Monday MLS Breakdown: Squaring up to the difficulties of cutting ties with a Designated Player

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Monday MLS Breakdown: Squaring up to the difficulties of cutting ties with a Designated Player
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Monday MLS Breakdown: Squaring up to the difficulties of cutting ties with a Designated Player

Seattle coach Sigi Schmid captured the difficulty of acquiring Designated Players as he assessed the viability of procuring Shalrie Joseph from Chivas USA over the weekend.

Chivas USA made clear that Joseph didn't fit into its oft-criticized plans. Schmid invited Joseph to train with his team. And yet the Sounders FC boss noted that a deal between the two sides looked unlikely at the moment.

“At the end of the day, it's something that would be great if it happened,” Schmid told the Seattle Times on Saturday. “The expectations are no, that it's probably not going to happen.”

Joseph's plight resembles Freddy Adu's situation in Philadelphia and the experiences of other out-of-favor players on maximum-plus or DP deals in MLS over the past few seasons. Their abilities outstrip their current paychecks. Their current employers want to move the player to a new club. But the mechanics of a deal make it difficult to react an agreement amenable to all parties.

Most of the blame for these sorts of situations rests with the clubs themselves. More often than not, they place themselves in a situation where they have tied themselves to a player for multiple guaranteed years. These deals can benefit the team if they extract equal or greater value from that deal on the field, but they also inflict salary budget nightmares if the player does not perform to his previous standards or slips out of the plans of the current boss.

In other countries, these particular issues do not present a difficult proposition. Sure, the manager wants to move the player off his wage bill to clear room for another option or two. Maybe the team takes a loss to usher the player out the door to another team. Perhaps all involved parties settle on amenable particulars to terminate the relationship. In the end, the situation usually does not cause problems.

MLS clubs do possess the option to act in this fashion within the confines of the salary budget system. League regulations allow clubs to buyout the contract of one player per offseason without incurring any budgetary charge for the upcoming campaign. They must do so with their own funds, according to the league's roster rules. Any subsequent buyouts – including agreements reached during the middle of the season – require the club to shell out the money and suffer through a budget charge assessed by the league after an agreement is reached to conclude the contract.

(Note: It is worth pointing out that non-guaranteed players do not fall under this purview. Clubs can end those contracts before the contract guarantee date – and, in some limited instances, after the guarantee date – without any impact on a salary budget. This fact constitutes one of the principal reasons why clubs cut ties with marginal players once they reach guaranteed status under the terms of the Collective Bargaining Agreement.)

Even if the club is willing to ante up the money and sever the relationship with the player, the player may not consent to the deal to end the contract. Any buyout requires the consent of both parties before it takes effect. Toronto FC discovered the problems with this approach last year as it tried to end Julian de Guzman's deal with the team. De Guzman did not accept the terms of the buyout (it is rarely, if ever, at full price) and left TFC scrambling to figure out another way to dump his salary.

If a team is unable or unwilling to buyout the remainder of a deal, then it must shop the player on the trade market to find the unwanted star a new home. At this juncture, the likely destination hinges more on salary budget space than any sort of assets. The dumping team will almost certainly assume a large portion of the salary – in terms of both financial and salary budget obligations – in order to consummate the proper team.

Take, for instance, the situation facing Joseph at the moment. He currently possesses a guaranteed contract for 2013 that will pay him in the neighborhood of $600,000. No team will trade for his contract under those terms.

In order to make that deal work, Chivas USA will likely have to assume the entire financial obligation of the DP portion of his contract (the difference between his final number and the $350,000 paid by the league as part of the salary budget, but still cheaper than a buyout) and find some way to significantly reduce Joseph's salary budget number through allocation money.

If the Red-and-White does not possess the necessary allocation money to facilitate a deal (and some teams do not at this point on the calendar after failing to stockpile appropriately or spending during the winter), then it will likely have to trade with another team – likely under onerous terms given the situation at hand – to obtain it or swallow hard to reach the buyout to required to clear Joseph from the books.

On just about every front, Chivas USA – or Philadelphia with Adu or any other club in this situation – lacks the flexibility to strike a deal. Sometimes, the circumstances – an injury on one team or reduced demands from the party seeking to make the move – change to pave the way for a deal. Other times, there simply is no deal to reach.

The next few weeks will likely determine where Adu and Joseph will fall on that spectrum. For now, the messy status quo prevails until one of the involved parties finds a way to alter it.

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