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D.C. United has a chunk of cash to spend, whether Steve Birnbaum leaves MLS or not

The latest rumor gives a us a chance to envision what D.C. has to play with.

With the MLS transfer window now open, teams are gearing up to bolster their squads and push for a trophy. D.C. United is hopefully in that group, but a recent tweet about defender Steve Birnbaum has us thinking about just how much the Black-and-Red can accomplish on that front:

Putting aside the impact that a Birnbaum departure would have on the field, where Ben Olsen would have to rely on Kofi Opare, Bobby Boswell and Jalen Robinson as his center back depth, I thought it may be as good a time as any to look at what that kind of money could be turned into as well as what is currently available for United.

Bearing in mind the requisite winks, nods and shoulder shrugs that accompany anything to do with an MLS club's funds, I’ll be the first to admit that these are not exact numbers by any means. Hopefully they can at least get us into the ballpark of how much money United has for this transfer window (money that Olsen recently said that "...we’re looking to spend"). So for the sake of this exercise, let’s use the number Stein provided here along with the information provided in MLS’s Roster Rules and Regulations and in the CBA found on the Players Union website.

Assuming a $700,000 sale, the team would earn 2/3 of the fee, or $466,666.67, which the club can assign all, or some of, as general allocation money (GAM). The club also received $150,000 in GAM for the 2016 season, as all MLS teams do. Teams who appear in CONCACAF Champions League are entitled to a competition allocation of $200,000, though it remains unclear if DCU (or any other team in MLS) had a further bonus coming in this year for making it to the knockout stages.

There is an interesting wrinkle, and it’s the Third Designated Player payment. This is for clubs to pay $150,000 to the League to acquire a 3rd DP spot. That money is spread evenly amongst teams that have two or fewer DPs on their roster. Six teams added a third DP since 2015 ended, which means $900,000, split among the seven teams with two or fewer DPs, or a little more than $125,000 in allocation money to each ($128,571.43), in just this year alone. Combine that with those teams already with a 3rd DP spot - which, we're guessing, means an annual payment - and the seven MLS teams without a 3rd DP have $278,571.42 to spend in GAM. So, figuring in the proceeds of a Birnbaum sale, DCU would have somewhere around $900,000 in GAM, or by my math $895,238.09.

Let's move on to the new allocation method of the moment, Targeted Allocation Money (TAM). The club received $100,000 of targeted allocation money as part of last year’s announcement of the TAM concept, and received $900,000 this year (an $800,000 one-time amount plus the $100,000 annual for 2016). They received TAM when they traded former homegrown forward Michael Seaton to the Portland Timbers, and in two 2016 draft moves, they sent and received TAM in deals (deals in which Ben Olsen said they got most of what was traded back).

So let’s say they maybe came out of those three deals with $10,000 of TAM. We know that TAM was used in order to sign Argentine playmaker Luciano Acosta, so it would be safe to assume that since the rules say TAM can be used " sign a new player provided his salary and acquisition costs are more than the maximum salary budget," of $457,500, and Acosta’s base salary is $327,272.76, that at least $130,227.24 was spent. We know that TAM was part of the deal that went to the Colorado Rapids for Marcelo Sarvas. In order to eat half of his contract, perhaps D.C. had to up the TAM a little, perhaps something around $75,000 was in order. So D.C. has dipped into their TAM to the neighborhood of $200,000, or $195,227.24 which, combined with what they received in 2015 & 2016, brings us to a little over $800k in TAM to use ($804,772.76).

Then you have the other money, received as part of the saga surrounding D.C. United and Orlando City when both clubs were in pursuit of Antonio Nocerino. It has been speculated here and elsewhere that the Black-and-Red received something in the neighborhood of $200,000-$250,000 from OCSC so the Lions could sign Nocerino, a mix of GAM and TAM whose breakdown will likely not be made known. For the sake of discussion, let’s say that the money was on the low end, split among both groups equally, and look at how much of each (we think) there is:

  • Targeted Allocation Money: $904,772.76
  • General Allocation Money (if Birnbaum stays): $528,471.42
  • General Allocation Money (if Birnbaum goes): $995,238.09

Even if Birnbaum stays, having more than $1.4 million of allocation money, which amounts to almost 40% of the MLS Team Salary Budget for 2016 is a pleasant dilemma to have. However, when the secondary transfer window ends on August 3 and there hasn’t been any noticeable movement on the roster, questions need to be asked of Dave Kasper and United. Money, after all, can't go out on the field and win games.