Dust2
08-06-2009, 01:06 AM
The current hard cap is $2.3 mil this year. Assuming that it will increase to $2.5 mil for 2010, it would look like this under the various sports league models:
The current MLS hard cap structure
NRL (rugby): $2.5 mil (league paying) floor; $2.8 mil ceiling
CFL: $2.5 mil (league paying) hard cap; luxury tax $3 for $1 over at $2.8 mil and beyond
NFL: $2.5 mil (league paying) floor; ceiling ~$2.9 mil; incentive bonuses not counted toward the salary cap
$2.5 mil (league paying) salary cap with paid attendance bonus (1000 paid attendance above the league paid average attendance = $100k in extra cap space)
$2.5 mil (league paying) salary cap with DP exempted
$2.5 mil (league paying) salary cap with 2 DPs (1 exempted, 1 not)
$2.5 mil (league paying) salary cap with 2 DPs (both exempted)
NHL: $2.5 mil (league pay) lower limit; $3.5 mil upper limit
NBA: $2.5 mil soft cap (league pay); luxury tax ($1 for $1 over) starting at $3 mil
NBA/Snowden: $2.5 mil soft (league pay); $6 mil hard cap; luxury tax ($1 for 1 over) starting at $3 mil
Snowden's two tiers cap: $2.5 mil soft cap (league pay); $7.5 mil hard cap (3:1 ratio)
UEFA Platini: cap links to 25% of each club's total revenue with luxury tax
MLB: no salary cap; luxury tax starting at around $4-6 mil
EPL, USL, La Liga, Serie A Mexican FMF, J-league etc... no salary cap
MLS is at a crossroad. What happen in the 2010 CBA will determine the future of MLS for the next 5-8 years and beyond. It will set the foundation of where MLS will go from here and what kind of league MLS will be. In the past several years, MLS have been successful in building SSSs, getting a $17 mil a year TV deal, shirt sponsorship initiative that have net MLS tens of millions and the $150 mil 10 years adidas deal. According to Soccer America, "since the last collective bargaining agreement with players in 2004, MLS has received more than $200 million in expansion money." With team #19 and #20 to come, MLS will receive another $75-80 mil in expansion fee. The new breed of expansion teams (Toronto, Seattle, Philly, Vancouver, Portland, Montreal) are showing signs of significantly higher attendance than the old MLS cities. Maybe, it's time to install a more flexible salary cap structure.
I believe the best cap structure for MLS is one where the ratio between the highest team and lowest team is about 2 to 1. This keep the whole league competitive as oppose to the like of EPL where the ratio between the Chelsea and Hull is 25 to 1. In addition, some form of luxury tax is needed to help the low revenue teams financially. This means that if the high revenue teams want to spend more, they will have to pay for this advantage. What I would like to see as the salary cap structure in 2010 and beyond is the NBA/Snowden mixture:
$2.5 mil soft cap (pay by the league)
$6 mil hard cap (pay by the club ownership from the $2.5 mil onward)
$3 mil luxury tax threshold ($1 tax for $1 over)---teams under this threshold will receive luxury tax
What kind of salary structure do you think is best for MLS to grow, succeed and prosper in the years to come? Here's Simon Evans, a Reuters Sports Correspondent, opinion on the matter:
http://blogs.reuters.com/soccer/2009/07/30/americans-fall-for-soccer-but-can-mls-cash-in/
The MLS’s prudent salary cap and the very gradualist approach to expansion have been factors in its modest success so far but they could, in time, turn out to be exactly what is holding the game back.
The current MLS hard cap structure
NRL (rugby): $2.5 mil (league paying) floor; $2.8 mil ceiling
CFL: $2.5 mil (league paying) hard cap; luxury tax $3 for $1 over at $2.8 mil and beyond
NFL: $2.5 mil (league paying) floor; ceiling ~$2.9 mil; incentive bonuses not counted toward the salary cap
$2.5 mil (league paying) salary cap with paid attendance bonus (1000 paid attendance above the league paid average attendance = $100k in extra cap space)
$2.5 mil (league paying) salary cap with DP exempted
$2.5 mil (league paying) salary cap with 2 DPs (1 exempted, 1 not)
$2.5 mil (league paying) salary cap with 2 DPs (both exempted)
NHL: $2.5 mil (league pay) lower limit; $3.5 mil upper limit
NBA: $2.5 mil soft cap (league pay); luxury tax ($1 for $1 over) starting at $3 mil
NBA/Snowden: $2.5 mil soft (league pay); $6 mil hard cap; luxury tax ($1 for 1 over) starting at $3 mil
Snowden's two tiers cap: $2.5 mil soft cap (league pay); $7.5 mil hard cap (3:1 ratio)
UEFA Platini: cap links to 25% of each club's total revenue with luxury tax
MLB: no salary cap; luxury tax starting at around $4-6 mil
EPL, USL, La Liga, Serie A Mexican FMF, J-league etc... no salary cap
MLS is at a crossroad. What happen in the 2010 CBA will determine the future of MLS for the next 5-8 years and beyond. It will set the foundation of where MLS will go from here and what kind of league MLS will be. In the past several years, MLS have been successful in building SSSs, getting a $17 mil a year TV deal, shirt sponsorship initiative that have net MLS tens of millions and the $150 mil 10 years adidas deal. According to Soccer America, "since the last collective bargaining agreement with players in 2004, MLS has received more than $200 million in expansion money." With team #19 and #20 to come, MLS will receive another $75-80 mil in expansion fee. The new breed of expansion teams (Toronto, Seattle, Philly, Vancouver, Portland, Montreal) are showing signs of significantly higher attendance than the old MLS cities. Maybe, it's time to install a more flexible salary cap structure.
I believe the best cap structure for MLS is one where the ratio between the highest team and lowest team is about 2 to 1. This keep the whole league competitive as oppose to the like of EPL where the ratio between the Chelsea and Hull is 25 to 1. In addition, some form of luxury tax is needed to help the low revenue teams financially. This means that if the high revenue teams want to spend more, they will have to pay for this advantage. What I would like to see as the salary cap structure in 2010 and beyond is the NBA/Snowden mixture:
$2.5 mil soft cap (pay by the league)
$6 mil hard cap (pay by the club ownership from the $2.5 mil onward)
$3 mil luxury tax threshold ($1 tax for $1 over)---teams under this threshold will receive luxury tax
What kind of salary structure do you think is best for MLS to grow, succeed and prosper in the years to come? Here's Simon Evans, a Reuters Sports Correspondent, opinion on the matter:
http://blogs.reuters.com/soccer/2009/07/30/americans-fall-for-soccer-but-can-mls-cash-in/
The MLS’s prudent salary cap and the very gradualist approach to expansion have been factors in its modest success so far but they could, in time, turn out to be exactly what is holding the game back.