Three pending MLS roster rule changes, unofficially

Photo Darby Winter/Special to The Philly Soccer Page

According to Paul Tenorio of The Athletic (paywall), last week Major League Soccer’s (MLS) Board of Governors approved three changes to its roster rules and regulations, which are intended to take effect mid-season this year. Since they change details within the Collective Bargaining Agreement (CBA), they will not take effect until they have been approved by the Major League Soccer Players Association (MLSPA). So MLS itself has not yet announced them.

Going rule by rule we explain the current one, the proposed change(s), and then what it may mean for the Philadelphia Union.

First — DPs, U-22s, and GAM

Normally, an MLS player is contracted to the league, not his club, and is paid from the salary cap money the league provides. We do not know how the league acquires the salary cap money.

However, some MLS players are not paid normally. The player’s age at the beginning of the calendar year and his roster category affect the situation.

The senior roster is paid by the league. Three groups are not, either in part or fully. The supplemental rosters, “designated players” (DPs), and U-22 initiative players (U22s) can be paid by both the league and the club. Where applicable, we illustrate in parentheses using Philadelphia’s details.

Ever since the Designated Player Rule was introduced to let the Galaxy sign David Beckham, individual clubs may choose to increase spending on salaries than the league’s maximum budget charge allows. By the beginning of the 2024 season, the DP rule had four variations.

  • A club could have two DPs. It could add a third, who is age 24 or older, by paying $150,000 every year into a pool to be split equally among all the teams having only two. The three old, expensive DP teams were eligible for only one U22 player. The U22 initiative is a second, more recent device allowing a club to spend beyond the salary cap on a player who was under 22 when initially signed. Atlanta has Franco Ibarra, for example.
  • A club could have its two DPs plus a third whose salary is eligible to be bought down with Target Allocation Money (TAM). “Eligible” means the salary is equal to or less than the annual maximum individual salary budget charge — it increases every year — plus $1 million dollars. These clubs could have three U22s. (When Alejandro Bedoya was a DP, later in his contract he was probably bought down with TAM to make room for other DPs, while avoiding the $150,000 surcharge. Daniel Gazdag’s 2023 salary would have qualified for a TAM buy-down; Mikael Uhre’s was too high.) (2024 salaries will be published by the players’ union in late May.)
  • A club could have two DPs and a “Young DP” who either turns 24 during the 2024 calendar year or is younger and three U22s (Philadelphia has no U22s and Philadelphia’s Julian Carranza will turn 24 on May 22, and cannot remain a Young DP after this season.)
  • A club could have two DPs, three U22s, and an annually varying quantity of General Allocation Money (GAM) above and beyond every club’s annual ration.

Unofficially, the following changes will simplify DPs, U22s, and GAM, and there will be only two variations.

  • Teams will have three DPs and three U22 initiative players.
  • Or,…teams will have two DPs, four U22s, and $2 million in GAM annually.

Tenorio does not say overtly that the Young DP designation has been eliminated, but logic suggests it may have merged into the U22 player initiative.

The DP, U22, and extra GAM changes should not affect the Philadelphia Union significantly.

Usually, Philadelphia does not buy expensive, young prospects from overseas to develop them for sale as, for example, Atlanta United has done with DP Thiago Almada. (However, when Ernst Tanner likes an opportunity, he tries to seize it by whatever means possible–Carranza, Jose Riasco, Sanders Ngabo, Markus Anderson, and probably soon Cavan Sullivan, by way of examples).

Instead, the Union’s stated plan is to identify younger amateur players to develop and sell to European developmental leagues. Those teams will then sell the players onward and the Union will receive a percentage of the second sale fee, which is what happened with Brenden Aaronson. It still may happen with his brother, Paxten, and also with Mark Mckenzie. Cavan Sullivan and Jack McGlynn may be next in line.

Second: Contract buyouts

At the beginning of 2024 a club could buyout only one contract per season during both the season and the off-season.

When the change goes into effect, a club will be able to buyout two.

Judging a player’s future contribution to a new team is inexact (as observed when Nick Sakiewicz signed Algerian goalkeeper Rais M’Bolhi). Soon, moving on from a poor judgment may occur more quickly because wiggle room for mistakes has doubled.

