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David Price likely to set salary arbitration record

David Price is eligible for arbitration this winter and he is likely to receive a record salary for a one year pre-free agent contract.

Kim Klement-USA TODAY Sports

Max Scherzer received a salary of $15.525 million for the 2014 season, establishing a new high for a one year salary for an arbitration-eligible player prior to free agency. Scherzer's salary eclipsed the $15.5 million that Prince Fielder received from the Milwaukee Brewers in 2011, and the $15 million that the Phillies paid Cole Hamels in 2012.

David Price earned a salary of $14 million in 2014 with the Tampa Bay Rays before he was traded to Detroit in July. Price was then in his third season of arbitration eligibility. He currently has five years, 164 days of major league service time, which is just eight days shy of the six years needed to be eligible for free agency. The Rays saw to it that he was not called up a couple of weeks earlier to start his free agency clock.

Price was a "Super Two" arbitration case in his third major league season, meaning he would have four seasons of arbitration eligibility before becoming a free agent. Scherzer, on the other hand, had a full three seasons of service time after the 2013 season, and he was coming off a Cy Young performance. Now, Price figures to set a new high for a one year salary for an arbitration eligible player prior to his free agent seasons.

MLB Trade Rumors estimates Price’s value at $18.9 million. Some of the comparable pitchers would include his teammates, Max Scherzer and Anibal Sanchez, as well as left-hander Cole Hamels of the Philadelphia Phillies. Matt Swartz published this breakdown of Price's arbitration case earlier this offseason.

The primary criteria when establishing salary in arbitration are service time, salary history, performance (including any awards), and comparable salaries for players with like experience. Service time and salary history are key, and Price figures to be near the top of the performance scale, meaning he should be in for another decent raise.

If the Tigers were to simply agree on a one-year contract with Price to avoid arbitration, the price tag will be about $19 million. He would certainly receive a qualifying offer at the end of the season if he were to become a free agent, and his club would receive a supplemental first round draft pick as compensation if he were to sign with a new club, as long as he is not traded after the season begins.

There have been bigger contracts given to players who were not yet eligible for free agency, but those are all multi-year contract extensions, which combine a mix of the final season or two of a player's arbitration eligibility and some seasons when they would be eligible for free agency.

The San Francisco Giants settled two seasons of arbitration eligibility with two time Cy Young winner Tim Lincecum for a combined $40.5 million for the 2012 and 2013 seasons. The Giants also gave catcher and former MVP Buster Posey a nine year, $167 million contract that averages out to $18.5 million, but there are five years of free agency eligibility included in that deal.

The Miami Marlins bought out all of Giancarlo Stanton's arbitration years and another nine years of free agency with a 13 year, $325 million mega-deal. The Los Angeles Dodgers gave Clayton Kershaw a record $215 million, which included his final season of arbitration. His salary was just $4 million for 2014, but he received an $18 million signing bonus and will earn a salary of $30-33 million for six years through 2020.

When determining the value of a one year contract for an arbitration-eligible player, salaries for players who would be eligible for free agency are not considered as comparable, nor are multi-year contracts. The fact that Price is projected to top the record for a one year contract by some $4 million plus is a strong indication of his market value.

The Phillies' Ryan Howard still holds the record for the highest salary award for a first year eligible player and the record in an arbitration case that actually went to a hearing. The former MVP received a $10 million salary for the 2008 season. He followed that with a three year, $54 million contract to complete his arbitration seasons, followed by another five year, $125 million contract that the Phillies would love to dump.

The highest salary given to a pre-arbitration eligible player is $ 1million to Mike Trout for the 2013 season. He then signed a six year, $145 million contract to take him through all of his arbitration-eligible seasons, plus two seasons of potential free agency.

After Price, the next highest projected salaries for an arbitration eligible player this winter are $11.8 million for Chris Davis of the Orioles, and $11.3 million for Doug Fister of the Washington Nationals, both in their final seasons of eligibility. Austin Jackson is projected to receive $8 million from Seattle.

Price has gone from year to year, one season at a  time, never receiving a multi-year contract. The Tigers currently have just two players whom they signed to guaranteed multi-year contracts prior to their free agency. The two are Justin Verlander and Miguel Cabrera, both of whom have been given lucrative extensions well into the future. Yoenis Cespedes signed a four year contract with the Oakland A's, but he was a free agent from Cuba at the time.

The approximately $19 million figure for Price is a bargain by comparison with what a pitcher of his caliber would receive in free agency, but it will be a record one year contract salary, unless he is signed to a multi-year contract.