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Why the Celtics won’t sign Marcus Smart to an extension

Greg M. Cooper/USA TODAY Sports

Marcus Smart wants to stay in Boston, and the Celtics front office have always been high on their 23-year-old lottery pick. With Danny Ainge no longer needing to hoard future salary cap room to land free agents like Gordon Hayward and Al Horford, the door would appear to be wide open for Smart and the C’s to reach an extension before the deadline on Oct. 16.

However, there are a number of impeding factors that will come into play as negotiations heat up over the next few days. What is Smart’s market value? Do the Celtics ever really sign players to rookie extensions? How many real threats are there to sign Smart away from the Celtics next summer? What does the point guard free agent landscape look like next summer?

Let’s try to examine each of these issues to get a better sense of whether the tenacious guard will be locked in with the green for years to come by opening night:

The Celtics’ history of rookie extensions

Ainge is used to adapting to changes in the CBA and salary cap during his time at the helm in Boston, but one thing has remained pretty consistent over those years: He doesn’t sign players on rookie contracts to extensions very often. In fact, in Ainge’s 13-year tenure with the Celtics, only Kendrick Perkins (2006) and Rajon Rondo (2009) have agreed to an extension on their rookie deals with Boston ahead of the opening night deadline for former first round picks.

Ainge’s strategy on this front makes a lot of sense over recent years. The Celtics have not only been maintaining cap room since 2013, but they also haven’t had any “elite” prospects that have proven themselves worthy of big money (Avery Bradley, Tyler Zeller, Jared Sullinger, Kelly Olynyk, etc.) by their fourth NBA season.

With Rondo and Perkins, Ainge landed deals that ended up being extremely team friendly for the long-term. Perkins was a raw prospect in 2006 when he signed a four-year, $16 million extension, but he developed nicely over the next few years and was a certified bargain for the final couple years of that deal as Ainge brought in expensive pieces around him in Kevin Garnett and Ray Allen.

Rondo was obviously a more established piece when he signed his extension in October 2009 (five years, $55 million), but he hadn’t fully turned into the triple-double machine and core piece that he would develop into for Boston during final years of the Big 3 era. In both cases the Celtics had no need to preserve cap space and landed deals with minimal risk and good cost control. It’s safe to say both Perkins and (especially) Rondo regretted signing those deals.

The Celtics face somewhat similar circumstances with Smart in 2017 to what they did with Rondo in 2009. They are capped out for next summer and have an emerging point guard that appears poised for a breakout. With a major luxury tax bill looming next summer, controlling Smart’s expense seems like the savvy play in theory. What exactly is a reasonable assessment of Smart’s value though?

What is Smart’s market value?

Let’s start by first looking at Smart’s numbers from last season:

2016-17: 10.6 ppg, 3.9 rpg, 4.6 apg, 1.6 spg, 2.0 tpg in 30.4 mpg. 35.9 FG%, 81.2 FT%, 28.3 3pt% (4 attempts per game)

Let’s also examine a few deals of note as we try to gauge a range for the Oklahoma State product:

2017 extensions

Veteran young mid-tier player extensions
Norm Powell: Four years, $42 million
Josh Richardson: Four years, $42 million

Rookie extensions
Andrew Wiggins: Five years, $149 million
Joel Embiid: Five years, $146 million (partially guaranteed)
T.J. Warren: Four years, $46 million
Gary Harris: Four years, $84 million

2017 notable unrestricted point guard free agent signings
Steph Curry at age 29: 5 years, $201 million (Warriors)
Kyle Lowry at age 31: 3 years, $100 million (Raptors)
Jrue Holiday at age 26: 5 years, $125 million (Pelicans)
George Hill at age 30: 3 years, $57 million, third year unguaranteed (Kings)
Jeff Teague at age 29: 3 years, $57 million, third year player option (Wolves)

2016 extensions
C.J. McCollum (Trail Blazers): Four years, $106.6 million
Steven Adams (Thunder): Four years, $100 million
Giannis Antetokounmpo (Bucks): Four years, $100 million
Rudy Gobert (Jazz): Four years, $94 million
Victor Oladipo (Thunder): Four years, $84 million
Gorgui Dieng (Timberwolves): Four years, $62.8 million
Dennis Schroder (Hawks): Four years, $62 million
Cody Zeller (Hornets): Four years, $55.6 million

Takeaways: On the surface, the recent extension numbers for the likes of Harris and Embiid should be good news for Smart’s camp. Both players were paid handsomely for what they produced in the NBA to this point, but each play bigger positions of need around the NBA compared to Smart.

The point guard spot is one of the deepest positions in the league, and even though Smart is much more than a point guard from a defensive standpoint, it’s helpful to compare him to recent signees on the guard market that are in his “class” (Oladipo, Hill, Teague, Schroder, Richardson (hybrid guard).

