MLS to invest $37 million in player compensation for 2016 and 2017

MLS has announced it will invest an extra $37 million in player compensation over the next two seasons.

It is a move that the league says will immediately raise the quality of play, allowing teams to increase depth by adding additional high-earning players to their rosters.

"If you look at our rosters, most teams have between five and six high-quality players," MLS VP of player relations Todd Durbin said on a conference call with reporters on Wednesday. "We needed to find a way to drive more quality deeper into the roster."

The process began last summer, when MLS introduced a program that allowed each team to spend an additional $500,000 on players. These funds, known as "Targeted Allocation Money," notably gave the LA Galaxy the flexibility to sign Mexican national team midfielder Giovani dos Santos. It also allowed Columbus Crew SC to acquire Argentine center-back Gaston Sauro, who helped lead the Crew to a berth in MLS Cup.

The success of the program prompted the league's board of governors to approve an additional $800,000 in allocation money for each team in both 2016 and 2017. Including the original $500,000, that's a $2.1 million payroll increase per club from the start of 2015.

Overall, the latest expenditure represents the largest investment in players since the Designated Player rule was introduced in 2007, according to MLS spokesman Dan Courtemanche.

"We believe that this is going to give our teams the ability over the next 24 months to go out and add one, two or three additional players at a salary range of $500,000 to $1 million a year," Courtemanche said on Wednesday.

Durbin said the league has not deviated from its goal of becoming one of the world's elite leagues by 2022.

MLS still has a long way to go. A 2014 report authored by Sporting Intelligence's Nick Harris listed the average salary of Premier League players at roughly $4 million a year. Harris reported that the average wage in Mexico's Liga MX ($403,000) was almost double that of MLS ($206,000).

"We're not going to be spending at those levels overnight," Durbin admitted, when asked how MLS will be able to close the gap with the best-paying leagues over the next six years.

While top MLS players like Orlando City's Kaka or Toronto FC's Sebastian Giovinco -- who last week was named the league's Most Valuable Player -- make north of $7 million annually, the median wage remains less than $100,000. The league's minimum salary is just $60,000.

"Obviously we're spending a significant amount on our designated players and on a couple of roster spots below that," said Durbin, adding that the league spent $115 million on DPs in 2015, up from $32 million four years ago.

"What we're really trying to do is drive up the average spend as it relates to the quality of players in that next layer of roster, which is what we believe will have the greatest short-term impact on product quality."