Midseason Earthquakes Salary Analysis
Now that the new CBA has been signed and the MLS Players Union has simultaneously released its semi-regular salary survey, the good news is that we know more about salary and roster rules than ever before in MLS history.
The bad news is this that this is still MLS, so a whole host of questions remain unanswered: How big is the budget for Homegrown players prior to their salaries counting against the salary cap? How much allocation money is given for failure to make the playoffs? Is MLS so horrifyingly short-sighted that they'd count transfer fees against the salary cap even if the players who transfer aren't making DP-threshold salaries? Are salaries against the cap counted pay-as-you-go like the NFL, assessed on total annualized salaries like the NBA, or the latter with exceptions for half-season contracts (which is my best guess)? What significant rule changes will be instituted within the next year that will make much of this irrelevant?
Below is a table that includes the best information we currently have about the San Jose Earthquakes roster situation, with some notes about the areas of uncertainty that remain:
The first thing that stands out, for me, is the fact that the Quakes are more than $150,000 over the limit if Matias Pérez-Garcia's cap hit is structured the way we assume it is. In the outside shot that the transfer fee counts towards Designated Player status but not the salary cap, the Quakes would have a bit of room under the cap without spending any extra Garberbucks. If not, there's almost no room, and I think any suggestion that this ownership group isn't willing to spend should be well and truly thrown out, not in the least because of the generous salary they're currently paying Innocent.
Assuming that we're over the cap as described above, I project San Jose to have enough money from their failure to make the playoffs and the Sam Cronin trade to buy down safely under the cap utilizing traditional allocation funds. That means we're currently breaking even, but does not offer any meaningful space beyond minimum salaries. However, given that we've brought in a potentially-expensive Ligue 1 trialist and are looking seriously at Marc Pelosi (my guess is we're driving a hard bargain), the Front Office seems to be signaling a willingness to make future moves. That either indicates they have more allocation money than I anticipated or that Pelosi is willing to accept very, very little this year. Edit: Marc Pelosi signed just hours after this piece was written, and since the deal was completed after the MLSPU survey, we won't know the details for quite a while. I think it is safe to assume the deal is a minor commitment of funds for this season given the lack of space.
If the Quakes wanted to make a bolder move, say, for Coutadeur or someone of his class, they couldn't get there without some major moves. The TAM could quite easily buy Wondo or MPG down to a non-DP, freeing up a DP level of spend, but would still require enough cap space to fit a DP cap hit. Essentially, the TAM gives you a de-facto fourth DP spot, but you have to clear out the marginal cap space of a DP charge to get it. In this case, the cap hit is half the DP threshold because of the half-season, which is $218,250. That would require trading Pierazzi for either no players or players who make $60,000 or less. That means that a DP is totally within reach, but would require use of the TAM and ditching Pierazzi to have a realistic chance at it. Although a lot of Quakes fans may be dissapointed in JBP's overall productivity, that's still quite a high price to pay, not in the least because we may actually have to include other assets in order to convince another team to take his contract on. It would be worth it, however, if the right kind of player came along. We'll have to wait and see whether Kinnear thinks Coutadeur is that kind of player, although there's certainly a possibility he is.
What about bottom-of-the roster deals? By my count, there is one remaining roster spot as-is, and we'd need two to complete the deals I just suggested.
I would not be surprised if Steven Lenhart were declared out for the season, which would give the Quakes another slot, but no extra salary room. I don't quite understand how the terms of loan agreements work (whether they offer any roster room relief), but I would not be surprised to see Tomás Gomez and/or some other Quakes sent to Sacramento in search of game time, which may carry with it extra space on the roster, but without any salary cap room.
That's why deals like Matheus Silva make so much sense. He counts $0 marginal against the cap, he's an 18-year-old with some long-range potential, and he offers some measure of cover in defense where we need it. Compare that to Ty Harden, a 32-year-old who counted around $11,000 marginal against the cap and had no long-range potential. Given how old this team was last season, I would not be surprised if this was the primary mechanism for an incipient youth movement.
What about the academy? I've watched a few academy games now, and while there are definitely some potential future pros (Amir Bashti and J.T. Marcinkowski look the closest right now), none of them will be signing pro contracts at this point. The earliest I could see either of those two signing is before next season, and given that both committed to college programs that are both soccer and academic powerhouses (Stanford and Georgetown, respectively), it might even be a bit longer than that.
One final note is about Steven Lenhart. He took a deeper discount than we had imagined in the offseason, and signed the deal prior to the current CBA being ratified. That's important, because under the new CBA his contract would be 100% fully guaranteed because of his age and length of MLS service. That would prevent the Quakes from buying him out of the salary cap in the offseason. Instead, if the renegotiated contract is non-guaranteed, Lenhart may have done the franchise an incredible solid by facilitating a future buy-out presumably in exchange for a wink-wink promise to help with medical bills for his knee and keeping him around the franchise in some sort of coaching or ambassadorial role, as is common in salary-capped leagues like the NBA (just look at the Dallas Mavericks, Miami Heat, and San Antonio Spurs for example).
The final CBA and salary survey have given us a lot better picture of where the San Jose Earthquakes franchise is at, and what it’s capable of doing with personnel. However, there are still so many unknowns, not in the least the team's current standing and health, that could push that remodeling project to the offseason rather than the midseason window.