Oladipo’s deal ($21 million annually) looks like a hefty overpayment today to everyone (except Pacers GM Kevin Pritchard). Schroder’s ($15.5 million annually) is a far more reasonable number with a flattening cap for the Hawks and still has two years remaining on it as Schroder enters his prime at age 23. I’m guessing Smart’s agent is likely shooting higher at the likes of Hill and Teague ($19 million annually) for his ideal range and using Schroder and Oladipo as potential benchmarks in negotiations.

The problem for Smart is that his offensive numbers are nowhere close to what those players have produced in recent years. He can make the case that his defensive ability and versatility will make up some of that gap (he’s a better defender than anyone on that list outside of maybe Hill). However, when a player is one of the worst high volume 3-point shooters in recent history, it’s hard for the Celtics to buy the fact that player is worth $15 million per year before the team actually sees some tangible regular season growth in that area. They aren't going to pay that money unless they have to.

If the Celtics are going to pay above market rate for Smart right now, they need a good reason to do so. His numbers over his first three seasons isn’t one. His improved conditioning and figure during this offseason is enticing but doesn’t mean much over four preseason games. The only big reason to overpay Smart now (or even pay him expected fair market value) is if the Celtics are worried about having to lose him or heavily overpay him next summer. That brings us to our next question.

What teams would be threats to sign Smart next summer?

When the Celtics are weighing the risk and reward of waiting on a Smart deal, it is important to assess the odds of Smart getting a sizable offer on the restricted free agent market next summer. Boston looks to have a couple things in their favor:

1. Most teams around the league are set at point guard:

A quick reminder of what the landscape looks like at the moment:

Teams “set” at point guard in 2018-19:
Charlotte (Kemba Walker), Golden State (Curry), Houston (Chris Paul), Memphis (Mike Conley), Miami (Goran Dragic), Minnesota (Jeff Teague), New Orleans (Jrue Holiday), Oklahoma City (Russell Westbrook), Philadelphia (Markelle Fultz), Phoenix (Eric Bledsoe), Portland (Damian Lillard), Sacramento (George Hill/De’Aaron Fox), San Antonio (Tony Parker/Patty Mills) Toronto (Kyle Lowry), Washington (John Wall), Utah (Ricky Rubio)

Teams that could use a point guard but are rebuilding and/or have young talent at point guard already:
Atlanta (Dennis Schroder), Brooklyn (D’Angelo Russell/Jeremy Lin), Chicago (Kris Dunn), Dallas (Dennis Smith Jr.), Denver (Jamal Murray), Indiana (Victor Oladipo), LA Lakers (Lonzo Ball), Milwaukee (Malcolm Brogdon), Orlando (Elfrid Payton), New York (Frank Ntilikina)

Teams that could use an upgrade at point guard but probably won’t have cap room next summer:
Cleveland (assuming Isaiah doesn’t re-sign), Detroit (Reggie Jackson), LA Clippers (Milos Tedonsic)

That doesn’t necessarily mean all of these teams won’t have interest in a player like Smart (who obviously can defend multiple positions and play off the ball). However, it’s doubtful many of these franchises would be willing to fork over the kind of offer ($15+ million per year) to put a scare into the Celtics during restricted free agency next summer because of a flattening salary cap.

2. Most teams around the league aren’t going to have significant salary cap room in 2018

Cap space around the league for next summer is hard to find, and it’s even tougher to seek out teams that actually need a guard and have the necessary cap space in place to throw big money at a free agent. Let’s take a look at a few hypothetical possibilities after parsing through the books on all 30 NBA teams.

Atlanta (projected $15-$30 million in cap room): Smart’s age fits the Hawks’ rebuilding timetable, but this team already has a pair of smaller guards on big money contracts in Schroder and Kent Bazemore signed through 2020. Not sure how throwing big money at a minus shooter like Smart helps them build for the future from a fit standpoint, unless they are looking to tank for a couple more years. They will have the money to spend though.

Chicago (projected $40 million in cap room): Lots of money available to throw around here for another rebuilding team, but more young guards are already in place. Kris Dunn is under contract for the next few years, and Zach LaVine is in line for a new contract as well when he hits restricted free agency next summer. Lesser names like Jerian Grant and Justin Holiday are under contract through 2019 as well. If Dunn flames out this year, the Bulls could start trying to rebuild their identity with a guy like Smart, but the fit isn’t there for now. They have bigger needs at other spots.

Dallas (up to $30+ million in cap room): A sneaky candidate given how much cap space they will have, but they might be targeting bigger names than Smart to pair with Dirk Nowitzki in the closing days of his career. They also just drafted Dennis Smith Jr. so it’s hard to see them being in the market for another big money point guard, although pairing the two in the backcourt could be an option if Wesley Matthews (player option for 2018-19) opts out.

