Finally, over a month into free agency and just weeks before the start of preseason camps we finally know the salary cap for 2024. In addition to the salary cap, a number of other competition rules and updates were released, which likely helped postpone the process. Unfortunately the entire release makes for a ‘good news/bad news’ situation, particularly for Y. Michele Kang and the Washington Spirit.

Salary Cap

In a healthy showing, especially after the securing of a multi-platform broadcast deal which secured millions for the league, the cap ballooned to $2.75-million. The number is up from a max available spend of $1.975-million in 2023. Additionally, the NWSL is also phasing out Allocation Money, which operated basically as NWSL Bucks. Each team had an allotment (confusingly, stashes of which could be traded between teams) and were responsible for “buying” the money from the league to use in player acquisitions.

The salary cap boom likely made this level of banking something the NWSL front office no longer wanted (nor, with 14 teams now, likely has the funds) to manage, and is a show of trust with its many new owners. As a result, transactions will now be much simpler. You want Y, you pay X, league approves, done deal. (Teams have until December 31, 2026 to spend or withdraw any outstanding balances.)

From the Spirit perspective this is good, we know we have an owner who is heavily committed financially, so affording even more cap space is good on the surface. However, other rules may provide more limitations than she or the team may have been expecting.

Related Party Transactions

Here’s where things begin to feel uncomfortably targeted. This section of the new rules put strict limitations on what can be done between clubs under multiple ownership models (whomstever could they mean???).

Article I of this section reads:

Related Party Club: A non-NWSL Club wherein an investor from an NWSL Team holds
a majority interest, has decision-making authority, and/or exerts meaningful influence
over the non-NWSL Club’s technical or business decisions. The League will, in its
discretion, make the decision whether a non-NWSL Club meets the Related Party Club
definition. In the event of a dispute, the League will consult with the Executive
Committee on the decision.

With Michele Kang already an owner of London City Lionesses, and a few bangs of a gavel away (or however they do it in France) from adding Olympique Lyon Femenin, we think we know who they’re talking about.

The problem comes in the pages of restrictions on intra-club player movement, both incoming and outgoing. Keep in mind, Lyon took over OL Reign some years ago, and players like Dzsenifer Marozsan and Eugenie Le Sommer were loaned from Lyon to Reign. Seeing how Kang could use the same mechanisms was apparently threatening enough to stockpile a bunch of rules to get in the way.

They can all be read here, but a few stand out:

1. No exclusivity agreement shall exist between and NWSL Team and the Related Party Club
2. The number of players loaned or transferred to OR FROM an NWSL Team by its Related Party Club must not exceed three (3) players at any given time during a season
3. For an Inbound Loan, a Player’s Salary Cap charge will be equal to the amount of compensation paid by the NWSL Club AND the Related Party Club during the term of the Loan.
4. For an Outbound Loan, a Player’s Salary Cap charge will be equal to the full compensation paid to the Player by BOTH the NWSL Team and the Related Party Club.

The first is reasonable, it’s not really fair for every Lyon player to be off limits to other NWSL teams. However, being restricted to three players per season being able to be loaned or transferred between the Spirit, Lionesses and Lyon is the sort of thing that feels unnecessary, and can stand in the way of player development. NWSL clubs don’t have academies, so drafting or signing young players and loaning them in-network to be certain they receive quality resources and attention paid to their development should be encouraged, not restricted.

The last two are the ones that truly blow my mind. As a fan of a certain blue London club (Chelsea FCW/FC), I’m very aware of the way loans work in Europe. There are restrictions on the number of players that can be loaned in or out (though the total number makes the NWSL’s three seem laughable), it’s the potential salary cap hits that are the most brutal. Often loans simply require player agreement and a negotiation between clubs on how they will (if at all) split the paying of the player’s salary.

The way these new NWSL rules read is that any loan (in or out) between an NWSL Club and ‘Related Party Club’ requires the NWSL Club to be responsible for the player’s full salary with regard to the salary cap, whether they’re paying the full salary or not.

For instance, if Lindsey Horan wanted to come back to the NWSL and play for the Spirit her entire salary would count against the Spirit’s cap regardless of how much was being split with Lyon. But this also applies to outbound loans too, which is the worst bit. Say Andi Sullivan wanted to experience Champions League competition and was loaned to Lyon, her entire salary would count against the Spirit’s salary cap each season despite her literally playing for another team. The only way to avoid a substantive salary cap hit would be for the Related Party Club (London City or Lyon) to pay an amount less than or equal to the player’s NWSL salary, any more (regardless of exchange rates and/or increased costs of living) and the cap hit applies.

Net Transfer Threshold

The league has also decided to make up a transfer fee threshold that applies domestically and internationally. Not sure why they would do this, the women’s market is already artificially suppressed, and no such thing exists anywhere else. But now all NWSL teams are under a Net Transfer Fee Threshold of $500,000.

In short, this means that any fees that exceed $500k net will incur a hefty 25% charge towards that team’s salary cap. Basically, if a club spends more than $500k and doesn’t bring in enough in outgoing transfers to hit or dip below $500k, the overage will be taxed at 25% and the team’s overall cap number will be lowered by that amount.

This is an odd move that extinguishes much of the excitement from a large salary cap increase. The European market is ramping up, with Arsenal reportedly being willing to spend £500k on striker Alessia Russo last January. Given the conversion rate, that would be in the ballpark of $633k, meaning an NWSL team offering the same money to secure Russo, and assuming no substantial outgoing transfers, would have their overall cap number lowered by $158,250.

What this effectively means is that without a major outgoing transfer, every NWSL team is automatically out of the bidding for elite under contract players. In the fast growing women’s football market, $500k is already nothing, and each year that number will appear more laughably small. This past summer Chelsea paid Tigres half that amount for Mia Fishel, who is currently serving as backup to Sam Kerr.

Sure, they can raise it next year, but it’s concerning that a league experiencing so much growth would feel this sort of thing was necessary at all. We’d entered a space where nearly every club has substantial financial backing, so I can’t really work out why these broke boi rules were considered and applied.

Under-18 Entry Mechanism

Depending on how you feel about the recruitment of under-18 players, this is where we get back to some good news. We’ve already seen what players like Chloe Ricketts and Jaedyn Shaw can do at a professional level, and the number of talented teenagers is growing.

With these rules, each team is now limited to four U18 players, up from just two. These players take up a roster spot and still cannot be waived or traded until the player turns 18 (or with player and parent/guardian consent). Once a player turns 18, another U18 spot automatically opens up for the team.

The constant shifting of NCAA conferences caused by college football is harming, and will continue to harm, other sports, including women’s soccer. Expanding player and team options to help some navigate this issue is good. Of course it will only apply to the top 1% of the top 1%, but it’s a smart recognition that, without team academies, it’s important to find ways to secure, keep and develop young talents.