While their regular season success was overlooked to some extent due to more significant jumps in the standings in 2023/24 by Oklahoma City, Minnesota, and Orlando, you could make a case that no NBA team exceeded preseason expectations from start to finish by a greater margin than the Pacers.
After winning 25 games in 2021/22 and 35 in ’22/23, Indiana was projected to take another modest step forward in ’23/24 — oddsmakers had their over/under set at 38.5 wins. However, propelled by a high-flying offense led by star point guard Tyrese Haliburton, the Pacers didn’t spend a single day below .500 all season, finishing the year with a 47-35 record and a top-six playoff spot in the East. They knocked off the No. 3 Bucks and No. 2 Knicks in the postseason before falling to the eventual champion Celtics in the Eastern Conference finals.
Indiana likely wouldn’t have been one of the last four teams standing if not for some injury luck in the playoffs. Giannis Antetokounmpo, Damian Lillard, Julius Randle, OG Anunoby, Mitchell Robinson, and Bojan Bogdanovic were some of the opposing players who missed most or all of their playoff series vs. Indiana.
Still, the Pacers beat the teams in front of them in the first two rounds, then played the Celtics about as competitively as a team on the losing end of a sweep can, dropping one game in overtime and two more (without Haliburton) by a single basket. They likely won’t enter the 2024/25 season as a favorite to return to the Eastern finals, but this is a good team that doesn’t appear to have reached its ceiling yet.
To continue getting better, the Pacers may have to rely mostly on internal improvement and tweaks around the margins. Haliburton’s All-NBA season means his maximum-salary rookie scale extension will begin at 30% of the 2024/25 cap (instead of 25%) and the club has already committed to a similar max deal for free agent forward Pascal Siakam. Those two contracts will occupy a substantial chunk of Indiana’s cap room for the next few years, and the club gave up a handful of first-round picks in order to acquire Siakam from Toronto in the first place.
That doesn’t mean the Pacers have no paths to making upgrades though — two of the three first-rounders they gave up for Siakam were 2024 picks, so they still have future draft assets available to offer up in trade talks. And even with max deals for Haliburton and Siakam set to hit the books, the team isn’t quite up against the luxury tax line yet. There’s room to maneuver here, even as the ongoing development of young players like Haliburton, Bennedict Mathurin, Jarace Walker, and Ben Sheppard offers hope of growth from within.
The Pacers’ Offseason Plan
As noted above, the Pacers have already taken care of the No. 1 item on their summer to-do list. They became the first team to take advantage of the NBA’s new rules allowing clubs to negotiate with their own free agents beginning one day after the end of the NBA Finals, quickly coming to terms on a reported four-year, maximum-salary deal with Siakam.
There are a couple caveats to keep in mind here. First, that deal can’t be officially signed until July 6, so it’s technically possible for it to fall apart before then, but that’s extremely unlikely. Siakam has seemed to genuinely enjoy his time with his new team, and the Pacers acquired him knowing they would probably have to go up to the max to retain him beyond 2023/24. He did nothing during his half-season in Indiana to dissuade them from making that offer, leading the team in scoring and rebounding in both the regular season and the playoffs.
Second, while Siakam’s new deal has been reported as a four-year max, we won’t know all the specific details of that deal until it’s official. Are all four seasons fully guaranteed? Are the base salaries technically slightly below the max, with incentives available to max it out? Is there an option on year four?
The answers to these questions will go a long way toward determining just how much risk the contract carries in the back half (Siakam will be 34 when it expires), but regardless, it’s a deal the Pacers had to make. Indiana isn’t a free agent destination, so when the team finds itself in a position to lock up a two-time All-NBA forward for the foreseeable future, it has to take advantage of that opportunity.
With Siakam taken care of, the Pacers have just about all of their rotation players under contract for 2024/25, but there are a couple exceptions. Reserve forward Obi Toppin is eligible for restricted free agency this summer, while backup big man Jalen Smith holds a $5.4MM player option that he may decline. Of the players who finished the season on the roster, Toppin and Smith ranked seventh and ninth, respectively, in minutes per game.
Accounting for Siakam’s new contract and T.J. McConnell‘s full salary (it’s partially guaranteed for now), the Pacers are already on the hook for about $149.4MM for 10 players, which doesn’t include new contracts for either Toppin or Smith. I imagine ownership would prefer to stay below the projected luxury tax line of $171.3MM if possible — that means it could be a tight fit to retain both Toppin and Smith and then fill out the rest of the roster.
On the surface, Toppin looks like the logical keeper if the Pacers have to decide between the two. The former lottery pick thrived in the team’s up-tempo offense, settling into a role off the bench as an efficient scorer and rebounder (and even a shooter — his .403 3PT% was a career high). He was a key part of the postseason rotation, while Smith was barely used in the playoffs.
But the equation won’t necessarily be that simple. While Toppin’s qualifying offer is worth about $7.7MM, there may be a team willing to give him a deal that starts in the neighborhood of the full mid-level ($12.9MM) or even a little higher than that — matching such an offer could force the Pacers to go over the tax line. Plus, if Smith ultimately gets a sense that he’s better off picking up his player option than testing the open market, he can lock in his $5.4MM cap hit without the club having any real agency in the decision, which would make it trickier to re-sign Toppin and stay out of the tax.
Of course, it’s worth stressing that there are no rules preventing the Pacers from signing both players to new contracts. Maybe ownership will be comfortable paying a small tax bill for a roster coming off an Eastern Conference finals appearance. If Toppin’s price comes in lower than expected, perhaps they could even squeeze both players and two or three more in below the tax line. A trade that reduces salary elsewhere on the roster would also be an option.
