Major League Soccer announced on Friday that the Board of Governors approved an increase in the amount of Targeted Allocation Money (TAM) available to each club. Following the 2017 MLS season where each club received an allotment of $1.2 million dollars of TAM, all 23 MLS teams will continue to receive $1.2 million of TAM per year in 2018 and 2019. MLS clubs may pull forward and use immediately the $1.2 million of TAM designated for 2019.
MLS clubs also will have the flexibility to spend up to an additional $2.8 million of TAM, on a discretionary basis funded by the team, per year in both 2018 and 2019, which will further enhance the quality of play across the league. This injection should increase a teams ability to build their rosters with increased flexibility and help add high-quality players outside of their Designated Player spots.
About Targeted Allocation Money:
- The minimum salary budget hit for a player who is bought down with TAM is $150,000.
- Discretionary TAM cannot be traded.
- Targeted Allocation Money may be used to sign new or re-sign existing players whose salary and acquisition costs are more than the maximum salary budget charge but less than $1.5 million.
- Clubs may use up to $200,000 of their currently available Targeted Allocation Money to sign new Homegrown Players to their first MLS contract, subject to League review and approval. Targeted Allocation Money cannot be used on a Homegrown Player previously signed to MLS.
- Targeted Allocation Money may be used to convert a current Designated Player to a non-Designated Player by buying down, on a prorated basis, his salary budget charge to at, or below, the maximum salary budget charge. If Targeted Allocation Money is used to free up a Designated Player slot, the club must simultaneously sign a new Designated Player at an investment equal to or greater than the player he is replacing.
- Targeted Allocation Money and General Allocation Money cannot be used in combination when signing or re-signing a player, or when buying down the budget charge of a Designated Player. Either Targeted Allocation Money or General Allocation Money may be used on a player in a single season, not both.