J.R. Smith, as first announced on his Instagram, is returning to the Cleveland Cavaliers. Smith's new deal is a two-year deal that will play him $5 million annually and has a player option for the second year. In addition, Smith has a no-trade clause in his contract.
For the Cavs, this deal is largely a win. For one, Smith is back for $1.4 million less than he made last season and that means something for the Cavs, a team that was already going to pay a huge luxury pax before re-signing Smith and still has to re-sign Tristan Thompson to a new deal that will likely be close to - or at - the max. By signing Smith for $5 million instead of $6.4 million, the Cavs save at least $4.2 million in taxes. That figure will likely rise if and when Thompson signs a long term deal.
Smith's player option works for the Cavs too. For one, if he does pick it up after next year, $5 million under the new cap is very affordable. Even if Smith has just an ok year this year and more playoff J.R. than regular season J.R., $5 million isn't a bad salary to pay Smith. In addition, bringing back Smith means that Cavs are on track to bring back every key player from last year's team. Smith isn't quite as big of a piece as Kevin Love or Thomspon, but he has a role on this Cavs team. Whether he starts or comes off the bench, Smith's shooting and creating abilities are a nice fit between Kyrie Irving and LeBron James on the wing. That matters when LeBron will turn 31 this year and the Cavs have arguably never been better positioned to win a title.
If you're going to nitpick anything about the deal from the Cavs end, it's the no-trade clause. Smith, due to his short and inexpensive contract, theoretically could have been used in a deal - perhaps with the trade exception created by the Brendan Haywood deal - to help Cleveland land a player of significance. The Cavs can still do that with the trade exception, though, so not being able to deal Smith isn't particularly bad. After Smith's free agency experience, it's hard to see teams being interested in acquiring Smith anyway.
As for Smith, it was probably tough for him to accept less than he could have earned if he had just opted in. And it's not like he gained any extra contract flexibility to singing a new deal instead of opting in - he was going to be a free agent next summer if he had opted in at the beginning of free agency. The plus side, though, is that Smith is coming back to a team that supported him last year and if he has a really good year this year, he can decline his player option, test free agency again and perhaps get a bigger deal as part of a relatively thin free agent class.
Final Grade: B+
The Cavs got Smith back at a fairly good price and didn't have to commit to Smith for an extended period of time. And by signing Smith, the Cavs have brought back just about everyone - and Thompson, the last holdout, will be back one way or another - from a team that made the NBA Finals. You could argue it wasn't necessary for Smith to get the no-trade clause, but that's a small thing. This is a good deal for the Cavs.