Backpass: Large Club, the Size of a Small Club
The CBA pushes off the Rapids largest dilemma till 2027. But the issue isn't going away.
There is both a lot, and not a lot, to say about the revised MLS collective bargaining agreement with the MLS Players Association. A lot because the specific details, the analysis, and the reasons why are all matters of interest which we, of course, spoke at length about on our podcast, the flagship enterprise of this multi-media conglomerate that Matt and I are running.1 Not a lot to say because the specifics obscure the important, blunt-trauma facts of the situation. The very-wealthy team owners lost a bunch of money in the pandemic. In order to make a bunch of money, they ensured the players couldn’t get a collective pay raise until 2027, a time so far off in the distance that by then my sweet little children will both (shudder) be teenagers.
But there are layers within layers of the things that the re-constituted and extended CBA reveals about MLS, and specifically, the Colorado Rapids. The one that came to mind this cold and snowy afternoon is this: every year that the league keeps player costs cheap, the salary cap low, and retains the whole slew of Byzantine additional financial mechanisms like GAM and TAM and the Waiver Draft and the Second-Phase Re-Entry Draft2 is another year that the Rapids continue their charade. The charade I’m talking about is the one where they’re one of the ‘big boys’ of the league - a big club. They are an MLS Original, sort of like a big club. They have a billionaire owner that owns lots of other teams. But they do not act like a big club.
The Rapids are never not going to be mystifying to me; mystifying to *us*. They have an owner worth $10 billion, but he spends money on his teams like an octogenarian on double-coupon day.3 All his teams are currently being run on the cheap - with the possible exception of the Rams, who I choose to completely ignore. Arsenal are adrift in the EPL’s midtable, and at the recently-closed Winter transfer window, they shipped off 8 players including Mesut Ösil, and added just one guy, Martin Ødegaard, on loan, who will likely not solve any of their problems. From what I gather the Nuggets are Nikola Jokić and eleven scrubs. The Avalanche are doing fine, but I can’t say any of their players are particularly famous.4
And of course, there’s the Rapids - the team that their owner forgot. I can probably never say it better than Sam Stejskal did in a piece he wrote for The Athletic in 2019. He wrote:
Colorado’s biggest issue is their owner, Stan Kroenke. Broadly characterized by high-ranking sources around the league as the worst owner in MLS, Kroenke, who also owns English Premier League giants Arsenal and the NFL’s Los Angeles Rams, is absurdly absent from the Rapids organization.
The absence is, of course, only a small part of the problem. The real issue is spending.
On the micro-level - meaning, for the team - Kroenke keeps costs low at the Rapids in a number of ways. First, by having a smallish front office staff supplemented by farming out some promotions and marketing stuff to the KSE main office in the Pepsi Center (home of the Avs and Nuggets). Second, the advertising budget for the Rapids has never been particularly robust. Third, once you discover how fancy and impressive the stadium amenities are around the league, you come to realize that the Rapids home digs are slowly falling behind the times. There are investments that ought to be made into Dick’s Sporting Goods Park to keep up with the times. They are not being made. And fourth, the team doesn’t spend on the roster. Sure, sure, they’ve used TAM on occasion to firm out the 4th to 7th spots on the roster, but they only once, briefly, used all three allowed DP spots at the same time: in the latter half of the 2016 and the 2017 season, when they had Kevin Doyle, Shkëlzen Gashi, and Tim Howard all at once.
And their DPs have always been… somewhat modest. If DPs were cars, then Seattle’s Raul Ruidiaz is the latest high-end Porsche; Carlos Vela is a Ferrari 488 Pista; Zlatan is a Bugatti Chiron Super Sport 300+. Kevin Doyle is a Chrysler 300. I mean, it’s a cool car. But you put it in the driveway next to a Bugatti and ask ‘which one belongs to the MTV Cribs Hip-Hop superstar, and which one belongs to his high school pal that runs his instagram feed and picks him up his weed?’ and you’ve got your answer. More and more, the league is becoming one that buys luxury performance roadsters, leaving the ‘sensible mid-range sedan’ teams behind. This is the new normal - Cincinnati just dropped a $13 million+ transfer fee on Brazilian up-and-comer Brenner. Heck, David Tepper spent $300 million just to be allowed into MLS’ exclusive domain with his new club, Charlotte FC.