One additional factor that should help the Pacers navigate the tax line and the aprons? The team holds three 2024 second-round picks, at Nos. 36, 49, and 50. I wouldn’t necessarily expect Indiana to use all three picks on players who will immediately sign standard contracts, but adding one or two of them to the 15-man roster would make sense financially — a minimum-salary free agent would count for about $2.09MM for cap and tax purposes, whereas a second-round pick will likely count for just $1.16MM.
Gaining that bit of extra financial wiggle room with a couple roster spots could end up coming in handy, and Indiana’s scouting department showed with its Sheppard pick at No. 26 in last year’s draft that it can find players further down the draft board who are capable of contributing right away (during the playoffs, Sheppard averaged 19.7 MPG and started two games).
The Pacers will also have contract extension decisions to make in 2024/25 for a pair of players who look more valuable than ever coming off the team’s extended playoff run.
Myles Turner was considered a trade candidate for years and appeared to be on the outs in Indiana back in 2022 when the club signed Deandre Ayton to a maximum-salary offer sheet, while McConnell began the 2023/24 season out of the rotation. But both players were huge parts of the Pacers’ success in ’23/24, with Turner averaging 17.0 points per game on .517/.453/.760 shooting in 17 playoff starts, while McConnell averaged 11.8 PPG and 5.1 APG off the bench in those 17 games.
Turner won’t become extension-eligible until midway through the season, but McConnell could be signed to a new deal beginning in July.
It will be interesting to see what the price point is for Turner, who has never been viewed as a star but is that rare form of center who can both capably protect the rim and hit three-pointers. He’ll earn $19.9MM in the final year of his current contract in 2024/25 and it’s safe to assume he’ll be seeking a raise on his next deal. I expect his camp to keep a close eye on what Nic Claxton gets in free agency — if Claxton signs for upwards of $25MM per year, Turner’s reps could make a case for an even larger payday for their client by arguing that he makes a similar impact to Claxton on defense and is more versatile offensively.
McConnell, 32, is four years older than Turner, plays a lesser role, and will make $9.3MM in ’24/25. His next deal won’t be as lucrative as his teammate’s, but there’s no reason to count on him taking a pay cut. The pesky 6’1″ guard is coming off perhaps the best two-year stretch of his career, having averaged 9.4 PPG, 5.4 APG, and 2.9 RPG on .550/.427/.823 shooting since the start of the 2022/23 season. He’s a Rick Carlisle favorite and has shown how useful he can be on a winning team.
If the Pacers aren’t comfortable with how the initial extension negotiations go with McConnell, they can afford to be patient. He’ll be extension-eligible for the entire 2024/25 league year, up until June 30, so there’s plenty of time to get something done. The window for Turner is a little smaller, since he won’t become extension-eligible until January 30.
It’s worth noting that Indiana traded Buddy Hield in a contract year a few months ago when it became clear that he and the club weren’t going to agree to terms on an extension. I don’t think the Pacers will want to move Turner or McConnell, but it’s a possibility worth monitoring if one or both players don’t have a deal in place before February’s trade deadline.
Salary Cap Situation
Guaranteed Salary
Tyrese Haliburton ($42,300,000)
- Haliburton’s cap hit is a tentative figure based on 30% of a projected $141MM cap.
- Myles Turner ($19,928,500)
- Aaron Nesmith ($11,000,000)
- Bennedict Mathurin ($7,245,720)
- Jarace Walker ($6,362,520)
- T.J. McConnell ($5,000,000)
- Partial guarantee. Rest of salary noted below.
- Isaiah Jackson ($4,435,381)
- Ben Sheppard ($2,663,880)
- Andrew Nembhard ($2,019,699)
- Total: $100,955,700
Non-Guaranteed Salary
- T.J. McConnell ($4,300,000)
- Partial guarantee. Rest of salary noted above. McConnell’s salary will become guaranteed if he remains under contract through June 28.
- Kendall Brown ($2,120,693)
- Total: $6,420,693
Dead/Retained Salary
Player Options
Team Options
Restricted Free Agents
- Obi Toppin ($7,744,600 qualifying offer / $20,409,036 cap hold): Bird rights
- Total (cap holds): $20,409,036
Two-Way Free Agents
Draft Picks
- No. 36 overall pick (no cap hold)
- No. 49 overall pick (no cap hold)
- No. 50 overall pick (no cap hold)
Extension-Eligible Players
- Isaiah Jackson (rookie scale)
- T.J. McConnell (veteran)
- Doug McDermott (veteran)
- Extension-eligible until June 30.
- Andrew Nembhard (veteran)
- Pascal Siakam (veteran)
- Extension-eligible until June 30.
- Jalen Smith (veteran)
- Player option must be exercised.
Note: Unless otherwise indicated, these players are eligible for extensions beginning in July.
Unrestricted Free Agents
Other Cap Holds
- Gabe York ($1,867,722 cap hold)
- Total (cap holds): $1,867,722
Note: The cap hold for York is on the Pacers’ books from a prior season because he hasn’t been renounced. He can’t be used in a sign-and-trade deal.
Cap Exceptions Available
Note: The Pacers project to operate under the cap and under the first tax apron. If they approach or exceed the first apron, they would lose access to the full mid-level exception and bi-annual exception and would gain access to the taxpayer mid-level exception ($5,183,000).
- Non-taxpayer mid-level exception: $12,859,000
- Bi-annual exception: $4,681,000
- Trade exception: $159,471
Note: Unless otherwise indicated, trade exceptions don’t expire before the regular season begins.
However, it sounds like there’s mutual interest in a reunion.