Let's Talk About GAM, Baby

With a nod to Salt-N-Pepa's 'Let's Talk About Sex'

Ok, as the league season gets started on Saturday the elephant in the room for the Rapids is the lack of investment in the squad.  Now the Front Office can't control what kind of budget they get from KSE for Designated Players, or how much discretionary TAM they get to work with, but they can control how they spend the General Allocation Money(GAM) they have.  While most of that information is private, we can make some educated guesses about where we're at.  Right now it seems like we have a lot of GAM we're not spending.

WARNING: Lots and lots of numbers ahead

GAM can be spent in roughly three different ways:

• An unlimited amount can be spent on transfer or loan fees
• A limited amount can be spent per player to buy down their salary hit.  As is typical with MLS the exact numbers allowed are a little murky, but any player making more than $1.6M is a DP no matter what, while some rules refer to up to 50% of the budget charge being covered by GAM.  For the Rapids it doesn't matter much as we don't have a player right now that falls into the grey area (more on that later)
• It can be traded

An important note, given people's opinion of Kroenke/KSE, there is no benefit to the owner to not spending GAM.  they can't pocket it in cash.

Teams get GAM three different ways:

• A yearly stiped from the league (this year its $1.625M for everyone), teams in the CCL get an unknown amount more
• Player sales, up to $1.05M of a transfer fee received can be converted to GAM
• Trades

So given that we can zero in a bit on what the Rapids have, and what they've spent.  The one piece we don't know is how much GAM they had at whatever point we start counting.

For this exercise I'm going to start counting with the Sam Vines sale last yea, and I'm going to assume that we had $0 at that point (worst-case scenario).  This is a clean place to start, because teams have to be roster compliant with salaries at the start of the season, so all 2021 salary requirements for GAM would have been covered by then, and none of the players who needed GAM in 2021 are on the roster now.

So lets talk about GAM the team has received since then:

• $1.625M - League stipend
• $1.05M - Sam Vines sale
• $1.05M - Auston Trusty sale*
• $550K - Kellyn Acosta trade (We get another $550K next year, plus up to $400K in performance bonuses)
• $225K - International slot trade with Atlanta
• $50K - Nicolas Benezet trade (plus up to $50K more if he met performance metrics, unlikely)
• $X - Additional league stipend for being a CCL team
• $X - Cole Bassett loan fee

* - We don't know how much we sold Trusty for, but Sam Stejskal is comfortable using Transfermarkt's $2M, so who am I to disagree?

Grand total: $4.55M + the CCL and Bassett GAM.  I think its safe to say we've received over $5M in GAM in the last 7 months.

Now lets talk about what the Rapids have spent GAM on:

• $1M - Max transfer fee (reportedly we spent the Vines GAM on getting Max)
• $300K - Aboubacar Keita trade (plus up to $150K more)
• $50K - Dominique Badji trade (it was for 2022 GAM)

That's the easy stuff.  $1.35M spent.  The third category, spending it on salaries, takes a little more analysis.  First of all every player has to have a max budget charge of $612,500 in 2022.  If their salary is less than that, fine.  If you make more than $1.6M, you're a DP and you hit the cap at $612,500.  Its that in-between area where GAM comes in.  If you don't want to use a DP slot on a player making between $600K and 1.6M you use GAM (or TAM, but that comes out of KSE's pockets) to buy down their cap hit to that $612,500 number.  Using the 2021 salary guide (because the 2022 one isn't out yet) here's who did, and who likely, needs GAM to buy down their contracts.

2021:

• Kellyn Acosta - No longer on the team
• Michael Barrios - $40K
• Younes Namli - No longer on the team
• Jack Price - $45K
• Diego Rubio - $15K

So, based on last year's salaries coming into 2022 we had $100K in GAM commitments.  Things have changed slightly so we'll go through them:

2022:

• Bryan Acosta - He was a DP for Dallas last year, but its been confirmed we won't be making him a DP.  He was on $700K last season, but we passed up picking him up on his 2022 option from his last contract and renegotiated with him.  So its safe to say he's not going to be making much more than that $700K, and quite possibly less.  So I'm going with less than $100K..
• Cole Bassett - He got a new contract as part of his loan to Feyenoord, and you have to figure he's making significantly more than his $120K last year.  But we're getting an unknown loan fee for him as part of the deal with Feyenoord.  Basic negotiation is probably good enough to get back from Feyenoord at least enough to cover any GAM we'd have to spend on him.  So I'm going to cancel out his possible GAM hit with his GAM addition and call it $0.
• Jack Price - Team captain, was already over the limit, and got a new long-term deal.  It would not shock me to see that he's getting $800-$900K or a bit more.  So lets call it $300K of GAM for now for him in 2022.
• Michael Barrios - Contracts typically have a least a bit of a raise in them, so lets be generous and say we're spending $100K on him this year.
• Diego Rubio - See Michael Barrios.  Call it $100K
• Marc-Anthony Kaye - Got a new contract but he was only on $250K last year.  Do we really think we tripled (or more) his salary?  Lets be generous and say $100K which would be almost tripling.
• Max - Was signed on the U22 Initiative which means he makes under the max salary charge and hits the cap at even lower, so no GAM needed.

Anyone else who got new contracts or on existing contracts would have to have surprisingly large escalation clauses in order to need to use GAM.

So estimate $700K in GAM needed for our salary charges combine that with the expenditures above and you're looking at around $2M in GAM we've spent/committed to spending.

So cancelling out Cole Bassett, we're still looking at close to $5M of GAM we've stockpiled in 7 months, and $2M we've spent.  That's a difference of $3M!  Even if I'm off on my assumptions we've got enough GAM to sign a top-level non-DP player!  And we probably have enough to sign two of them!

So all of those numbers boil down to a simple question.  Why aren't we spending our GAM to improve the team before the season starts?