MLS changes roster rules to add roster flexibility

(image via Houston Dynamo FC)

Major League Soccer’s summer transfer window opened today, and the Houston Dynamo are already busy. Striker Ezequiel Ponce was announced a while back as the team’s new Designated Player striker. Today, the club announced the signing of winger Lawrence Ennali as a U22 Initiative signing. Major League Soccer also announced new roster rules for today that will have an impact on the Dynamo, not just this year, but going forward.

Major League Soccer finally announced the rumored changes to roster construction today as the transfer window opens for its American based clubs. The new rules now allocate six roster spots that can be used in two different ways. Previously, if a team had three “full” Designated Players (DPs), they were only allowed one U22 Initiative signing. Now, a team with three DPs, no matter how they use their DP spots, can have three U22 Initiative players. A team can also opt to use just two DPs and four U22 Initiative signings. If a team chooses this option, they will also receive an additional $2 million in General Allocation Money (GAM). For this season, that will only be $1 million GAM since it is being implemented in the middle of the season. This extra GAM is also owner-funded, which means the teams must buy the extra salary cap space from the league.

So, where does that leave the Houston Dynamo? Now that Ponce has to be registered as a DP, the Dynamo will buy Erik Sviatchenko off a DP tag with Targeted Allocation Money (TAM). Ponce, Hector Herrera and Sebastian Ferreira are now the three Designated Players for Houston, and none of them can be bought off that tag with TAM. Ennali becomes the team’s third U22 Initiative player, alongside Aliyu Ibrahim and Nelson Quinones. Because Quinones is out for the season with an injury, he can be replaced by another player that is not a higher Salary Budget Charge than Quinones. If the Dynamo were to do that, they would have to move that new player or Quinones off the U22 designation next year when the Colombian returns.

Unless Ferreira can be moved this window, the Dynamo will have to choose the option of three DPs and three U22s. Teams have until the transfer window closes on August 14 to declare which path they are choosing for the 2024 season. If Ferreira can be moved, the Dynamo could open a DP spot or an additional U22 spot, depending on their preference. If they can move Ferreira this offseason, that also could influence the club’s decision for next season. Having an extra U22 and additional GAM seems an enticing option for a “smaller market” club like Houston.

One other wrinkle in these new rules that could affect the Dynamo is the added Allocation Money from transfers. Clubs can now convert up to $3 million of total transfer revenues into GAM without restriction. In the past, teams could only convert $1,215,506 following a player transfer. (Don’t ask why they chose that number.) That could come into play for Houston if they are able to sell midfielder Coco Carrasquilla, either during this window or I the winter. GAM received by choosing one last DP must be used during that season, but GAM received from a transfer can be applied during the current or future seasons. GAM can be used to buy-down a player’s salary against the cap. It can also be traded as an asset.

Now, what is next for the Dynamo in this window? Head coach Ben Olsen has hinted at potentially bringing in another attacking option. According to the Club Roster Profiles that MLS released earlier this season, the Dynamo have 9 international slots and are using them all. That doesn’t include the additions of Ponce and Ennali. Stephen Annor and Ousmane Sylla will likely be moved to Dynamo 2 for the remainder of the season to open the needed international slots for the new signings. But that means they wouldn’t be able to add any more international players this season. If the Dynamo were to make another addition it would most likely need to be a player already in MLS via a trade. We’re not sure just how much cap space they have left to work with but bringing in a player on a lower salary, like they did with McKinze Gaines, is the most logical option.

Confused yet? If you want to read more on the new roster rules you can find them here and the complete roster rules and regulations is available here.