There are uncapped leagues in North America (MLB). There are hard capped leagues (NFL). There are even leagues that have ways of doing both (NBA). There are many approaches to league salary structure that are tested in the USA, and MLS' use of single entity and an initially very hard cap has worked to get them to a certain point in growth. Then they started softening that. First it was one DP, and then it was three DPs per team and then it was Home Grown Players being off budget for at least the first two contracts. MLS is not as strict as the NFL.

But there are a couple ways to bring more quality or keep more quality within Major League Soccer. One would be to add more DPs, another would be to remove transfer fees from the cap hit, another would be to borrow from the NBA's "Bird Exception."

The NBA launched the Bird Exception in order to allow its stars to stay with teams where they'd spent time. This is an issue in MLS as well. GMs of successful teams have to cut regular and good players because the cap hit goes up. This hurts the team's depth, encourages poor roster churn and disconnects the fanbase from players they love. In a sport that already has the highest average churn in the world (because there are tens of thousands of players), the tight cap encourages poor decision making, or good decision making that has the same effect as poor decision making.

Adding a similar rule (let's call it the Donovan Rule), would allow teams to retain players that they advance in their careers. Unlike the HGP rule which encourages development, this would be about refinement, about marginal improvements being rewarded rather than sold onto the higher leagues. It would mean Stuart Holden, Geoff Cameron, Ricardo Clark, Kenny Cooper, Nate Jaqua, etc. don't leave purely for more money. Certainly, many players would still leave to test themselves in higher-quality situations, but if MLS keeps even one-third of those that have been climbing the ladder it is a higher quality league than it has been. It would also mean more cap room for teams that use their Exception to retain talent, as the essence of the Rule is no cap hit.

The details are for smarter people than myself. A simple version would be that the rule applies to a player that has been with the same team for at least 7 transfer windows (3.5 seasons). A team could only use the Rule every other transfer window. Once exercised the remainder of the new contract or extension does not count towards the salary cap at all. These contracts, similar to DP and HGP deals would be the responsibility of the local investor/owner group. Like all MLS contracts, they would be subject to league approval. A player would not keep their rights when traded, but if traded after the contract they are an off cap player.

Imagine Seattle with an extra 350k of cap space because they retain Fredy Montero as a non-DP. This reward to the organization would be because they took him from near unknown and helped him become a perrenial MLS All Star. Or look backwards when the Houston Dynamo lost the creative Holden. Or having FC Dallas be able to retain George John or Brek Shea rather than lose them to lower EPL sides for not much money. Or even just have Real Salt Lake not have to lose Robbie Russell due to his cap hit (they may have dealt him anyway due to family situations). Currently, the league or teams are going to lose players like this. The league is weaker than it could be with a smallish tweak.

At this point about 10% of the league qualifies for being with their team in their fourth season. Many of these are players that aren't difference makers. But a few are. Some are even DPs who could be kept in the league on a new deal. The concept rewards teams for keeping players happy and productive. Those players than get rewarded as well. A team that drafts or discovers a talent and takes them from a 60k to 250k player now loses them because the cap hit is worse than the talent those players add. This change reduces that effect.

Landon Donovan is one of the most notable. The LA Galaxy benefited from previous exceptions in the DP era. Giving them a reward for Donovan may seem odd, but by encapsulating it in a rule there's some other strong talents that could be kept in MLS as well. Because several of these players are going to leave MLS. For the league to be a "Top League by 2020" it must keep that talent. Even if it is only some not all.

The full list has top talents and lesser talents both, but even getting a 100k player off of the cap would help the small market teams. They'd have a player that would be clear to their fanbase and corporate sponsors is a larger part of the community. It is ordered by length of time spent with the organization.

It would make it a bit harder on future expansion sides. There would need to be some kind of exception for them, maybe a similar rule for the players they bring up from lower division, or additional allocation money. But smart talent evaluators and businessmen need to be rewarded and at the same time MLS needs a level of parity to help generate interest in all markets. There are other ways the Cap could be softened, but this may be the best way to help all current teams without damaging overall competitiveness.