Philadelphia’s habit of bringing in two new players to compete for one future roster slot will still cost the same dollars, but now it may free up the second roster slot more quickly. (Jesus Bueno’s old foil Richard Odada is still technically on the Union’s books until this June.)

Third: More GAM from loans and transfers

Under current rules, MLS teams can convert up to $1,215,506 of any transfer or loan revenue into GAM.

Under the new one, teams can convert up to $3 million into GAM. (Last summer’s reported $7.5 million offer from Olympiakos for Carranza would generate $1,784, 494 more of GAM later this summer than when it was initially presented.)

As economics teaches, more money circulating without increases of produced goods and services inflates prices. For example, the increase in obtainable GAM may only mean that an international roster slot may no longer cost $50,000 of GAM. Instead, it may cost $123,000.


  1. Tim, we are lucky to have you. Thanks

  2. Andy Muenz says:

    Why does MLS insist on changing rules mid-season. It’s bad enough that the new injury/sub rules are going into place this weekend, but multiple rule changes at different points is ridiculous.

    • +1 Combined with last years oh yeah and we are changing how the playoffs work.

    • pragmatist says:

      They usually don’t. I think Jim even touched on it in a recent press conference. They like to make changes in the off-season, but they are trying to take advantage of the time leading up to the World Cup, so some changes can’t wait until the off-season.

      • Andy Muenz says:

        That’s like a defendant in an assault trial saying that they usually don’t walk up to people they see on the street and start beating them up. Just because it’s not the usual thing doesn’t make it right when you do it. And it’s not the first time they’ve done it, as SoccerDad pointed out.

    • Probably want to make sure they take full advantage of the summer transfer window in Europe.

    • The game rule changes were supposed to start at the beginning of the season. The ref lockout delayed that.
      The roster rules mods are being implemented this summer to allow teams to take advantage of Messi, Copa, CWC and the WC now. There will most likely be more significant changes made to the roster rules ahead of the 2025 season.
      This is part of the reason why MLS is still a single entity. Like it or loathe it, it does allow the league to make changes and course corrections faster when needed.
      This ability to change roster rules mid season will also be a large factor in the Union’s ability to sign Cavan Sullivan.

      • Andy Muenz says:

        And even if the replacement refs couldn’t handle the injury/sub changes, why weren’t they implemented as soon as the old refs came back rather than waiting three weeks?
        Let’s play 20-25% of the season under one set of rules and the rest under a different set. What a great idea.

      • When your company changes plans mid year, is that wrong too? If a marketing plan or a product isn’t doing well does your company just through their hands up and say “well we cannot do anything until NEXT year.”?
        This isn’t a matter of MLS suddenly saying that wins are now worth 4 points instead of 3.
        Teams also knew that the game rule changes were coming. The roster rules changes are just the league’s leaders course correcting due to market changes.

  3. Gruncle Bob says:

    When have the U used a contract buyout? I can’t remember any.
    Contract buyouts reward spendthrift owners with GMs who make bad decisions. This change does not help the U in any way.

  4. Matt Custer says:

    MLS player payroll rules make the Byzantine Empire’s bureaucracy look like the very model of simplicity.

    • Have you ever tried to understand the NBA’s salary cap? The NFL’s? MLB’s myriad of roster designations and rules? MLS’ roster rules are quite simple in comparison.

    • +1
      But at least with baseball we have all grown up with them, in my case for more than six decades.

  5. Eric Boyle says:

    I leave this stuff to the finance guys! Thanks for this.

    What I want to know is whether the Union gets money from the pool generated by the Barca retirement league! Certainly, seems they have at least 3 DPs.

  6. Thank you for deciphering the undecipherable!!! I am struggling to see how it will benefit the Union versus putting us further behind the high spending clubs. The buy out clause is particularly egregious. I get the idea to allow more risks for acquisitions, but rewarding it?

    I love the emphasis on US based kids (which has paid benefits with individuals like Vasquez and Rocio and McGlynn coming to the Union) however for those of us that want to see titles and trophies I am afraid we are more like Borussia Dortmund than Bayern Munich (or Leverkusen this year). Perennial contenders but never enough to get over the hump. I hope I am wrong.

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