Giants Reportedly Offer Tim Lincecum Three-Year, $37 Million Contract

With a much-anticipated arbitration hearing scheduled for tomorrow, Tim Lincecum and the Giants continue to talk contract. The latest, from John Shea:

A major-league source said the Giants have made a three-year, $37 million offer with annual salaries of $9.5 million, $12.5 million and $15 million, and that the Lincecum camp countered with a proposal north of $40 million.

It may seem that the sides aren't all that far apart, but with one day left before the hearing, the Giants are running out of time to make content their star player.

Tim Lincecum is what's known as a "super two" player. Among all players with more than two but fewer than three years of Major League service time accumulated, the top 17% in total service qualify as super twos. These players then become eligible for four years of arbitration, rather than the standard three. Lincecum is still under club control through 2013, but because of his eligibility, he is in line to make more money sooner.

The proposed three-year deal would buy out Lincecum's next three years of arbitration. Given that the Giants have submitted an $8m figure for tomorrow's arbitration hearing against Lincecum's $13m, we can see why the two sides have yet to reach an agreement - when you're that far off in the first year, the gap will only grow as you include another two. Because there's no guarantee of sustained health or performance, we would expect Lincecum to compromise a little bit when considering future salaries, but that reported offer from the Giants would pay Lincecum less in 2011 than he's seeking in 2010, so it's understandable why it's been turned down. Any counter offer from the player's side likely begins with an eight-figure 2010 salary.

Lincecum has arguably been the National League's top pitcher two years in a row. While arbitration-year salaries escalate - the same player will make more in his second arbitration year than in his first, and so on - a $13m proposal is not unreasonable for a player in Lincecum's position. For historical reference, Ryan Howard holds the record for super two arbitration salary at $10m, which he earned in 2008. He then signed an extension guaranteeing $15m and $19m in his next two years. While the market has collapsed a little bit since then, Lincecum is also far and away the more valuable player of the two. A healthy Lincecum deserves to make more over the next three years than the $37m the Giants have offered, and while players will sometimes make concessions in getting themselves some security and comfort, one wonders how much Lincecum would be willing to concede now that things have gotten this far.

Read a discussion on the matter at Giants blog McCovey Chronicles.