Fresh off being minted as the league’s Sixth Man of the Year, Smith received a rousing ovation from the Madison Square Garden faithful.
His first four shots found the bottom of the net, and the final one—a buzzer beating 36-footer that gave the Knicks a 26-20 lead after one quarter—brought down the house.
The Knicks went on to defeat the Celtics, 87-71, and will carry a 2-0 series lead to Boston.
Smith’s first quarter helped propel them, and it was a microcosm of his tenure in New York. Sadly, for Knicks fans, there is a very real possibility that it may end this summer.
Smith is coming off of a career year in which he turned in career highs across the board: 18.1 points, 5.3 rebounds and 2.7 assists.
This past season, he opened eyes across the league and has been vital in the Knicks’ revival.
Yet this past season, his $2.8 million salary was not only far below his market value, it was less than the $4.05 million the Knicks paid shooter savant Steve Novak.
Smith has a player option for next season, and a source close to Smith tells SheridanHoops.com that it is “very, very likely” that he will opt out of his contract and become an unrestricted free agent this summer.
If so, the Knicks will be limited in what they may offer him.
Per the NBA’s collective bargaining agreement, the Knicks will have an “early Bird” salary exception which they may use to re-sign Smith.
The early Bird exception is available to re-sign a free agent who played each of the previous two seasons with the same team, even if, like Smith, the two seasons were played under different contracts.
An incumbent team (the Knicks in this case) can re-sign an early Bird free agent for the greater of either: (A) 175 percent of his salary under the terms of his immediately expired agreement, or (B) 104.5 percent of whatever the league’s average player salary is for the first year of the new deal.
Does your head hurt yet?
Let’s plug in real numbers to make it all make sense.
Because Smith would be an early Bird free agent if he opts out this summer, under the first calculation, the Knicks can offer him a starting salary of $4.9 million by using the 175 percent rule.
Under the second calculation, they could offer Smith 104.5 percent of whatever is the average player salary for the 2012-13 season, a number we won’t know until July 1, 2013, when the league’s finances for the previous season are fully accounted.
But for all intents and purposes, we can safely assume that the average player salary will end up being around $5.34 million. Under the second calculation, the Knicks could give Smith a starting salary of $5.58 million.
So, that’s it.
The most the Knicks can offer Smith in year one of a new deal would be $5.58 million.
As an early Bird free agent, the Knicks could offer Smith up to four years, with annual raises of up to 7.5 percent of his salary in the first year, or, in this case, $418,000.
Add that all up, and the most the Knicks can offer Smith as a free agent this summer is a four-year deal worth $24.8 million, or an average of $6.2 million per year.
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It is not all bad news for Knicks fans, though. And there are two important things to consider here.