams to find those types of players.

Beyond that, players just have to demonstrate they deserve one of those match day slots.

 

Well, since, according to this, all MLS teams already have salary expenditures that surpass $3 mil, and also taking into consideration that the salary budget is $2.81 mil, I would say that, yes, it is very likely that such a salary floor would be approved by 2/3 of MLS owners.

 

i mean maybe not at this second, but i think 5-10 years down the road i think they would. Hell if you convince them that doing that would bring in more talent and increase popularity of the league and in turn tv revenues, then im sure they'd be all for it now. (if there is revenue sharing for national tv broadcasts, i really am not informed about the MLS rules in this sense)

 

Why do people continue to insist on disregarding US Labor Law ?

Jasonma, FINISH HIM !

Jesus man, you ARE PC4TH ... how many times are you going to post this same exact crap in multiple threads ?

 

Though using USMNT eligibility might be a legal loophole its close enough to the edge of employment law where everyone that can work in the U.S. without a visa (green card, refugee, etc.) has to be treated the same as a U.S. citizen that I doubt MLS would risk it.

 

In what way am I suggesting to disregard US employment law? I never said not to employ foreigners, I'm fully aware that's illegal. You obviously employ anyone that has a work permit/greencard/whatever that permits them to work in this country.

If you reread my proposal, all I was saying is that if the objective is to have more USMNT eligible players playing domestically, you might offer teams an incentive to do just that by excluding a portion of their salaries from hitting the salary cap. There are multitude loopholes in MLS for excluding players salaries even now.

 

Making those exclusions based on your criteria is what's illegal guy.

 

Maybe, that's why I said it might be a loophole. You can certainly reward an employee for honors they receive (such as a USMNT callup) but since only actual American citizens are eligible for that award it might be skirting too close to the employment rules to reward the business (team) for that honor. Close enough that I don't think MLS would chance it.

 

Absolutely. What he's saying though, is to base it on USMNT eligibility:

"My suggestion would be (working along with the other proposals I brought up) to allow teams to count only 50% of a USMNT elegible player .."

I think that'd be a direct breach.

 

So if I had a company and said that I would be willing to hire anyone, but members of a group who are chosen based on the criteria listed in anti-discrimination laws (sex, race, national origin, etc) were paid more, the Feds would be ok with that? And now you want to extend it to all those eligible for that exclusive club.

So if I wanted to pay members of the Boy Scouts (or anyone who could be a member of the Boy Scouts) more than the other people, the Feds would look away?

For a more glaring example, replace "Boy Scouts" with "Klan" and see that there's no way a loophole this big exists in Anti-discrimination laws

 

Oh, I missed the eligible part. Yeah, that pretty much blows up the idea.

As for people who have actually qualified I'm not so sure its as cut and dried as Achowat makes it. If they've been capped by the Nats that's a form of acknowledgment of being a leader in their field (or in this case on the field ). Companies regularly reward their employees for winning awards and such, the Nats could be considered just another form of reward.

Now the OP's original idea (or at least what I thought the idea was) was to reward the teams for what the players did to be called to the Nats, which is further away from just rewarding an employee for a job well done. That's where it gets too close to employment law for me to think they could get away with it. Even more so now that I see he's just rewarding teams for players eligible for that award, so that's pretty much not going to be allowed.

But if MLS said that were going to give 10% bonuses to any player called up to the Nats I don't think that's running afoul of the employment laws. If they said they would give the bonus to any player called up for any National Team that's clearly acceptable.