After Glen Grunwald and the New York brass decided to let the free-agent market determine Lin's value, the Harvard grad signed a four-year, $30 million offer sheet with the Houston Rockets, leading some to question whether or not this was too steep a price to pay for Lin's services.
According to ESPN New York's Ian Begely, a Knicks source has said that New York will "definitely" match Houston's offer for Lin, which in my mind, is the right decision.
First of all, the Knicks simply need a starting point guard, and Lin is the best affordable option out there.
Although there may be potentially cheaper starting options out on the free-agent market, the fact that the Knicks have Lin's early-bird rights is a big deal, as that means they can offer him a lot more than they can offer any other point guard.
If they chose not to re-sign Lin, the Knicks would have only the miniature mid-level exception of $3 million to spend on his replacement, and maybe not even that if they can't work out a sign-and-trade for new backup Jason Kidd.
Besides Raymond Felton, who despite his impressive season with the Knicks in 2010-11 has proven time and time again that he is not a good point guard, that sort of money simply cannot bring in a starter.
But though Lin is the best point guard the Knicks can currently afford, it appears that the salary-cap implications of signing Lin to this four-year contract give people the most reservations about whether or not the Knicks should match the Rockets' offer.
Should the Knicks match the Rockets' four year, $30 million offer for Jeremy Lin?
What people fail to understand, though, is that the Knicks' salary-cap situation is actually so bad that adding Lin would make very little difference to their ability to sign players in the future.
In 2015—the first of two possible years that Lin would be earning $10 million—the Knicks will owe a combined $64.2 million to Amar'e Stoudemire, Carmelo Anthony, Iman Shumpert and Tyson Chandler.
That would already put them over the salary cap, which this year stands at $58 million.
The Knicks would also be only $10 million away from the luxury-cap "apron", which essentially means that they would be $10 million away from being forced to use the mini mid-level exception for that offseason, rather than the full mid-level, much like this year.
Once you add Lin to the books, the only major difference in the Knicks' ability to sign players would be that their mid-level exception would be reduced from $5 million to $3 million.
To me that seems like a risk worth taking, especially considering the flashes of potential greatness Lin showed this past season.
Now the Knicks would face some hefty luxury tax per the new CBA, but that doesn't actually affect their ability to sign players. All it does is take money out of James Dolan's pockets.
Money that could easily be reimbursed by the marketability of Lin himself.
Even if you want to look at the contract outside of the context of the salary cap and compare Lin's salary to those of other players, matching the offer seems very reasonable.
This offseason, we've seen Landry Fields offered a three-year, $20 million deal by the Toronto Raptors and Omer Asik offered a three-year, $25 million deal by the Houston Rockets.
Lin's new contract will be only marginally more expensive on average than that of Fields, and actually cheaper than that of Asik.
Considering that Lin proved himself to be superior to both players last season, that sounds fair to me, if not unfair to Lin.
Essentially, matching this offer for Lin really isn't the big risk that some make it out to be, and once you factor in the Knicks' ability to opt out of the fourth year of the deal, this really becomes a no-brainer for Glen Grunwald and company.