Indiana (up to $20 million in cap room): Lots of cap space available here, but they are already heavily invested in Victor Oladipo ($21 million). That’s not to say Oladipo and Smart couldn’t play together, but putting $40 million in that backcourt isn’t necessarily a ticket out of the basement in the East, particularly when Indiana already has guards like Darren Collison and Cory Joseph (player option) under contract for 2018-19.

New York (significant cap room only if Kanter opts out): The Knicks would need Enes Kanter to opt out of his player option (far from a certainty) and maybe move a contract or two to carve up significant cap room. A Smart and Kristaps Porzingis pairing would be enticing in the Big Apple, but let’s also remember that New York just drafted a point guard with the No. 8 overall pick (Ntilikina). This franchise is unpredictable though, so I’m leaving them on here.

Orlando (would need to renounce Gordon/Payton for major cap room): The Magic seem like exactly the kind of team that the Celtics should worry about losing Smart to. They’ve been going nowhere for years and could consider gambling on a guy like this. Then you look at their payroll and realize they have DJ Augustin and Shelvin Mack under contract for a combined $14 million next year. Yikes. The Magic would also have to say goodbye to Aaron Gordon and Elfrid Payton (restricted free agents in 2018-19) to open up cap room for Smart, and that’s not happening.

Philadelphia: That Embiid max contract likely takes the Sixers out of running for Smart if they want to retain a guy like Robert Covington next summer as well. Combine that with the presence of Markelle Fultz, and I don’t think the C’s are worried about the Sixers looming as a major threat to hand over a big offer sheet.

So, who exactly should the Celtics be worried about on this list? The Bulls, Hawks, Mavericks and Pacers are all teams that are set up to make some noise in free agency next summer, but I’m not sure any would feel the need (or like Smart enough) to overpay the former No. 6 overall pick enough to pry him away from the Celtics. Smart may be a defensive star, but those type of guys go for closer to $10 million (see: Andre Robertson’s 3 year, $30 million deal this summer) than $20 million these days, and the Celtics will be happy to pay something closer to the former next July.

One other sign that doesn’t bode well for Smart? Look around at the restricted free agent market from last summer and count how many players had to settle for qualifying offers and/or short-term deals (Nerlens Noel, Alex Len, Nikola Mirotic, JaMychal Green, Kentavious Caldwell-Pope). A couple wings were paid handsomely (Otto Porter Jr., Tim Hardaway Jr.) but the rest of this restricted free agent class did not see the robust market they witnessed a year or two ago. I expect that trend to continue next summer with only a minor projected salary cap increase from $99 million to $101 million. As I documented, most teams just don’t have a lot of money to spend.

A couple final reasons for the Celtics to stay cautious with Smart? Keeping as much financial flexibility as possible in case a certain someone in New Orleans becomes available. Making the math work for Anthony Davis in a trade could become trickier if you have an overpaid Smart on the books already and the Pelicans don't want him. The Celtics are also going to have to give a hefty raise to Kyrie Irving in his new max deal in the summer of 2019, so they can't afford to spend too much on his sidekick in the backcourt with an expensive luxury tax bill looming later this decade.

A weak point guard and restricted free agency crop does help Smart

The one thing that Smart does have going in his favor during negotiations is that he was taken in a weak draft class (2013) and there aren’t a lot of premier point guards available next summer.

In fact, here’s a list of the best floor generals that will be available next July:

Isaiah Thomas
Chris Paul (probably staying in Houston)
Elfrid Payton (restricted)
Jeremy Lin ($12 million player option)

With the lack of appealing options out there, it only takes one team to fall in love with Smart to earn the 23-year-old guard a lucrative contract. He actually may be the most appealing candidate out there for a rebuilding team. If Smart has a breakout year, he could very well get a sizable offer sheet from one of the suitors I mentioned.

However, a subpar or even a mediocre offensive season in 2017-18 should put a fairly low ceiling on Smart’s market given the lack of cap space teams have and other big names expected to hit the open market (LeBron James, DeMarcus Cousins, Isaiah Thomas, Paul George, etc.).

Final Verdict

All of this isn’t meant to say that the Celtics won’t reach an extension with their up-and-coming guard by Monday’s deadline. However, if the sides do come to terms, it’s going to come at a number that’s favorable to Boston. Whether Smart’s agent is amenable to that range ($10-14 million per year is my estimate) is anyone’s guess, but it’d be no surprise for him to pass on that and bet on his client given the way Smart has looked this preseason.

Either way, the Celtics aren’t going to lose Smart in restricted free agency. They love the guy and will probably match any offer that comes his way next summer since they don’t have the cap space to replace him elsewhere.

While it makes sense, in theory, to eliminate the risk of an inflated offer sheet, the fact that an offer like that can only really come from a few teams (that may not like or need Smart) makes the waiting game a wise gamble for the Celtics. Just because Gary Harris got a big deal this early doesn’t mean Smart is going to get one too.