The macro-level view of the Rapids thriftiness is in regards to how it will affect league rules. Richer teams are not going to want to be held back by the smaller teams for much longer. The salary cap, including GAM and TAM, is $9.2 million this year, and rises to $13 million in 2027, not including DPs. That’s a fraction of the NBA salary cap - $114 million per team, spread across just 12 players. MLB’s ‘soft’ salary cap, called the ‘luxury tax threshhold’, kicks in when teams cross $210 million. MLS franchises are a rare commodity, and their value is directly related to the degree to which they capture the world’s imagination - there’s a reason you can go to Malaysia or Zimbabwe and find Manchester United kits, but not NYCFC jerseys. But that can’t last forever - owners like Paul Allen and David Tepper will want to go big and go global; they will want to beat Liga MX teams and attract in-their-prime global superstars, not the current no-longer-mint-condition former stars the league generally pulls now. And they won’t accept Josh Kroenke crying ‘but I don’t wanna!’ for much longer. Paying 1/10th of what other US leagues are paying their top athletes isn’t gonna work forever.
Granted, this all has to follow the money - there’s a chicken and egg problem here, too. You can’t just start throwing obscene amounts of money at players to build a super team, or you might end up the sports equivalent of ‘The Adventures of Pluto Nash’, a 2002 box office bomb that cost $100 million to make, but grossed just $7.1 million. MLS owners are going to hope that a newly negotiated TV contract in 2024 that will include local and national rights will allow them to accelerate the leagues growth curve to start joining the bigger leagues like France and the Netherlands, instead of MLS’ current league power rankings at 20th-best in the world, behind the Greek and Danish leagues.
Colorado still act like a small club, even though their owner ought to allow them to behave like a large club. The CBA negotiation can mean a lot of things depending on how you look at it. But one thing it probably means- the Rapids days as the frugal hanger-on club in MLS may have an expiration date off in the not-so-distant future.
For the un-initiated, this is a self-deprecating joke of the highest order. We are not, shall we say, ‘profitable’, or ‘a business.’ There is a fantasy somewhere that Matt and I become rich and famous media personalities; much sought after for influencer marketing gigs; the kind of folks who stroll into the MLS Cup Final and the press box goes a’tizzy. This fantasy is close in reality to believing that there really are orcs and balrogs in a mythic place called Middle Earth. Matt and I are not quitting our day jobs
The Second-Phase Re-Entry Draft, if you think about it, sounds like an aerodynamic problem that Space X and NASA might jointly be working on.
This note is explanatory because I worry that some of our younger readers (those under 40) may not be aware that once upon a time supermarkets would have a day a month where your ‘$0.40 off coupon’ for cat food would be worth $0.80. My grandmother went all in on this every time. We would come over and my mother would look in the pantry and say ‘Mom, why do you have 6 cans of cat food?’ And she’d say ‘It was on sale and I had a coupon!’ And my mom would gently remind my Bubbie that she doesn’t have a cat.
Full disclosure - not a huge hockey fan here. I can name a dozen players. The Avs have a guy who earns $12 mil a year and another guy with a dozen assists already in this young season. And I’d never heard of either of ‘em.
Where do we begin with this? Overall it’s a great commentary but there are a lot of things that need to be for the digressed upon: The Altitude-Comcast debacle. The lack of consistent playoff appearances, along with any sort of meaningful progress in the playoffs. The lack of outreach from the Club to the community. The lack of meaningful upgrades and needed repairs to the stadium. Most importantly, why can Colorado not turn a profit running a bare-bones operation?